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| Version 2 | Version 3 |
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| Osborne unveils £103m renewables funding for Scotland | Osborne unveils £103m renewables funding for Scotland |
| (about 1 hour later) | |
| Chancellor George Osborne has announced an extra £103m of funding for renewable energy in Scotland. | Chancellor George Osborne has announced an extra £103m of funding for renewable energy in Scotland. |
| The money from the Fossil Fuel Levy was additional to the Scottish government's budget, but within the UK's overall spending plans and contingencies. | The money from the Fossil Fuel Levy was additional to the Scottish government's budget, but within the UK's overall spending plans and contingencies. |
| Scotland's Finance Secretary John Swinney said the funds were "long-awaited" but welcome. | Scotland's Finance Secretary John Swinney said the funds were "long-awaited" but welcome. |
| Accompanied by Chief Secretary to the Treasury Danny Alexander, Mr Osborne made the announcement in Easter Ross. | Accompanied by Chief Secretary to the Treasury Danny Alexander, Mr Osborne made the announcement in Easter Ross. |
| Friends of the Earth Scotland has also welcomed the new deal, but said it was a "small part" of a larger effort to reduce carbon emissions and the would be a challenge in spending the money appropriately. | |
| The UK and Scottish governments have reached an agreement on accessing funds from the Fossil Fuel Levy, a tax paid by suppliers of non-renewable energy sources. | The UK and Scottish governments have reached an agreement on accessing funds from the Fossil Fuel Levy, a tax paid by suppliers of non-renewable energy sources. |
| It currently holds about £206m. | |
| Under the deal, £103m will go towards Scottish renewable energy projects, including wave and tidal schemes. | |
| The remaining £103m will be made available to support the capitalisation of the £3bn UK-wide Green Investment Bank. | |
| The fossil fuel levy was introduced in Scotland in 1996. | |
| It was, in essence, a tax on carbon, designed to raise money from traditional energy sources in Scotland to invest in renewable power. | |
| But in 2002 another environmental tax was introduced, the Renewables Obligation. | |
| For several years the two processes ran in tandem, generating a surplus which presently stands at £206m. | |
| The money has been sitting in a bank account in London, to the ire of nationalists who argued that these were Scottish funds which should be released and spent on Scottish energy. | |
| Their argument seemed to be gaining traction when, in May 2010, the coalition agreement between the Conservatives and Liberal Democrats agreed to "review the control and use of accumulated and future revenues from the fossil fuel levy in Scotland." | |
| Turning that review into a concrete agreement was complicated, partly because the money had been accounted for by the Treasury in its overall budget. | |
| Handing it over would have involved a cost elsewhere, and therefore, UK ministers argued, would require a proportionate cut in Scotland's overall budget. | |
| To the delight of the Scottish government, that position has now been abandoned and a compromise has been reached. | |
| An amount equal to half of the money in the account, £103m, will be transferred to Scotland for spending on renewables without any reduction in the Scottish budget. | |
| For arcane accounting reasons, this money does not technically come from the fossil fuel levy account itself but the Treasury is keen to point out that it has been found from existing UK government resources and will not require any additional borrowing. | |
| The other £103m will be used as capital for the UK's new Green Investment Bank, while money raised in future - forecast at around £40m over the next few years - will be split equally between the two governments. | |
| Mr Osborne said the UK government was committed to creating jobs across Scotland - particularly in the green energy sector. | Mr Osborne said the UK government was committed to creating jobs across Scotland - particularly in the green energy sector. |
| He said: "It's great news that we have been able to cut through the arguments and the wrangling with the Scottish government that have stopped this money being invested in the past. | He said: "It's great news that we have been able to cut through the arguments and the wrangling with the Scottish government that have stopped this money being invested in the past. |
| "It shows how serious the UK government is in its support for Scotland's green future." | "It shows how serious the UK government is in its support for Scotland's green future." |
| Mr Alexander added: "The UK government is strongly committed to supporting the growth of this sector in Scotland in the long term." | Mr Alexander added: "The UK government is strongly committed to supporting the growth of this sector in Scotland in the long term." |
| The Scottish government has been calling for money to be released from the Fossil Fuel Levy, which is held by Ofgem, so investments can be made in onshore and marine renewable projects. | The Scottish government has been calling for money to be released from the Fossil Fuel Levy, which is held by Ofgem, so investments can be made in onshore and marine renewable projects. |
| Mr Swinney said: "For too long Scotland's money has been sitting unspent in an Ofgem account in London." | Mr Swinney said: "For too long Scotland's money has been sitting unspent in an Ofgem account in London." |
| He added: "Scotland has the natural renewables resources to become the green energy powerhouse of Europe using all forms of renewables including hydro, wave, tidal, onshore and offshore wind." | He added: "Scotland has the natural renewables resources to become the green energy powerhouse of Europe using all forms of renewables including hydro, wave, tidal, onshore and offshore wind." |
| Mr Osborne made the announcement at a former oil rig construction yard at Nigg. | Mr Osborne made the announcement at a former oil rig construction yard at Nigg. |
| Last month, it was revealed the site was to become a service hub for the energy industry. | Last month, it was revealed the site was to become a service hub for the energy industry. |
| Inverness and Aberdeen-based Global Energy Group purchased Nigg from KBR and the Wakelyn Trust for an undisclosed fee. | Inverness and Aberdeen-based Global Energy Group purchased Nigg from KBR and the Wakelyn Trust for an undisclosed fee. |
| The company intends to develop the 238-acre (96.14 hectares) site to meet contracts from the oil, gas and marine energy markets. | The company intends to develop the 238-acre (96.14 hectares) site to meet contracts from the oil, gas and marine energy markets. |
| The firm expects to employ 2,000 people by 2015. | The firm expects to employ 2,000 people by 2015. |
| First Minister Alex Salmond travelled to Nigg to make last month's announcement. | First Minister Alex Salmond travelled to Nigg to make last month's announcement. |
| He also confirmed funding of £1.8m from Highlands and Islands Enterprise (HIE) - to help transform the site into what Scottish government sources call a "multi-use modern energy park". | He also confirmed funding of £1.8m from Highlands and Islands Enterprise (HIE) - to help transform the site into what Scottish government sources call a "multi-use modern energy park". |
| Nigg is expected to compete for work with Ifab, a new yard in nearby Invergordon opened by Aberdeen and Invergordon-based Port Services Group. | Nigg is expected to compete for work with Ifab, a new yard in nearby Invergordon opened by Aberdeen and Invergordon-based Port Services Group. |
| Per Hornung Pedersen, chief executive officer of Edinburgh-based developer Pelamis Wave Power, said the funding was a welcome boost. | |
| He said: "Wide scale commercial deployment of marine renewables will be delivered by substantial high-value manufacturing activity. | |
| "Pelamis Wave Power are currently planning for the serial production of Pelamis wave energy machines and we welcome the confidence this sort of support brings. | |
| "The majority of the capital expenditure involved in the manufacture of a Pelamis machine is currently spent in the UK, and all the design, fabrication, and assembly of our machines is done in Scotland - so we are well aware of the potential economic opportunity in this sector." | |
| Francis Stuart, Friends of the Earth Scotland's policy officer, said the money had been a long time coming, but was welcome. | |
| He added: "The challenge now will be to ensure that it is used in the best and most appropriate ways, to support Scotland's vast renewable potential, and help fund a just transition to a low carbon economy in Scotland. | |
| "While this funding will make a welcome contribution to progress towards meeting Scottish and UK carbon reduction targets, it is still a small part of the overall picture. | |
| "The Scottish government needs to significantly increase investment in energy efficiency and demand reduction measures through, for example, reversing its recent cuts to walking and cycling budgets and fully funding a nationwide, free and universal home insulation scheme. | |
| "If it doesn't, then we have little confidence that it will meet its legally binding carbon reduction targets." |