The UK Government may re-examine a decision not to release a £191 million fund that could be used to help Tayside and Fife capitalise on the renewables market, it has emerged.
Chancellor George Osborne said he would have further discussions with First Minister Alex Salmond about the fossil fuel levy, which could be used to start work on potential projects in Dundee and Methil.
The fund is held in London and has been earmarked for the promotion of renewable energy sources north of the border, but cannot be accessed without a corresponding cut in Scotland’s block grant.
The Comprehensive Spending Review last October contained an offer that would have seen up to £250 million go into a future green investment bank as compensation for the cash but Mr Salmond rejected the offer, accusing the Treasury of “sleight of hand” as he believes Scotland is entitled to a share of those funds already.
The devolution of the Crown Estates, which is also seen as important to Scotland’s renewable energy future, was also discussed when Mr Salmond met Mr Osborne.
A UK Government spokesman said the Chancellor had ruled out revisiting the windfall tax on the North Sea oil industry, although he did say he would consider measures to mitigate some of the impact.
On corporation tax, another of Mr Salmond’s demands, the Chancellor said he would await the decision of a consultation taking place in Northern Ireland before coming to any decision.
No commitment was made on the devolution of excise duties or the Crown Estates. Mr Salmond also met energy secretary Chris Huhne to discuss the issue.
Ahead of that meeting, Mr Salmond said, “A crucial power we must gain is responsibility for the Crown Estate, which means we can benefit from the riches of our own waters.
“In particular, we can licence marine renewable energy projects, both to stimulate green industry and to ensure that local communities benefit from natural resources.”
Scottish Lib Dem leader Willie Rennie also visited London on Monday to meet business secretary Vince Cable for discussions about Scotland’s renewable future.
The Mid Scotland and Fife MSP said he had pressed the case for the green investment bank being based in Scotland.
He added, “I also pointed out the huge potential for renewable energy in Scotland and made clear that it is crucial the green investment bank has a focus on that potential in Scotland.”
Mr Salmond was continuing his visit to London today with a meeting with Deputy Prime Minister Nick Clegg.
Photo by Flickr user phault.