Renewables Obligation (Scotland) Order 2009 - inflation indexation changes: island communities impact assessment

Determination

In developing this ICIA, the Scottish Government has determined that changes to the inflation indexation of the Renewables Obligation (Scotland) Order 2009 are not likely to have an effect on island communities that is significantly different from its effect on other communities across Scotland. Similarly, it is not anticipated that there will be significant effects on a specific island community compared to other island communities.

Renewable energy projects are distributed across both mainland and island areas, and consultation responses did not highlight impacts unique to island communities.

Where higher CAPEX costs on the islands may affect project financing, we consider that additional support is available to island communities including through the Carbon Neutral Islands Financing Roadmap (2025–2028), the National Islands Plan Update (2025), and the Area Based Scheme. These policies provide tailored support for islands and rural areas, ensuring that their needs are addressed within broader decarbonisation and energy transition plans which could help mitigate against any potential impacts of this policy change.

There is limited evidence island communities would experience impacts of this policy change differently to other communities. One possible difference has been identified alongside a proposed mitigation. Our assessment has therefore not produced evidence that island communities will be disproportionately disadvantaged.