A surge in investment in the renewable energy sector is expected to help Scotland through the economic difficulties expected in 2009, according to the Scottish Government.

Over the past 18 months around £1bn worth of projects have been announced, with 17 projects since May 2007. Another 31 are currently under consideration, including seven new hydro and wave power proposals.

First Minister Alex Salmond expects this activity to continue and for Scotland to become a focal point in creating renewable energy projects.

He said: "There can be no better start to 2009 than for there to be a further surge in renewable investment, creating jobs now and opening the prospect of Scotland becoming the green energy powerhouse of Europe."

Last month Mr Salmond announced the details of the £10m Saltire Prize to set up a working wave or tidal power project in Scotland's waters that can produce 100GWh of electricity over a continuous two-year period, by 2015.

So far 33 firms from around the world have expressed an interest in competing for the prize.

The Scottish Government said it expects a further £1bn of investment this year, to help cope with the economic downturn.

Scotland has been praised by European Union Energy Commissioner Andris Piebalgs for its work in promoting renewables.

Mr Piebalgs said in a message to the First Minister: "I am greatly encouraged by all the work that Scotland is undertaking in promoting renewable energy, such as the creation of the Green Energy Centre and the Saltire Prize, and I look forward to continuing our constructive collaboration."

Proposals for a North Sea "supergrid" to sell energy produced in Scotland to European markets are to be discussed between representatives of Scottish Government and European Union officials.

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