A £35 million fund to support production of new offshore wind technology in Scotland was unveiled by First Minister Alex Salmond today at the opening of the second Scottish Low Carbon Investment Conference in Edinburgh.
Mr Salmond also announced that 'Oyster' wave energy developer Aquamarine Power has secured £7 million of new funding and a commitment of further investment from existing shareholders over the next two years to help take the company to commercialisation in 2014.
And he welcomed the publication by Scottish Enterprise today of a new Offshore Wind guide - which emerged following last year's inaugural SLCI conference - indicating that Scotland's oil & gas sector can help reduce offshore wind costs by at least 20 per cent.
"Last year's conference gave a clear focus on what was needed to provide optimum investment conditions for low carbon energy - from ensuring we brought offshore oil & gas expertise together with the renewables industry, to providing the right support to bring research and development to Scotland. We listened, we acted and in 12 months we have achieved much. But there is more to do. The last year has demonstrated the appetite of the Scottish Government and private sector to work together to invest in this exciting new industry.
"As developers and investors look across this global market for certainty and for leadership from government, they can look to Scotland to provide those things. We are determined to remain among the most attractive locations for manufacturing, including the prototype testing that follows the R&D phase. That is why I am announcing a new £35 million fund to support production of full-scale prototypes of the next-generation offshore wind turbines that will power the renewables revolution, deliver our 2020 vision and reindustrialise Scotland."
The £35 million POWERS fund builds on recent successes in attracting world-leading turbine manufacturers to locate R&D bases in Scotland and aims to leverage up to a further £80 million of private investment to bring the production of full-scale prototypes to Scottish sites.
Scottish Enterprise chief executive Lena Wilson said:
"Offshore wind is a rapidly expanding, long term, global market, with significant low carbon economic growth opportunities for Scotland. We have a real opportunity to capture a share of the critical turbine manufacturing market and this fund underlines our commitment to developing our business environment to ensure Scotland is at the forefront of a globally competitive offshore wind sector and helps achieve Scotland's low carbon economic growth ambitions."
Highlands and Islands Enterprise chief executive Alex Paterson added:
"We welcome the announcement of the POWERS development fund as an additional support which will help us move forward and build on the many assets we already possess across the Highlands and Islands. Scotland is a great place for all types of renewable energy, with an established and growing supply chain, good infrastructure bases and an abundance of natural resources. The POWERS fund is a further indicator of Scotland's determination to be a global player in the growing offshore wind market."
The First Minister also announced that Aquamarine Power has closed a £7 million funding round comprising £3 million each from existing major shareholders SSE Venture Capital and ABB and £1 million from Scottish Enterprise, via the Scottish Investment Bank. The three shareholders are also working together to develop a further funding package of £18 million to take the company to commercialisation in 2014.
Mr Salmond said:
"In Scotland we have shown that where the public sector provides the right conditions and works strategically with industry, that investment and jobs follow. This has been evident in several sectors, including in marine energy, which will make an important contribution to us achieving our 2020 target to generate the equivalent of 100 per cent of electricity demand from renewables.
"That is why I am delighted to announce that Aquamarine Power, one of Scotland's great green energy success stories, is today celebrating a further investment of £7 million to help it take another step towards the commercialisation of its Oyster wave energy technology. This is great news for Scotland's world-leading wave power industry and a clear signal to the wider energy and investment community that marine technologies can be compelling investment propositions."
Aquamarine Power CEO Martin McAdam commented:
"This new investment and further financial commitment from our existing shareholders is another tremendous vote of confidence in Aquamarine Power's Oyster technology, our team, and the global market potential of nearshore wave energy. We are still seeking new shareholders who can bring additional finance and technical expertise to our business by investing alongside our existing shareholders in future rounds.
"However this level of commitment frees us up to concentrate fully on the challenge of deploying Oyster technology to produce cost effective, reliable, clean energy from the sea. Our goal is to start delivering the first pre-commercial marine energy array in Scotland in 2014. I would like to say thank you to SSE, ABB, Scottish Enterprise and our other investors who all remain exceptionally supportive of our business strategy."