Landmark case begins weeks after small hydro operators were hit with fresh retrospective bills
A decade long legal fight between Scotland’s small hydropower sector and the Scottish Assessor reaches its climax this week in Edinburgh as the Upper Tribunal for Scotland begins hearing the long-running case over the way small hydro schemes are valued for business rates.
The lead case — Connell Renewables Limited v. The Assessor for Highland and Western Isles Valuation Joint Board — opens before Lord Young today (Monday 10th November) and is scheduled to run for five days.
- Case: Connell Renewables Limited against The Assessor for Highland and Western Isles Valuation Joint Board
- Court: The Upper Tribunal for Scotland
- Venue: George House, 126 George Street, Edinburgh EH2 4HH
- Dates: Monday 10th November 2025 (scheduled for 5 days)
- Starting Time: 10.00am on each day
The hearing marks the culmination of a complex and costly legal battle dating back to the 2017 revaluation, when hundreds of small hydro operators saw their rateable values soar, in some instances to levels higher than wind farms eight times their generating capacity.
Those inflated valuations, on which business rates are based, have been challenged ever since by Alba Energy, which represents hydro operators in Scotland.
The case returns to court amid fresh controversy. In recent weeks, scores of hydro sites have been hit with retrospective rates bills after the Assessor introduced a new valuation methodology mid-litigation.
The new approach, applied only to those operators with appeals lodged, has resulted in additional bills running into hundreds of thousands of pounds for businesses that had already paid under the old system.
One 2-megawatt hydro scheme, Inver on the Isle of Jura, for example, has been revalued at £676,000 — higher than a 20-megawatt wind farm valued at £597,000.
Alba Energy says that the new charges have been applied only to appellants, meaning those exercising their right to challenge 2023 valuations are being hit with even higher bills.
According to correspondence from the Assessor’s office, Inver was told the additional charge would not be pursued if it withdrew its appeal against the 2023 valuation.
Operators say the disparity highlights a “deeply flawed and inconsistent” approach that threatens the viability of small-scale renewable generation across rural Scotland.
Alexander Linklater, Executive Director of Alba Energy, said: “After more than ten years of legal wrangling, this is finally the moment of truth. We hope the Tribunal will bring an end to this long and costly battle and restore fairness to Scotland’s hydro sector.
“These small rural businesses simply want a level playing field. The bills they are currently paying make no sense. Rateable values for hydro power average out at more than 240% those of comparable wind power.
“This is massively at odds with the green agenda and highly damaging to growth, particularly in Scotland’s fragile rural economy.
There are more than 500 small hydro schemes in Scotland, which generate enough energy to power 350,000 homes. More than 85 per cent of the UK’s hydropower is generated in Scotland and most small hydro is designed in Scotland, developed in Scotland, engineered in Scotland and built in Scotland.
