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Outer Hebrides Energy Strategy

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Outer Hebrides Energy Strategy SUSTAINABLE DEVELOPMENT COMMITTEE 18 JUNE 2014 OUTER HEBRIDES ENERGY STRATEGY Report by the Director of Development PURPOSE OF REPORT To present a finalised draft of the Outer Hebrides Energy Strategy. COMPETENCE 1.1 There are no legal or other constraints to the recommendations being implemented. The costs associated with commissioning the audit of energy supply and demand in the Outer Hebrides will be funded from Departmental Budgets. SUMMARY 2.1 The development of an Outer Hebrides Energy Strategy is included as an action within the ‘Outer Hebrides Economic Regeneration Strategy 2012-2020’. A consultative version of the Outer Hebrides Energy Strategy was developed in January 2014 and, following a consultation exercise, a final draft is appended to the Report. 2.2 The strategy provides a framework within which to draw together a range of diverse but inter-related strands of activity, allowing us to clarify and monitor progress on the energy- related aspirations of the Comhairle and its Community Planning partners. Its overarching objectives are to maximise the economic benefits of renewable generation to the Outer Hebrides, increase our self-sufficiency in meeting our energy needs, and address levels of fuel poverty in the islands. 2.3 Following comments on the consultative draft by the Comhairle’s Energy Member Officer Working Group, the document was circulated to the following organisations: HIE (Core and Outer Hebrides) Scottish Natural Heritage Skills Development Scotland Stornoway Port Authority Lews Castle College Comhairle Development Services Community Energy Scotland Comhairle Economic Development Hebridean Housing Partnership Tighean Innse Gall 2.4 There was a good level of engagement with the consultation and some high quality feedback was received and incorporated into the final draft. In particular, the Fuel Poverty aspect of the proposed strategy has been strengthened. 2.5 The Energy Unit has concurrently commissioned a comprehensive audit of energy supply and demand in the Outer Hebrides. This piece of work is currently being carried out by Element Energy and the resulting report will provide a valuable energy baseline for a range of Energy Unit tasks: local, national and European. The finalised Outer Hebrides Energy Audit (2014) will act as an Appendix to the published version of the Outer Hebrides Energy Strategy. RECOMMENDATION 3.1 It is recommended that the Comhairle approve the finalised version of the Outer Hebrides Energy Strategy. Contact Officer John Cunningham, [email protected] , ext 211397 Appendix Outer Hebrides Energy Strategy (Finalised Draft) APPENDIX OUTER HEBRIDES ENERGY STRATEGY Maximising the Benefit from Our Natural Resources Final Draft May 2014 OUR VISION By 2030, the Outer Hebrides will be a key contributor to decarbonisation targets in Scotland, the UK and Europe. 500MW of commercial Onshore Wind generation will be in place, complemented by 50MW of Community generation. The seas around the Outer Hebrides will be producing Renewable electricity at commercial scale from wave power together with fixed and floating wind turbine installations, and a thriving Off-Grid sector will be generating energy from alternative sources for heat, light and transport, demonstrating increased innovation and self-sufficiency in meeting our energy needs. 1. INTRODUCTION The Outer Hebrides is in the enviable position of being home to some of the best Renewable Energy resources in the world. Current estimates project a realisable 6.5GW of Renewable electricity from the Outer Hebrides, including a massive 4.8GW Wave Energy resource. There is currently 555 MW of contracted Renewable generation in place in the islands, comprising a mixture of onshore wind and marine energy proposals, and including a nationally significant level of community owned generation. The Outer Hebrides therefore offers the potential to make a significant contribution to the renewable energy industry in Scotland. However, this vision is constrained by poor Grid connectivity. At present, the Outer Hebrides is served by a 22MW Radial Connector from the UK Grid with no export capacity. In order to export the hundreds of Megawatts of electricity which will be generated on and around these islands, a new 450MW Radial Connector to the UK Grid is proposed, with additional export capacity required in the longer term, once Marine Energy technologies mature. In addition to these opportunities, there are a range of inherent challenges facing the Outer Hebrides. The islands have long been dependent on imported fuel as an energy source. Rising oil prices, below average incomes, and relatively poor housing conditions, along with an extreme weather regime, have resulted in the islands experiencing the highest levels of fuel poverty in the UK. 1 This strategy therefore seeks to support a range of measures to impact on the cost and security of our energy supply, addressing high levels of fuel poverty through energy efficiency measures, pursuing local electricity supply opportunities, and supporting off-Grid innovation and increased self-sufficiency in meeting our energy needs by promoting developments in Energy Storage, District Heat initiatives and micro-generation. Harnessing our renewable resources would allow the Outer Hebrides to become a key contributor in supporting the low carbon agenda in Scotland, the UK and Europe, helping to reduce CO2 emissions and slowing the progress of climate change. While the Outer Hebrides contribution to the process of climate change is small, the impact on the islands as a result of climate change will be considerable. The Outer Hebrides is recognised for the strength and quality of its natural and historic environment. However, increased sea levels and storm intensity will have a disproportionate impact on our environment and how we live and work, so we have a vested interest as an island chain in promoting sustainable development and reducing our carbon footprint. Efforts to harness our renewable resources will need to ensure the respective needs of the economy and the environment are complemented rather than compromised, supported by a strong spatial planning and consenting framework. The proposed radial connector offers a transformational opportunity for the fragile economy of the Outer Hebrides, enabling about £2 billion of private sector investment. Inevitably, a significant proportion of this investment will go to specialised suppliers and contractors whose products and services are not available in the islands, but a key objective of this strategy is to capture as much of this investment value for the islands as possible. This will mean mobilisation of the island Supply Chain, promotion of the opportunities and the development of trust and cooperation with developers seeking to invest. The return for the islands from this process will be in the form of ‘Community Benefit’, paid to the local community on a per MW installed basis by developers, together with potential community buy-in opportunities into some of the onshore wind developments, and an unprecedented demand for island labour in all areas of the Supply Chain – manufacture / fabrication, installation, operation, maintenance, and research and development. At a wider level, supporting the continued development of the flourishing community renewable sector in the islands will open up new income streams for investment into these communities. 1 Fuel Poverty is the situation where more than 10% of a household’s income is spent in heating the home. 2. STRATEGY IMPLEMENTATION Policy Context This strategy is informed by a number of related policy documents. • The Outer Hebrides Community Planning Partnership (OHCPP) has signed up to the ‘Outer Hebrides Climate Change Declaration’ (2012) which has committed us to a year on year reduction in carbon emissions of 3% a year. This is reinforced in the Comhairle’s own Corporate Strategy 2012-2017 and Carbon Management Plan 2013-2015. • The Council’s involvement in the ISLEPACT project led to the development of an Islands Sustainable Energy Action Plan (2011) with the target of at least 20% reduction in carbon emissions by 2020. • These local targets are mirrored at national and EU level. The Scotland 2020 targets contained within the 2009 Climate Change Act contain a target for a reduction of 42% in carbon emissions. • The Scottish Government’s ‘Economic Strategy’ identifies renewable energy as one of six key sectors offering significant potential for future economic growth. This is mirrored at a local level within the Outer Hebrides Economic Regeneration Strategy 2013-2020, in which ‘Energy’ is identified as one of the 7 key sectors for the Outer Hebrides. • The priority areas, actions and targets within this strategy directly link to those relating to renewable energy (from an economic development perspective), fuel poverty and reduced carbon emissions as contained within the OHCPP’s Single Outcome Agreement 2012-2023, the aforementioned Outer Hebrides Economic Regeneration Strategy and the Comhairle’s Corporate Strategy. Measuring Progress The Outer Hebrides Energy Audit (Element Energy, 2014) has provided an up to date baseline for carbon emissions, energy supply and demand in the islands. This is reinforced by targets contained within the Single Outcome Agreement and the Economic Regeneration Strategy. In assessing the impact of this strategy, progress will be measured in relation to the following indicators: • Reduction in carbon emissions in line with 2020 targets. • Reduction in fuel poverty
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