Renewables investment plan faces delivery risks

A Scottish Government plan to boost the offshore wind supply chain is making slow progress and faces multiple risks to achieving its aims.

The government set up the five-year Offshore Wind Investment Programme (OWIP) in 2023. It aims to spend £500 million of public money to speed up building of the port infrastructure and manufacturing facilities needed to support Scotland's offshore wind development projects. So far, only £141 million has been committed across 17 projects due to reasons such as reduced investor confidence and wider regulatory issues. There is currently no clear plan for what will happen beyond 2028/29.

The government put in a place a collaborative investment approach with its delivery partners to make the best use of public money. However, this was significantly weakened after an early data breach. Wider governance issues, including funding, project monitoring and risk management have also hampered efficient delivery of the project.

OWIP is broadly on track to achieve its aim of generating three pounds in private investment for every public pound spent, with £413 million secured to date. However, most of OWIP’s investments have been grant-based rather than loans or equity in companies. This limits the potential to get money back and potentially increases costs to the public. Most of the private investment relates to a single subsea power cable manufacturing plant in the Highlands.

Stephen Boyle, Auditor General for Scotland, said:

The Scottish Government’s project to stimulate investment in offshore wind infrastructure has made some progress, but it is slow going and there are clear risks to the programme. The government must address these quickly.

'Strengthening the programme's governance and delivery arrangements and developing a clear plan for the future will help reduce uncertainty for delivery partners and investors, and give the programme the best chance of being successful.