Renewables – Update on Timelines

It was agreed at the recent meeting of the Trust that some clarification would be helpful for the public to better understand when they can expect to see key developments in renewable energy transpire. The local picture has been somewhat complicated, and the following should assist in identifying how the Stornoway Wind Farm may be expected to unfold from here.

CfD

The UK government’s main mechanism for supporting low-carbon projects is a process called Contract for Difference (CfD). These contracts have a dual purpose of incentivising developers and protecting consumers. In order to be eligible to bid for a CfD, developers require three things:

  • a lease over the land where the development is to be sited;
  • a grid connection offer from the network provider;
  • planning consent.

Projects in possession of these had to meet the submission deadline of 18 June. Any project not meeting those three criteria were not eligible for participation in the 2019 round. Because this is a confidential process, no one can definitely say which projects will be in the auction, but it is clear from these rules which ones will not.

Once the eligibility of those participating has been confirmed, the window for bids is expected to open from 9 – 15 October, with applicants expecting to be notified of the outcome in early November.

Interconnector

In a separate, but not unrelated, process, the energy regulator Ofgem is assessing the Western Isles’ eligibility for an interconnector. The regulator has stated that it is minded to support a 450MW cable, while the community and developers favour a 600MW cable. This cable is necessary if there is to be any additional electricity generated in the islands, as the local grid has reached full capacity.

The Stornoway Trust with other local community representatives and developers met with Ofgem in order to make the case for the larger capacity cable. This, again, is strengthened by the development of consented projects, or those with a realistic chance of success.

A decision is hoped for by early autumn.

Trustees were, however, concerned by the recent news that the Shetland community has relinquished its share in the Viking Energy project to SSE. The Trust agreed that it hoped that SSE would continue to vigorously support the case for a 600MW connection for the Western Isles, given that this could compete with its own interests in Shetland.

Scottish Land Court

The Court has heard/will hear a number of cases relating to the Stornoway Wind Farm.

First of all, the Stornoway Wind Farm Developer – Lewis Wind Power (LWP) – has applied for something called a Section 19a consent. As has already been explained to the affected crofting communities, this is the part of the 2010 Crofting Act which ensures that developers (local, national or multinational) carry out their planned scheme in a fair and reasonable manner, giving due consideration to the crofters. That would, naturally, include making fair financial recompense.

Consideration of a 19a by the Court is a standard part of the process. As there has been a number of objections to the Stornoway Wind Farm, emanating from only four of the fourteen affected grazings, there will now have to be a hearing. This is scheduled for October/November of this year.

Simultaneously, the Court is having to process an appeal from four crofting Townships within the Trust area. They applied to the Crofting Commission under section 50b of the Act, to use the common grazing land to site turbines on the exact locations currently consented to LWP. The Commission rejected the four applications as being detrimental to the landlord, and the Court has now heard the four townships’ appeal against that rejection. A decision is awaited imminently.

Should the decision of the Crofting Commission be overruled, LWP’s ability to underpin the case for the interconnector could well be jeopardised, which is of obvious concern to Stornoway Trust, the community landlord.

Risk

The Stornoway Trust has always taken the view that the Stornoway Wind Farm should be progressed with a view to maximising community benefit and minimising community risk. We believe that working with a developer – LWP – derisks the project for the Estate, while providing sizeable financial benefits in terms of rent (to landlord and crofter), an annual community benefit fund, and the 20% equity option after the wind farm is operational. The latter would enable the community to continue to have a share in the profits generated by the developer. It would equate to community ownership of approximately 36MW, further enhancing the community benefit derived from the project.

Furthermore, the viability of this project continues to be a lynchpin in the case for the interconnector. It formed the bedrock of SSE’s case for the bigger cable and remains central to the argument for securing the connection. This would open the way for smaller, community-owned schemes, such as Knock & Swordale, and the community-led consortium on the Arnish Moor.