Business rates cap averts renewables disaster in Scotland

Holyrood moves to curb possible 650 per cent rate hike for renewable energy schemes

The Scottish government has capped a massive hike in business rates bills which threatened to undermine ambitious plans to boost plans to boost renewable energy generation north of the border.

According to Scottish Renewables, smaller hydro, solar and wind schemes faced business rates increases of up to 650 per cent as part of a wider revaluation of the property tax launched by the Holyrood government in December.

However Dereck Mackay, finance minister in the Scottish Nationalist Party administration has announced that rate increase next year for a host of small businesses will be capped at 12.5 per cent.

The announcement, which benefits nearly 10,000 small firms across Scotland, is part of a wider fiscal package.

In addition, the minister announced further support for companies working in the renewables sector with continuing relief for community owned businesses.

And district heating schemes will receive 50 per cent rates relief for the next 12 months.

Hannah Smith, policy manager at Scottish Renewables, said that the package was broadly welcome but expressed concern about the rating picture beyond next year.

“Businesses have no idea what their bills will be from April 2018, so it is important that government, the assessors and industry work together to review the way values are calculated and ensure that renewable energy projects are taxed in a fair and proportionate manner from next year.

“It is disappointing that there will be no specific relief for small-scale onshore wind and solar generators, which are also facing very large increases, but the relief for new-build schemes and those with an element of community investment is welcome.”

In a separate development, north of the border Conservatives have backed the Scottish government’s target that half of the country’s energy should be generated from renewable sources by 2030.

The Scottish Tories’ environmental policy document, published yesterday, proposes the introduction of a Scottish Renewable Energy Bond, which will enable communities to pool ownership of renewables and local energy systems.

The Conservatives, which have been the main opposition party north of the border since last year’s elections to the Scottish Parliament, have also proposed that up to 10 per cent of the Scottish Government’s capital budget should be allocated to energy efficiency measures.