Skunnered

On top of one of VE's windmills would be pretty high!

I believe the Shetland distillery project now comes under a new company called Catfirth Ltd. http://www.shetlandtimes.co.uk/2008/08/08/blackwood-is-relaunched-to-revive-whisky-distillery-plan

It's all very well for these people to bang on about human rights, but what about the human rights of the victims?

According to this article in The Shetland Times 12 June, it appears that the cable will be able to import electricity from the grid to Shetland, if required, as well as exporting power from the windfarm to the mainland. So I don't really understand why SSE say they have to replace the Lerwick power station whether or not there is a windfarm in Shetland, because if the wind isn't blowing, we would surely get our backup from the main grid. http://www.shetlandtimes.co.uk/2009/06/12/electricity-firm-lays-out-latest-cable-plan

The middle-aged people in Shetland remember only too well what it was like in Shetland before the arrival of the oil industry, and they are very much aware of the benefits that were brought to Shetland by that industry, not just Sullom Voe, but overall. And it's very misleading for pro-windfarm people to suggest that the windfarm project would bring benefits to Shetland to equal those produced by the oil industry. As AT said, if we can have an inter-connector and establish other forms of power generation such as tidal power, then the new industry may produce a decent level of employment for some, but otherwise the employment level and general economic activity in Shetland from having a large windfarm will be fairly small. So if the oil industry fades in the future, young Shetlanders will still have a problem finding employment here. I just don't see this project as being anywhere near the god-sent replacement for the fading oil industry that a lot of people seem to think it will be.

^^As an afterthought - does anyone know if the cable is to be for one-way traffic only (i.e. export of power) or will it be able to bring power up from the mainland as well?

^^SSE have already stated that they will have to replace the power station in Shetland whether we have a windfarm or not. Presumably this is going to be required for local backup in Shetland. So Shetland won't be depending entirely upon power from the windmills, nor from the grid through the cable.

^^We might shortly be getting a comment from a Shetlink member living on Foula!

The estimates used in this report were dated April 2008. I believe that since then the estimated construction costs have increased to about £800M so that VEP's requirement would be 90% of £400M or £360M. I believe that the CT have recently considered whether they would have to increase their Equity investment from £50M to a much higher figure. This really depends upon how much investment they can find elsewhere e.g. from banks and/or investors such as Venture Capitalists. It's unlikely that the banks will give a straight loan at a reasonable rate of interest, so they may find that the cost of raising the funds is much higher than they first thought, and therefore they may decide to invest a much higher amount of their own funds as equity. At this time the sources of funding are unknown, and can't be finalised until they know if they have planning permission, so that they can put together a final prospectus to send to the banks and other potential investors. Only then will they be in a position to calculate the actual cost of financing for the project.

^^Well, it's a relief to know that they have a code of conduct!

^^Sounds like a very sensible solution to me!

It may generate more money into the SIC coffers than SVT, but it will not produce anywhere near the level of employment, nor economic activity for local businesses and the general community, that has been generated in Shetland by the oil industry. So whether we have a wind farm or not, when the oil stops Shetland will still have to come up with some sort of sustainable industry that will generate employment and economic activity, and that will probably need considerable funding from the SIC war-chest, as well as some real imagination.

^^OK, AT, so if the price per unit of electricity that SSE has to pay VE is fixed by Government, and if the price that they have to buy the ROCs from VE is also fixed by Government, then I concede this point and agree that VE's revenue is guaranteed so long as they can generate the forecasted level of electricity, or more. However there still remains the uncertainties regarding the total cost of construction, the sourcing and cost of the required financing, and how much they allow for decommissioning costs. And I still think that VE should be more forthcoming about the margin of error in their estimates, because no financial forecasts ever turn out to be bang on!

I can't speak for other people but I can explain the concerns that I have with this particular issue. Actually we have already had this discussion in this thread, but I'll explain it again. VE will get its revenue from SSE who will buy the electricity from them at a certain price. As the contract between SSE and VE hasn't been made public, then we (the public) don't know what that price per unit will be, or what it will be based on. We don't know whether it is a fixed price per unit, or whether it will be based on some formula, or based on the general price of electricity, or linked to some economic index. So at this stage we only have VE's word for it, that it is "guaranteed income". Now we also don't know whether SSE have some kind of get-out clause which would allow them to pay VE at a lower price if the general price of electricity falls, or in the event of some other economic event at some point in the future. Which it might, because we have seen a lot of commodities' prices leap in the air and fall back to ground lately, so anything could happen over 25 years. SSE is a very astute commercial organisation, whose main objective is to do the best that it can for its shareholders. When it comes to contract negotiation I'm not sure that I believe that the SIC (and their advisers) would be a match for SSE. So much for the "guaranteed" revenue. Then there's the finance costs. At the moment no-one knows how much that will be, not even VE, because they don't know where the funding is going to come from. If it's bank loans, then at this stage they don't know how much interest the banks will charge. If a large chunk comes from Venture Capitalists, they will be looking for a high return, perhaps up to 30% per annum on their investment. And of course we don't know how much of the oil fund will be needed for the SIC investment, because that will depend upon how much can be raised from elsewhere. And if the total construction costs go higher than the current estimate, which is very possible, then the total amount of required financing will be higher, and the financing costs will be higher. Then there's the de-commissioning cost at the end of the project. VE have stated that they have allowed for this, but do we know how much they have allowed, or whether it is an adequate amount to do the job properly in 25 years from now? Whatever it is, it is an amount that has to be set aside every year, and cannot therefore be included in the Profit figure. With all of these issues still to be ironed out, I cannot understand how VE can make a statement that the project will contribute £x to the Shetland economy. Surely they should be giving a bottom figure and a top figure, and explaining the likelihood of it being anywhere in between. They have already revised their estimates enormously, which is to be expected with such a major project, but they shouldn't be giving the impression that these are anywhere near definite or accurate figures. They are purely estimates, and could be well wide of the mark at this stage. So there you have it!

^^Just a suggestion: Perhaps he doesn't want yet another layer of top management and wants to have closer direct contact with his Dept. Heads. If that's the case it would seem to make sense to me to put his trust in his Heads, and they should also be able to deputise individually when he's not available. As far as the new post is concerned, surely the Capital Expenditure list the biggest issue facing the Council at the moment, and requires someone senior dedicated to it.

^^Just a thought, but can you be sure that he's not already one of "THEM".

It seems they've finally made a decision about the Whalsay ferry terminal / pier / whatever. Apparently this has been dragging on for years, now they have actually made a decision!! So that's got to be one tick in the "Better" box!

Does anyone know the precise location of the proposed site at the "Lower Staney Hill"? E.g. where would it be in relation to the Clickimin Centre, and where would the access road come from?

We seem to have wandered off the original theme of this thread onto the New Anderson High, purely innocently I hasten to add. Would it be an idea to transfer the last several postings from here to the Anderson High thread? (Mods?)

Towards the end of the article on page 5 it says "However, a joint contribution from the PE department expressed reservations about any move to Lower Staney Hill because not having their own custom-made facilities would have a detrimental impact on their ability to teach the curriculum. PE teachers fear that taking classes at Clickimin Centre would isolate pupils from the general working of the school, deny them access to a dedicated fitness suite and compromise their ability to use information technology in their classes." As I said in my previous posting, I don't know if the PE teachers know for sure that there will be no dedicated games hall at the new school if it is built at lower Staney Hill, or if they are just fearing that this might be the case. As to potential cost saving, the article makes no mention of this, as far as I can see. Also, I have no idea what is contained in the Cost Comparison Report.

Just to clarify, I get the impression from the article that if they build the school at lower Staney Hill then they would not include a games hall in the school because they could use the Clickimin Centre instead, hence the concern of the PE teachers who want to have control of all of the PE facilities in the school and not external. Now whether this is a genuine part of the plan or whether it is simply a fear of the PE teachers is not made clear in the article. anyway, if they are not building a new PE games hall inside the new school, surely that should save a little amount of money? Oh well, maybe not!

From the article in last Friday's Shetland Times (28 Aug.) it seems that they are intending to use the Clickamin hall, because the PE teachers are complaining that it will be difficult for them to teach PE properly if the games hall is not in the main school building.

I suppose what I'm really trying to say is, what they should not do, is spend £6 million (or was it £11 million) in order to not make several decisions.

^^They always pay more for their projects than anyone would expect. Maybe the contractors see them coming. Didn't they just pay £400,000 for toilets at the pier-head? I reckon you could build three houses for that amount, not just the toilets!

If they have the guts to make the right decision on the Anderson High (i.e. NOT the existing site) then I would say yes, they are better than the last lot. If they decide to build it at the Knab, then they are just as bad. Oh, of course, then there's the tunnel(?) to Bressay, and lets not forget the wind farm. Lots of opportunity to show us how good they are, if they can bite the right bullets!