Scottish ministers accused of 'embarrassing downgrade' as public energy firm plans dropped

Scottish ministers have come under fire after it emerged that plans to set up a state-owned energy firm have been dropped.

First Minister Nicola Sturgeon announced four years ago the intention to establish a not-for-profit national energy company that would deliver low-cost green power to households across the country, helping to reduce fuel poverty and tackle climate change.

Speaking at the SNP party conference in 2017, she said energy would be “bought wholesale or generated here in Scotland – renewable, of course – and sold to customers as close to cost price as possible”.

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But the proposal is absent from the latest Programme for Government, released on Tuesday, less than two months before Scotland is set to host the United Nations climate summit COP26.

First Minister Nicola Sturgeon has come under fire after dropping plans to set up a state-owned green energy firm that would help alleviate fuel poverty and tackle the climate crisisFirst Minister Nicola Sturgeon has come under fire after dropping plans to set up a state-owned green energy firm that would help alleviate fuel poverty and tackle the climate crisis
First Minister Nicola Sturgeon has come under fire after dropping plans to set up a state-owned green energy firm that would help alleviate fuel poverty and tackle the climate crisis
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Analysis: Nicola Sturgeon has shown her hand for the next year with Programme fo...

Efforts will instead focus on the creation of a “new dedicated national public energy agency”, more akin to an advisory body.

The move has been branded “a total dereliction of duty” and an “embarrassing downgrade” for the SNP and their new partners in government, the Scottish Greens, who had backed the plans.

In June this year, Greens co-leader Lorna Slater, now herself a government minister, criticised Ms Sturgeon for not moving fast enough on the proposal.

Liam Kerr, Scottish Conservatives shadow cabinet secretary for net zero, energy and transport, said: “The SNP announced their plans for a public energy company to much fanfare, but completely failed to get it off the ground.

“Now we see them quietly try to ditch this pledge to replace a company with a new agency.

“This is typical of the SNP, who are always keen to grab a headline, but regularly fail to follow through with the necessary infrastructure on the ground.

“This new agency is without substance, focus and power and will do nothing to accelerate our moves towards using renewable power.

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“In the year Glasgow is hosting COP26, that is a total dereliction of duty from the SNP-Green government.

“The dropping of this commitment is also an early sign that the Greens are all too happy to sell out their principles for a seat around the table with their nationalist friends, having previously questioned the SNP as to why this company hadn’t yet got up and running.”

Monica Lennon, Scottish Labour’s net zero, energy and transport spokesperson, called for ministers to make good on the original proposal.

“This embarrassing downgrade lays bare the complete lack of ambition at the heart of this government,” she said.

“A real public energy company has the potential to transform energy production in Scotland and drive forward the renewable revolution we urgently need.

“Instead it seems we’re about to be landed with yet another toothless government body.

“This is just not good enough.

“The Greens and the SNP must drop these watered-down plans and commit to delivering the promised national energy company in full.”

Members of Scotland’s Just Transition Partnership, which is made up of trade unions and environmental groups, also expressed disappointment.

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Partnership co-chair Dave Moxham, deputy general secretary of the Scottish Trade Union Congress and an adviser for the Scottish Government’s Just Transition Commission, said: “The news that the Scottish Government intends to abandon their commitment to a publicly owned energy company means they clearly haven't listened … a public energy company that invests, builds and generates renewable energy while prioritising the domestic supply chain is essential to making the energy system work for people and planet.

“Nearly half of Scotland’s offshore wind farms are owned by overseas companies who are quick to offshore work to the Far East, Denmark and Spain, despite the consequences for emissions and the risk that workers and communities lose all faith in politicians when they talk about a just transition.”

Friends of the Earth Scotland director Dr Richard Dixon said: “This company should be driving change by creating new renewables projects, prioritising domestic supply chains and providing affordable energy.”

Key environmental commitments set out in the new Programme for Government, designed to create a “fairer, greener Scotland”, include providing £1.8 billion to make homes easier and greener to heat, ensuring that at least 10 per cent of the total transport budget goes on active travel such as walking and cycling by 2025, and investing an extra £500 million to support new green jobs and training.

In answer to a parliamentary question, net-zero secretary Michael Matheson had confirmed “work on a planned public energy company was halted during the pandemic”.

He said of the replacement public energy agency: “This will co-ordinate and accelerate delivery of heat and energy efficiency work, inform and educate the public on the changes required, provide expert advice to national and local government, and work with public, private and third sector partners to deliver this transformative national project.”

The Scottish Government and Scottish Greens were contacted for comment.

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