Chamber and committees

<>The Scottish Government published its updated carbon management plan in 2014 and commissioned energy saving audits on all of the buildings on our estate. The result was our carbon management project register. Projects are prioritised based on their carbon savings, cost and payback. To date we have chosen projects which have reduced the Scottish Governments energy consumption including boiler replacements, LED lighting upgrades, Building Management System upgrades and improvements to our computer room air conditioning units. Solar will be considered as part of this process however we will continue to prioritise technology with has the greatest impact on our energy consumption and carbon emissions.

The Scottish Government currently has renewable technology in the form of solar heating panels at our offices at Saughton House in Edinburgh and Tweedbank near Galashiels and biomass boilers at our offices in Faskally and Inverurie. We will pursue installing further renewable technology when funding is available and the cost, payback and carbon savings makes it value for money over other energy efficiency projects.

The Scottish Government is engaging with the Solar Trade Association, the Scottish Renewables Solar Network and the Scottish Institute for Solar Energy Research as well as other stakeholders to ensure that we are doing what we can to provide an environment where the potential of solar in Scotland can be achieved.

The commencement of a Scottish arm of the Solar Trade Association in Scotland in March 2015 demonstrates that Scotland is an attractive place for solar development and indeed data for the end of 2014 shows Scotland had 153MW of installed PV, an annual growth of 28.6% compared to the end of 2013. The Scottish Government is doing its bit to encourage and build on this success.

During the Scottish National Party government since 2007, Scottish Ministers have engaged regularly with representatives of the Iberdrola Group – the parent company of Scottish Power – and its associated businesses that operate in Scotland, including Scottish Power Generation, Scottish Power Energy Networks and Scottish Power Renewable Energy.

This engagement has taken place in a variety ways, through for example bilateral meetings, standing advisory groups such the Scottish Energy Advisory Board and under the auspices of industry trade bodies.

Throughout the Scottish National Party administration since 2007, the Scottish Government has engaged with the UK Government to promote the full spectrum of Scotland’s wide-ranging energy interests and support the electricity generation sector in Scotland.

Many of these discussions – for example, on the subject of network transmission charges or Scottish coal production – will have had direct relevance for Longannet.

Scottish Power has invested heavily at Longannet over many years, with the intention to maintain generation at the power station until or beyond 2020. On 24 October 2013, Energy Minister Fergus Ewing visited the power station to inspect a recent phase of major refurbishment works designed to improve efficiency and environmental performance.

The commercial prospects for Longannet have worsened since then. Principally, in October 2014 when the station was excluded from the UK Capacity Market auction – a decision Scottish Power linked explicitly to the UK system of discriminatory transmission charges – and in March 2015 when the station was unsuccessful in a National Grid tender for additional voltage support services.

Since March 2015 the Scottish Government has engaged with all the Longannet unions, Scottish Power, Fife Council and a range of public sector agencies to assess the situation and seek the best possible outcomes for the workforce, suppliers and the local economy.

The Peterhead Carbon Capture and Storage project, which I recently visited, could secure the future of unit 1 at Peterhead for 15 years.

Table 1 presents waiting times data derived from developmental management information submitted to the Scottish Bowel Screening Centre. These data are provisional and have not been subject to data validation processes for the submission of data for the bowel scope study to Information Services Division.

Table 1: Average and maximum waiting times for a flexible sigmoidoscopy in NHS Grampian as at 12 May 2015

Patient group	Number of patients	Average (days)	Maximum (days)
All patients	1,473	90	241
Flexible sigmoidoscopy performed	672	112	241
Waiting for a flexible sigmoidoscopy	801	72	203

Table 1 presents data derived from developmental management information submitted to the Scottish Bowel Screening Centre. These data are provisional and have not been subject to data validation processes for the submission of data for the bowel scope study to Information Services Division.

Table 1. Number of patients waiting for a flexible sigmoidoscopy in NHS Grampian as at 12 May 2015

Patient Group	Number of patients
Waiting for a flexible sigmoidoscopy	801

Source: Scottish Bowel Screening Centre Bowel Scope Weekly Update data supplied by NHS Grampian

Scottish Ministers have regular contact with representatives of Scottish Power, part of the Iberdrola Group, at which the company’s current generation assets and future investment plans are discussed.

Following Scottish Power’s decision to opt-out Longannet from the UK capacity market auction in October 2014 – a decision Scottish Power linked explicitly to the UK system of discriminatory transmission charges – both the Deputy First Minister and Minister for Business, Energy and Tourism have visited Longannet power station to meet company representatives.

In addition, ministers have made repeated representations to National Grid and the UK Government at the highest level to underscore the significance of Longannet and to highlight Scottish Government concerns about dwindling spare capacity in the GB electricity system.

Under the devolved settlement, governmental and regulatory responsibility and operational control of GB energy market issues rests with the UK Government, Ofgem and National Grid. The actions urgently required on the key factors contributing to the threat of premature closure of Longannet – principally, transmission charges and the design of the UK Capacity Market – are ones that must be taken by the relevant UK authorities rather than the Scottish Government.

Details of recent meetings in person and by telephone are listed in the following table.

Date	Activity
7 October 2014	The Minister for Business, Energy and Tourism (Fergus Ewing MSP) had a telephone call with Neil Clitheroe (Chief Executive Officer, Scottish Power Retail and Generation) and discussed the future of Longannet.
22 October 2014	Fergus Ewing had a telephone call with Neil Clitheroe and had another discussion on the future of Longannet.
12 November 2014	Fergus Ewing co-chaired a meeting of the Thermal Generation and Carbon Capture and Storage Industry Leadership Group. The state of the electricity sector was discussed, focusing on supply margins. Scottish Power was represented at the meeting by Hazel Gulliver (Europe and Scotland Policy Manager).
26 November 2014	Fergus Ewing met with Mike Calviou (Director of Transmission Network Services, National Grid) to discuss the future of Longannet and emerging findings of National Grid’s System Study for Scotland.
21 January 2015	Fergus Ewing met with Keith Anderson (Chief Corporate Officer, Scottish Power), Frank Mitchell (Chief Executive Officer, SP Energy Networks) and Neil Clitheroe. Discussions included the future of Longannet.
16 February 2015	The First Minister co-chaired a meeting of the Scottish Energy Advisory Board with Professor Sir Jim McDonald of the University of Strathclyde. Mike Calviou gave a presentation on Security of Supply and discussions referenced Longannet. Keith Anderson and Frank Mitchell attended by telephone and in person.
23 February 2015	Fergus Ewing visited Longannet Power Station and met with representatives of Scottish Power and the union Prospect.
13 March 2015	Mr Ewing had a phone call with Mike Calviou and discussed the future of Longannet.
19 March 2015	Mr Ewing met with Mike Calviou in London and discussed the future of Longannet.

The industry led carbon price support (CPS) proposal for ‘restoration coal’ is with the UK Government for consideration.

The current cost of coal for Longannet is circa £40 per tonne. Generators then need to pay a circa £40 carbon tax on each tonne of coal resulting in a full cost of coal to the plant of circa £80 per tonne.

Under the proposed CPS scheme, coal feedstock which is produced as part of coaling operations which are restoring legacy opencast sites would be exempt from the (£40 per tonne) CPS tax.

Under the proposed CPS model, generators like Scottish Power would then be able to buy ‘restoration coal’ at the market cost (i.e. £40 per tonne) plus a margin to cover the costs of restoration – this margin being less than the £40 carbon tax.

This scheme could thereby secure a steady stream of lower total cost feedstock resulting in a significant saving to a plant of Longannet’s scale and subsequently lowering the running costs of the plant.