Oor Nicola Sturgeon thread.

[Detournement]

Perhaps we don't need to immediately produce 5-6 Scotland's peak demand?

Or Sturgeon could have spent the entirety of Cop 26 shouting to the world that Scotland needs new borrowing powers to finance renewable energy?

Just like the Growth Commission she is happy to tie Scotland to a failed economic model simply to please the corporations she will be looking to for lucarative positions when she's done gaslighting brain dead Nats about Indyref2. 

Edited January 17, 2022 by Detournement

[sophia]

8 minutes ago, Detournement said:

Perhaps we don't need to immediately produce 5-6 Scotland's peak demand?

Or Sturgeon could have spent the entirety of Cop 26 shouting to the world that Scotland needs new borrowing powers to finance renewable energy?

Just like the Growth Commission she is happy to tie Scotland to a failed economic model simply to please the corporations she will be looking to for lucarative positions when she's done gaslighting brain dead Nats about Indyref2. 

My word, that's certainly a novel strategy when presented with the gift of a generation.

 

[Detournement]

Just now, sophia said:

My word, that's certainly a novel strategy when presented with the gift of a generation.

 

All we are getting is £700m. For assets that produce £5 billion a year.

One of the few things to be politically optimistic about for the future was using our natural resources to finance building a better country. That's gone now. BP, Shell et al will get the benefits and we will get the bills. 

[sophia]

11 minutes ago, Detournement said:

All we are getting is £700m. For assets that produce £5 billion a year.

One of the few things to be politically optimistic about for the future was using our natural resources to finance building a better country. That's gone now. BP, Shell et al will get the benefits and we will get the bills. 

You certainly are the hardest of work.

Your first line is conflating the development and operational stages of these projects.

I get the feeling that you know this.

Despite the fact that the ship has sailed, the UK government wished it bon voyage, on turbine manufacturing, we will enjoy the ongoing jobs bonanza throughout the development, construction and operational phases of these projects. Self evidently, we get much more than the bills.

[Antlion]

35 minutes ago, Detournement said:

Perhaps we don't need to immediately produce 5-6 Scotland's peak demand?

Or Sturgeon could have spent the entirety of Cop 26 shouting to the world that Scotland needs new borrowing powers to finance renewable energy?

Just like the Growth Commission she is happy to tie Scotland to a failed economic model simply to please the corporations she will be looking to for lucarative positions when she's done gaslighting brain dead Nats about Indyref2. 

From someone who claimed they were “glad” Brexit had happened (once it became clear the Tories were running it), any hand wringing about wicked corporations and brain dead nats rings a bit hollow. 

[Jim McLean's Ghost]

12 minutes ago, sophia said:

You certainly are the hardest of work.

Your first line is conflating the development and operational stages of these projects.

I get the feeling that you know this.

Despite the fact that the ship has sailed, the UK government wished it bon voyage, on turbine manufacturing, we will enjoy the ongoing jobs bonanza throughout the development, construction and operational phases of these projects. Self evidently, we get much more than the bills.

Even at a pitiful margin the energy companies will recover their outlay in less than a decade.

It is clearly being sold off on the cheap.

[Saltire]

35 minutes ago, Detournement said:

Perhaps we don't need to immediately produce 5-6 Scotland's peak demand?

Or Sturgeon could have spent the entirety of Cop 26 shouting to the world that Scotland needs new borrowing powers to finance renewable energy?

Just like the Growth Commission she is happy to tie Scotland to a failed economic model simply to please the corporations she will be looking to for lucarative positions when she's done gaslighting brain dead Nats about Indyref2. 

I think there is a legitimate case for public ownership to be made and I'm sure it will be by those who support it, or a variation of it. I'm not sure what elements of the economic model has failed in your analysis so it would be good to hear a bit more of your view but I do think fuel poverty is unacceptable and is about to get worse.

Since my younger days I've come round to accepting that we will live in a mixed economy and the balance of private to publicly owned assets will be driven by the government of the day. Even if we end up publicly owning the assets, we'll need to borrow from banks and pay private businesses for the equipment and labour to install the assets. It also makes sense to me to leave the decommissioning liabilities with them. 

A fair taxation system on profits from generation, transmission and distribution will give us national income and leave the challenges of operating the assets to others. To be frank we can't set up a publicly owned industry on the scale required overnight even if we wanted to.

In the case of the Scotwind auction, the projects won't all come on line at once, it will take a couple of decades.

[Theyellowbox]

1 hour ago, Saltire said:

This forum is absolutely about debate, but I'm not sure if you've fully appreciated the scale of this auction round. The figure awarded are for 25GW of offshore wind generation capacity, 5 or 6 times Scotland's peak demand. The capital cost for offshore wind is coming down quickly but recent capital costs are between £2m and £4m per MW installed. Extrapolating this:

Total Capital costs £50bn - 100bn

Scotland's GDP in 2020 was around £150bn

Scotland's (understated in my opinion) tax revenue in 2019  was around £12bn

I'm not sure where we would borrow the money required to invest on that scale on top of everything else that needs to be done in the energy transition and ongoing capital and revenue investment elsewhere. However, like our oil and gas, this resource is a bankable asset when it comes to borrowing in the bond markets

It seems to me that a fair tax regime to take revenue from these resources (and address fuel poverty) is a lower risk than trying to do it all ourselves in the public sector. Doing that is a legitimate view, but perhaps a much more difficult funding model. The key here is surely to reap the rewards of a sustainable energy source that allows Scotland to export a colossal energy surplus for income and pioneer large scale energy storage of this immense resource.

I have been involved in previous rounds of offshore auctions but not this one.

 

 

 

Absolutely spot on. There is no way Scotland could either financially or politically afford to solely invest in these projects. We COULD borrow money if we were an independent nation, but would the public accept the level of investment required in order to get a faily decent return, but over 25-30 years? I doubt it.

What could/should be a sensible 'investment' by the government would be to both take a small minority stake in some of these projects at inception and sell down stakes once financial close is reached. The proceeds then become a self funding development fund. Of course, that's politically difficult too. As above, getting the tax revenues from these assets is by far and away the safest and most palatable return for the government.

The perception is that offshore windfarms are a simple project that is only a few million pounds as per the first generation onshore windfarms, but these offshore windfarms are absolute beasts. Not even the large companies building them can afford them solely.

[Saltire]

2 minutes ago, Jim McLean's Ghost said:

Even at a pitiful margin the energy companies will recover their outlay in less than a decade.

It is clearly being sold off on the cheap.

That's not how it works, the projects are developed based on generating a return over the life of the assets. On the scale that we're looking at here, there will be a huge amount of debt used to fund the schemes, simple payback is never used to justify them or they wouldn't fly. There will a required rate of return based one each participants' hurdle rate and in theory as long as the net present value of the project is positive for the asset's life you are making your return servicing your debt and making a profit from it. These rates will be quite low in today's debt market and will be paying our pensions in the future as well as keeping the lights on.

There is no reason why a state owned company couldn't be a share holder and boost the public purse. There will be a sell off of shares in a number of these schemes as they progress through development.

[Caledonian1]

12 hours ago, Detournement said:

All we are getting is £700m. For assets that produce £5 billion a year.

One of the few things to be politically optimistic about for the future was using our natural resources to finance building a better country. That's gone now. BP, Shell et al will get the benefits and we will get the bills. 

I am really sorry I have missed this - I was focusing on the Scottish Infrastructure thread for discussion on ScotWind but its been brought to my attention that you are embarrassing yourself on here too. 

You clearly know nothing about ScotWind and the unbelievable opportunity that this is for the Scottish economy but I have to admit I did have a chuckle with work colleagues this morning when I told them there was one guy (assuming?) on a fitba forum I frequent who was angry that Nicola Sturgeon had sold off another scottish resource for peanuts (like Maggie did with NS oil).  One question I got back from a colleague was...".can you ask this guy when the wind is likely to run out as I have a mortgage to pay off " I look forward to your answer and will pass it on.

[DeeTillEhDeh]

I am really sorry I have missed this - I was focusing on the Scottish Infrastructure thread for discussion on ScotWind but its been brought to my attention that you are embarrassing yourself on here too. 
You clearly know nothing about ScotWind and the unbelievable opportunity that this is for the Scottish economy but I have to admit I did have a chuckle with work colleagues this morning when I told them there was one guy (assuming?) on a fitba forum I frequent who was angry that Nicola Sturgeon had sold off another scottish resource for peanuts (like Maggie did with NS oil).  One question I got back from a colleague was...".can you ask this guy when the wind is likely to run out as I have a mortgage to pay off " I look forward to your answer and will pass it on.

The wind will stop on this thread when H_B stops spouting his economic illiteracy.

[Caledonian1]

28 minutes ago, DeeTillEhDeh said:

7 hours ago, Caledonian1 said:

I am really sorry I have missed this - I was focusing on the Scottish Infrastructure thread for discussion on ScotWind but its been brought to my attention that you are embarrassing yourself on here too. 
You clearly know nothing about ScotWind and the unbelievable opportunity that this is for the Scottish economy but I have to admit I did have a chuckle with work colleagues this morning when I told them there was one guy (assuming?) on a fitba forum I frequent who was angry that Nicola Sturgeon had sold off another scottish resource for peanuts (like Maggie did with NS oil).  One question I got back from a colleague was...".can you ask this guy when the wind is likely to run out as I have a mortgage to pay off " I look forward to your answer and will pass it on.

The wind will stop on this thread when H_B stops spouting his economic illiteracy.

excuse my ignorance but H_B?

[Detournement]

We have sold the economic rights to renewable energy power by wind in most viable offshore locations.

The wind obviously remains. What is lost is Scotland's potential to use our renewable assets to invest in increasing the standard of living for ordinary Scots. 

 

[Caledonian1]

12 minutes ago, Detournement said:

We have sold the economic rights to renewable energy power by wind in most viable offshore locations.

The wind obviously remains. What is lost is Scotland's potential to use our renewable assets to invest in increasing the standard of living for ordinary Scots. 

 

Not exactly sure what you mean there (maybe just badly worded)

This is indeed a huge opportunity for the economy of Scotland and as such for the benefit of the people of Scotland. Thousands of jobs will be created in Scotland whether thats in offices in Westhill, Aberdeen, Edinburgh, Glasgow, thousands of jobs will be created around ports and harbours where fabrication and O&M will be based and the wider supply chain will benefit in opportunities for engineering, manufacture and other technologies.  There will be spin off industries created as not all the electricity will go directly into the Grid - both TOTAL (Flotta) and Vattenfall have ambitions for offshore production of hydrogen - something Scotland can lead on and create even further export opportunities.  I dont see the downside.

 

This round was initially expected to deliver around 10 or 11GW and its awarded 24.5GW....a bigger opportunity than many dared expect.  Soon there will be further announcements regarding INTOG (decarbonisation of oil and gas assets utilising floating wind) this will bring many more nearer term opportunities to the Scottish supply chain (and indeed act as a fantastic test bede for the larger ScotWind windfarms)

 

Edited January 18, 2022 by Caledonian1

[Saltire]

56 minutes ago, Detournement said:

We have sold the economic rights to renewable energy power by wind in most viable offshore locations.

The wind obviously remains. What is lost is Scotland's potential to use our renewable assets to invest in increasing the standard of living for ordinary Scots. 

 

We certainly have not. We now have the potential to tap into the cheapest source of energy available to us which can bring down the cost of energy to our homes and businesses, it opens up the possibility of locating massive data centres and other major technology employers here. Manufacturing looks for cheap (and increasingly) clean energy and guess what we'll have in abundance? Storage technologies are advancing as well so we will be able to smooth out the peaks and troughs and perhaps export tertiary fuels.

In order to get our surplus power to the overseas market, we need investment in large scale HVDC links costing £billions to construct and operate. The scale of investment cost is almost as mind boggling as the scale of the resource.

How would we deliver this purely in the public sector either from a standing start or over what period? I have worked in the energy sector for decades and the scale of this is remarkable. It took a long time and a lot of money to establish the publicly owned energy sector in the 20th century in a very different landscape. I'm not saying it can't be done but how would it be done and who would do it?

I'm not a disciple of Adam Smith or trickle down economics but although we won't have the bulk of manufacturing jobs, the construction activity and ongoing operation and maintenance of the assets will generate large amounts of economic activity in Scotland for decades to come. 

 

[Detournement]

1 hour ago, Caledonian1 said:

Not exactly sure what you mean there (maybe just badly worded)

This is indeed a huge opportunity for the economy of Scotland and as such for the benefit of the people of Scotland. Thousands of jobs will be created in Scotland whether thats in offices in Westhill, Aberdeen, Edinburgh, Glasgow, thousands of jobs will be created around ports and harbours where fabrication and O&M will be based and the wider supply chain will benefit in opportunities for engineering, manufacture and other technologies.  There will be spin off industries created as not all the electricity will go directly into the Grid - both TOTAL (Flotta) and Vattenfall have ambitions for offshore production of hydrogen - something Scotland can lead on and create even further export opportunities.  I dont see the downside.

 

This round was initially expected to deliver around 10 or 11GW and its awarded 24.5GW....a bigger opportunity than many dared expect.  Soon there will be further announcements regarding INTOG (decarbonisation of oil and gas assets utilising floating wind) this will bring many more nearer term opportunities to the Scottish supply chain (and indeed act as a fantastic test bede for the larger ScotWind windfarms)

 

Aye she sold more power for less money than was expected. 

The manufacturing process was excluded from the license agreements. The corporations awarded licenses are under no obligation to manufacture in Scotland or provide jobs. They agreed to a non binding pledge about spending in Scotland that can easily be fulfilled by she'll companies if not totally ignored. 

 

[topcat(The most tip top)]

I know a lot less about Offshore engineering than I do about economics but it seems obvious that while the powerful combination of cutting edge auction theory and hindsight could have squeezed marginally more cash for the Scottish Government out of this deal but to suggest that these assets were massively underpriced but yet nobody was willing to bid more seems extraordinary.

 

 

[spongeheid15]

A see Nippy wants the EU flag to continue to be flowing at the parliament every day, petty politics again (should be the union flag) rather than address the NHS crisis, education, and streets in here own city being rat infested the list could go on. Still the sheep follow. 

[spongeheid15]

[welshbairn]

They could have built three new hospitals for the price of that EU flag, disgraceful.