Offshore wind delivers one tenth of jobs promised by ministers

Ten years ago the Scottish Government were championing the desire to be the green energy capital of Europe with around 28,000 jobs in offshore wind alone.

It comes as GMB Scotland has written to energy secretary Neil Gray asking for an urgent summit to ensure that the nation does not continue to get the green jobs revolution wrong.

They want to ensure more turbines and other infrastructure for wind farms off the coast of Scotland are built here to create more jobs.

It coincided with Mr Gray travelling to Japan for a trade visit to encourage further investment in renewables.

The GMB says Mr Gray "does not need to fly around the world" to create renewables jobs in Scotland.

🔴 Save on a full year of digital access with our lowest EVER offer.

Subscribe for the whole year to The Herald for only £24 for unlimited website access or £30 for our digital pack.

This is only available for a limited time so don't miss out.

👉 Click here to subscribe

Union leaders have raised concerns that the number of jobs created in offshore wind has not kept up with the amount of revenue being generated - indicating there is a 16,000 jobs gap leaving Scotland 'shortchanged' while ministers have been seeking to make the nation a destination of choice.

Analysis using the latest Office of National Statistics' low carbon and renewable energy estimates shows that while in 2014 every £1m of income made by offshore wind firms translated to seven jobs for workers - this has plummeted to just one job per £1m of turnover in 2021.

While offshore wind turnover has risen over 27-fold over the seven years to 2021 - from £95m to £2.594bn the number of jobs has only risen by nearly four-and-a-half times from 700 to 3100.

If job numbers had kept pace with turnover, Scotland would have had over 19,000 jobs.

At the COP26 summit in 2021, Scottish Enterprise signed an agreement with Tokyo-based Marubeni Corporation to explore opportunities for floating windfarms and green hydrogen. Another Japanese company, Mitsubishi, is already an investor in Scotland's biggest operating offshore wind farm, Moray East, which came online last year.

The GMB fears a huge opportunity to increase the country’s manufacturing capacity through renewables and the transition from fossil fuels will be missed "without more ambition, commitment and fresh thinking".

Scottish Trades Union Congress general secretary Roz Foyer said: “Offshore wind companies are raking it in whilst jobs are being lost and workers are being left hung out to dry. This cannot be right or allowed.

READ MORE: Auditors cast new doubt over future of ScotGov-owned Ferguson Marine

“Over 16,000 jobs have been missed out on due to a clear lack of coherent strategy on energy from government.

“We must learn the lessons of this cost-of-living crisis and redistribute the eye watering profits made by the energy companies back into our workforce and their communities. The Scottish Government must revisit and rapidly deliver on their promise of a nationally owned energy company to ensure wealth from our natural resources can be properly captured and retained across communities.

“Workers, not shareholders nor profiteers, should be at the forefront of any energy transformation in Scotland. This is what our movements demands as part of a truly Just Transition."

Scottish Renewables say the official estimates "seem to be low" believing the numbers employed by offshore wind were over double that at 6,735.

Nick Sharpe, director of communications and strategy at Scottish Renewables, said that Scotland’s offshore wind industry was on the cusp of investing up to £29bn in Scotland – one of the largest private investments ever made in this country.

“Deployment equals employment, so as we build offshore wind projects, the number of jobs in the sector will increase," he said.

In 2010, a Scottish Government report suggested the offshore wind sector alone could offer the potential for 28,000 direct jobs.

Twelve years ago, the potential wind and marine energy power in the Pentland Firth - where the north-east Atlantic meets the North Sea – led the then First Minister Alex Salmond to dub it the "Saudi Arabia of Renewables" with Scottish firm BiFab at the time making turbines for offshore wind farms.

In November, 2010, Mr Salmond, first announced a £70m investment fund to finance the offshore wind sector.

He said by 2020, 28,000 jobs could be created directly servicing domestic and worldwide offshore wind markets and add £7.1 billion in value to Scotland's economy.

Opening the Scottish Low Carbon Investment conference in Edinburgh, he urged private finance leaders to seize the multi-billion pound opportunities arising from the renewable and low carbon technology revolution.

Another union source said the job numbers were a "travesty" and an "embarrassment" and said action was needed to ensure the nation reaped the benefits of offshore wind. He feared that recruitment of foreign workers to serve wind farms was a factor.

The controversial Offshore Wind Workers Concession (OWWC) which allows the employment of cheaper foreign nationals on wind projects will close at the end of this month.

Unions have been fighting the OWWC which allows companies to skip the usual post-Brexit immigration restrictions and employ foreign nationals to join vessels engaged in the construction and maintenance of offshore wind farms.

The Herald on Sunday has previously revealed that foreign governments including China and overseas firms with interests in Scotland’s offshore wind farm revolution are already enjoying more than £200m in annual profits.

Ministers been under fire for failing to properly cash in on the seven farms that are operating and three major schemes that are in advanced stages of development which together according to energy firms will have 5GW of installed capacity - enough to power double the 2.7m homes in Scotland.

There has been concern that governments in China and the United Arab Emirates which have presided over human rights concerns are among the beneficiaries of Scotland’s green revolution.

The 2019 opening of the Beatrice wind farm by Prince Charles now King Charles II

The “astonishing” array of state government-controlled firms that are making millions from having a key stake in Scotland’s collection of offshore wind farms also include France, Norway, Sweden and the Republic of Ireland. The Scottish Government has no stake in any company reaping the green rewards, even though it is in the nation's waters that the farms are being constructed.

The Scottish Government has been criticised for its failure to set up a publicly-owned energy company saying it did not have the powers - while Wales is developing a similar plan.

Campaigners have long called for the establishment of a state-owned company which would have owned energy resources, to provide secure, reliable and low-cost retail energy to households and to ensure there were renewable energy supply chain and manufacturing jobs for Scotland.

It is felt by some that the failure to create a state-owned energy company has meant that the nation has lost its grip of the profits of Scotland's green revolution.

Gary Cook, the GMB union’s senior organiser for engineering and manufacturing, said the failure to create and protect engineering jobs during the transition to renewable energy is "abject and has become a national embarrassment".

Development stage plans for one of the world's biggest offshore wind farms, the SSE Renewables-backed Berwick Bank state that it could create 4,650 direct and indirect jobs in Scotland.

An economic impact study carried out by independent renewable energy consultants, BVG Associates says that at peak construction in 2026, around 9,300 jobs would be created in the UK - adding an estimated £8.3bn (€9.6bn) to the UK economy and up to £4.1bn to Scotland, as a whole over the life-time of the project. Mr Cook said: “We are used to hearing a lot of promises but little detail. Exactly what jobs will be created here and how?"

Earlier this week a US firm said it was committed to invest £300m as part of a drive to transform a Scottish port into a major energy transition facility with indications it would support “thousands of jobs” in the construction phase and hundreds long-term.

Ardersier Port Authority hailed the investment by Quantum Energy Partners, which will help to accelerate work already under way at the 450-acre site in the Highlands between Inverness and Nairn.

It was hoped the redevelopment of the former McDermott construction yard will support future offshore wind projects in Scotland, the UK and Europe, and enable the domestic decommissioning of aged North Sea oil and gas assets.

Mr Cook said the investment is welcome and hints at the scale of the opportunity for Scotland.

He added: “We need a new industrial strategy, an ambitious plan to build manufacturing, attract investment, secure infrastructure, increase training, and seize the opportunity.”

A Scottish Government spokesman said: “The Scottish Government is utterly committed to a just transition for our energy sector. We are taking decisive action backed by the £500 million Just Transition Fund, which the UK government has so far refused to match.

“Research has provided an initial upper estimate that up to 100,000 roles in Scotland are ‘new and emerging’ green jobs and Scotland is the top ranked nation in the UK for green jobs creation for the second year in a row.

“Our world leading ScotWind leasing round is a key part of this. We strongly welcome commitments made by the successful developers to invest an average projection of £1.4 billion in Scotland per project, which equates to more than £28 billion across the 20 projects and will help create thousands of new jobs.

“Earlier this week a major Japanese company, Sumitomo Electric Industries, announced plans to establish a manufacturing plant in Scotland to supply the country’s growing renewable energy sector. This is a real vote of confidence in Scotland’s green economy, which continues to thrive.

“Whilst the Biden Administration is stimulating massive investment in renewables through the Inflation Reduction Act and the EU is following suit with its Net Zero Industry Act, the UK Government’s lack of action means we are left on the side-lines with the risk that investment flows to the US and EU and not Scotland.”