Scottish Renewables hits at grid charges for marine projects

Sep 18, 2012 - High costs to connect to the grid wave and tidal projects in the Pentland Firth and Orkney Waters are putting at risk the projects' viability, Scottish Renewables said today.

Charges in the area, which was recently launched as Scotland's first Marine Energy Park, have kept rising in spite of energy regulator Ofgem's review aimed at reforming the charging regime, according to the announcement. The review has resulted in improvements for mainland generators, while the islands are set for a spike in charges, the industry body said.

According to figures released at today's Marine Energy Conference in Inverness, annual connection charges in the Pentland Firth and Orkney Waters are estimated to hit GBP 107 million (USD 174m/EUR 133m) in 2020. This is double Scottish Renewables' estimate from a year ago of GBP 56 million in annual charges if the projects were to connect in 2012.

By contrast, if the projects were to be deployed at the UK's other Marine Energy Park in southwestern England, there would be an annual subsidy of GBP 2 million, according to the analysis.

Scottish Renewables said that the massive increase in charges for the Orkney Waters area was due to the fact that "local works", including costly undersea grid cabling, should be paid by power generators on the islands.

"The level of charges for Orkney Waters is adding significant costs to wave and tidal projects and can only hold back investment in our world-leading marine energy sector," Scottish Renewables chief executive Niall Stuart said and called on the Secretary of State for Energy and Climate Change to use his powers to change the transmission charges.

(GBP 1.0 = USD 1.624/EUR 1.243)

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