Official Report 837KB pdf
Item 3 is an evidence session on the Great British Energy Bill. The Scottish Government has provided a legislative consent memorandum on the bill, which is a UK Government bill at Westminster. The memorandum, which was lodged on 8 August 2024, set out a holding position on whether the Scottish Government supported provisions in the UK bill that are in areas of devolved competence. The memorandum did not go into much detail at that stage, which was fairly understandable because the bill was in its early stages. The Scottish Government has not provided the substantive update that the committee and the Parliament need to properly engage with the questions of consent in relation to the bill.
Meanwhile, the bill has been proceeding through the UK Parliament. Time for the committee to report was beginning to run short, so, with that in mind, I invited the Scottish Government to give evidence today, despite the fact that we do not have the supplementary memorandum. However, I am very grateful to the acting cabinet secretary for providing an update on the Government’s position on the bill by letter after the invitation was sent.
I would like to put on record that I am sorry that we kept you waiting slightly, cabinet secretary, but the last evidence session ran on. I welcome Gillian Martin, the Acting Cabinet Secretary for Net Zero and Energy and, from the Scottish Government, Emma Shepherd, the unit head of public and community energy; Norman Macleod, senior principal legal officer; and Natalie Hakeem, the energy engagement team leader. Cabinet secretary, I think that you want to make a short opening statement.
Thank you very much, convener. Happy new year to you all. I thank you and the committee for inviting me to discuss our approach to the UK Government’s Great British Energy Bill as well as our reaction to the bill and some of the discussions that we have had with the UK Government on aspects of the bill.
The UK Government has said that GB Energy has been designed to do four things: the production, distribution, storage and supply of clean energy; the reduction of greenhouse gas emissions from energy produced from fossil fuels; improvements in energy efficiency; and measures for ensuring the security of the supply of energy. Many of the bill’s objectives, particularly the production of clean energy, are already commercially under way in Scotland, and I am keen to investigate how Scotland can benefit, given our current advanced status as a green energy-producing nation.
We already have a strong pipeline of clean energy and a growing supply chain. We are at the forefront of floating offshore wind development, and we have a depth of knowledge and experience of community and local energy.
11:15To date, I have had very positive discussions with the UK Government about the role of GB Energy and how it will dovetail with our already well-established activity, communities and sectors. Those positive discussions have been framed by the joint vision statement that I signed with the secretary of state in late summer last year, which commits the Scottish and UK Governments, alongside our public bodies, to working together to maximise the public benefit of GB Energy’s activities in Scotland.
The bill will provide a statutory basis for Great British Energy as a publicly owned and operationally independent energy company and will give the UK secretary of state the ability to provide financial assistance to GB Energy to enable it to become operational.
Since our legislative consent motion was lodged in August, my officials and I have taken part in many discussions on the bill with the UK Government. I am grateful to my UK Government counterparts for the positive tone of those discussions.
The Scottish Government is broadly supportive of the bill, and we have been working closely with the UK Government to ensure that it delivers for the people of Scotland. However, there were issues with two clauses that we wanted to iron out. Our negotiations on the bill focused in particular on clause 5(4), which concerns the level of engagement that the UK secretary of state would have to have with the Scottish ministers when preparing a statement of strategic priorities for Great British Energy. I am keen to ensure that the bill contains proper recognition of devolved interests and that the Scottish Parliament has opportunities to scrutinise matters within its competence.
I am pleased to say that discussions have progressed well, and I have emphasised to the UK Government the importance of tabling the relevant amendment in a timely manner, so that we are in a position to give legislative consent to the bill. That will allow the Scottish Parliament and this committee to have sufficient opportunity to scrutinise the bill. We will lodge a supplementary legislative consent memorandum once the UK Government has tabled the amendment that we have been negotiating on.
I will continue to work with counterparts in the UK Government as its plans for GB Energy progress, not only in relation to the bill but once it has been passed. I look forward to answering the committee’s questions.
Thank you. I should point out that the committee has written to the UK Government to ask whether it would like to give evidence to the committee. I am sure that someone will be listening to today’s session on its behalf, and I am sure that, when you speak to the UK Government, given the cordial relationship that you have with it, you will suggest that that would be an excellent idea.
I will ask the first question. The LCM sets out that a supplementary LCM will be lodged—you have referred to that today—following further analysis. Can you provide the committee with more detail on the analysis that is being carried out by the Scottish and UK Governments? Can you clarify what each Government will be responsible for?
The main issue that I had to bottom out with UK Government ministers was the fact that, initially, Scottish Government ministers would be consulted only on the strategic priorities of GB Energy and would not be asked to give consent.
Given that much of the bill and the activity of GB Energy would be in devolved areas in which we have powers, we thought that it was particularly important that consent had to be given. It took us a wee while to go back and forth on that, but I am confident that we have reached a point at which the UK Government is satisfied that it should table such an amendment. I have not seen the amendments to the bill, as they have not been tabled, but should things go in the direction that I hope they will—I have had an exchange of letters with the relevant UK minister, Michael Shanks, which indicates that our concerns are being dealt with—we will be happy to give our consent.
We discussed that issue as part of our constructive engagement on the bill. There is now an understanding that it is important that we are asked to give consent, for two reasons. If we are asked to give consent, the committee will have the opportunity to scrutinise us on why we are giving—or are not giving—consent to certain things.
That is where I have slight concerns—it is about the timescale. Even if you decide not to give consent, if the bill is going to have an effect on the powers of the Scottish Parliament, the committee has a right to look at it. Can you assure me that the committee will have more than enough time to consider the supplementary LCM before the bill is rushed through the UK Parliament and we get sidelined?
There are two elements to that. First, the issue in the bill that we want to bottom out is about consent for strategic decisions on GB Energy’s operations in Scotland—there should be a requirement for consent, not consultation. Secondly, there is the legislative consent for the bill. At the moment, I think that the bill is with the Lords. Once it has come through the Lords, we will see what the UK Government is putting forward by way of amendments to clause 5 and to clause 6, which I might come on to talk about, because that is another issue on which we have had discussions.
We will put in place our supplementary LCM as soon as we see those amendments. If they are in the shape that we hope they will be, that will be a very quick process, because we want to give you as much time as possible.
You will no doubt have gamed this out to work out how much time you will give us. How much time will you give the committee to look at the LCM and the supplementary LCM once the amendments have been laid? Will it be a week, two weeks or a month?
It depends on parliamentary timelines as well. As soon as we see the amendments, we will be able to produce an LCM. We will do that as soon as we can. It looks like we will be supportive of the bill and will want to give consent. The negotiations have come to fruition and, if the amendments are the way that we hope they will be, we will produce that LCM immediately.
I accept that. I am trying to make it clear that the committee wants and needs proper time to consider the matter. Even if you are happy to give consent, there is a procedure to go through. Part of the reason for having this evidence session today is that I am slightly frightened, as I guess the rest of the committee will be, that we might get bounced, given that the bill is making such quick progress through the UK Parliament.
My understanding is that the bill will be out of the Lords within the next couple of weeks, and there may be amendments made by the Lords. At that point, there will be amendments from the UK Government. As soon as the UK Government tables its amendments, that will effectively be the starting pistol being fired for us to look at those amendments and give our consent.
Okay. I think that I have made my point. I will go to the deputy convener for his questions.
Good morning. I want to stick with clause 5 and your concern about the requirement to consult the Scottish ministers in setting the strategic priorities for GB Energy. I take it from what you have said that your request to the UK Government is that there should be a requirement to get the consent of the Scottish ministers. Is that correct?
Yes.
Can you give a practical example of the type of policy implications that there could be if clause 5 was not changed from a requirement to consult to a requirement for consent in areas of devolved competence?
As Mr Matheson will know intricately, Scottish Government ministers have powers to consent to developments of all types in the Crown estate, the sea bed and the landmass of Scotland. If we were to merely be consulted on things that were happening with GB Energy, that would take away from that power. A requirement for consent would dovetail with the consents that come to us.
The issue is really important when it comes to the strategic goals of GB Energy. Initially, when GB Energy was floated as an idea before the election, we all asked about what it would be. I am keen that we are an equal partner in the strategic actions that GB Energy takes. It is not there as a competitor to other operations; it must add to what we already have in Scotland. Having “consult” instead of “consent” means that, whatever those strategic priorities end up being, we would be consenting to them.
As the company develops, I want to see those strategic priorities provide additionality to what is already in the energy sector in Scotland and increase capacity in areas where required. For example, I am keen that whatever GB Energy is doing in the community energy space does not reinvent the wheel. We already have Local Energy Scotland, which is an organisation that was set up by the Scottish Government. I do not want to see another body—it would be confusing for the public and I do not think that there is any need for it. I was able to discuss with Michael Shanks how we could work together so that, if we already have vehicles in Scotland for activity that GB Energy is carrying out, we would be able to use those organisations and add the funding to their capacity, rather than have separate entities set up and badged with GB Energy. Those are a couple of examples.
If the strategic priorities require our consent, it means that, as it develops—I do not think that GB Energy is fully developed yet, but that is the point—we have the proving part in place such that, whatever direction it goes in, it must be with the consent of the Scottish ministers. It is very early days in relation to what GB Energy will achieve.
I will pick up on that, so that I am clear in my understanding. I agree with you that, notwithstanding GB Energy’s four strategic objectives, there is still some uncertainty about what exactly it is trying to replace or add value to in the existing market. That is still somewhat confusing to me.
I am taking from what you say about the setting of the strategic priorities that there is a danger that, if the Scottish ministers are only consulted, GB Energy could set strategic priorities that run counter to the priorities that the Scottish Government has set; for example, in how it wants to use the Crown estate or in how it might want to go about setting out good practice for community benefits. There is potential for those priorities to undermine some of the things that we already have in place or to work counter to what we are trying to achieve. Is my understanding correct?
Yes. There are those examples, but there are other examples as well.
Given the maturity of the sector in Scotland with regard to renewable energy and, in particular, community energy, it is important that we are able to work as a helpful partner. We have already done quite a lot of the things that are being tabled, which are not as mature in other parts of the UK. It comes back to the point about not reinventing the wheel. We already have organisations, strategies and priorities here.
I will give another example. It was in my mind that I did not want a situation in which GB Energy projects would be able to leapfrog any commercial projects in getting grid connection. I asked about that very early on, because we have organisations that are waiting for grid connection, which is the major investment driver for projects that are already under way. I was given the assurance that that would not happen. I want developments to have parity. That is another practical example.
On the types of energies that are happening in Scotland, some areas, for example wave and tidal, are quite nascent technologies. I see GB Energy potentially helping the Scottish Government to close the gaps in nascent technologies that need Government support as they come to commercial fruition.
11:30I do not think anyone is saying that there are not enough wind opportunities in Scotland. We have the commercial round of ScotWind and we have onshore wind. However, in wave and tidal, which are still at an early stage—not in technology terms, because the technology is proven, but in commercial and scaling—there is a real opportunity for Scotland to concentrate on areas that we would expect a public body to lift up and assist to reach commercial maturity, in the way that wind has been assisted.
For me, the notion of consent is important in that equal partner relationship. It is a good thing for the UK Government to have our consent. Scotland is so far ahead in the renewables sector and in the work that the Scottish Government has done that we know where the gaps are and where we need added value. We can therefore work as an equal partner in helping GB Energy to set out its strategic priorities when it is operating in Scotland.
It is clear that GB Energy, as a body or organisation, is evolving. As it stands, we already give some support to wave and tidal, but commercialisation is a challenging environment for wave and tidal because of the cost base associated with that area. I would be interested to see whether GB Energy eventually has the objective of helping to commercialise some of those emerging technologies. Do you have a formal agreement with the UK Government that it will shift from “consult” to “consent” in clause 5 of the bill?
I will wait to see the wording of the amendment before I lodge an LCM, but we have an agreement that that has been taken on board.
So, in principle, it has been agreed to.
In principle, yes.
I think that we are being told that it has been agreed to without that being in writing.
I just want to check something. Clause 5(3) of the bill says:
“The Secretary of State must lay a copy of the statement, and of any revised or replacement statement, before Parliament.”
That got me thinking about whether we could get agreement from the UK Government about the current set of strategic priorities. The Scottish Government has to agree to those priorities as they relate to devolved matters. However, the deputy convener talked about an evolving situation. In 18 months’ time, or in two or three years’ time, the UK Government may reset its strategic priorities. Is it the Scottish Government’s position that this is not a one-off consenting process for strategic priorities but that, under clause 5, it is an on-going process?
That is effectively what I mean by future proofing. GB Energy will be a publicly owned company. It has highlighted its five strategic priorities, but they are very wide, and we want to give our consent to them as they evolve.
Clause 6 enables the secretary of state to give direction to GB Energy. At the moment, clause 6 says that the secretary of state should consult GB Energy and
“such other persons as the Secretary of State considers appropriate.”
We have asked for an assurance that the Scottish Government will be specifically included in that list, so that is another area where we have reached agreement.
I do not doubt the good will on both sides. However, you talked about future proofing. The strategic priorities are set out at a very high level, and then they will become regionalised, localised and sector specific. They will be realised and have practical implications on the ground across a range of devolved areas—in a positive way, I hope. Agreement to high-level strategic priorities may become detached from the decision making and what happens on the ground. What confidence do you have that the Scottish Government will remain an equal partner in the process, when agreement has been sought and secured from it in relation to the high-level strategic priorities?
That brings us back to clause 6, which talks about directions to GB Energy. In the future, the Scottish Government may think that those directions are at odds with the high-level priorities that it has signed up to. Will you seek to give consent to, or to be consulted on, any directions that are given to GB Energy or its partners under clause 6?
The concerns that you have just outlined are the same as my and the Government’s initial concerns when the draft was put in front of us. That is why we have worked so hard to ask for a change to the wording in clause 5 and to get agreement in clause 6 that we will be involved in the consultation around the direction that is given to GB Energy.
I feel confident that the change from “consult” to “consent” will allow future proofing to happen. I am also heartened by the willingness of the chief executive officer, Juergen Maier, to engage with me and the First Minister very early on in his appointment, and to talk about working together. There is also the Secretary of State for Scotland. It will be good for both Governments to have a relationship where consent is in statute, because that will ensure that the Scottish Government is treated as an equal partner.
There is a recognition that the Scottish Government is well ahead—particularly with the work that we have done with Crown Estate Scotland on ScotWind and so on, our onshore wind sector deal, our hydrogen strategy and community energy with the community and rural energy scheme. We are not just an equal partner but—I hope—a source of advice on how GB Energy will best operate in Scotland. From speaking to Juergen Maier, I certainly get the feeling that that will be the case. I have also offered that expertise and discussion to ministers, throughout the process of creating GB Energy. That is why I want the amendment to include the word “consent”.
Does “consent” relate to clause 5 but not to clause 6?
No. I wrote to Minister Shanks on 16 December, and we have sought agreement from the UK Government on the wording of clause 6. Discussions on that are still taking place but are very positive. At the moment, clause 5 is pretty much nailed down; we are still in discussion on clause 6, but I am hopeful.
Your UK Government counterparts should be following this scrutiny session, so—
I am being careful, because I do not want to pre-empt anything. It is important that we see the wording of the amendments before we can say that we are absolutely satisfied.
I will give the briefest preamble to my final question. I do not doubt the good will and common cause in relation to the Secretary of State for Scotland, the Scottish Government or the CEO. I am not trying to be a fly in the ointment either; I am just trying to do my due diligence in relation to scrutiny. However, of course, secretaries of state come and go, cabinet secretaries come and go—
That is true.
CEOs come and go, and what is left is what is in statute—and that is what we have to scrutinise. I would be keen to see the word “consent” in clause 6 as well. I would also be keen to see how the approach will be reviewed in the future in relation to whether the powers that are passed to the UK Government on an operational basis do what it says on the tin and give us the outcomes that we want. It is important for the committee to get a balanced view on the passing of the powers, or on recommending that the powers be passed via an LCM to the UK Government.
We have concentrated on the areas that have devolved implications, particularly in clause 5, but not so much in clause 6, which is about the company more generally, rather than about acting in the Scottish space. We have had those discussions. Clause 5 is the one that we really had to get “consent” into, because that makes the most material difference in terms of things happening in the devolved space and some of the issues that Mr Matheson brought up.
So, you have on-going discussions on clause 6.
Yes.
The next questions will be from Monica Lennon. Sorry, Monica. I do not know why I sound surprised—I had lost you on my list.
Yes, I am still here, convener. I have a question about the issue of alignment with the European Union, because the LCM stated that the position on EU alignment would be looked at
“as part of further analysis.”
Has that analysis been carried out? Are you able to say whether there are any implications for alignment with the EU?
Yes. We look at EU alignment in absolutely everything that we do, both in terms of whether we give consent and in terms of our own bills. Nothing in this bill suggests anything in relation to EU alignment, so I am content in that area. It is a short answer, but effectively there is nothing that is an issue.
Okay, that is straightforward.
I have some questions that can be asked later, convener, but that is all that I wanted to ask on that issue.
Douglas Lumsden has some questions.
I want to ask the cabinet secretary about the 200 jobs in Aberdeen that GB Energy has announced. Has GB Energy provided you with any more information on what those jobs will be?
No. I am glad to hear that the UK Government has been invited to the committee because that level of detail is for it to provide and those questions are for it to answer. There have been high-level announcements and statements about what it will mean in terms of jobs for the area, where the offices will be situated and so on. We were very pleased that Aberdeen was chosen as the headquarters, but what that means in reality in terms of jobs—forgive me for saying so—is a question for Minister Shanks, as are questions around how the priorities might take shape.
Would you expect to be involved when that head office is communicating with organisations such as the Scottish National Investment Bank, Marine Scotland and Crown Estate Scotland? Would the head office come through yourselves before engaging with them? How do you see that working?
In the summer, the Secretary of State for Energy Security and Net Zero and I signed a joint vision statement, which is in the public domain, specifically about engagement with Scottish public bodies. Work has also been done by the Department for Energy Security and Net Zero on working with Scottish bodies. It does not want to be in a situation where, going back to what Mr Matheson said, anything butts up against any of the priorities or processes of Crown Estate Scotland or SNIB, for example.
The Crown Estate Bill for England and Wales is currently going through the UK Parliament. We passed our own legislation for Scotland—the Scottish Crown Estate Act 2019—five years ago, so our Crown Estate is a separate entity, but we would expect that GB Energy will be working with it. We are also keen to make progress on ensuring that there is parity between the Crown Estate in Scotland and the Crown Estate in England in their relationships with GB Energy.
11:45The recognition that GB Energy will interact with Scottish public bodies, and that we will be kept aware of what those interactions are, was set out in the vision statement.
We have heard that GB Energy will have a role to play in the development of renewable energy in Scotland. What role do you think that it will have to play in carbon capture and storage and in hydro pump storage?
That is a good question. I think that carbon capture and storage will be a separate thing. I do not think that the committee will be surprised to hear me say that, in respect of carbon capture and storage, the GB Energy Bill is not the big-ticket item—that would be track status being given. We have been waiting for years now for track status to be given to the Acorn project, which is—I say this without any kind of bias—probably one of the most advanced propositions for carbon capture and storage. I do not think that GB Energy itself is going to provide the momentum—putting that project on the track 2 status will be the mechanism that will allow it to go ahead.
Again, the committee might want to get UK Government representatives in front of it and ask where they see their role with carbon capture and storage. My understanding, however, is that GB Energy is about energy generation rather than carbon capture and storage.
On hydro, however, you make a very good point. I personally believe that we could do an awful lot more on hydro in Scotland. Again, I do not know whether that would be in a GB Energy space or whether it would be more about looking at how hydro has been supported more generally by the UK Government. Hydro has perhaps not had the support more generally from the UK Government to enable it to flourish and grow in the way that it should have done. Whether that is for GB Energy to pursue, I do not know; I think that GB Energy will be more project based. If there is a role for GB Energy in projects to do with hydro, again, that is a question for the company itself. There is an awful lot more capacity in hydro in Scotland than we are already realising, so that may be an area that it might want to look at, but, again, that is a question for GB Energy.
With regard to carbon capture, utilisation and storage, do you think that GB Energy has a role to play in setting up a market for carbon? Perhaps that is where it could add a little bit of value.
That has not been mentioned in my discussions. Again, I think that CCUS is separate; I have not had those discussions about CCUS. My discussions have been around the priorities that have been laid out, which are about energy generation.
I am glad that you have brought up that point, however, because it gives me the opportunity to say yet again, on record, that carbon capture, utilisation and storage in Scotland has huge potential but we need that track status. CCUS is another real area of economic growth. In addition, it has always been said in all the reports that have come from the UK Climate Change Committee that CCUS is a fundamental part of helping us to get to net zero.
This is my last question. We know that GB Energy will not supply electricity directly to households, so will the Scottish Government revive its plans to have a public energy company?
We looked at what was required in terms of the legislation around that; it is not something that we are able to do under the current devolution settlement.
Mark Ruskell has some questions.
You have mentioned the Crown Estate and Crown Estate Scotland. I am interested in exploring what that partnership working might look like. Would it effectively be a carbon copy of the relationship that GB Energy has with the Crown Estate? Would the relationship with Crown Estate Scotland be similar? Is there currently any detail on what that partnership working would potentially look like?
The Crown Estate in Scotland is a separate legal entity, so, as you know very well, Mr Ruskell, there would be a separate bill associated with that. The UK Government is looking to modernise the Crown Estate in England and Wales so that it can be in a position to act, I imagine, more like the Scottish Crown Estate. The UK Government has presumably looked at what we have done with ScotWind in that respect, and at what the Crown Estate in England and Wales needs.
My understanding is that the Deputy First Minister has been negotiating with the UK Government on the Crown Estate Bill, and the Crown Estate has asked us to ensure that there is parity. However, we need to look very carefully at what ends up being in the Crown Estate Bill for England and Wales in terms of borrowing powers, because that would have implications for the limit on our borrowing powers. The Deputy First Minister is working on that.
We always look to see whether the Crown Estate legislation in Scotland is fit for purpose, and we review the governance and the operating model to make sure that it is fit for purpose as things progress. We optimise that role in value creation.
At the moment, our view is that we should keep an eye on the legislation on the Crown Estate in England and Wales and see if there is anything in that bill that we would like to adopt when we look to our legislation, but at the moment, we do not know. I think that it is getting a reading tomorrow—is that right? It is definitely upcoming. The Deputy First Minister is leading on that.
Do you anticipate our legislation needing any changes in the short-to-medium term to make sure that there is not a situation where there is a more attractive investment proposition in England because of new powers of the Crown Estate? Crown Estate Scotland would then be playing catch-up due to the borrowing powers limitations that currently exist. I am just trying to understand whether there are risks there, and, if there are, how quickly those could be mitigated.
I do not think that there are any risks. I have the programme for government here, which says:
“Reviewing Crown Estate Scotland’s governance and operating model to ensure it optimises its unique role in value creation and growing sustainable wealth for Scotland through helping deliver the supply chain side of the offshore renewable energy expansion. This will benefit communities and mitigate against climate change and biodiversity loss.”
That will not necessarily need any legislative change; it is about governance, the operating model and working with Crown Estate Scotland in that area.
The situation with regard to giving borrowing powers is quite complex. We do not have the powers to give Crown Estate Scotland borrowing powers. If borrowing powers are given to the Crown Estate in England and Wales, we would need to have a discussion about what that meant for Crown Estate Scotland and whether it wanted to go down the same route.
We would prefer that any activity and funding associated with the Crown Estate also came to Scotland. That is what we are looking for in relation to parity. We do not want to lose any funding.
You would prefer a level playing field.
It is about having a level playing field, yes. As I say, the Deputy First Minister and Mairi Gougeon, who has responsibility for the Crown Estate, are leading on that. Again, the GB Energy Bill does not have much about the Crown Estate, but the Crown Estate Bill that is going through the UK Parliament does.
Thanks for that. I am thinking about where we are with our energy policy and the energy strategy just transition plan. Is that, in its draft form, well aligned with the objectives of GB Energy? If GB Energy feeds into the energy strategy just transition plan, would there be a need to update it on the back of GB Energy coming into some form of existence, or is everything well aligned anyway?
There are other things. GB Energy is a consideration, but there is more than just that. We have a new UK Government that has very quickly become quite active in the energy space, particularly in consultation with us. We have had discussions about things such as community benefits. We have long been calling for the mandating of community benefits and having guidelines associated with consultation with the public. We are doing our own, because we are not waiting for the UK Government, but we want to work with the UK Government on any of its plans in mandating all that.
There has been quite a lot of policy shift from the UK Government, and the impact of that is why we have not published our energy strategy. We are coming to grips with that, and we are involved in it.
GB Energy is not feeding into our energy strategy, but our reaction to the policy shifts from the new UK Government has been taken into account. There is quite a lot there that we have to grapple with, and it is making a material difference to some of the things that we have in the energy strategy. We do not want to publish an energy strategy that goes out of date.
GB Energy will be quite closely aligned with GB Nuclear. Is there an acceptance in the UK Government of this Government’s policy on nuclear in national performance framework 4?
Yes. There is no agreement. We have a different policy on nuclear to that of the Labour Government, but there is acknowledgement that we do not want new current technology nuclear developments in Scotland.
Consenting planning would be the Scottish Government’s role in relation to that. Is it unlikely that we will see GB Energy and GB Nuclear looking at investment models for small modular reactors in Scotland, or eyeing up spaces for new nuclear or extensions?
You rightly point out that we have the consenting powers associated with that. Our policy is well known.
Do you think that it is unlikely that GB Energy would be working on nuclear in Scotland?
That is a question for GB Energy, but there are things in our policy that mean that consent will not be given for new nuclear with the current technologies, for all the reasons that are on the record.
Indeed. It is highly unlikely.
Monica Lennon might have some questions on this, although I cannot see her on the screen. There she is. Monica, I think that you have some questions on this.
Thank you, convener. Mark Ruskell has covered a lot of the ground, but I will stick with the energy strategy and the just transition plan, which we all look forward to seeing in its final version. Cabinet secretary, can you give an update on what recent engagement has been had with trade unions and whether it is the Scottish Government’s aspiration to see collective bargaining agreements across the supply chain?
I have been speaking to the RMT union and to other trade unions and I am a member of the RMT parliamentary group. There is just a concern that collective bargaining agreements might not be in place for offshore wind and offshore oil and gas supply chain jobs. Is there anything that you can say today on that?
I had a meeting on that with the Scottish Trades Union Congress and relevant union heads in St Andrew’s house—I think it might have been in July or August. They wanted to feed their thoughts into the draft energy strategy and just transition plan in person, and they also made those points to me. The issue will sit more within the just transition plan space.
Again, I am not going to pre-empt what will be in the plan when it is launched. Given what I have just said to Mark Ruskell, the matter has been looked at, particularly in relation to the energy strategy, given what has been happening in the UK space, not just with policy but with some of the issues that have been brought up and decisions that have been made around legal proceedings, if I can put it that way. All I can say to Ms Lennon is that we engage with the unions all the time on the matter, and I had that specific meeting with them to go through some of the issues that she mentioned.
12:00
I appreciate that answer.
Given that we are talking about energy and the just transition, it would be remiss of me not to ask about Grangemouth. I know that you have had close discussions with the UK Government about GB Energy and everything adjacent to that. Now that we are into 2025, are you able to update us at all about the future of the Grangemouth refinery and the jobs and supply chain there? Could anything that has been discussed about GB Energy and related work give some fresh hope to the workforce and community?
I had a meeting yesterday with the secretary of state and representatives from Petroineos. The company is going into stage 2 of its consultations with the workforce. It is starting to have one-to-one meetings with members of the workforce, particularly those that it has not been able to redeploy.
I have asked for more detail from the company on the workforce that it is retaining for the import terminal, the shutdown of the refinery and the processes that are associated with that shutdown. I have also asked for information on people who have other employment, whether in other parts of the Grangemouth industrial complex or elsewhere. Petroineos said that it would try to provide that for me, because it is important that we know what is going on there.
I am also due to have a review of the study that has been done. I refer to project willow, which is looking at the various commercial opportunities for the Grangemouth site. It is far advanced. The secretary of state had his discussion with Ernst & Young on that before Christmas. Mine is due next week, so I will be able to have a lot more discussion about it. Once that study is published, it is our aim to work with the UK Government, Petroineos and any potential investors that we have in the UK and Scotland on some of the opportunities that there will be for that site.
Some of those opportunities are exciting. I look forward to hearing more about the detail of project willow. It says to me that there are, initially, four or five particular streams of opportunity for what that site could become that could be really exciting for Scotland, the rest of the UK and the workforce at Grangemouth.
It sounds like you are feeling optimistic for the future. I am not sure whether the workers and their families are feeling excited. I think that they are incredibly worried.
The just transition plan and energy strategy are not ready yet. There are opportunities that can be grasped, but is there a risk that the action and strategy will come too late? We have talked many times in the chamber and in committees about the fact that, if we do not deliver a just transition for the workforce and community at Grangemouth, it will be really difficult to make that real in any other part of Scotland.
What reassurance can you give the committee and the country that we will not miss those opportunities, whether on sustainable aviation fuel or something else? You are having discussions with the UK Government and separate discussions with other stakeholders. How do we, as a Parliament and a country, feel as confident and excited as you feel that we will not miss those opportunities?
I do not think that I have worked more closely on anything with the UK Government than I have on the Grangemouth situation. I have also worked with partners in the community of Grangemouth, including the unions, representatives of the workforce, Petroineos, the local council leadership in the area, and the Grangemouth future industry board. I do not think that I have ever been involved in anything that has been so focused on a practical just transition. Both Governments have put substantial funding into project willow but, for us, project willow is not a study; it is a commercial opportunity, and we want to encourage investors to look at it seriously, with a view to the Grangemouth refinery site becoming sustainable, running into the future and bringing massive economic benefit to the country.
Cabinet secretary, I have given quite a lot of leeway on this, and I want to try to focus on the legislative consent memorandum. I hope that you will understand that—
I understand that, but I do want to answer Ms Lennon’s questions.
Absolutely. I am sure that you want to take the opportunity, and that people want to know the answer, but I have got to focus back on the LCM. Monica, do you have any further questions on that?
No. Thank you for your leeway, convener, and to the cabinet secretary. It is our first day back, and I think that there is massive interest. We cannot talk about energy and just transition without thinking about Grangemouth, so perhaps the Government will consider making a proposal to the Parliamentary Bureau for a debate in the chamber very soon.
I am sure that you have made your advertisement for that well, Monica.
Kevin, I think that you have the last question.
Good morning, cabinet secretary. You said that all of this is early days. I am going to take you back to earlier days—not that much earlier, but to 8 October 2024, when it was stated that there would be 1,000 jobs at the Aberdeen headquarters of GB Energy. Forty-four days later, at a Westminster committee, Juergen Maier said that there will be 200 to 300 jobs. That was on 20 November, and it is a big loss from the 1,000 that was first stated. He also said at committee:
“we have not yet completed what we think the workforce plan is going to be”.
Have you had discussions with GB Energy, the secretary of state, the Minister for Energy Security and Net Zero or Mr Maier, about the workforce plan and what that means for Aberdeen?
I have not had discussions specifically on the numbers that you have mentioned. Obviously, they have said that there is going to be employment at the levels that they have projected. Douglas Lumsden mentioned that, too. I think that that is a question for them. Have they overstated the amount of jobs associated with GB Energy?
Given that GB Energy’s priority will be the projects, it is quite difficult to put a number on the employment that will come from GB Energy. What were the 1,000 jobs? What were the 200 jobs? Are the 200 jobs associated with the operation of the company or are they associated with the projects? Forgive me, Mr Stewart, but those are questions that I have, too. I really hope that the UK Government takes the opportunity to come and speak to the committee about that kind of detail.
I hope that it does, too, cabinet secretary, because I think that everyone out there—particularly folks in Aberdeen—wants to know that detail. I hope that you will join me in asking those questions as we move forward.
I want to move on to the strategic priorities, which are extremely important. Many of those priorities fall into devolved areas. The Scottish Government has already put hydrogen forward as a priority, and yet I have seen very little from GB Energy or in the bill about hydrogen. Will you give us an idea of what, if any, discussions have been had about hydrogen and how Scotland will play a part in GB Energy’s move forward on that front?
Again, I am giving some leeway on the basis that—
I can give a concise answer. My discussions with the UK on hydrogen have not been in the space of GB Energy. They have been on the export infrastructure for hydrogen and on how are we going to get hydrogen from Scotland, which is going to be a major producer of green hydrogen, to our customer base, which is largely going to be Germany. We need that infrastructure, and we need to work with the EU on that, as well as on the technical aspects of the standards that are associated with the production and export of hydrogen.
The discussions have not been specifically on hydrogen projects. If GB Energy wants to do hydrogen projects—again, how it might do that is a question for it—I would suggest that there is an opportunity. I do not want to upset the convener by going back to talking about Grangemouth, but there is a big opportunity there for the production of blue, and then green, hydrogen. A lot of that would be made much more commercially viable if we had track status on carbon capture and storage as well.
I have been having those discussions around hydrogen, but not necessarily in relation to my focus on GB Energy, on the bill and on ensuring that we have the consent responsibilities that I want us to have.
Okay. Again on strategic priorities, the national grid is such a priority for GB Energy, and that obviously has implications for infrastructure in Scotland. We have seen elsewhere in the world of late—particularly in Ukraine, with the Russian invasion and attacks—what can happen with the ability to knock out national grids and national infrastructure. With regard to discussions on future consents, have there been any discussions about establishing local grids, rather than there being an overreliance on a national grid?
It would help if you could answer that in relation to the LCM, cabinet secretary. We will have another session with you on energy, where I am sure that question can be asked. Without being too much of a killjoy, I would like to try to drive us back to the LCM.
GB Energy is not involved in the grid infrastructure. The only discussion that I have had around that is one that I mentioned earlier, in which I wanted to ensure that GB Energy projects would not be able to leapfrog organisations that are in the existing queue for a grid. You raise a very interesting point, Mr Stewart, and I will come back and speak to you about some of those things—at another session, maybe.
I thank you for that answer.
My final question is about technology development, which will fall into GB Energy’s domain. I had the pleasure of attending a meeting with you recently at OSI Renewables in Aberdeen and listening to some of its proposals. What discussions have there been about joint funding for research and development and investment in these projects? Can we be assured that there will be linkages between GB Energy and the Scottish Government’s ambitions on that front, and that the resources will follow? Is that part of the discussions that you are having?
I want to make sure that a fair share of the investment funding for any technology that goes to GB Energy comes to Scotland, so that we do not reinvent the wheel when it comes to the vehicles that are used to give out that funding. We already have well-established funding streams that have done very well and are oversubscribed. To increase capacity, we need to make sure that the funding that is associated with GB Energy’s funding streams in that area is coming to Scotland.
Thank you, cabinet secretary, and thank you, convener.
Well done, cabinet secretary, for getting it back to the LCM. I am grateful for that and for your evidence this morning. It slightly extended the area that we looked at, but I am grateful for it.
Before we move into private session, I would like to thank Jenny Mouncer for her service to the committee as she moves on to another job. She will be mortified and embarrassed that I put that on the official record, but I think that the clerks do a huge job of work for us. Thank you.
12:14 Meeting continued in private until 12:37.Air ais
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