Kick-Starting Scotland’s Green Economic Recovery webinar: Moving as one towards the common goal of net-zero

The Scotsman’s webinar Kick-Starting Scotland’s Green Economic Recovery heard that collaboration between all stakeholders is key to Scotland meeting its climate change targets. David Lee reports.

Foundations for an offshore wind farm float in The Cromarty Forth. Locals are accustomed to the sight of oil rigs moored up for maintenance, but moves to more renewables will transform the area, and the Scottish economy. Picture: Getty Images

A successful transition to a net-zero economy in Scotland by 2045 is not about either-or choices, but focusing on all areas that can make a difference to a greener future.

The Scotsman webinar, Kick-Starting Scotland’s Green Economic Recovery, which took place last Thursday, heard a range of experts discuss the scale of the challenge.

Morag Watson, head of policy at Scottish Renewables, told delegates attending the virtual event that Scotland was generating 97.4 per cent of its electricity through renewables, but decarbonising energy use in heat and transport would be a huge undertaking.

While electricity and transport each make up about 25 per cent of energy use, heat accounts for 51 per cent of energy use in Scotland.

Watson said the Climate Change Committee’s 2020 report to the Scottish Parliament showed Scotland’s emissions had decreased faster than any other part of the UK, but added: “The lion’s share of that decarbonisation – about 65 per cent – came from decarbonizing electricity, 25 per cent of our use. She said that, having committed to net-zero, the main things we need to do before 2045, is electrify most heat use, and most transport.”

This means doubling the amount of electricity generated and quadrupling that generated from renewables, requiring “a massive scaling up” of electricity generated from solar power and onshore and offshore wind, Watson said.

She added: “The key is a clear transparent pipeline of projects [so] individuals and companies have confidence to invest in skills and infrastructure. If we don’t have a pipeline, we don’t have confidence for investors and it’s hard for the supply chain to take the economic opportunities.”

Clear policy and clarity was required and the challenge had been a “stop-start in policy and fiscal support” at UK level, Watson said, so projects weren’t coming forward quickly enough.

Joanne Allday, a senior executive at Port of Cromarty Firth, agreed: “We need clarity of policy direction. The private sector takes direction from government.”

She continued: “We’re very excited because we’re in the heart of a lot of developments, particularly offshore wind. We’re expecting 10 GW to be awarded [of offshore wind capacity] within the next decade.

“There’s an amazing pipeline of projects coming to fruition and we’re trying to ensure the supply chain is aware and geared up to service it. In the Cromarty Firth, we’re working together to create a strategic renewable energy hub, and attracting new manufacturing to the port at Invergordon and the Nigg Energy Park.

“We are also creating a hub using some of that on and offshore wind to create green hydrogen for industry. That has significant export potential too.”

Watson said that hydrogen was needed to “balance the electricity system and make it work effectively”. Green hydrogen is made by using renewable electricity to split water, with the hydrogen then deployed as a ‘fuel vector’, a way to move and store energy.

Dr Jacqueline Redmond, a board member at the Scottish National Investment Bank, explained the mission of the Bank, established last November – is to support Scotland’s net-zero journey, while delivering positive outcomes for communities and people. The Bank would provide “long-term patient finance” and be capitalised to about £2 billion over a decade, with loans of between £1 million and around £40m available.

“We are here to provide patient finance and act as a catalyst for private investment to achieve that step change in the Scottish economy [through] innovation and accelerating the move to net-zero,” she added.

“The Green Investment Bank was incredibly successful, the key catalyst in de-risking offshore wind, and giving other investors confidence a project was green and profitable. The Scottish National Investment Bank is very similar, except its mandate is broader.”

It would not be involved in “grand projects”, but more focused on supporting sustainable supply chains, she explained, saying: “It’s important that when we see a new supply chain coming along, we embed it in Scotland – embed the value.”

Redmond said one large offshore wind project placed only 1 per cent of orders with Scottish business. Watson identified a challenge here, as the Contracts for Difference approach looked for lowest costs: “That is an incentive for shopping around globally, to find those lowest prices because if you don’t have a Contract for Difference you don’t have your project, and we don’t get a pipeline of projects.”

Mike Smith, chief executive of Neccus, an alliance of interests focused on industrial decarbonisation, told delegates that the decarbonising industry was “one of the most important, but also one of the hardest” to address. It is responsible for one-third of all Scotland's emissions, through three major sources: energy to power industrial processes; the heat that industrial processes require, and emissions from these processes.

He added: “We’ve made progress, but there’s a lot more to do. Most progress has been in decarbonizing energy, but we’ll never achieve net-zero for industry without addressing the other sectors – and, unfortunately, electricity isn’t really a viable source of the kind of very high-heat processes much industry requires.”

Smith said it was vital that Scotland did more to stop outsourcing emissions. “We have been offshoring the products we ultimately consume and need to do more to turn that around.”

Richard Cockburn, a partner and energy expert with legal firm Womble Bond Dickinson, said Scotland could take a global lead in floating offshore wind turbines.

“They create jobs, they create expertise and it’s expertise that can be exported to other parts of the world,” he said

He urged Scotland to move more swiftly on “greenports” – zones with tax and customs reliefs to encourage investment – as England was motoring ahead here.

Allday said the Opportunity Cromarty Firth consortium was working to secure greenport status, but warned: “We are behind England quite significantly. We hoped the greenport prospectus would be issued before the Scottish elections. We’re already seeing investment and employment opportunities being displaced to ports in England. This is a major threat to Scotland, but we hope – now the election is over – to get back on track, and attract new manufacturing and investment opportunities.”

Scotland could capitalise on its renewable energy strength, alongside greenports, to create a real “sweet spot”, she added.

Both Redmond and Watson welcomed plans for a cabinet secretary in the Scottish Government to cover net-zero, energy and transport. The former believes it is key to “pull together all the different elements of what we mean in addressing net-zero”. Watson said: “My concern isn’t with the policies proposed, but the time it takes to deliver them.”

She added that she thought the target to decarbonise one million homes by 2030 was great, but was concerned that the timeline to introduce the policies needed was four years. She argued: “We cannot move that slowly. We declared a climate emergency but did not see the [necessary] speed of policy-making coming forward. I hope a cabinet secretary role can bring the speed and impetus we need.”

Cockburn agreed, saying that targets to move towards net-zero had to be “achievable, timebound and realistic”.

Mike Smith of Neccus said integration of all the big projects moving Scotland towards net-zero was vital – including hydrogen to move and store energy, continued decarbonisation of electricity, and carbon capture and storage.

He told the event: “When we talk about the climate emergency, there’s a [tendency] to pit solutions against each other. We shouldn’t do that, but see they are entirely complimentary. The solution industry needs is clean energy in the form of greater renewables, but also hydrogen and bio-source energy.”

Allday concurred: “We’re meant to be in a climate emergency so we need to act that way, and make the best use of all these different technologies.”

When can we capture it?

Green hydrogen and carbon capture and storage (CCS) are seen as two significant long-term opportunities for Scotland – but when might we see them making a real difference?

“I can see initial CCS projects being sanctioned as soon as the end of 2022. By sanctioning the project, you’re committing to delivering it, committing to significant investment. I think it can start to make a contribution from the mid-2020s and by the end of this decade, we could be capturing, 5 million tonnes of CO2 per year from across Scotland, and potentially more by taking advantage of the fact that there will be other countries in Europe, that don’t have the opportunity or the geology to store that carbon.” Mike Smith, Neccus

“We’re hoping we’ll have green hydrogen available from as early as 2023, possibly 2024 or 2025. We’re working with the largest distillers in our region – Glenmorangie, Whyte & Mackay, Diageo – who are seriously interested in taking green hydrogen. When you have the credibility of those companies behind you, people take the investment opportunity more seriously.” Joanne Allday, Port of Cromarty Firth

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