Labour’s pledge to create thousands of green jobs in Scotland won’t cut much ice amid the legacy of distrust bequeathed by the SNP Government after years of inflated claims.
Keir Starmer put the plan to create a new GB Energy with headquarters somewhere in Scotland at the heart of the Labour party’s election strategy last week on a visit to Scotland as campaigning for the July 4 UK general election got under way.
He promised that Labour would almost double the number of low carbon jobs in Scotland to 50,000 by 2030 by unlocking investment in offshore wind and the like while delivering big savings for consumers.
The numbers were meant to sound impressive and Labour clearly felt the focus on energy would resonate in Scotland given the importance of the wider sector to the country’s economy.
But the figures probably had a familiar ring to many in Scotland. People have got used to SNP ministers bandying around exaggerated estimates of the jobs potential of the renewables revolution and of their own ability to tackle the energy crisis affecting households.
READ MORE: SNP Government new energy jobs boast insults electors
Former first minister Nicola Sturgeon said the Scottish Government she led would set up a state-owned firm to sell energy at affordable prices by 2021 but the claim came to nothing.
Consumers were instead left facing huge increases in their energy bills after Russia’s war on Ukraine fuelled the surge in inflation which started amid the recovery from the pandemic.
Ms Sturgeon rehearsed claims about Scotland’s potential to become a renewables powerhouse after turning her back on the oil and gas industry, which she and Alex Salmond had claimed in the 2014 independence campaign could power prosperity in Scotland.
After calling for the Cambo oil field development West of Shetland to be blocked, Ms Sturgeon presided over the development of an energy strategy which recommended a presumption against exploration in the North Sea.
Against that backdrop, the SNP Government has been accused of hypocrisy for criticising Labour’s plan to increase the windfall tax imposed on oil and gas firms to fund its energy investment plans.
New first minister John Swinney signalled at the weekend that he could drop opposition to new licences. Mr Swinney wants to work more closely with the oil and gas industry as he looks to bolster SNP support in North-East Scotland seats.
The rethink may reflect the recognition that the number of jobs created in the renewables sector has fallen well short of target. Labour claimed: “Less than a quarter of the green jobs promised by the Scottish National Party in 2010 have materialised” – citing Daily Express coverage of Office for National Statistics numbers.
READ MORE: Scottish windfarm plan fuels energy transition controversy
The under-achievement partly reflects the fact that much of the labour-intensive manufacturing work associated with windfarm development such as turbine production has been done by firms based overseas.
The Scottish Government failed to ensure the country developed the capacity to compete successfully for such work.
Labour claims GB Energy will address the problem by using public funds to crowd in private investment. The party said it would build resilient supply chains in Scotland by using a new British Jobs Bonus to provide specific incentives for developers that create good jobs in areas currently reliant on energy industries, including the North-East of England.
However, this sounds suspiciously like the approach followed by the Scottish Government and the Tory administration at Westminster in key respects.
In recent weeks fresh evidence has emerged about the problems the SNP Government has faced delivering on initiatives even as members of Mr Swinney’s team have tried to rekindle hopes of a bonanza.
The efforts come amid hopes the new generation of floating windfarms will create work for huge numbers of people in Scotland centred on Green Freeport areas.
Last month ministers hailed news the Scottish National Investment Bank would provide £50m funding to support the development of Ardersier port as Sumitomo started work on the development of a cable factory at Nigg.
READ MORE: Energy giant highlights impact of SNP Government planning delay on key renewables project
However, the outlook for one initiative at Nigg that was hailed by Ms Sturgeon appears unclear.
In December 2021 SSE announced it was providing support for a £110 million turbine tower manufacturing plant that would be developed by Global Energy Group and Haizea of Spain.
With SSE predicting that 400 manufacturing jobs would be created at the plant and a further 1,000 supported in the supply chain, Ms Sturgeon said the facility would help to deliver a just transition to net zero.
She said it would bring multiple benefits to communities across the Highlands and beyond while playing a pivotal role in delivering offshore renewables growth in Scotland and further afield.
SSE noted at the time that the plant was due to enter construction in January 2022 with first production scheduled for 2023. SSE said it expected to place orders with the factory “in the near future” to meet its growing offshore wind pipeline.
However, six months after the plan was announced it emerged that Haizea Wind had exited the project.
Asked last month when it expects the plant to be operational SSE said it remained supportive of Global Energy Group's plan to deliver a tower facility at Port of Nigg without offering further details.
Global Energy Group has been asked for an update on the project, which provides a reminder that initiatives can be much harder to deliver than they are to announce.
READ MORE: North Sea giant plans $500m investor payouts
Scotland faces competition for investment from firms operating overseas and in other parts of the UK.
German energy giant RWE recently highlighted the value of the work it is doing on the huge Sofia windfarm off North-East England to ports in the area.
The Port of Tyne had been upgraded to work on the project and others of similar scale.
The turbines for Sofia will be manufactured by Siemens. The German firm has developed a significant turbine blade production facility in Hull, which employs hundreds.
Plants in North-East England could support windfarm work off Scotland.
All this suggests that Labour could face big challenges delivering on its pledge to create green energy jobs in Scotland on the scale expected.
With that in mind, Mr Starmer might want to reconsider its plans to increase the tax burden on oil and gas firms.
Labour has said it will impose a proper, time-limited windfall tax on oil and gas giants and close loopholes. This apparently refers to the generous investment allowance introduced alongside the windfall tax in 2022.
To mollify critics in Scotland, Mr Starmer stressed a Labour government would not revoke North Sea licences but made clear it will not issue new ones.
However, industry leaders warn the planned moves could lead to the loss of thousands of jobs that already exist and mean Scotland misses out on many others. Trades unions agree.
READ MORE: North Sea deals collapsing amid tax fears warns entrepreneur
Oil and gas firms need to pay a tax rate that fairly reflects the profitability they achieve and encourages investment in resources that Scotland and the rest of the UK will need for years.
There have been signs the current windfall tax is having unintended consequences.
North Sea exploration pioneer Deltic Energy faces having to surrender a licence on which it made a bumper find with Shell because it has been unable to secure the investment required to fund its share of the appraisal costs.
Shell and One-Dyas of the Netherlands are in line to inherit Deltic’s interest in the licence.
Deltic said yesterday that it has been awarded a stay of execution by Shell, which will give it until June 12 to try to strike a funding deal.
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