Scots wind farms facing rate increase

Scotland’s drive for renewable energy is in danger of being hampered by proposed business rate changes, a leading accountant has warned. Ernst & Young energy expert Jonathan Johns said a new way of measuring rates was expected to see a hike in the bills of Scottish generators, making wind-farms less appealing to investors. And he warned that the newly opened UK-wide electricity market - known as BETTA - would also put pressure on bills. Regulator Ofgem has insisted the impact is "broadly neutral". Johns has just crowned the UK the joint most attractive place to generate renewable energy in the world, alongside Spain. But he warned that other countries were close to claiming the title. He explained that China and India were both becoming major markets, while developers eyeing the open spaces of Canada were beginning to receive more support from the government. He said: "The new regime is expected to result in significant increases in business rates - greater than in England and Wales. The Scottish market is currently the most active in the UK renewable energy industry."

The Scottish Executive is aiming to generate 18 per cent of all the country’s energy from renewable sources, with a so-called aspirational target of 40 per cent by 2020. However, energy insiders have warned that this latter figure was poorly thought out - largely due to planning complications. The government currently provides incentives to businesses producing energy from renewable sources, as at this early stage the market is not cost-efficient on its own. Johns did not foresee an end to this scheme - known as ROCs - but did warn the government against taking the growth of the industry for granted. He said: "As power sector players come to terms with the need to reduce emissions, renewable energy - wind in particular - has a firm seat at the energy table. But it cannot be complacent. Nuclear is lurking in the wings." It is widely expected that Tony Blair will publicly agree to build fresh nuclear power stations should he win the forthcoming election.