Making the most of opportunities in renewable energy
Earlier this week, it was announced that the UK had reached what was rightly called a historic milestone of 20GW (gigawatts) of wind energy capacity. This is enough to power more than 14 million homes and reduce carbon emissions by 25 million tonnes a typical year.
SSE has contributed 1.7GW of this from its onshore and offshore wind portfolio in the UK If you add almost 600MW (megawatts) of onshore wind energy capacity in Ireland, 400MW of run-of-river hydro schemes, 750MW of flexible hydro electric capacity and our 300MW pumped storage plant at Foyers, you have an outstanding portfolio of renewable energy assets across the UK and Ireland.
It’s a portfolio rooted in the foundation of the hydro-electric revolution in the north of Scotland 75 years ago, that has been built up recently through more than a decade of targeted investment that is continuing. The completion in 2019 of the Stronelairg onshore wind farm (228MW) and the Beatrice offshore wind farm (SSE share 235MW) will give SSE a renewable energy portfolio of over 4GW.
But SSE’s renewables story is not just about capacity.
It’s a big portfolio, but it is also unique. It features ‘Britain’s biggest battery’ in the form of flexible hydro capacity – a ‘battery’ that is becoming more and more important as the increasing volumes of wind and solar energy coming onto the UK system will create the need for more flexibility in the form of energy storage. SSE’s flexible hydro assets are well placed to provide this in an optimal way.
It is also diverse – diverse in terms of technology (on- and offshore wind, run of river and conventional hydro and pumped storage) and geography across the UK and Ireland. This geographic diversity in on- and offshore gives a spread of wind capture opportunities that supports the overall balance of the portfolio.
And it is supported by strong operational capability, consisting of expertise in renewable energy engineering and wind speed forecasting, and enhanced by strategic siting of assets into operational hubs that can be managed in a safe, pragmatic and low-cost way.
On top of this, it is a portfolio that is supported by a strong pipeline of future opportunities. Offshore wind received a boost in July when the UK government confirmed its ambitions for the sector by announcing plans for regular Contracts for Difference auctions from 2019. There are early indications that political support for onshore wind in the UK is on the increase. In Ireland the new renewable support scheme creates potential for further on- and offshore development there.
We have a significant onshore wind development pipeline that currently includes 570MW of capacity with consent for development, some of which we may seek to optimise through planning amendments to accommodate more advanced, efficient turbines. The capacity features extensions, adjacencies or redevelopments of existing projects.
Offshore, we have interests extending to well over 3GW in projects under development at Seagreen and Dogger Bank in the UK and Arklow Bank in Ireland and are fully engaged with the Crown Estate and Crown Estate Scotland about longer term opportunities as well.
In May, we set our or strategic goal of creating value from developing, operating and owning assets in renewable energy. In line with that goal, and in a similar vein to previous timely divestments to create value and support future investment, we will consider doing so again in the future if the right opportunity arises.
Many organisations and individuals have contributed to the renewable energy revolution seen across the UK and Ireland. SSE’s contribution is a large, unique and diverse portfolio of assets that is supported by a strong operational capability and an extensive pipeline of options for future development.
It is a first class example of creating value in a sustainable way.