Through our use of renewables obligation certificatesto incentivise commercial generation of green energy,we have positioned Scotland as one of the mostattractive long-term markets for private investment inwave and tidal power anywhere in the world.The European Marine Energy Centre, based in Orkney,also provides the world's first facility for thedevelopment, testing and accreditation of full-scale,grid-connected marine energy generation technologies.We have also awarded funding to help pioneeringdevelopers such as Pelamis, Aquamarine, Wavegenand OpenHydro to deploy and demonstrate theirinnovative wave and tidal electricity generatingdevices.Marine renewables took a major step forward in Marchwhen, following the world's first commercial wave andtidal power leasing round, developers and major powerutilities signed agreements to develop marine energyprojects capable of generating up to 1.2GW off theScotland's north coast by 2020.We are also seeking to push forward innovation inmarine power through the Saltire Prize - our £10million global challenge which has attracted interestfrom across the globe and is now open to entrants.FINANCINGWhile the recent leasing agreements for offshore wind,wave and tidal projects indicate the commitment ofmajor companies to the technologies, it is clear thatsignificant sums of private capital are needed to fullyrealise the potential of clean green energy.Scotsman Robert Fleming created one of the world'sfirst investment trusts and used it to channel thesavings of the rising British Victorian middle class intohigh risk, high return bonds, developing the railwaynetworks that spanned America.In the last century, new financial instruments andinnovative techniques were developed to exploit NorthSea oil and gas, often financed from the new resourcesfrom the OPEC countries after the 1973 oil shock.And in the 1980s the Bank of Scotland was among thefirst in converting sovereign debt to equity investmentto help South American nations emerge from theirdebt crisis.So we have faced the challenge of finding productiveuses for an influx of funds before and we can again. Wemust now create the right investment structures toproductively use the new wealth from emergingeconomies such as China.Over the past decade the surplus savings in thedeveloping economies were used by the developedeconomies to finance unsustainable asset inflation.Today we must harness that wealth to create tangibleinfrastructural development that will create real wealth,not virtual wealth, in the green economy. In Scotlandthis work is being taken forward by our recentlyestablished Scottish Low-Carbon Investment Project.In addition to our wonderful natural resources,Scotland has considerable human resources, with 40 years of world-class experience and globally-recognised expertise and skills in large-scale offshoreenergy generation in the harsh waters of the North Sea.While oil and gas will remain an important part of boththe Scottish and global economy for years to come, we are also working to transfer these skills andexperiences to the offshore renewables sector.SEIZING THE OPPORTUNITYAs world leaders gather for another G8 summit, thereis no more pressing issue than the need for the world'sdeveloped nations and emerging economies to moveswiftly towards a low-carbon future and help stem thetide of climate change that wreaks most havoc in thepoorest countries.Against that challenge, nature has providedhumankind with a further opportunity. One that offersthe chance to deploy Earth's resources sustainably -whether capturing the winds around us, channellingthe rise, fall and flow of the world's seas and oceans orharnessing the power of the sun.As national economies emerge from recession, and the demand for energy continues to rise in the face ofpeak oil and growing climate chaos, we face a perfectstorm for a renewables revolution. It is one whereScotland is determined to be in the vanguard, playingour part in a global effort to safeguard the planet forfuture generations. nBIOGRAPHYAlex Salmond has led the Scottish Government asFirst Minister since the 2007 Scottish Parliamentelections, when he was elected MSP for the Gordonconstituency in north-east Scotland. A formerassistant economist at the Department of Agriculture& Fisheries for Scotland, Mr Salmond was an oileconomist and bank economist with the Royal Bankof Scotland in the 1980s. He served as MP for Banff& Buchan from 1987 until standing down from theUK Parliament in 2010. He represented the sameconstituency as its MSP between 1999 and 2001.He was elected national convener (leader) of theScottish National Party for a second time in 2004,having previously held the post from 1990 to 2000.RENEWABLE ENERGY077SCOTLAND'SSPECIFIC TARGETFOR GREEN ELECTRICITY GENERATION IS TO MEET HALF OUR NATIONAL DEMAND FROM RENEWABLESOURCES BY2020. WE ARE ONTRACK TO MEETOUR INTERIM TARGET OF 31 PERCENT BY 2001 ""

" "BY AROUND2016, THE UK WILLHAVE LOST 15 PERCENT OF ITS GENERATING CAPACITY FROMTHE CLOSURE OFCOAL-FIREDPOWER STATIONShe UK offshore resources, in particularoffshore wind, have the potential toprovide the entire UK with its energyneeds as well as a good part of Europe.However, a range of political, economic andenvironmental factors will play a part in determiningwhether this potential is realised. Over the ten-year period up to 1973, the USA spentabout US$100 billion in today's money sending mento the moon. They did this out of curiosity, and thedesire to be first. Some considered the adventure to bea wasteful folly; others considered it to be the mostaudacious, ambitious and significant achievement inhuman history. From either perspective the difficultquestion to answer is: did they need to do this? Overthe next ten years, the UK is planning to invest overUS$100 billion to build an offshore wind energyportfolio. Many people are questioning the viability ofthis ambition, and they would be right to do so. With itscomparable scale, the moon landings have shown usthat it is possible to make the necessary investmentwithin a pre-defined timeframe to achieve a seeminglyimpossible result. However, and other than theobvious, there is a key difference between the moonlanding programme and the UK's energy infrastructureinvestment plans. The UK's way of life, possibly ouractual survival, depends on delivering a new energyparadigm, and unlike the Americans in the 1960s, theUK does not have a choice. In the immortal words ofApollo 13, failure is not an option. THE CONTEXTBy around 2016, the UK will have lost 15 per cent ofits generating capacity from the closure of coal-firedpower stations and a further 20 per cent of itsgenerating capacity from nuclear power stations. Evenin times of recession, where the UK's electricitydemand has dropped by over 15 per cent, this losswould result in a capacity shortfall of 10 per cent. Theexpectation is this shortfall will come from theinstallation of new gas fired power stations. However,concerns have been raised about the security of gassupplies, not least by UK energy regulator, OFGEM. Inaddition to this serious issue of security of power andenergy supplies, the UK also faces the monumentalAbove: Kentish Flatsoffshore wind farmOFFSHORE WIND COULD BE KEY TO ENERGY SECURITY078RENEWABLE ENERGYROB HASTINGS, DIRECTOR OF MARINE ESTATE, THE CROWN ESTATET