Green Investment Bank could boost Scotland’s low carbon economy

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  By a Newsnet reporter

The Green Investment Bank (GIB) locating in Edinburgh is testament to Scotland’s commitment and embracing of its vast renewable resources, Mike MacKenzie MSP has said.

Earlier this week it was announced that Scotland topped the European league table for carbon emission reduction.  The country has achieved a 22.8% reduction in carbon gas emissions between 1990 and 2010, the greatest reduction amongst any of the 15 original EU member states with fully developed industrialised economies.

Only certain heavily forested East European nations, whose woodlands act as “carbon sinks”, were able to beat this figure.

Meanwhile the World Wildlife Fund has called on the Irish and Northern Irish governments to take a leaf out of Scotland’s green book and develop a low carbon economy.

Malachy Campbell, a policy officer with WWF, said Scotland was blazing a trail by setting ambitious targets that could save £325 million a year and reduce energy levels by 12% by 2020. “Why are we not doing it?” he asked.

According to a report published this week by the government and industry-backed Energy Technologies Institute (ETI) and investment management firm Ecofin, the £3bn Green Investment Bank could play a crucial role in attracting finance to early stage carbon capture and storage (CCS) projects.

The report suggests the Green Investment Bank could help raise finance for CCS projects by leading or facilitating a syndicate of banks, which would make assembling large amounts of capital far easier and limit the exposure of individual institutions in the potentially risky development of new technologies.

Mr Mackenzie – a member of the Economy, Energy and Tourism Committee – said the renewably energy industry’s progress is being propelled by the Scottish Government’s commitment to the renewable energy sector.

He added:

“The Green Investment Bank launching in Edinburgh today is a mark of Scotland’s renewable energy calibre. Given Scotland’s natural wave and wind resources and the financial services based in our capital city and elsewhere, Edinburgh is the best location for the Green Investment Bank HQ.

“The renewables industry now meets 35 per cent of Scotland’s annual demand for electricity and directly employs more than 11,000 people across the country. We are well on the way to meeting the Scottish Government’s ambitious target of 100% domestic electricity consumption from renewable sources by 2020.

“This stands in stark contrast to the UK government changeable opinion on the value of renewables.

“I will be pressing UK Energy minister Ed Davey on the fact that that future energy policy of the UK must be renewable focussed – which will allow the developing green industry in Scotland to continue to blossom.”

However, there is already concern amongst renewables industry insiders about the commitment of the bank to fund offshore wind and tidal projects in Scotland after the bank apparently claimed such projects were too risky.

There are also fears that funding could be diverted into nuclear projects after UK Business Secretary Vince Cable would not rule out the possibility when interviewed on BBC Scotland.