BNEF warns of decline in green investment if Scotland chooses independence

Sep 15, 2014 - Clean energy investments are expected to slow down if Scotland votes for independence this week, due to the inevitable uncertainty over future renewables policy, Bloomberg New Energy Finance (BNEF) warned today.

The market analytics company said that at least in the short term, project developers and banks will be delaying decisions as any vote in favour of Scotland’s independence would lead to prolonged and complex energy negotiations between it and the UK. The Scottish independence referendum will take place on Thursday, September 18.

BNEF calculates that Scotland has 5.7 GW of permitted wind projects and 11.3 GW announced or in planning. Angus McCrone, senior analyst, explained that no matter the referendum result, in the very long term there will be many renewable energy projects in Scotland as it is a firm supporter of the sector. “But our concern is that in the event of a “yes” vote, there could be a loss of momentum as investors worry about the likely price and market for electricity their projects could generate,” McCrone added.

Infinis Energy, a company with 274 MW of installed onshore wind capacity in the UK, has already put off the investment decisions on two wind farm projects in Scotland until it is clear what would be the impact of the referendum results on energy policy.

If Thursday’s independence vote is yes, it could affect projects throughout the UK, noted Analyst Kieron Stopforth, who is the author of the current research. He pointed out that the “longer-lasting effect” would be on Scottish projects. BNEF also said that Scotland may be more dependent on England and Wales as electricity customers than the two are on Scotland as a power producer as in 2012 less than 4% of England and Wales’ power came from Scotland.

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