This blog sets out the background to wind energy development in Scotland, the details of the recent ScotWind seabed leasing agreements and how the Scottish wind energy sector may develop in the future. It is linked to a forthcoming blog on wind energy, economic impacts and the Scottish supply chain.
Current deployment and government targets
The use of wind turbines for electricity generation has grown significantly in Scotland and the rest of the UK in recent years. While the vast majority of Scottish wind energy is currently onshore, offshore development is growing and is anticipated to exceed onshore capacity in the years to come. The UK is seen as having very good conditions for offshore wind, surrounded by seas, with good wind conditions and some areas of relatively accessible, shallow waters (mainly in the North Sea). The Scottish Government control wind energy deployment through the planning regime but most projects also rely on gaining a supply contract (contract for difference; CFD) from the UK Government before development.
Currently, Scotland has 8.8GW of onshore wind capacity and 2.1GW of offshore wind. In 2021, the UK had 14.5GW of onshore and 11.3GW of offshore in total. Total installed UK electricity capacity was 77GW in 2021.
The Scottish Government’s Offshore Wind Policy Statement (published October 2020), set out an ambition to achieve 8-11 GW of offshore wind in Scottish waters by 2030. The recent Draft Energy Strategy states the Government are ‘consulting on setting a further offshore deployment ambition’. Their Onshore Wind Policy Statement (published December 2022) sets out an ambition to deploy 20GW of onshore wind by 2030.
In April 2022, UK Government’s Energy Security Strategy announced updated targets for offshore wind, increasing them to 50GW (previously 40GW in the Net Zero Strategy, Oct 2021), and up to 5GW of floating offshore wind (previously 1GW) by 2030 (conventionally offshore turbines are set on fixed structures on the seabed, which limits their deployment to shallower waters). There is no equivalent UK target for onshore capacity (for which UK Government support has been less consistent in recent years).
The UK Government are aiming to fully decarbonise the Great British (GB) electricity system by 2035. The Climate Change Committee (CCC) recently modelled that by 2035 in the GB system about 42% of electricity will come from offshore wind and about 12% from onshore wind. The CCC are also anticipating a 50% increase in demand for electricity by 2035.
In the National Grid’s Future Energy Scenarios (NG-FES) for net zero, grid connected offshore wind capacity is forecast to be 70-78GW by 2035 and 89-110GW by 2050 in the GB system (35-38GW in Scotland by 2050). Onshore wind capacity would be 29-36GW in 2035 and 34-48GW in 2050 (24-28GW in Scotland). There is currently thought to be a pipeline (projects in some stage of development) of about 100GW of offshore wind in the UK.
While in recent years, the equivalent of nearly 100% of Scotland’s gross electricity consumption has come from renewable sources (i.e. the renewable electricity produced in Scotland was nearly equivalent in volume to the overall Scottish electricity demand) not all this renewable supply was consumed in Scotland. Of the electricity produced in Scotland about 54% was from wind, 7% from hydro, 20% from nuclear and 15% from gas (but again not all of this was consumed in Scotland). Scotland produces much more electricity that is uses and in recent years has exported more than a third of the electricity it generated (to England and Northern Ireland).
The plans for much greater deployment of wind energy in Scotland will mean there will be more available for export, storage or potentially for use in the production of hydrogen. There will also be a substantial requirement for electricity network upgrades with National Grid ESO identifying £21bn of investment in the GB transmission network to meet 2030 needs (with half of this in Scotland). Ofgem recently approved 26 transmission network reinforcements including new subsea lines between Peterhead and Yorkshire. With the rate of turbine installation needing to triple to hit the 2030 targets the UK Government is also developing plans to cut planning consent times from four years to one. It is not just the UK with major plans for offshore wind, the six European countries with North Sea coastlines have combined offshore wind targets of 121GW by 2030, 190GW by 2040, and 261GW by 2050.
Scottish and UK wind energy deployment
UK and Scottish Government 2030 plans
National Grid 2050 (‘Consumer transformation’ scenario – GB system)**
No current target
* The Draft Energy Strategy consultation ‘seeks views on whether the Scottish Government should set an increased ambition for offshore wind deployment’
** These figures only include offshore wind capacity connected to the grid. There is potential for non-grid connected capacity, but this was not included in this table.
ScotWind and potential future developments
‘ScotWind’ was the first round of offshore wind leasing in Scottish waters for a decade. Until 2017, Scottish offshore sites were leased by the Crown Estate, at the time a UK-wide body. The management of offshore wind rights were devolved by the UK Government to Scotland in 2017 with the creation of Crown Estate Scotland (CES) and the ensuing first ScotWind auction.
The first round of CES agreements (ScotWind) was announced in 2022, with 20 projects given option agreements. If every project was developed to full potential they would result in 27.6GW of wind energy capacity. The option agreements grant developers access to specific areas of the seabed, although successful applicants will still have to go through other planning processes and many will seek to secure a UK government subsidy contract (CfD) before development could proceed.
The most recent CfDs for offshore wind are ‘expected to pay back to consumers for much of their lives, making them effectively subsidy-free’. Some believe that not all future projects will need to rely on a CfD or if projects finished ahead of schedule they may generate on a ‘merchant basis’ (without government contract) before their CfD becomes active.
The nearly 28GW of potential capacity is much more than the Scottish Government had expected (around 10GW) from ScotWind, stating that the first ScotWind licencing round ‘reflects market ambitions which exceed our current planning assumptions’. Ultimately the level of deployment can be controlled by Scottish Minsters as the consenting authority. ScotWind projects are expected to be delivered from the ‘late 2020s onwards’.
GB offshore wind developments have almost all been in shallow waters (10-60m) with the majority of these thus far being in waters off the East coast of England. ScotWind may change both of these positions. Many (possibly the majority) of ScotWind developments are anticipated to use floating turbines.
Floating wind turbines allow for siting in deeper waters increasing access to the windiest areas. Hywind in Scotland (the world’s first floating wind farm) has for 3 years been the best performing wind farm in the UK (operating at an average efficiency/capacity factor of 57%). Floating offshore wind is seen as presenting significant export opportunities to Scotland and the UK. Globally, it is estimated that about 80% of the technical offshore wind resource is at depths of greater than 60m and thus more suitable to floating wind. So far there is much greater emphasis on floating wind in the Scottish plans than in the ambitions of the UK Government where the 50GW by 2030 target includes an ambition for 5GW from floating farms (which would easily be met if all proposed ScotWind projects became reality).
Onshore, the Scottish Government plans for a more than doubling of capacity by 2030. Much of this may, however, come from ‘repowering’ of existing sites, whereby more powerful turbines replace older existing models. This would result in fewer but taller turbines generating much more power. The Scottish Government use the example of the SSE Renewables’ Tangy Wind Farm where 22 turbines were replaced by 16, with overall capacity going from 18.7MW to 80MW.
Beyond ScotWind and the road to net zero
The National Grid-Future Energy Scenarios work suggests there is potential for more offshore wind in Scotland beyond ScotWind, and there will be a need for more electricity supply as the heat and transport sectors decarbonise. The uncertain nature of future demand, the readiness of the electricity network and the contracting mechanism (currently CfD) mean that the timing and nature of further leasing rounds are difficult to predict. A second ScotWind leasing round had initially been expected in 2023 but the greater than predicted planned capacity from the first round means this is no longer expected (although an Innovation and Targeted Oil & Gas (INTOG) leasing round for offshore wind projects designed to reduce emissions from oil & gas production and boost further innovation has seen 13 projects receive ‘Exclusivity Agreements’ this year). There is discussion of the potential for ScotWind 2 but this ultimately ‘depends on Marine Scotland and the Scottish Government’. This blog is linked to another post which considers the economic impacts of wind energy in Scotland and the prospects of Scottish companies being involved in deployment.
Niall Kerr, Senior Researcher – Climate Change / Net Zero