Good morning, everybody, and thank you for inviting us.
The Royal Society of Edinburgh’s energy inquiry report took slightly over a year to produce. We took evidence from a wide range of people, and we had public meetings as well as meetings with the industry and the Scottish Government. I will give a brief summary of the findings.
I will start with a realistic reminder of the scale of the problem. With regard to the carbon targets, the Scottish Government is committed to reducing carbon emissions by 42 per cent by 2020 and by 80 per cent by 2050. Probably its most famous target now is to be net zero carbon by 2045. Although the report is partly about meeting energy needs, it has that target very much in mind, together with the challenges as we move forward to try to meet it.
The data at the moment shows that 78 per cent of Scottish energy consumption is in transport and heat. When people talk about energy, they think mostly about electricity, but the 2017 Scottish Government data shows that 78 per cent of consumption is in transport and heat. Members will be well aware that, to address that issue for the carbon targets, there is a move towards the electrification of cars and heating.
Renewable generation has steadily increased as a percentage of electricity consumption, and Scotland is ahead of the game, with more than 60 per cent of electricity generation now in renewables. Low-carbon generation in Scotland is much higher because of its two nuclear power stations. Around 80 per cent of the generating capacity in Scotland is low carbon. However, those nuclear stations are due to go offline.
If we look at energy as a whole, which is what we are interested in to realistically meet the net zero carbon target and in order to provide Scotland with energy, we see that only 17.8 per cent of Scottish energy consumption is provided by renewables—that is Scottish Government data. Around 80 per cent of consumption remains fossil-fuel based. That is a very large percentage of energy that will need to be replaced either with alternatives or by capturing the carbon.
In the whole of the United Kingdom—much of the issue is not devolved—25 per cent of current consumption is what we would deem to be low carbon, as it is either nuclear or renewables energy. Turning that into something else is a really significant challenge.
The current plans for the UK are to replace the current nuclear fleet and possibly to grow it in capacity, but that is proving challenging. In Scotland, we are likely to lose low-carbon generation because the nuclear fleet is going offline.
If we electrify everything and do not keep gas from fossil fuels as part of our heating or transport systems, we will face a situation in which we need to double or maybe treble electricity production. We are looking at a very significant increase in electricity generation set against a backdrop of 80 per cent of our energy consumption coming from fossil fuels at the moment. Therefore, we would have to substantially increase production if that is the way that we go.
One of the things that came out of our report was that there are no easy answers to the problem. There are some possibilities. In the report, we went through each of the different technologies and looked at whether they are costly, low carbon and require carbon capture and storage, for example. We also looked at the timelines, because some of the technologies are still in a research or development stage.
On the things that can be done, we can certainly reduce demand. That will involve making more energy-efficient infrastructure and housing and maybe having smart grids in order to use the amount of electricity that we have more efficiently. Increasing our energy storage would also allow us to use energy more efficiently. However, none of those measures will generate anywhere near enough to meet the gap that we will have.
With regard to other options, there has been a lot of discussion about hydrogen and switching our natural gas network to using it. That is fine and it is discussed in our report, but it requires CCS at source to work. Currently, the only way to produce a sufficient amount of hydrogen in a reasonably energy-efficient and low-cost manner is by cracking methane. However, if we crack methane, we create carbon dioxide, which means that we would need to have CCS at source and pump hydrogen round the gas network. That is a technological challenge in itself in terms of converting things, and it would require domestic boilers and some industry infrastructure to be replaced.
Another option is nuclear energy. I appreciate that the Scottish Government has said no to nuclear, but that is based on current technologies, so future nuclear technologies might also be an option.
Increasing renewable energy is an option. Two of the key technologies, which we looked at in the report, are offshore wind and geothermal and ground-source heat opportunities. There is the idea of putting in district heating networks. All of those will reduce demand to some extent. However, there would have to be a really significant—a multiple times—increase in renewable capacity to meet current needs purely with renewables, and I think that that is not feasible at the moment.
The report’s key recommendations largely revolve around the fact that we did not feel that it was our place to make recommendations about exactly what technologies the Scottish Government should invest in, because there are multiple routes and, undoubtedly, a basket of options will be required, as there is a significant challenge ahead. The key recommendation is to establish under statute an expert advisory commission that would cover all aspects of energy, including policy, economic aspects and technology.
People not bringing the public with them is often one of the main things that hold up major infrastructure projects or even stop them completely. We can see that from some of the nuclear problems in the UK. Finance is also an issue for major projects. Therefore, the commission should cover all aspects of energy, including the problems with non-devolved energy matters.
I will not go through all the recommendations. However, if we do not produce more energy and we continue to consume energy at the rate at which we currently consume it or at a higher rate, Scotland will be left with extremely poor energy security, which would make us very vulnerable as a nation and would leave us in a poor position geopolitically. It is hard to apply moral pressure to states if we rely on them for energy production.
One of the key recommendations was to have “a clearly articulated position” on the security of supply that Scotland would feel comfortable with in the future.
There is a clear need to improve storage options. That is an easy win, and it can help us to use energy more efficiently and smartly.
Reducing demand should be a priority. It is the most obvious thing to do, but it is not easy. It will require investment. It needs to happen in industry by using things such as waste heat, as well as in buildings and infrastructure.
There is a clear requirement for investment in research and development. There are no straightforward technological solutions, so we will need R and D if we are to meet the targets by 2045. We also need a skilled workforce to go along with that, which means investing in skills.
Finally, there needs to be communication at all levels across Government. When we went to talk to the UK Government—not the Scottish Government—we found that we had to talk to different departments, that the department responsible for transport was not aware of energy policy, and that there was no joined-up thinking across the piece. It is difficult to achieve joined-up thinking across departments but, if we are to meet a challenge as large as this one, we need to think about that in all the decisions that are made.
That is a summary of our findings. We are happy to take questions.