Lothians MSP Alison Johnstone has called on the Scottish Government to take action to secure the future of Leith-based wave energy firm Pelamis.
On Friday, the Pelamis directors announced that it been forced to appoint administrators, potentially putting 56 jobs on the line. Most staff are employed in their Leith Docks facility.
The firm, which only celebrated ten years since it first pioneered wave-based electricity generation in UK waters this August, has spent the intervening years developing the “world’s most advanced wave energy technology.” But despite this, it has apparently run out of cash before it could secure a commercial scale order.
A statement released by the firm last Friday read: “The directors of Pelamis regret to announce that they have been unable to secure the additional funding required for further development of the Company’s market leading wave energy technology. As a result of this the board has reluctantly moved to appoint an administrator to assess the options for securing the future for the business and employees of Pelamis.”
They added: “The directors and employees of Pelamis are dedicated to the success of this revolutionary technology, and are committed to working with the administrator when appointed, the Scottish and UK Governments and any future partners to ensure its success.”
Despite its world leading position, the firm, along with other wave-energy generators in the sector, has struggled to get the cost of generating wave-energy cost competitive with off-shore wind.
Following a question to the Energy Minister Fergus Ewing at Holyrood, Alison Johnstone said: “Pelamis has been a global pioneer in wave technology and a leading Edinburgh company, which we cannot afford to lose. We hear so much about Scotland’s renewable energy potential but we will not reap the rewards without support to turn research into commercially-ready technology.
“Pelamis is a highly respected company which has built up a huge amount of expertise. I urge the Scottish Government to use every possible means to support this company and its employees at this uncertain time.”
However, it would appear that the Scottish Government is not prepared to intervene directly in the future of Pelamis.
In his response to Alison Johnstone, Fergus Ewing blamed uncertainty over renewable energy subsidies which are set by the Westminster government and indicated that the Scottish Government has decided to support the wave energy sector by setting up a new body called Wave Energy Scotland.
He said: “Pelamis is in administration. The Scottish Government and Scottish Enterprise have looked extremely closely at the whole situation and we believe that the best outcome is to establish Wave Energy Scotland.”
Two years ago, the future of this Leith firm looked very different.
Edinburgh North and Leith MP Mark Lazarowicz has also called on the Westminster government to intervene. In a statement released today he said: ““I have raised the urgent need to try and save Pelamis in a meeting with the Secretary of State for Scotland and contacted the UK Energy and Climate Change Secretary urging him him to act.
“Scotland and the UK have Europe’s greatest wave resources, but we run a real risk that if wave power technology isn’t given the long term guarantees of support that it needs, other countries will become the leaders in the technology.”
Sadly, it would seem the politics are moving to slowly for most of the firm. It would appear that 40 of the employees at the firm were told today that they were being laid off and would not be getting their last months pay.
@NicolaSturgeon First Minister, Pelamis Wave now laid off 40 employees. No wages being paid for month end. Disastrous for Scottish industry.
— Alan (@alan341) November 26, 2014
Sadly as of today I no longer work at Pelamis Wave Power. So ends a fantastic four and a half years, and the last tweet from here!
— Deborah Smith (@DeborahSmithPWP) November 26, 2014
A statement received from the Administrators said they had ‘no choice’ but to make 40 members of staff redundant. The remaining 16 employees, 13 in Edinburgh and three on Orkney, will continue to work with the joint administrators to help realise the company’s assets.
Blair Nimmo, joint administrator and head of restructuring at KPMG in Scotland, said: “The financial situation of the business is such that we have had to take the difficult choice of making a large proportion of staff redundant.
“We will be working with the employees and the relevant government agencies to ensure that the full range of support is available to all those affected. We would like to thank the staff for their co-operation during this difficult period.
“We will do everything we can to seek a buyer who may be able to protect the business, its skilled workforce and see the continuation of the groundbreaking advances Pelamis has made towards renewable energy production.”