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The proposed ETS expansion is part of a whole-system approach set out in the final Circular Economy and Waste Route Map, making incineration a less attractive waste treatment method while limiting the production of plastic upstream and increasing its removal from the waste stream prior to incineration.

Supporting policies include the ban on certain Single Use Plastic Items, implementation of an Extended Producer Responsibility for packaging scheme this year and the commitment to require kerbside collection of plastic film and flexible packaging.

The Scottish Government is aware that the best way to mitigate ETS costs is to produce less waste and we will continue to work to put policies in place that reduce fossil-based waste in the residual waste stream.

That is why the primary focus of the Scottish Government continues to be on transitioning to a circular economy and preventing waste from occurring in the first place.

Zero Waste Scotland's (ZWS) Corporate Plan for 2025-2030 includes present and future targets beyond the life of this Corporate Plan.

The reference to seeking reduction of Scotland's extraction of raw materials by one third is based on a United Nations Environment Programme (UNEP) Report, which stresses the importance of high-income countries reducing their material footprint by bending the resource use curve to achieve economic growth, reduced inequality, improved quality of life and dramatically reduced environmental impacts.

During the lifetime of the current Corporate Plan, Scottish Government will continue to work with ZWS in developing data and policies required to establish a baseline and trajectory for future target setting to measure progress towards a circular economy.

The UK ETS is jointly governed by the UK ETS Authority (‘the Authority'), comprising Scottish, UK and Welsh Governments and the Department of Agriculture, Environment and Rural Affairs in Northern Ireland.

The Authority is currently in the process of analysing the results from a recent consultation and developing policy positions. Following this period of analysis, an Authority response will be published in due course, which will provide further details on the outcome of the consultation and policy positions for all Scottish partners.

We are aware that Scottish local authorities (LAs) are in a different position to the rest of the UK, given the introduction of the ban on landfilling biodegradable municipal waste, due to come into force on 31 December 2025. This differing position for Scottish partners is foremost in our consideration of related policies in this area.

In order to reflect this, a provisional analysis set out in the analytical annex of the recent consultation noted that if all household waste that currently goes to landfill in Scotland was to be redirected to incineration because of the landfill ban, total costs for all Scottish LAs could increase to £40million.

The Scottish Government is committed to continuing to working with COSLA on future ETS cost projections. We continue to work closely with Local Authorities, through our SG-LG group, on circular economy related issues.

The Scottish Government published its response to Dr Colin Church’s second and final report on 5 May 2023, which focused on options to decarbonise residual waste infrastructure in Scotland.

We welcomed the report’s recommendations in supporting the continued reduction of emissions associated with waste, whilst also recognising Dr Church’s observation that “properly regulated incineration has an important role to play as part of the waste hierarchy in managing Scotland’s unavoidable, unrecyclable residual waste in a sanitary manner”.

We acknowledge of course that the residual waste sector is a complex system and, in accordance with Dr Church’s Recommendation 1, our Circular Economy and Waste Route Map (published in December 2024) sets out a series of ongoing and future policy commitments to achieve Dr Church’s Recommendation 1 (i.e. “rapidly seek further reductions in the proportion of recyclable materials in the residual waste stream”).

This includes policies such as banning single use plastic items, the implementation of the packaging extended producer responsibility scheme and a new co-designed statutory Code of Practice for household waste and recycling.

In its May 2023 response, the Scottish Government accepted Recommendation 17 in principle. While the Scottish Government agrees that phasing out the incineration of plastic waste is key to decarbonisation, our approach must be balanced, as banning it outright could lead to an increase in inappropriate disposal.

Our Route Map commitments will help to deliver increased reuse and recycling in accordance with our Circular Economy goals and help drive the reduction in fossil-based plastics going to incineration.

Maximising the economic opportunity for the Scottish supply chain from our renewable potential is a key focus for our Green Industrial Strategy, published in September 2024.

We are investing up to £500 million over five years in the offshore wind supply chain, which is expected to leverage additional private investment of £1.5 billion in the infrastructure and manufacturing facilities critical to growing the sector. This investment will support thousands of new jobs and maximise economic value to Scotland.

Through the Supply Chain Development Statements process, offshore wind developers have made commitments to invest an average of £1.5bn per project across the 20 ScotWind developments in the Scottish supply chain. These commitments are an integral part of the leasing process and are intended to drive developer engagement with the supply chain from the very outset of project development.

The UK Government’s Clean Industry Bonus will provide extra revenue support to offshore wind developers who choose to invest in cleaner supply chains, and in supply chains in the UK’s most deprived areas. We expect both Scottish offshore wind projects and supply chain to benefit from this new initiative.

Through the Onshore Wind Sector Deal we are continuing to see positive engagement with industry on publishing data on the percentage of local content in the supply chain, which will help to illustrate the economic impact developments for communities and Scotland’s regional and national economies.

The Scottish Government is committed to supporting the net zero economy. Together with our enterprise agencies, we have invested £75 million in the cutting-edge National Manufacturing Institute Scotland facility, which is actively supporting low-carbon and green manufacturing.

We are also committing £2.9 billion of capital for activities that will positively impact our climate goals and support domestic manufacturing in green sectors, including over £300 million in energy efficiency and clean heat measures and £150 million to anchor our offshore wind supply chain.

Our Enterprise Agencies play a key role in supporting our low-carbon, green manufacturing sector, for example through funding streams and links to Business Energy Scotland and the Scottish Manufacturing Advisory Service.

Growing the economy is one of the Scottish Government's top priorities, and Scotland's regional economies, and Regional Economic Partnerships (REPs), are key to delivering this. We are committed to building a resilient and equitable economy where all regions can thrive and contribute to national prosperity.

This includes supporting our regions to develop their own regional economic strategies. These are led by the regions themselves, allowing the aims and priorities to specifically respond to regional needs and opportunities. Many REPs now have published and well-established strategies, setting their direction cohesively, and strongly demonstrating their plans for economic growth which enables clearer prioritisation and decision-making when seeking targeted support.

Policies to support the decarbonisation of Scotland’s manufacturing base will be summarised in the forthcoming Climate Change Plan which is being informed by discussion with representatives from key industrial sectors.