§ Mr. Ernie RossTo ask the Secretary of State for Scotland if he will make a statement about a third round under the Scottish Renewables Obligation. [19299]
§ Mr. WilsonA consultation exercise held earlier this year by my Department showed broad support for the Government's approach to developing renewable energy. I am therefore proposing a third order under the SRO to oblige ScottishPower and Hydro-Electric to secure the availability of more capacity from new renewable sources in Scotland.
The first two orders led to 56 renewables projects with a combined capacity of 189MW securing contracts with ScottishPower and Hydro-Electric, although many of these have not yet been commissioned. I am very keen to see SR03, which will come into force in early 1999, again attracting technically sound yet innovative projects which must be extremely competitive on price, with the downward trend in prices seen under SRO2 being continued in so far as that is possible.
Capacity will be made available to those technologies that are able to demonstrate these qualities. On that basis I am minded that the third order should cover wind, small hydro, waste to energy and biomass projects, and that it should also make limited capacity available to small wind schemes and wave power projects. I hope that community-based projects will take advantage of this opportunity.
The Government is committed to a new and strong drive to promote renewables and a review of renewable energy policy is underway. I intend that the SR03, which represents the culmination of the current programme in Scotland, should be for around 110–120MW in capacity, i.e. about the same size as SR02.
I am aware of certain concerns about the local environmental impact of particular renewables projects, and for that reason I expect prospective developers to consult interested parties, including local planning authorities, at an early stage. Evidence of having done so will be required as part of the application process. Developers are further reminded that the award of a contract under the SRO in no way implies preferential treatment when it comes to the planning process and planning permission will still have to be sought in the usual way.
My Department will shortly be writing to ScottishPower and Hydro-Electric setting out these proposals in more detail and will also issue detailed guidance to prospective applicants under SR03. Developers who are interested in bidding are invited to register their interest with my Department as soon as possible.