European perspective

Despite regularly travelling all over Europe and visiting many projects, the commissioner admitted he was impressed by those he saw during his trip to Orkney and Shetland.

“I was invited by Shetland Council to visit Shetland and also used the opportunity to go to Orkney, as I learned two and a half years ago, during a visit to Aberdeen, about this remarkable focus on renewable energy and it being a testing platform for wave and tidal devices for companies all around the world,” he said.

During his visit, the commissioner also took the opportunity to visit Edinburgh, where he met Deputy First Minister Nicola Sturgeon and representatives from Edinburgh Chamber of Commerce.

While he was in Orkney and Shetland, Hahn visited a number of projects funded by EU structural funds. The 2007-13 Structural Funds Programmes are well under way with hundreds of projects across Scotland. Scotland benefits from two EU regional policy programmes: the Highlands and Islands of Scotland convergence programme and the Lowlands and Uplands of Scotland competitiveness programme. The latter, with a European Regional Development Fund (ERDF) contribution of €376m, covers eastern, western and southern Scotland. The programme combines a strategic focus on research, innovation and enterprise development, with geographical targeting of deprived areas in urban and rural areas. Resources have been allocated to financial engineering instruments both for investment in SMEs and in urban regeneration projects. The programme for the Highlands and Islands region, with an ERDF contribution of €122m, is focused on enhancing business competitiveness and innovation and the key drivers of sustainable growth – including research and higher education – and on assisting peripheral and fragile areas.

From these two programmes, a £20m innovation and growth programme was launched in June to support SMEs. The programme will leverage a further £30m from public and third-sector partners to deliver projects supporting economic growth across the country. It will fund projects, to be operational by autumn 2013, which demonstrate an impact on job creation by investing in business competitiveness, innovation and improving the employment opportunities of young people and people living in deprived and fragile communities.

Hahn said: “The projects I have seen in Shetland and Orkney are excellent. For instance, with the University for the Highlands and Islands, looking Europe-wide, this is a unique project, we don’t have any comparable institution. I have discussed it with the vice-chancellor and maybe there is a similar one in Australia but not in Europe.

“In Shetland, I saw an energy-efficiency project called NINES which aims to reduce the energy waste in households. I also learned that the Orkney Islands are a port where most of the cruising ships in Britain berth during the year. They had more than 70 this year, this is why they have extended the pier using European funding. The attraction of Orkney is caused by the use of their cultural heritage and their archaeological sites. This is another good example of how important quality tourism is for the European economy. That is a message I will pass to other parts of Europe and in that respect, I really admire the Orkney authorities because if a big cruising ship is berthing, there are thousands of passengers leaving the ship. It really is a logistic challenge to handle this number of people at once but again, it demonstrates opportunities and possibilities. It was important for me to see this first hand because with the European Union, it is important to have an exchange of experience and to learn from each other. Of course, it is not always possible to compare one to another but to use it as an example of what is possible. Quality tourism is one of the assets we have all around Europe but it isn’t always used in the same way it is used in Scotland.

“The traditional task of regional policy is in particular to help less developed regions to catch up and this can, and will, be done in future by the over proportionate allocation to those regions. Around 25 per cent of the European regions are less developed but they will receive around 70 per cent of our budget which expresses the idea of solidarity within the European Union but the other 30 per cent is spent in more developed regions, and why? Because the second task of regional policy is to be that financial instrument in order to implement projects, actions and initiatives which contribute to the achievement of the European goals laid downs in Europe 2020.”

The Northern Isles New Energy Solutions (NINES) is being developed by Scottish and Southern Energy (SSE) in association with a range of local stakeholders, including Shetland Islands Council, Hjaltland Housing Association and Shetland Heat Energy and Power. It aims to support Shetland’s sustainable energy future by developing and managing the electricity distribution network more effectively to allow renewable energy to play a bigger part in meeting Shetland’s energy needs.

Key aspects of the project include replacing old inefficient storage and water heaters in 1,000 homes with modern ‘smart’ storage heaters which help to balance the electricity network; adding a new electric boiler to the existing district heating system, which will be associated with the proposed medium-scale Gremista wind farm; deploying new technology on the network that will allow more small-scale renewable generators to connect to the network; introducing new commercial arrangements to encourage businesses to change the times at which they use most energy; and installing a 1MW battery, part-funded by the Department for Energy and Climate Change, at Lerwick Power Station; and NINES will help plan for the replacement of the existing Lerwick Power Station, which is nearing the end of its useful life, with a smaller station than would otherwise be required.

Orkney’s Hatston Pier officially opened in April following an £8m extension project. The pier, on the edge of Kirkwall, was extended by 160m to 385m and Orkney Islands Council said Hatston had become Scotland’s longest commercial deep-water berth. It is strategically located for a test site, run by the European Marine Energy Centre (EMEC), off the island of Eday, where a number of tidal energy devices are undergoing trials. The project received £3.2m in support from ERDF. The marine renewables industry had already started to use the existing Hatston facility in relation to the EMEC tidal test site on Eday but the existing berthing and laydown infrastructure was operating at capacity and could not accommodate additional usage. The new facility in Hatston will act as a deployment, operation and maintenance centre.

Prior to the commissioner’s visit, Shetland Islands Council said it felt the EU was not paying enough attention to Shetland’s remote situation by ignoring other important factors such as distance from markets, the high cost of living and the fact that it costs much more per head of population to provide public services. Shetland’s Regional Aid status is under threat because some indicators used by the EU show Shetland to have higher levels of economic prosperity than other parts of the Highlands and Islands.

Speaking before the visit, Hahn said: “Crucially, I will be seeing some of the projects that demonstrate the dynamism at play in Shetland. There are big changes ahead and this is a crucial time as far as planning for the next seven years is concerned. Our reforms of EU regional policy will help ensure that the funds are invested with more focus than ever before, with more strategy focus, while making the most of every region and every community’s particular assets and strengths. This should all be aimed at improving the competitiveness of Scotland’s regions and cities but most importantly, the wellbeing of its communities.”