Partnership agreed to pursue Shetland Energy Hub to boost the economy

A Shetland partnership has agreed to develop an “Energy Hub” focussing on renewables to boost the economy.

Shetland Islands Council and the Oil and Gas Technology Centre (OGTC) have announced today (Wednesday) they will work together on the concept to deliver clean, sustainable energy for local consumption and export to the UK.

It will focus on using renewable energy to power offshore oil and gas platforms while also producing industrial quantities of hydrogen.

While project backers have hailed its “massive” opportunities, campaigners opposed to onshore windfarms claim it will lead to “further industrialisation” of the landscape.

The announcement comes just a week after SSE Renewables approved a final investment of almost £600 million in the Viking Energy windfarm project.

Although the Viking scheme is said to be running “in parallel” with the energy hub, both projects depend on an interconnector going ahead, connecting Shetland with the UK’s energy grid.

The hub is hoped to make West Shetland oil and gas assets achieve carbon net zero targets by 2030 as well as providing five per cent of the UK’s low carbon energy by 2050.

Project leaders say it is an ambitious concept, marking a shift from Shetland’s traditional energy industries, with the hope to benefit the community, provide jobs and energy security, both locally and nationally.

SIC leader Steven Coutts said: “This is exactly the boost that our economy needs at this time.

“I am delighted that the project has moved so fast since the council set it up earlier in the year as the opportunities are massive and the engagement is very strong.

“It is particularly important for our young folk and the wider community as we look to develop our workforce into the future.”

SIC chief executive Maggie Sandison added: “The hub’s aim is to provide local communities and industry access to clean energy, reduce emissions and maximise the value of the region’s oil and gas sector during energy transition.

“This project will create sustainable local and regional employment, which is of paramount importance in these difficult times.”

The next stage for the project is a period of planning, early stage concept engineering, research and studies. It will run for two to three years before any investment decisions are taken.

Colette Cohen, chief executive of the OGTC said: “Energy hubs are an exciting concept, which have the potential to accelerate the transition of our industry to a net zero future, while also supporting the UK’s net zero ambitions.

“Our objective at OGTC is to reduce the cost of developing and deploying technology to enable and accelerate the energy transition.

“The energy hub concept is a priority, working in partnership with industry, the regulators and research organisations, it will accelerate the development of key technology to create an integrated energy future for Scotland and enable the region to transition to a hydrogen economy.”

Douglas Irvine, project lead for the SIC said: “An essential part of our ambition is to ensure that the Shetland community’s energy requirements are integrated into the project, and community-scale schemes are encouraged as well as industrial-scale ventures.

“The interconnector between Shetland and the Scottish mainland is important for the project, but only a part of a much wider integrated renewable energy solution for Shetland and for the region”.

Campaigners’ concerns

Sustainable Shetland, which was formed in opposition to the Viking Energy windfarm project has raised fresh concerns about the energy hub.

Campaign chairman Frank Hay said alternative proposals for a gas fired power station remained a “far better” use of oil and gas technology than the hub’s proposals

Mr Hay also said he felt the cost of the interconnector would be “prohibitively expensive” at a time when oil and gas is trying to cut costs.

It might be worth pursuing hydrogen production as that would not necessarily require
an inter-connector to the mainland,” he addd.

“However, hydrogen has yet to make a much of an impact as an energy source and is not very competitive cost wise.

“This announcement, coming days after SSE announced their investment decision,
would appear to be a further PR exercise to boost support for the inter-connector.

“It would seem that the Shetland Islands Council will not be happy until they have
covered most of our island with wind turbines.

“Perhaps they should focus more on helping the beleaguered tourism sector rather than risking further damage to it by industrialisation of the Shetland landscape.”


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