Energy fund potential in Scotland
- Published on Thursday, 16 February 2012 09:16
- Posted by Scott Buckler
The First Minister has revealed the potential impact of the energy economy on the finances of an independent Scotland, describing it as the source of Scotland's "reindustrialisation"
Speaking to an audience of academics, students and members of the public at the London School of Economics, Alex Salmond revealed that in the first twenty years of an independent Scotland an energy fund could generate almost £30 billion.
The First Minister also gave details of how - had Scotland had full fiscal control even since 1979 - the nation would now have assets worth between 87 to 117 billion pounds.
The speech is the third in a series given by the First Minister south of the border over the last month.
Mr Salmond said:
"Under independence we would make the best use of our unparalleled energy resources. We have 25 per cent of Europe’s tidal power potential, 25 per cent of its offshore wind potential and 10 per cent of its wave power potential - not bad for a nation with less than 1 per cent of Europe’s population.
"Scotland has a huge competitive advantage. We will be able to produce energy better and cheaper than anywhere else – and in deeper waters. Reform Scotland estimates that as a result of our renewable electricity target Scotland would export half the electricity generated by 2020 - increasing Scottish exports by two billion pounds a year, equivalent to around 17 per cent of Scottish manufacturing exports to the rest of the UK.
"And while renewables will be the source of Scotland's reindustrialisation, in value terms there is at least as much oil and gas still to come out as has already been used - at least 40 years of oil and gas reserves.
"We still have an opportunity to establish an energy fund.
"If Scotland had been independent in 1979, oil revenues could have reduced our public sector debt from 39 per cent of GDP in 1979 to zero per cent by 1983-84, and we would then have continued to run budget surpluses throughout the late 1980s.
"If we had had been able to establish a sovereign wealth fund as North Sea oil revenues started to come on stream, then it is likely that Scotland would currently have financial assets worth anything from 87 billion pounds to 117 billion pounds.
"The debate about independence is about looking forward and creating a better future for Scotland. With that future in mind, we still have an opportunity to establish an energy fund to benefit future generations.
"Even just one billion pounds a year - less than 10 per cent - invested over 20 years, would create a fund for Scotland worth almost 30 billion pounds.
"An independent Scotland would pursue policies of ambition and responsibility. We would use Scotland’s natural resources and skilled workforce to build a sustainable economy.
"The rest of the UK has much to gain from the emergence of a secure, prosperous ally to its north. An independent Scotland would seek to make a responsible contribution on the European and world stage – and that would benefit all of the nations of these islands."