By Richard Johnstone | 14 November 2011
Scottish ministers have welcomed the UK government’s decision to release £103m for investment in Scottish renewable energy developments, ending a long dispute over cash earmarked for these projects.
Chancellor George Osborne and Chief Secretary to the Treasury Danny Alexander both visited the Cromarty Firth in the north of Scotland last week to announce the distribution of the money from the Scottish Fossil Fuel Levy.
More than £200m has been built up in this fund from payments, first made in 1996, by Scottish suppliers of electricity from non-renewable energy sources.
The cash is held in London and although it can only be spent on renewable energy projects in Scotland, access has to be approved by the Treasury.
Ministers at Holyrood have made repeated calls to be allowed to spend it, with demands for its transfer to Edinburgh having featured in the Scottish National Party’s last two Scottish parliamentary manifestos.
Osborne said that a new agreement had ‘cut through the arguments and the wrangling with the Scottish Government that have stopped this money being invested in the past’.
As part of the deal, the remaining money in the fund will go towards the UK-wide Green Investment Bank’s work in Scotland.
Osborne added: ‘The UK coalition government is committed to creating jobs across Scotland – particularly in the green energy sector. It shows how serious the UK government is in its support for Scotland’s green future.’
Scottish Finance Secretary John Swinney said that the move was ‘long overdue’.
He said: ‘For too long Scotland's money has been sitting unspent in an Ofgem account in London.
‘The investment we are making in Scotland's renewables future will bring the clear benefits of developing our competitive advantage, supporting new technologies, and creating green jobs to help stimulate a strong economic recovery.’
Industry trade group Scottish Renewables also welcomed the news.
Chief executive Niall Stuart said: ‘This is a clear signal to the industry, to investors, and to the public that the government is committed to helping Scotland build a world-leading sector. One that creates jobs and opportunities for local communities across the country, as well as helps tackle climate change and cuts carbon emissions.’
