Aberdeen finds the energy to look beyond oil

Aberdonians are used to seeing their city reinvented every few decades. Built on paper and textile trading in the 19th century, Scotland's granite city had to look to the sea for a living when the industries went into decline.

Aberdonians are used to seeing their city reinvented every few decades. Built on paper and textile trading in the 19th century, Scotland's granite city had to look to the sea for a living when the industries went into decline.

Now, the slow decline of the oil industry, the source of Aberdeen's most recent extraordinary boom, threatens the long-term economic future of the area. Strangely, the solution may lie in the opposite of its current emphasis on fossil fuel – sustainable energy.

A new government organisation, intended to draw expertise from the offshore oil industry to tap into the booming global market in sustainable energy, is to be set up and located in Aberdeen. Renewables UK aims to ensure that Britain captures much of the £500bn worldwide market in wind and wave power.

Projections by the World Energy Council suggest that the renewable energy industry will be worth up to £1,500bn by 2020 and, conscious that the oil bonanza is nearing an end, Scotland's third biggest city is preparing to relaunch itself as the energy capital of Europe.

The task of attracting renewable energy companies and creating thousands of jobs may seem an ambitious task for a team of six based at the Aberdeen offices of the Department of Trade and Industry. However, Aberdeen has twice before achieved world dominance. Carving out the granite that the city is built from – and creating the largest man-made hole in Europe, which can be seen from space – it was exported to pave New York and other cities.

By the 19th century, Aberdeen was thriving ontrade with the Baltic states, which led to prosperous paper and textile industries. However, by the end of the century there was a downturn in Aberdeen's fortunes as a trading port, which forced the city to reinvent itself as a deep-sea fishing centre.

As with the discovery of oil some 70 years later, the trawlers transformed the city into a boom economy. By 1908, an estimated 25,000 people out of a population of 164,000 were dependent upon the fishing industry for a living as Aberdeen grew quickly to become Europe's largest white-fish port.

By the early 1970s, Aberdeen was in difficulty again. The fishing industry, affected by changes to international quotas and the Icelandic fish wars, went into decline. Then came the discovery of oil and gas, which led to the development of the North Sea offshore industry. Once again, Aberdeen was able to rebuild.

As the city became the oil capital of Europe, the former RAF base at Dyce grew into an international airport and the busiest heliport in the world. Now, almost 30 years after the first "black gold" was pumped ashore, that industry is in a slow decline. Although present production levels are expected to continue for another 25 years or more, the number of people employed in the industry is due to fall – with Aberdeen expecting at least 9,000 jobs to go by 2016.

Rita Stephen, Aberdeen's assistant director of economic development, said: "It is right and proper that Aberdeen should be the energy capital of Europe for renewables. We have acknowledged that the oil industry is a finite resource and we need to look at sustainable development if we want to maintain Aberdeen's position as the jewel in the crown of Scotland's economy.

"The North Sea is still a rich seam from which to mine other sources of energy, such as wind, wave and tidal. It would be unbelievably shortsighted for us to ignore that opportunity.

"The oil industry has ensured good long-term employment for a large number of the population for many years but it is beginning to come to an end. In the 1970s, the North Sea was the most inhospitable environment from which anyone had attempted to extract oil, so new technology had to be developed. All the existing skills and technology we have learnt can be easily transferred to dealing with sustainable energy development."

To enhance its green credentials, the city is also campaigning for the proposed Scottish Energy Institute to be situated in the North-east. The institute, which would lead research and development of renewable energy products throughout Britain, would boost Aberdeen's dream of becoming Europe's energy capital.

Scotland is estimated to have Europe's biggest potential for wind and wave power, able to produce at least 10 times as much energy as it needs and offering huge potential for export.