The Shape Of Solar Scotland - Part II

Craig DalzellA year ago this month I told the story of a new renewables development that had been planned for next to my village and how it put me in the very unexpected position of actively opposing something that most would expect me to have been wildly in favour of. A 100MW solar farm, plus another 100MW worth of battery capacity, worth around £150 million that would produce more power than this village could use ten times over. At the time of its initial proposal it would have been the largest solar farm not just in Scotland but in the entire UK (though since then, several larger projects have been proposed – I’ll come back to that in a bit).My objection has never been about the renewables themselves – we need more in general and we really need more solar power in particular to balance a grid that is a little too tilted towards wind power – but it has been about control and who benefits from a project that would, in effect, turn a semi-rural Clydesdale village into an industrial estate power station with some houses on the edge. We do now have a few updates, courtesy of a meeting facilitated between the company and the local residents association (the unelected body we have representing the village because we don’t even have an elected Community Council here, never mind proper European-style municipal government) and held in the office of our constituency MSP and Cabinet Secretary for Energy and Net Zero Màiri McAllan. I should say that I, personally, wasn’t at this meeting (and neither was Màiri herself as she’s on parental leave) and only found out that it happened at all when the association published the minutes of the meeting on the village Facebook page almost a month after the fact.My main objection to the project has never been about the renewables themselves but about place, ownership and benefit.

Place

Covering some of the best grazing land in South Lanarkshire with solar panels isn’t the best use of that land when there are substantial areas of brownfield sites in the local area – a legacy of coal mining – and even less useful south facing upland that could be used instead – not to mention that we probably shouldn’t be putting a solar panel on the ground at all until every roof is covered and other opportunities like solar fencing are deployed. We could even be co-siting ground-based solar panels beneath wind turbines to maximise the benefits of both on effectively the same land. However, that would require a major change in how we own our energy resources in Scotland.

Ownership

The company involved here was Spanish but since last year have been bought be a French renewables company. At the time of my last article, I was in the middle of putting together what would become “Profit Extraction”, our policy paper on the detrimental effect that Scotland’s high levels of foreign ownership were having on our economy where something like £10 billion of the wealth created in Scotland doesn’t stay in Scotland. This project will end up adding to rather than subtracting from the problem. Under the Humza Yousaf administration, he made statements around a call for increased community energy and a 10% public equity stake in large scale energy projects like ScotWind. While he wasn’t in office long enough to actually start implementing that policy and while John Swinney’s administration hasn’t said much in favour it since, it doesn’t seem to have been formally repealed either with acting Energy Secretary Gillian Martin saying during the recent debate that led to Holyrood abolishing Scotland's 2030 climate target saying that "one thing that needs fixed is to ensure that communities feel the benefit of [renewables] developments".I would gently (read: firmly) suggest that the constituency of the Cabinet Secretary for Energy and Net Zero might be a good place to start putting this into practice. A £15 million low- or zero-interest loan is well within the reach of organisations like SNIB (which we argued should be set up precisely to do this kind of thing after funding social housing and before doing the kind of flashy tech accelerator funding it currently does) and after the loan is paid off would result in the entire village being effectively energy self-sufficient. If it must be built here, the community must feel the benefit.

Benefit

Under the current plan, the company would obviously be the main beneficiary. We don’t precisely know what their expected profit margin will be but they hinted during the public meetings last year that they’d be happy with a 10% margin from selling the site on, so let’s call it £15 million.The second beneficiary will be the landowner. Now, I must make it absolutely clear that I have nothing against him. He’s a decent guy, and is making the choice of how to use his land in the best way possible to ensure his own financial security. Scotland underpays our sheep farmers to the point that their wool makes less of a loss when it’s burned than when it’s sold while simultaneously houses go cold for lack of affordable insulation. This is a deliberate policy choice that I’ll likely come back to in a future article, but until then, if he can secure himself with a bit of extra rent then that’s entirely his prerogative. We don’t know how much he’ll earn from the farm – the contract is confidential – but if he’s achieved the rent rate these companies advertise on their website (£1,000 per acre per year) and they haven’t discounted him too badly (which I know has happened to other farmers approached by other companies) then he could be looking at an income of around £340,000 per year (or about £13.6 million over the 40 year lease).It was only at this latest meeting that the company revealed what they would be willing to pay to the community. Normally when a wind turbine is erected, a portion of the profits go into a community benefit fund. The amount is a pittance – just £5,000 per year, per MW of capacity – and there are often issues with the fund being siphoned away by our not-local-enough Local Councils or coming with strings on them that make them hard to spend on the community (like allowing capital funding to buy a new village hall but not revenue funding to keep it open) but it’s certainly a recognised and known amount. However, the 9CC group of communities in Ayrshire set a new standard by negotiating something closer to £7,386 per MW for the wind farm near them and have won praise for setting a new standard for negotiating with communities over renewables. Even higher amounts could be gained through full community ownership as has been seen in places like Skye.Last year, we were told that the solar project would attract “less than wind” in terms of community benefit because of the lower capacity factor of solar panels (the percentage of the peak energy capacity, say 1MW, a generator actually generates in a given year – around 32% for wind and closer to 8% for solar PV in Scotland). In the recent meeting they revealed that they wanted to contribute a flat rate of just £10,000 per year. This works out at £100 per MW of solar panels. There will be no direct discounts on the energy bills for locals. There will also be ZERO contribution from the energy from the batteries. This is because of a loophole in the Scottish regulations that means if a renewable generator contributes directly to the grid then it will attract community benefit but if it charges the battery which then discharges to the grid, it won’t. It is also possible to make a profit from the batteries alone, by charging them at cheap night rates and discharging them during the peak evening hours, so that loophole is doubly absurd.If the community is to host these solar panels and we’re NOT going to be funded to own a share of them directly then we should at least be paid a fair price for them. £100/MW isn’t an offer. It isn’t even an insult. It’s what you get when you’re not even important enough to insult.So I propose a fair price, based on research conducted on this project by Artivism Scotland. We’ll take the new benchmark set by the 9CC group of £7,386 per MW and we’ll adjust it for the lower capacity factor of solar. That would imply a community contribution not of £10,000 per year but closer to £181,000 per year or £7.2 million over 40 years. Note that this is still likely to be less than is paid to the landowner if they are getting something close to the website advertised rate (and if they’re not, then they are being screwed over by the company too and we should both be fighting for more). This sum still doesn’t include any payments from a share of profits from the batteries so there’s space to negotiate up from there too if the Scottish Government would like to close that rather glaring loophole for us.We’re not the only village in Scotland facing being screwed over by multinational companies for our renewable assets. The same company is involved with an even larger solar project in Thurso and we’ve spoken to multiple farmers who are being approached to rent their land to various renewables companies. The problem is that everyone is being approached individually, are being quietly screwed over and are being discouraged from talking to each other about it or, worse, ORGANISING like the 9CC group did. Whichever community makes the first bad deal will set the precedent for everyone else to be bid down from. On the contrary, whoever makes the first good deal will set the standard to bid up from.I said last year that the shape of solar Scotland was starting with our village. That shape is becoming more clear not just here but elsewhere too. We do, however, have the advantage of being directly in the radar of the Minister most closely in charge of these developments. It is still within the power of the Scottish Government to intervene and support us to ensure that the renewable developments are done in as minimally invasive a way as is possible and that the community benefits as much as possible from them. It should never be the case that someone like me should be opposing renewables on my doorstep– I want to be celebrating them and making sure that everyone else does too. That means getting it right, now, while we still can.