A new small-scale hydro scheme on the remote Morvern Peninsula, which the local people invested their money in, has started generating electricity and revenue for the community, a month early.

The 469kW scheme on the lonely Abhainn Shalachain river near Lochaline on the shores of the Sound of Mull could generate enough electricity to run 350 homes.

It will provide the community of a few hundred, who live on Morvern with additional regular income by selling power to the grid.

Perth hydro developer Green Highland Renewables (GHR) has commissioned the scheme which is being hailed by the Climate Change & Land Reform Minister as an example of what can be achieved on Forestry Commission Scotland (FCS) land by local communities.

Last year the people of Morvern became the first community group in Scotland to invest their own money in a hydro scheme on land managed by Forestry Commission Scotland. In total the Morvern Community Development Company and Morvern Community Trust invested £30,000 in the development.

Private investors in this type of project would normally look to get a return of between 8% and 12% on their investment and the community will look for something similar.

In addition the FCS ensures the community gets a free 5% stake in the project, plus the standard £5000 per annum per megawatt community benefit payment that is associated with renewable projects. At nearly half a megawatt, the Morvern project will earn about £2500 a year for the community from this source alone.

Welcoming the news Dr Aileen McLeod, The Scottish Government's Environment, Climate Change & Land Reform Minister said:

"This is an excellent example of how Scotland's National Forest Estate is helping put communities at the heart of their own prosperity. Through this partnership, public land is being used to generate renewable energy and provide an income to a rural community. This is positive news, empowering the community to take an economic stake in new developments."

Speaking on behalf of the Morvern Community Development Company and Morvern Community Trust, Angus Robertson, said:

"We believe strongly in community ownership and development of our own natural resources. We would have liked to be able to afford a larger share but are delighted to be a part of it. We thank the development team and are looking forward to a nice wet future."