Subsidy Cut Will Hit Hydro Power Stations Construction

The main operator of Scottish hydro power stations does not expect to build any new ones due to a subsidy cut, the BBC has reported.

The news comes after the government announced a 30% reduction in the Renewable Obligation Certificates companies receive per unit of energy produced.

Onshore wind farms are also facing a cut of 10%.

SSE, which trades north of the border as Scottish Hydro, had planned several new hydro schemes in the Highlands.


And although the changes by the Department of Energy and Climate Change only apply south of the border, industry experts believe there is little flexibility for the Scottish government to offer more generous subsidies than those given from UK budgets.

It also warned changes to Whitehall's support regime for renewable power could significantly harm biomass burning and wind farm development.

Scottish Renewables, representing the industry, challenged the Scottish government to increase support from Whitehall's levels.

SSE said the new regime will not affect existing plants or those under construction.

"Nevertheless, it means SSE no longer expects to develop any new conventional hydro electric schemes and the scope to increase generation of electricity from biomass at coal-fired power stations is significantly reduced," the firm said.

(NE)