AS the Scottish Government prepares for the delayed launch of its energy strategy environmentalists have provided a reminder that it has found it easier to make grand policy statements than to deliver on them.
A withering assessment of the progress made towards delivery of a £500 million initiative to support a “just transition” from fossil fuel dependence underlined the scale of the challenge facing ministers.
The Scottish Government has spent months working on its energy strategy. This was due to be unveiled in the spring until it announced that the launch would be delayed to the autumn. A Scottish Government spokesman said last week that the strategy is due to be discussed by the cabinet shortly.
The launch was delayed amid the turbulence in global energy markets which has left consumers in Scotland facing huge bills.
The Westminster government decided to double down on North Sea oil and gas in response.
The delay in publication of the Scottish Government’s strategy may reflect the fact it has limited powers to influence broader energy market developments, the response to which Westminster leads on. We can expect the strategy to include more lofty talk about the potential for Scotland to be a global leader in renewables.
The greens on which the government depends for support will want to see it come out against new oil and gas developments.
While Westminster has power to decide if such developments go ahead, Friends of the Earth Scotland says Ms Sturgeon’s administration has the power and duty to influence the process.
After showing little idea of how to use the powers it does have to make life easier for consumers, besides urging them to fit smart meters, the Scottish Government last week announced tweaks to a programme to encourage people to make energy saving improvements to their homes. This has had limited impact.
In that context the update on the £500m Just Transition fund that is expected to accompany the strategy launch will be studied closely.
Unveiled amid fanfare last year, the fund forms a key part of the Scottish Government’s efforts to show it can promote a green revolution powered by low carbon energy sources without leaving the workers and communities that depend on oil and gas destitute.
Some thought the initiative looked like a sop to voters in the oil and gas heartlands of the north east Scotland. The SNP fought the independence campaign in 2014 on the claim that oil and gas could fuel a prosperous future for Scotland before apparently deciding there was more political mileage in courting the green vote. The Scottish Greens said the Just Transition fund was a key commitment in the power sharing agreement struck with the SNP last year, during which Ms Sturgeon came out against plans for the giant Cambo oil field development off Shetland.
She has said recently that Scotland could use the proceeds of oil and gas taxation to support a £20 billion investment programme. Tax receipts have surged amid the boom in the North Sea that has followed the surge in oil and gas prices this year.
It will be interesting to see how Ms Sturgeon tries to reconcile the competing imperatives of supporting what is left of the oil and gas industry and securing the green vote in the energy strategy.
When the Just Transition Fund was announced last year some were unhappy that it was billed as a ten-year commitment that will support projects in the North East and Moray. That appeared to ignore other areas in which oil and gas is important.
There was little detail provided about how the £500m would be spent.
After Ms Sturgeon announced the first £50m of awards at the recent SNP conference in Aberdeen, Friends of the Earth Scotland said they raised “serious questions” about the direction of the fund.
It complained that much of the funding announced looked set to help the oil and gas industry rather than communities.
“Millions of pounds is going towards companies, many of which are backed by the fossil fuel industry, as well as a significant amount awarded to a contentious project which will destroy a vital community greenspace of St Fittick’s Park in Aberdeen,” said the organisation
The concerns centre on the decision to award over £14m to the Energy Transition Zone (ETZ) which will be developed in the Torry area of Aberdeen to help harness the capabilities of the oil and gas industry to support the net zero drive. Friends of the Earth Scotland said the zone was being resisted by local residents whose “local park will be destroyed to make way for the project, despite alternative sites existing elsewhere”.
The organisation also objected to the fact that £5m was awarded to support the One North East economic development initiative chaired by oil services tycoon Sir Ian Wood, compared with “just £4.2m … to community led participatory budgeting”.
Campaigner Ryan Morrison complained: “A just transition is about workers and communities but millions of pounds from this fund is going to private sector led business groups," adding: “There is no mention of how the Ministers will make sure this £50 million will create positive outcomes for workers and communities or help them to shape this transition.”
Supporters may say projects like the ETZ are creating the jobs of the future. If public funds could help them achieve that aim that would be money well spent.
But Friends of the Earth’s criticism of the awards underlines the fact the transition will be complex and potentially divisive. While it is easy for the Scottish Government to make pious statements with big numbers attached the hard part will be turning them into effective action.
The Scottish Government has a record for over-promising and under-delivering. In September last year Auditor General Stephen Boyle lamented the fact there was “a major implementation gap between policy ambitions and delivery on the ground”.
We have seen this in the area of energy. In 2017 the Scottish Government said it would launch a public energy company by 2021 to provide affordable supplies for consumers only to see the market go into meltdown and a wave of independents collapse. Last year the SNP said work on the plan had been halted amid the pandemic.
In November Audit Scotland raised serious concerns about financial planning related to the proposed National Care Service.
The costs that the country is paying for this kind of delivery failure and the fact that the Scottish Government prioritises political aims are obvious in the area of free ports.
After the Westminster administration launched a free port scheme to attract inward investment, the Scottish Government decided it needed to develop its own “green” model. We should hear shortly where the first two Green Freeports in Scotland are to be developed, with schemes focused on Clydeside and the Aberdeen/Peterhead region among the contenders.
The Teesside region in north east England has powered ahead after winning freeport status.
South Korean steel firm SeAH is developing a turbine base manufacturing plant there, which is expected to create 2,000 plus supply chain jobs.
Last month it was announced that the UK’s first large scale lithium refinery is to be developed on Teesside, creating 1,000 construction jobs and 250 operations roles in the process. It will make materials for use in electric vehicle batteries.
However, the European Union may be about to put a spanner in the works in terms of free ports, of the green or plain vanilla kind. It is concerned that the support provided for them may result in EU member states losing out.
Earlier this year the UK government diluted plans to make windfarm developers use local suppliers following objections by EU officials, who threatened to take the matter to the World Trade Organisation.
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