Just how well is Scottish Enterprise doing? You wouldn’t imagine anything other than unallowed success from the latest report from the Scottish Investment Bank, the investment arm of Scottish Enterprise.
A press announcement last week tells us it has invested £52.4 million into 133 Scottish companies during 2015-16. This, says SE, has helped to support growth companies at various stages, from seed through to those scaling up for international expansion.
During 2015-16, SIB says, it supported Scotland’s strong focus on renewable energy through £9.85m of investment into 10 marine and community renewable energy, through the Renewable Energy Investment Fund (REIF) delivered on behalf of the Scottish Government, leveraging £33m additional private and public sector investment.
Not a blemish, then? Well, not quite true.
The past month brought confirmation that Scottish Enterprise had lost its £15.2 million investment in Aquamarine, a wave energy company that went bankrupt last year.
This followed the loss of a £16.3 million investment in Pelamis, another wave energy company, which was biggest write-off in the agency’s 25 year history.
Edinburgh-based Aquamarine Power called in administrators, blaming the current economic climate for the decision.
The move came only weeks after it had been awarded a £580,000 grant from the European Union to help it accelerate the development of commercial wave energy technology.
Pelamis, another wave power technology firm, went under last November, calling in administrators after failing to secure development funding.
Wave power was the great renewable energy white hope of the SNP administration. Much hype surrounded the wave power projects.
While the focus has now shifted to subsea wave power technology, these failures have blown a great hole in the wave power story – with all too little discussion as to what went wrong.
But life moves on. Kerry Sharp, head of the Scottish Investment Bank, says, “It’s been a very good year for the Scottish Investment Bank. The results illustrate the impact that our activity is having on the Scottish economy, both in terms of actual investments made and the support we’re providing to companies in helping to prepare them for investment”.
And economy minister Keith Brown, added, “I welcome the positive performance delivered by the Scottish Investment Bank, which is continuing to support early-stage innovative companies to access risk capital investment, providing equity investment alongside private sector partners. “
But the collapse of Pelamis and the demise of Aquamarine Power had a near terminal effect on Scotland’s marine power sector, with the effect that Scottish Energy Minister Fergus Ewing stepped into to set up a separate wave energy quango, Wave Energy Scotland, managed by Highlands Enterprise.
Scottish Enterprise reported that while it had achieved seven out of eight of its ‘business plan milestones’ last year, the one milestone that it failed to achieved was in the offshore renewable energy sector.
SE admitted that it had failed to ‘secure commitments to major infrastructure, demonstration projects and supply chain developments that help realise Scotland’s competitive advantage in Offshore Renewables.
During 2015-16, SIB committed £9.85 million of investment into 10 marine and community renewable energy projects through the Renewable Energy Investment Fund (REIF).
A summary of lessons learnt would have been useful.