JACK McConnell believes Scotland can avoid building new nuclear power stations by becoming the "world leader" in renewable energy.

The First Minister has repeatedly refused to declare his position on new power stations until the issue of nuclear waste has been resolved. But The Scotsman understands he now believes Scotland can become nuclear free if it invests heavily in renewables over the next few years.

This comes as Tony Blair, the Prime Minister, is set to announce the results of the government's energy review, which is expected to recommend a "balanced" energy policy, including new nuclear power stations. A source close to the First Minister said that "different parts of the UK might contribute in different ways" to this policy, suggesting Scotland might concentrate on renewables and England on new nuclear stations.

The source said ministers did not believe that nuclear companies would be "knocking at our door asking to build new nuclear stations" because transmission charges make it more costly to produce electricity in remote parts of Britain.

Another senior Labour insider stressed that while there had been "no deal" with Westminster to give Scotland a nuclear opt-out, that was the way the Executive wanted to go.

Energy is shaping up to be a crucial issue at next year's election. The Scottish National Party, the Liberal Democrats and the Greens are all opposed to new nuclear power stations with the Conservatives in favour.

Labour's official policy is also pro-nuclear. But Mr McConnell is aware, not only that such a stance could cost him votes next May but also a chance of a coalition partner in the Lib Dems.

In an attempt to steer a path between the two parties, Mr McConnell recently agreed to back a more open Labour policy for next year's Holyrood elections, allowing the party to campaign on renewables, extending the licences of existing nuclear stations and "keeping options open" on new nuclear stations. However, it now appears that he has pulled back from that commitment.

About a third of Scotland's electricity comes from the nuclear power stations at Hunterston and Torness. Mr McConnell believes they can be kept on line for ten years beyond the end of their licences. By the time Torness comes to the end of its working life in 2031, Mr McConnell hopes renewables will be sufficiently advanced to fill the gap.

He put particular emphasis on the possibilities presented by renewables yesterday, saying:

"Scotland's most significant contribution will be in renewables. We've already seen massive expansion of renewable energy in Scotland. We have the potential, as yet untapped in some areas, to make an even more significant contribution, both here in Scotland and elsewhere in the UK."

The First Minister said: "Nuclear power makes up a significant contribution to Scotland's energy resource. It cannot be wished away ... but the great asset we have is in renewables."

Mr McConnell also changed his language on nuclear waste, suggesting for the first time that it might be dumped north of the Border - but only with the full backing of local communities. This has raised the prospect of England building new nuclear power stations and Scotland taking the waste.

Roger Crofts, an expert on energy and the secretary of the Royal Society of Edinburgh's recent study into energy, said that while it was possible that Scotland might be able to meet its energy needs without new nuclear stations, there were many problems to overcome.

This included finding a way of storing electricity from renewable energy sources before it could be used to carry the burden of the country's needs.

He said the crucial period was between 2012 and 2020, not after 2030. This was the time before either new nuclear stations could come on stream and before the benefits of renewables would really kick in.

Mr Crofts also cast doubt on whether Mr McConnell could simply decide to extend the lives of existing nuclear stations. He said: "It is not for politicians to decide whether the existing nuclear stations can be extended, it's a technical question about the graphite cores of the reactor. Our assessment was that you might only be able to extend the existing nuclear stations for five years maximum."

Mr Crofts said the Executive had to keep all its options open to cover the energy gap after 2012 and this might mean importing gas to fuel new gas-fired stations.

Nicola Sturgeon, the SNP's Holyrood leader, insisted renewables could provide the answer to Scotland's energy needs and no new nuclear stations were needed. The Greens welcomed Mr McConnell's apparent conversion to a non-nuclear future.