Official Report 187KB pdf
The next item of business is a debate on motion S7M-00159, in the name of Stephen Gethins, entitled “It’s Scotland’s energy”. I invite members who wish to speak in the debate to press their request-to-speak button.
14:30
Deputy Presiding Officer, congratulations to you and your colleagues on your appointment. If you will permit me, before I get into the meat of the debate, I thank my predecessor in Dundee City East, Shona Robison, who was not only an outstanding minister, as I am sure the First Minister will agree, but a tireless advocate for Dundee. I know that she will be greatly missed in the Parliament. I also thank my predecessors in this portfolio, Gillian Martin, who is here with me today, and Angus Robertson, not only for their tireless work in the portfolios that I cover but—I am not embarrassed to say—for their guidance and valuable advice in my first days in the post.
I thank colleagues from across the Parliament for their good wishes. I want to say straight off that it is my aim—the First Minister said this about his role, too—to work in a collegiate fashion: to agree where we possibly can and to disagree rigorously. I am sure that there will be opportunities for disagreement, but we must do so agreeably when we cannot agree.
No party or MSP has a monopoly on wisdom—certainly not me—and I very much look forward to working with everybody in this chamber. I am so grateful for the good wishes that I have received from colleagues from other parties. I will not embarrass you, but it has been heartening, and I thank you.
Nobody will mind me saying that, most of all, I thank the people of Dundee City East for their faith in me. I also thank people in Dundee and Angus for the privilege of serving as their member of Parliament. I will miss the parts of the constituency that my colleagues Heather Anderson and Lloyd Melville are now fortunate enough to represent, but I am absolutely determined to get stuck in for Dundee.
Dundee is Scotland’s “Yes city”. It is a city that my family once migrated to from Ireland. It is a city that, like the rest of Scotland, is at its best because of its diversity and its outward-looking nature, which enriches our industries and our society. The city informs my politics, as I know that it does for other colleagues in the Parliament.
Dundee is a city that has been at the heart of Scotland’s successes in food and drink, higher education, journalism and, of course, energy, which moves us to the fundamental point of today’s debate.
We are debating where decisions should be made. Are they better being made here, in Scotland’s Parliament, which is voted on by the people who live and work in Scotland, or at Westminster? Whatever our views, surely Scotland’s energy policies should be in Scotland’s hands. It is one of the most energy-rich countries in Europe, having won the natural lottery twice—once with hydrocarbons and then with its abundant renewables resources. Yet, despite that—
Will the minister take an intervention?
Do you know what? I will take an intervention, despite this being my first speech—and who better to take one from than Murdo Fraser?
I remind Mr Fraser that the convention is that there are no interventions on a first speech. However, the member has indicated that he is happy to take one.
My apologies to you, Presiding Officer, and to the member. He was so confident in his approach that it had entirely slipped my mind that it was his first speech in this chamber.
I very much welcome Stephen Gethins to his place on the front bench as energy minister. I want to ask him about the renewable energy that he is talking about, which Scotland has benefited from and which is funded by subsidies that are currently paid for by 70 million people across the United Kingdom. If he dismantles the UK energy market, as he proposes, will that not mean that those subsidies will need to be paid for by the 5.5 million people living in Scotland? What would that do for bills that are being paid by consumers here?
I have great respect for the member, and I thank him for both his intervention and his welcome. I urge him patience. I merely say this: Scotland is a massive exporter of energy; other markets rely on our energy and have done so for decades.
I am sorry to say so, but that speaks to the isolationist approach that has been taken by the Conservative Party, which turned its back on a Europe that is coming together on energy security. Isolationism is not a policy that our party—or a majority in this Parliament—will endorse. I will come on to that point.
In energy-rich Scotland, we are facing increasing energy bills. Just yesterday, the Labour Government, which had promised to reduce energy bills, put them up. We are a country that produces more energy than it consumes.
Mr Fraser will be delighted by this: for context, our oil and gas industry has sent £400 billion to the Treasury over decades, with very little in return and no long-term planning. Can members imagine that? We have a finite resource, but there is no long-term planning. We are one of the few countries on earth never to have put together a future generations fund. That is why Westminster has failed and why this place deserves to have full control over energy.
Renewables alone deliver 20.8 terawatt hours outside of Scotland annually. To put it into context, that net export is worth £1.7 billion and, if we kept the energy in Scotland, it would be enough to power every home in Scotland for three and a half years. That shows the value that it has to the rest of the UK and the whole of Europe when it comes to energy security.
Lower bills where that energy is produced should be part of the solution, but we have been let down. That is why decisions about energy should be made here. Westminster’s track record, be it under the Conservatives—or those former Conservatives—or under Labour, means that it no longer deserves to keep that control.
The disconnect between Scotland’s energy wealth and the daily reality that households face is not inevitable. We all talk—I have heard some fantastic speeches—about the conversations that have taken place over the past few weeks. It is a consequence of a constitutional arrangement that leaves decisions about Scotland’s energy in the hands of Westminster, which is delivering, in this energy-rich part of Europe, energy bills that are among the highest anywhere in Europe. That should be a challenge for all of us in this chamber.
The people of Scotland returned a Government with a clear instruction: deliver the benefits of Scotland’s energy wealth to Scottish households, communities and businesses. The First Minister set out that position and the electorate endorsed it.
Let us look more deeply into that. I am sure that members will all recall the polling evidence that came out last month during the election campaign. An Ipsos survey showed that more than three quarters of Scots think that there should be more devolution over energy, and that only 14 per cent think that it should remain under Westminster control, which would be the case under Labour, Reform and Conservative policies.
Will the minister give way?
I will give way for a second time, because I have great respect for the member.
I, too, welcome the minister to his position. I consider him a friend and am delighted to see him in his place.
The minister spent the election campaign talking about how independence could deliver taking a third off energy bills in Scotland. Can he tell us how?
I have great respect for the member, and I thank him for his kind words. He is an advocate for the north-east and for Dundee. However, he must understand that, as we sit here exporting electricity while the Treasury in London benefits from it, we could introduce measures such as a social contract or a social tariff to help lower bills for those most in need. That is only one of the things that could be done.
The benefit is not only to Scotland’s citizens. I will talk about the rest of my brief. Scotland is a responsible and outward-looking member of the European family of nations. Yesterday, my first meeting as part of my external affairs brief was with the Ukrainian consul general. Back in January, I sat in a bunker for two nights as the Russians bombarded Ukraine’s energy infrastructure. In a more dangerous world, Europe needs to move closer together. Parties that have turned their back on Europe ignore that at their—and our—peril. We are rich, and we should be thriving. We are part of Europe’s solution to the energy crisis.
Other members will be glad to hear that I saw that for myself in Aberdeen, on my first ministerial visit on Monday. I am grateful to colleagues from across the sector for meeting me. Those businesses matter. Yesterday’s Confederation of British Industry report showed that net zero-related industries are worth more than £10 billion, that they account for 5 per cent of Scotland’s total economic output and that they provide jobs for more than 100,000 people, as the member for Moray raised at First Minister’s question time. Those opportunities, which exist onshore and offshore, are set to grow.
That could be game changing for Scotland, with around £100 billion of global capital expenditure coming down the track. Westminster is holding back that huge potential, not least through the punitive transmission charging charges that it has set, which business cited to me.
The Scottish Government is doing everything that it can within its limited powers. We have provided £150 million of investment, which will attract wider investment and create a funding stack of almost £900 million-worth of projects across Scotland.
Will the member take an intervention?
I want to make some progress. I am not sure that I got a particularly good response from Mr Fraser.
High energy bills might not matter to the Conservative Party, but they matter to the people of Scotland. Labour came into government promising that bills would be £300 lower, but yesterday another eye-watering increase was announced that will mean that they will be £300 higher. That is not good enough. The future lies in providing clean, sustainable and secure power, strengthening affordability, resilience and competitiveness, and protecting Scottish people and businesses from our energy bills being dictated by international events.
Within the limited powers that we have, we are already reforming the energy consents process to enable us to bring forward more low-cost renewable energy. During the parliamentary session, we will establish a ScotWind health fund. We will also establish a future generations fund for the oil and gas sector, which Labour and the Conservatives failed to establish. We will encourage more community ownership—we are already delivering £15 million for that. We will deliver on the £500 million just transition fund, as well as supporting the Acorn carbon capture and storage project for the north-east. Do the Tory members remember carbon capture and storage?
More immediately, we want updated guidance to be provided to public bodies on community use of public land and an assessment to be undertaken of the potential for installing solar panels in underused spaces. That cannot be done within the current devolution process to enable us to meet our full potential.
That leads me on to oil and gas. Few industries know the price of Westminster failure better than our oil and gas sector. North Sea oil and gas plays a vital role in Scotland’s energy system and security mix. That excellent workforce in the north-east has been let down by our wealth being squandered by successive Westminster Governments. There is no future generations fund. Let us look next door at Norway. It has a sovereign wealth fund that is worth £1.6 trillion, which is six times Scotland’s gross domestic product. Just think what we could have done with that.
The North Sea is a mature and declining basin, so it is vital that we have a parallel-track approach to the transition, with oil and gas production being managed alongside the increasing deployment of renewables. However, the transition is being put at risk by the current energy profits levy, which is accelerating the decline of North Sea oil and gas while failing to give the support that is needed to renewables to ensure a just transition. The approach that is taken must be fair for the North Sea. That is why, I am afraid, we cannot back the Greens’ amendment. As the First Minister said earlier today, that approach must be evidence led and determined on a case-by-case basis, with climate compatibility and energy security tests being met. When I was in Aberdeen, I heard about the need for a joined-up approach.
I was glad that, on his first ministerial visit, Stephen Flynn went to Grangemouth, which has been so badly let down by Westminster. Climate action and a just transition to net zero will bring benefits across Scotland. We will support the creation of 500 additional jobs in the Grangemouth industrial cluster and, at the same time, we will invest £9 million in support for workers at Mossmorran.
Let me turn to the idea of community benefit. We must reject the Liberal Democrat amendment, because it knocks out the idea of devolving those powers, which the Liberal Democrats were once in favour of. I have great respect for the member for Orkney, Liam McArthur, and look forward to working with him on how we can expand the work that has already been done. However, let us not forget that, last year alone, community benefits delivered £30 million to our communities.
In conclusion—I think that I am reaching my conclusion—a more energy-secure Scotland will see us building renewable energy generation that will lower bills, protect us from international shocks and secure good jobs for those who are currently employed in our offshore sector and who bring so much to our economy.
Scotland has the energy; it does not yet have the power. Our vast resources are among the best in Europe, but the people are not feeling the benefit. Westminster has had its chance and has failed. Today, I am asking members to empower this Parliament to be part of the solution for energy security across Europe and to be part of the solution locally, nationally, internationally and—vitally—in people’s homes.
I ask colleagues to back our motion today, and I move,
That the Parliament believes that Scotland’s energy should be in Scotland’s hands, and calls for all energy powers to be immediately devolved to the Scottish Parliament.
I call Daniel Johnson to speak to and move amendment S7M-00159.2.
14:46
I congratulate you, Deputy Presiding Officer, and welcome you to your position.
I begin on a friendly note by welcoming Stephen Gethins to his position. I have known him for a number of years and hope that I will not embarrass him by observing that we first met when we were student politicians. Let us hope that we have raised the standard of debate a little since then. Indeed, I wonder whether this Government will become a tale of two Stephens. We can see why the First Minister appointed Stephen Gethins, because he brings a mature approach and can be collegiate and work on a cross-party basis. I will let others decide what the analysis of the other Stephen might be.
It is important to talk about energy and we need to have a grown-up and rational conversation, because energy is at the heart of our economy and of this country’s future prosperity, but the motion does not auger well. “It’s Scotland’s Energy” might make for a somewhat adequate T-shirt slogan, but it is an incoherent title for a parliamentary motion and an entirely empty basis for policy. I gently point out to Mr Gethins that his speech was rather heavy on rhetoric but rather light on actual analysis.
The reality is that we have seen a huge investment of £150 billion in renewables in Scotland since 2014. Of the 45GW of renewables capacity in this country, 25 per cent is in Scotland, with 80 per cent of the UK’s wind generation capacity being in Scotland. That is because of UK policy—driven by contracts for difference and by renewables obligations before that—which has driven investment and lowered costs by those bills being underwritten through strike prices. That has cost the average UK bill payer £39 annually. Is the Scottish National Party saying that that £39 should be spread only across UK bill payers? That would surely be worth hundreds of pounds per person, per year.
Mr Johnson made a rather pejorative point about the difference between rhetoric and action. I am reminded of promises made by the Labour Party in the run-up to the 2024 general election. It promised to reduce bills by up to £300 but, in fact, prices have risen by £300. Can he explain why we are seeing such a rise when other countries across Europe are investing in lowering fuel duty and bills for residents who are suffering from issues caused by the invasion of Iran? Why is the UK Government not taking the action that is being taken by those in other countries?
The cabinet secretary seems to be enjoying the new rules about interventions. Is he not aware that there have been some major changes in international circumstances? Average bills had been going down, especially for those on direct debits. Most critically, if he is talking about the lowest cost, I would ask him where in Europe has the lowest electricity cost. It is France, 80 per cent of whose generation comes from nuclear. If we are going to have a serious argument on energy costs, let us have it, but let us have it on the basis of facts, not assertion and dogma, which is what we have from the SNP Scottish Government.
The reality is that, if the SNP is going to assert that independence would lower bills by a third, it needs to explain how that would happen. Where is the excess? Right now, electricity bills are underwritten by taxpayers to the tune of £39 annually. What would happen to contracts for difference under an independent regime or a devolved one? Is the SNP saying that Scottish bill payers would pick up that underwriting? The reality is that the strike price has been above the wholesale electricity price, not below it. The SNP needs to answer those questions if it wants a serious debate on the matter.
We need a serious debate, because there are a number of areas within devolved competence on which we should be seeking to go further and faster. Why has the Scottish Government not been progressing quickly and successfully on upgrades? Consumer Scotland expects the schemes in Scotland to reach just 45 per cent of fuel-poor households, but the figure in England has been 95 per cent.
On transmission and infrastructure charging and upgrades, we have failed to see the support for the planning regime that we need to accelerate progress. The reality is that it takes seven to 10 years for renewables projects to get through the planning system in Scotland. Comparable projects in countries such as Norway take three to four years. Where has been the progress on heat networks? Where is the SNP’s promised publicly owned power company? Those are just some of the many questions on matters that are within devolved competence that we need to examine, and we need a debate on them.
It is all well and good to talk about renewables, but we have failed to have a public debate and discourse about what they mean in relation to infrastructure. That is why we now see renewables being used as a political football. We need a candid discussion because, if we are going to have renewables generation, we will require the infrastructure to distribute that power—not least to the rest of the UK, to which we want to sell that electricity. That infrastructure is underwritten and paid for across the United Kingdom.
Those are some of the things that we need to talk about. By all means, let us have a candid and mature debate about the future of our energy economy, but I do not believe that the motion or the Government’s proposals are anything more than sloganeering and rhetoric from the SNP.
I move amendment S7M-00159.2, to leave out from second “that” to end and insert:
“Scotland needs a managed and just transition that relies on an integrated UK energy market, balancing the continuing role of oil and gas alongside the maturity of the North Sea activity and Scotland’s climate targets, and supports the examination of all energy technologies, including nuclear, to achieve a sustainable energy mix.”
I remind members that the convention is that there should be no interventions during a first speech.
14:52
I welcome everyone to their new roles, including the ministers and shadow ministers.
I am delighted to rise to give my first speech. I believe that this Parliament and this Government need massive change, so I am encouraged by some of the talk of change that we have heard so far, especially the contributions from the Presiding Officer and his deputies. However, I remain concerned that real change will remain elusive and that this Parliament and, especially, this continuity Government remain out of touch, wholly self-satisfied and in a Marie Antoinette-like bubble. Nowhere is that more apparent than on energy policy. Energy reality simply does not seem to get past the outer walls here.
Scotland, the UK and, indeed, much of Europe face the simple reality that our energy system is not working. We have a fragile and overstretched grid that is struggling to deal with intermittent renewables, unable to cope with growth opportunities such as those from artificial intelligence and, increasingly, at risk of failure. We have a growing reliance on imported energy, particularly via French interconnectors and liquefied natural gas tankers, and we are destroying our own oil and gas industry, despite needing oil and gas for decades.
However, the main area of failure is the cost of our new energy system. We are facing an energy price crisis. Extremely high prices are hurting consumers and, perhaps most obviously, we have the highest industrial energy prices in the world, which are driving deindustrialisation. The damage from that is clear to see. Our primary steel industry across Scotland and the UK has nearly been lost. Industries including chemicals, pharmaceuticals and ceramics have all been hammered.
Across the board, manufacturing is at a huge disadvantage due to high costs. That is more obvious in Scotland, with the closures of the Grangemouth refinery, the Mossmorran plant and the Alexander Dennis bus factory in Falkirk.
Those problems are not caused by temporary gas price spikes; they are caused by net zero policies, particularly the overuse of expensive and intermittent renewables in the system—[Interruption.]
I remind members that there should be no interruptions during first speeches. I appreciate that the minister took interventions, but there should still be no interruptions.
Thank you, Deputy Presiding Officer.
As Professor Dieter Helm of the University of Oxford succinctly put it, renewables are
“not cheap, not home-grown and not secure”.
That is where we are.
The costs are being driven by two things. First, the direct costs of renewables are very high. We can see that clearly through CFD prices at the moment. The subsidies are paid by the UK Government, on which Scottish wind is wholly dependent.
For example, in allocation round 7—the most recent funding round of CFD—offshore wind is priced at £95 per megawatt hour and floating wind is priced at £215 per megawatt hour. On some of our older wind farms, such as Beatrice, it is priced at well over £200 per megawatt hour. The prices are all index linked and on long-term contracts, so the prices are fixed to go up for nearly 20 years. We can compare that with the direct cost of gas, which is between £50 and £60 per megawatt hour.
Secondly, the system costs that are imposed by renewables are even higher, and they continue to grow. They are like the submerged part of an iceberg, making up two thirds of the cost of our bills. The reason for that is that, to support intermittent generation, we have to build a vastly larger grid—much greater than that of a conventional system—at huge expense. There is also a huge amount of ire and anger from those in our rural communities, who do not want giant pylons or battery farms across their back gardens.
We also need to maintain 100 per cent back-up. In Scotland and the UK, the back-up comes from gas; in other European countries, it comes from coal. That adds huge cost, complexity and vulnerability. Vulnerability is an increasingly serious concern, with the risks of blackouts rising, as demonstrated by what happened in Spain last summer.
Scotland is going to be especially exposed to those risks. We rely on only two ageing conventional plants—Torness nuclear plant and Peterhead gas plant—and both could close in the early 2030s, which would make Scotland extremely vulnerable to blackouts and likely to be dependent on gas plants that are located in the north of England.
We have to start facing that energy reality. Renewables will definitely be part of the energy mix, but we have to recognise the high costs and limitations of them.
That brings me to our oil and gas sector—a world-leading industry that is being crushed by deliberate policy choices. Despite the massive investment in renewables, the oil and gas industry remains essential. In the UK, 75 per cent of primary energy still comes from oil and gas. Globally, 81 per cent of primary energy comes from oil and gas. We need to acknowledge that, in all scenarios, the UK and Scotland will need oil and gas for decades. It is needed for transport fuels and key chemicals—just about every product in this room requires oil and gas—and it is vital for heating and industrial processes. Paradoxically, the more renewables that we add to the grid, the more flexible gas back-up we need.
We need to maximise our use of oil and gas resources rather than import them from neighbouring Norway or from countries even further afield. We can do that. The North Sea has a strong and vital future, if we choose it. We need to urgently remove the energy profits levy. We need unambiguous support for the Jackdaw and Rosebank oil fields and all new projects. We need unambiguous support for new licences in drilling. That would revitalise our industry.
As my amendment states, I call on the Parliament to be a vocal champion for the North Sea oil and gas industry, to apologise for previous policies that show lack of support for the industry—including the presumption against new development—and to provide unambiguous support for Jackdaw and Rosebank and new drilling, with new planning laws needed if necessary.
The benefits of a stronger UK oil and gas industry are enormous: continued jobs, major tax revenue, greater balance of payments and greater energy security, with, in particular, the opportunity to reduce imports, including greatly reducing or even ending LNG imports.
Let us talk about emissions. UK emissions now account for less than 0.8 per cent of global emissions. Scotland accounts for about 10 per cent of that, at 0.08 per cent—not even a rounding error—and that figure is just going to keep getting smaller and smaller, as large nations such as India, Indonesia, Pakistan and Nigeria continue to use more energy, especially from gas and coal. The UK is still about the 24th largest oil producer in the world, but it accounts for only about 0.7 per cent of world production—another rounding error in global terms.
Furthermore, the Parliament should note that the Intergovernmental Panel on Climate Change has quietly removed its RCP—representative concentration pathway—8.5 scenario, once again highlighting that the scientific consensus is that there is not an emergency but a slow, mild warming. It is a problem, for sure, but not something that requires us to commit unilateral economic suicide and decimate every industry in this country.
That brings me to another industry that this Government has tried to destroy—nuclear. Nuclear energy is emission free, 24/7 and reliable, and every industrial country around the world is now moving towards it. It is increasingly seen as vital for new technologies such as data centres, artificial intelligence and robotics. Scotland used to be an absolute world leader in nuclear. We had four large plants across the country, cutting-edge research at Rolls-Royce in East Kilbride and at Dounreay, and world-leading nuclear vessel operations at Faslane. We need to rediscover that, because the world has turned. We need to reindustrialise, because 24/7, cheap, reliable and localised energy is needed for new technologies such as AI, and Scotland needs to be part of that.
It is simple. If we want real economic growth, we need a pragmatic energy policy that focuses on cheap, abundant and reliable energy. We need energy policy that is driven by reality, not wishful thinking, and it must acknowledge that our current failing system has the highest industrial energy costs in the world. We need energy policy that is backed by the broad shoulders of the UK Government. That means maximising our oil and gas resources in the short and medium terms and transitioning to a nuclear-powered system over the long term, with renewables playing a complementary role rather than a dominant one. That is how we will secure cheap energy for everyone and ensure that we can reindustrialise, protect our world-leading oil and gas industry and keep the lights on for Scotland’s future.
I move amendment S7M-00159.1, to leave out from second “that” to end and insert:
“Scotland’s current net zero-driven energy policies are failing, contributing to deindustrialisation through high energy costs and also increasing grid instability, including with the planned closure of Torness nuclear power station, thus creating a significant risk of blackouts; recognises the continued dependence of renewables on UK Government subsidies; acknowledges Scotland’s past leadership in nuclear power; calls for renewed investment in nuclear capacity, further calls on the Scottish Government to recognise the ongoing importance of oil and gas and to fully support the sector in the North Sea, including through unambiguous support for the Jackdaw and Rosebank oil fields and new drilling and licences; calls on the Scottish Government to apologise for its previous lack of support of the industry, including for what it considers has been the presumption against new developments, and considers that, in light of the challenges facing the sector, that energy powers should remain reserved to the UK Government.”
I call Lorna Slater to speak to and move amendment S7M-00159.3.
15:03
For a change of tone, the Scottish Greens believe that Scotland’s energy should be put in Scotland’s hands. We have long called for more powers for Scotland, as well as Scottish independence. Scotland urgently needs to respond to the climate emergency, cut the cost of living and ensure our long-term sustainable energy security. It might come as a shock to my colleague, but oil and gas are a finite resource. They are not abundant—it is a declining basin. Every litre of oil and gas that is pulled out of that basin costs more than the litre before, and that is even if we expand investment in oil and gas. It is a declining industry. The cost of energy in Scotland is a challenge.
The member does not, however, address the fact that demand is continuing to rise and is not going anywhere. Where do we source the gas and oil to meet the demand?
We need to manage that demand. The Scottish Government should have kept its commitment to reduce traffic kilometres by 20 per cent. It should have introduced the heat in buildings bill, which would have reduced energy demand to heat our homes. We can reduce the demand by changing how we use energy. The main problem for our energy in the UK, and for our costs here, is the way that the UK Government links energy, electricity and gas prices, which prevents bill payers from benefiting from the low generating cost of renewable energy. That urgently needs to change to allow for cheap renewable energy that would boost industry and accelerate the decarbonisation of heat and transport.
Will the member take an intervention?
I am going to make some progress, thank you.
It is a matter for the member whether she chooses to take an intervention.
In the previous session of Parliament, the Economy and Fair Work Committee heard over and over again that the cost of energy is the main concern for business and industry. Next winter, the cost of gas and oil to heat homes will be nearly everyone’s main concern. We cannot remain tied to the rollercoaster of fossil fuel prices. We need to produce our own clean, sustainable and affordable energy from renewable sources.
Will the member take an intervention?
I will take some more interventions in a minute. Let me make progress.
Throwing good money after bad to try to expand North Sea oil and gas drilling just adds carbon to the atmosphere that we have to remove later on, at great expense, or else it will drive up global temperatures, with disastrous consequences for future generations. The world has far more fossil fuel than it can safely burn, and issuing licences to extract fossil fuels from new sources is indefensible.
I congratulate Reform colleagues on finally managing to lodge an amendment to a debate—the third time is the charm—but I am alarmed by the flat-out climate denial and, indeed, reality denial that is contained in the amendment.
I will make two points, if I may. The first is that, last year, the UK paid £2.64 billion in CFD subsidies. That is the difference between the market price, which is driven by the expensive gas that the member talks about, and the CFD strike price. That is the reality of it. CFDs are £2.6 billion more expensive.
On her last point, does Lorna Slater acknowledge that the terms “climate emergency” and “climate crisis” are faith-based terms and are not actually supported by the scientific consensus or, indeed, by the IPCC, which is the correct technical authority?
I absolutely disagree with Duncan Massey, of course. The climate emergency is backed by climate science globally. To condemn future generations to the future that exists if global warming gets to 3.5°C or 4°C is a horrendous thing to do.
The member does not include in his calculations the cost of re-sequestering the carbon that is emitted. We have been letting the fossil fuel industry off scot free, because we let it pollute our atmosphere and raise carbon emissions, and then we sit in the chamber thinking, “Goodness, how are we going to put in place CCS and other ways to resequester that carbon?” Public money is trying to clean up the pollution that has been generated by private capital.
Will the member take an intervention?
No—I need to continue. Sorry.
Just so that we are clear, around £17.5 billion a year is spent in the UK on fossil fuel subsidies on an oil and gas industry that is fully established, unlike renewables, which is still a developing industry. That does not count tax breaks, which are a form of subsidy.
Previous analysis from Global Justice Now revealed that, in 2024 alone, the UK saw fossil fuel companies BP and Shell, which are among those that benefit from all that public support, make a combined total of £26.2 billion in profits. That is more than double the combined total of cuts made to the aid and welfare budgets in 2025. The head of BP in the UK has a base salary of £1.6 million, and her total compensation this year is expected to exceed £11.7 million. The UK handing more public money and tax breaks to those stinking rich polluters, instead of investing in moving us to clean energy that is locally generated from our abundant renewable resources, is unconscionable.
In Scotland, anyway, our energy transition is under way, with excellent progress on moving to renewable electricity generation. We now have the harder challenges of changing how we travel, how we manage our land and how we heat our homes. That is exactly where the SNP Government needs to set out its stall and say how it would meet Scotland’s energy needs if it had the powers.
Will the member take an intervention?
Let me finish this thought.
Spoilers—Rosebank et al are not climate compatible, so we need a plan. We cannot wait to find out that they are not climate compatible—they are not climate compatible. Will the Scottish Government transition using the strategy that is defined in its own draft energy strategy, or will it continue to sit on the fence?
I will take the intervention.
I appreciate that. Does Lorna Slater accept that there are children in Scotland who are living in cold homes because of the price of energy? Does she also accept that the contracts for difference subsidy of £2.64 billion that Duncan Massey referred to has played its part in causing our energy prices, which are four times those of the US?
I agree with the member that families are suffering in cold homes in Scotland, which is why we need the heat in buildings bill to ensure that everyone in Scotland has a warm, affordable home. I disagree with the point about contracts for difference, because it is important to invest in renewable energy as it becomes an established industry. It is distressing that the oil and gas industry, which is already an established industry, is still raking in public money, subsidies and tax breaks—it has not needed those for years, because it makes billions in profits. As we move to renewable energy, it makes sense, of course, that we support growing industries. That is how a just transition works.
Will the member give way now?
Certainly.
Ms Slater mentioned the evidence that was heard by the Economy and Fair Work Committee. I hope that she would agree that the tone of that evidence was that we are causing the deindustrialisation of Scotland through the imposition of levies and other market interventions on businesses. Hence, businesses are shutting down in Scotland and are offshoring to other parts of the world. We are defeating our own purposes by pursuing the policy prescription that Lorna Slater puts before the Parliament this afternoon.
The member makes a few mixed points. He was a member of the committee, and I heard in evidence put before it that businesses are struggling with the costs of energy. Everyone is particularly worried about the spikes in fossil fuel prices because of geopolitical events. We need to move away from that rollercoaster and back to the sustainable energy that we generate in Scotland, which means renewable energy for the long term.
Would the member give way again?
I advise the member that she does not have time to take any more interventions.
A new report commissioned by the Energy and Climate Intelligence Unit states that net zero industries contribute £10.2 billion in gross value added to the Scottish economy and support more than 150,000 jobs. An estimated 3,000 businesses are now part of the Scottish net zero economy, with 90 per cent being small or medium-sized businesses.
The Scottish Greens want Scotland to lead a renewables revolution, with £600 million of investment in onshore and offshore wind, tidal and solar, including redeploying millions in public funding that has been pledged to unproven greenwashing carbon capture and storage technologies. The Government needs to bring back the heat in buildings bill to decarbonise Scotland’s homes and buildings by 2045. With our abundant renewable resources, energy should be cheap in Scotland but, while Westminster holds the power, we cannot make that happen. It is time that we did.
I move amendment S7M-00159.3, to insert at end:
“in order that Scotland can respond to the climate emergency, cut the cost of living and contribute to energy security; recognises that the climate emergency is an urgent priority for Scotland and for the world, and that the re-emergence of climate denial poses a serious threat; accepts that the world has far more fossil fuel than it can afford to burn without disastrous consequences, and considers that issuing licences to extract fossil fuel from new sources would therefore be indefensible; recognises that the way in which the UK Government links electricity and gas prices prevents billpayers from benefiting from the low generating cost of renewable electricity, and that changing this system would accelerate the decarbonisation of heat and transport; believes that putting Scotland’s energy in Scotland’s hands must include a significant increase in community-owned energy, and further believes that reducing the cost of energy and achieving a rapid and just transition away from fossil fuels will deliver jobs, investment and a strong economy, particularly in rural and island communities.”
I call Liam Kerr to speak to and move amendment S7M-00159.4.
15:12
I congratulate Stephen Gethins on his appointment as energy minister and I commiserate with him for having to prosecute such an evidentially lacking and, indeed, threadbare motion. Listening to the debate exposes the perils of reducing nuanced, data-driven policy areas to the narrow nationalist rhetoric of the SNP. The consequences of what the motion calls for would be calamitous, whether that is in regard to energy generation, household bills, the economy or, indeed, the environment.
For example, the Government demands control over renewables generation and continues to bank on intermittent and variable wind power, but it fails to mention that it already has power over, for example, seabed rights for offshore wind projects yet its handling of the ScotWind licences was so botched that, last November, Shell handed back the CampionWind lease, having spent 18 months trying and failing to sell it. In February, Audit Scotland launched a formal investigation into the ScotWind leasing round.
The Government also fails to mention that, without the UK’s contracts for difference regime providing crucial stability for high upfront cost projects, it is unlikely that any of Scotland’s 3GW of operational offshore wind would have been built, let alone the fact that the ScotWind projects would not even have got off the ground. Then, there are the constraint payments, which in 2025 totalled somewhere between £340 million and £380 million.
It is deeply irresponsible for the minister to propose the motion without addressing issues such as replication of the CFD regime, ways of meeting those constraint payments or the funding of the transmission and storage updates that are required to integrate Scottish offshore wind, which it is estimated will cost up to £20 billion by 2030.
Does the member think that the £400 billion that has gone to Westminster has been well spent, given that no resource has been given back and no future generations fund has been established? What does he make of the constraint payments that are holding back renewables, an issue that, even in my first week in post, industry has been raising with me persistently? Westminster has failed—does he not agree?
I fundamentally disagree. We only need to go and look at the current infrastructure that is out there. That is what the money has bought, because, thankfully, we are part of a wholly integrated United Kingdom. To suggest otherwise is deeply irresponsible, and that irresponsibility is most stark in the Government’s position on oil and gas, to which my amendment principally speaks.
The SNP motion says that the Scottish Government wants control over North Sea oil and gas, yet it quietly ignores the Scottish Government’s January 2023 energy strategy, which states that the Government has
“a presumption against new exploration for oil and gas.”
In other words, while oil and gas remains reserved, a Conservative Government could—and would—reverse Labour’s economically, strategically and environmentally disastrous ban on new exploration and production. However, if the SNP got control, its energy strategy makes it clear that it would shut the North Sea. The worst of it is that current domestic production from the North Sea meets around 40 per cent of UK gas demand, and nearly half is brought in from Norway, which is drilling the same basin. In fact, while Labour and the SNP are trying to shut the North Sea and lose taxes and jobs, Norway licensed 70 new blocks in early 2026 and gave companies major tax incentives. We must not let decisions on North Sea energy fall into the SNP’s hands.
On the renewables intermittency problem, the minister utterly fails to address questions of baseload. Torness, Scotland’s last nuclear station, which generated around 17 per cent of Scotland’s electricity in 2024, will shortly be closed. However, this Government has used the powers that it already has to block any new nuclear in Scotland—a decision that this Parliament has heard time and again in recent years is based on misinformation, prejudice and blind ideology.
Finally, it is important that I address the issue of high energy bills, which the minister is right to say are a real challenge and a cause of fear for people. The minister tries to suggest that getting energy powers would reduce those bills, but people need to hear the truth. For example, the way to reduce the constraint payments that are paid when wind farms generate excess power that cannot be transmitted or stored efficiently is through major investment in transmission and storage infrastructure, which would largely be funded through network charges on household gas and electricity bills, which would add around £108 a year to the average household bill. Perhaps, in closing, the Government will address how it would fund those network and storage upgrades were it ever to receive those powers, particularly in the context of the £5 billion black hole legacy left by the previous SNP Government.
I note that the minister is not levelling with people that Scotland’s bills have virtually nothing to do with licensing powers and everything to do with terrain, population density, climate, housing stock, rurality and the transmission and grid upgrades.
Of course, one solution to high bills that is entirely within the Government’s existing powers would have been to use ScotWind revenues to reduce bills, invest in infrastructure or create a sovereign wealth fund. However, the finance secretary’s predecessor, Shona Robison, chose not to do that and instead used that money to plug her own funding gaps in the Scottish budget.
To go back to the issue of constraint payments, the member will realise that one of the reasons that constraint payments are paid is that the nuclear sector is pumping baseload on to the grid and cannot actually be turned off. Further, I point out that new nuclear will cost about £50 billion—that is the estimated cost of Hinkley Point C. How are £50-billion nuclear power stations going to bring down energy bills?
I am afraid that the deep ignorance of the SNP’s nuclear policy is exemplified in that intervention. Nobody is proposing to build Hinkley C in Scotland; what we are looking at is small modular reactors—
They do not exist.
They absolutely could be—and, indeed, are being—built.
What Scotland needs is informed, long-term strategic planning. We need a strategy that not only recognises the importance of oil and gas jobs, energy security, the environment, the economy and skills, but acknowledges the need for new nuclear baseload. The strategy must do so alongside and in partnership with a balanced, managed transition to renewables, and it should detail a serious long-term plan for storage and transmission to genuinely reduce people’s bills. Scotland does not need more ill-informed, superficial posturing from an SNP that is obsessed with grievance and manufactured divisions. That is why the SNP motion should be rejected and the Conservative amendment whole-heartedly supported.
I move amendment S7M-00159.4, to leave out from “welcomes” to end and insert:
“recognises the need for bold and ambitious reform in Scotland following the Scottish General Election; acknowledges that the majority of people in Scotland want the Scottish Government to focus on the issues that impact their day-to-day lives; considers that the priority of the Scottish Government should therefore be to improve the NHS and public services, make life more affordable, support communities and high streets, grow a fair and prosperous economy, which tackles inequality, and ensure that every child has the opportunity to succeed; believes that this ambitious future can and should be achieved through the devolved powers of the Parliament and rejects any attempt by the Scottish Government to delay this work by dedicating resources towards returning to divisive arguments of the past.”
I call Liam McArthur to speak to and move amendment S7M-00159.5.
15:20
Thank you, Deputy Presiding Officer. I welcome you to your post and I hope that you find the role as rewarding as I certainly did over the preceding five years.
I also offer my congratulations to the cabinet secretary. I may not have known him for quite as long as some members in the chamber have, but I have known him for a good many years, and I like and respect him enormously. That respect has been diminished only slightly by the motion that he lodged for today, but, on a more positive note, his motion has at least enabled a debate that is timely, certainly on the back of yesterday’s energy price cap announcement. We all recognise that it means that bills will rise again, pushing more households into fuel poverty, against the backdrop of an ongoing cost of living crisis.
Although the principal cause of rising energy costs may lie in conflicts far away, the impact on people, business and communities here is real and keenly felt, giving rise to a palpable sense of anger and anxiety. Irrespective of international events, it is also clear that the current system needs reform, whether that is by cutting the link with wholesale gas prices or by implementing a transmission charging regime that is fit for purpose. It will not be easy, of course. Achieving energy security, affordability and sustainability is among the biggest challenges that we now face.
Sadly, the Government’s motion seeks to simplify that challenge by framing it merely as a matter of constitution—but, as we have heard, ignoring the implications of fragmenting the energy market, which none of the organisations that provided briefings for the debate was calling for.
A more productive exercise would be to look at the clear and numerous ways in which we can maximise Scotland’s energy potential while better protecting households and businesses. One such example, which is reflected in my amendment, is the need to take community benefit far more seriously. Supporting the generation of cheap, clean energy is vital if we are to protect ourselves from the volatility of fossil fuel prices, but communities that host renewable developments deserve to feel that benefit, both in strategic local investment, such as housing, and in measures to bring down bills. That is simply not happening right now.
I see that in my Orkney constituency. The islands have been a pioneer in the energy sector for decades, yet we experience some of the highest fuel poverty levels anywhere. That cannot be right. Addressing that situation will require an overhaul of outdated guidance, as well as engagement with rural and island communities.
Lessons must also be learned from the failures of ScotWind. Having sold off sites at bargain-basement rates, ministers have then refused to transfer that revenue to the communities and local authorities that are most affected.
Would the member accept that that money going to communities comes from other communities and that the subsidies come to the energy companies through a pool that comes off people’s energy bills? We are also discussing how people cannot afford their energy bills. It is nice for communities to get a new football field or a new hall, but the money for them comes through because those companies have so much coming from everybody who pays the bills.
As we have already heard, the subsidies going into the energy sector across the board are wide and extensive. My argument is that the communities directly affected by such developments need to see the benefit not just through reduction of bills but through more strategic infrastructure that, to be frank, is not about new football parks or community halls; it is about strategic investment in infrastructure, such as housing, which is in crisis in places such as Orkney.
In the context of today’s motion, however, had the UK Government treated the Scottish Government as the latter is treating local councils such those in as Orkney and Shetland, we would have heard some fairly unparliamentary language, even from somebody as measured and diplomatic as the cabinet secretary. A different approach is required in the future—one that ensures that projects attract investment and deliver meaningful benefit locally.
While the Scottish Government calls for more powers, the fact is that it simply has not kept pace with the scale of the change that is required. Even coming forward with an energy strategy was beyond the Government during most of the previous parliamentary session. In the absence of such a strategy, Scottish Renewables has called for clear statements of policy intent so as to give certainty to key sectors, such as marine, as well as to create the conditions for growth. Essential, too, will be modernising grid infrastructure and properly resourcing planning and consenting to support development at pace. We need to see both of Scotland’s Governments working collaboratively in Scotland’s interests, which Mr Gethins is well suited to doing.
On oil and gas, there should be no debate about the fact that they will remain part of our energy mix for years to come. However, there is no world in which we can continue to rely on the North Sea basin indefinitely. That is not a matter of politics; it is just an immutable fact of geology.
The futures of oil and gas and renewables are intertwined. Polarising policy and debate might have political upsides, but it has few upsides for either sector or for our country. Any transition that ignores the needs of those on whom it will rely most heavily can only fail, and the people and communities at the heart of that transition must be fully involved in the decisions that affect them. That will require the removal of barriers to transition, better targeting of support for training and skills, and investment in the development of genuine job opportunities.
None of that will be easy. All of it will require detailed planning, long-term commitment and collaboration across parties and between Governments, but trying to achieve that while incurring the significant costs, delays and disruptions that would result from dismantling our energy market would be beyond difficult. I urge Parliament to reject the motion and to back the Liberal Democrats’ amendment.
I move amendment S7M-00159.5, to leave out from “Scotland’s energy” to end and insert:
“local communities which host vital renewables projects deserve proper community benefit that would provide funding for short and long-term investment such as economic development, housing and cutting energy bills; further believes that the Scottish Government’s proposed good practice principles, which recommend community benefits be provided at the value of £6,000 per Mega Watt per year, will not meet the expectations of communities; calls for future ScotWind rental income to be transferred to the nearby councils so that those communities can feel the benefit of hosting national projects, and considers that new rules are needed for future ScotWind-style sales to protect the value of Scotland’s assets and attract more investment.”
We move to the open debate. Our first speaker is Jack Middleton, who is also making their first speech in the Parliament.
15:27
I am grateful for my first opportunity to address members as the newly elected MSP for Aberdeen Central.
My constituency rests between two shining rivers—the Don and the Dee—and absorbs the whole of Aberdeen city centre. My constituency is famed for its silver granite and golden beaches, and I am proud to call it my home. It is where I was born, and it is where my family has lived for generations.
So, too, is Aberdeen home to many famous sons and daughters—the Ballon d’Or-winning footballer Denis Law; the multi-Grammy-award-winning singer Annie Lennox; the socialist revolutionary Bob Cooney; and, of course, the self-titled king of Aberdeen himself, Kevin Stewart. [Laughter.] By serving his constituents with dedication and passion for 15 years, Kevin ultimately laid the groundwork for what was a resounding election victory for the SNP in Aberdeen Central. Speaking both as an Aberdonian and as a friend of his, I hope that members will join me in thanking Kevin for what he achieved in the Parliament and in wishing him the very best for the future.
There is much to be proud of in Aberdeen Central, but, in the energy capital of Europe, far too many of my constituents live in deprivation. Too many cannot afford to feed themselves, feed their kids or even turn their heating on. Many more live on the margins, struggling every single day simply to make ends meet.
In a city that is a global energy superpower, that reality makes me sick. It should make every MSP in the chamber feel sick, too. During my election campaign, I spoke to thousands of Aberdonians who told me that they do not feel that the current political system delivers for them. No wonder. In Aberdeen Central, hard work does not always lead to job security, especially for our oil and gas workers. While London politicians are arguing about how they want to spend our energy wealth, we are paying some of the highest bills on the continent.
My city faces many challenges, but I know that the answers to those challenges do not lie in the tired old politics of the past, nor do they lie in hatred or within division; those answers lie outside the walls of the chamber and among the sovereign people of Scotland.
Key to understanding what is happening today in Aberdeen Central is acknowledging what is not happening. When it comes to our vast energy wealth, Westminster calls the shots, and the UK Government has no pride in Scotland’s premier industry. It promised to remove the energy profits levy and move to an oil and gas price mechanism, but it has not done so. It promised to bring thousands of jobs to Aberdeen through Great British Energy, but it has not done so. Aberdonians are being asked to ignore that reality. All the while, Labour lifts sanctions on Vladimir Putin’s regime and waves through dirty Russian oil and gas via the back door, while blocking use of our own domestic resources.
The UK Government talks us down and tells us to keep our mouths shut, but, Presiding Officer, I will be crystal clear in speaking on behalf of my constituents. There is nothing morally just about sending thousands of working women and men to the jobcentre during a cost of living crisis of Westminster’s making, with little prospect of those people regaining employment in the industry in which they have honed their skills for years. There is nothing progressive about blowing up the investment and infrastructure supply chain that we need to secure Scotland’s future as a green renewables powerhouse.
To be frank, I do not think that those in charge at Westminster have a clue. The average punter in the north-east of Scotland has a greater understanding of industry and Scotland’s energy requirements in their pinkie finger than the boffins and bean counters in Whitehall, who rarely venture beyond the M25, will gain in their entire careers. Why on earth would we continue to put our trust in those charlatans, who want to exploit Scotland’s energy resources simply to fill the coffers of the UK Treasury and, perhaps if they are lucky, drive down bills for taxpayers in England? If we want things to change, it is very obvious that Scotland’s huge energy wealth has to be in Scotland’s hands.
To visualise what that would look like, we need not dream or imagine—we just need to look a few hundred miles across the North Sea to Norway. Stavanger is a city of broadly similar size to Aberdeen. Norway discovered oil off its shores at virtually the same time as we discovered it off our own, yet Norway has much lower poverty, much higher wages and much greater job security. The cherry on top is that its people enjoy a quality of life and a set of living standards that are the envy of the world. The Norwegians used the discovery of oil to become wealthier; in Scotland, by most metrics, we have somehow become poorer.
That is because, while we entrusted Westminster with our energy wealth, Norway trusted itself. It understood one simple principle: a nation’s resources should be used to benefit a nation’s citizens. That is why its sovereign wealth fund is now larger than the gross domestic product of most western democracies. If Scotland had had the power to make the same choices as Norway did back then, a Scottish sovereign wealth fund would be worth more than £1 trillion by the end of this parliamentary session.
I accept that we cannot go back. However, we can go forward and prepare for the future, because we have North Sea resources that will last for decades and a renewables potential that should last forever.
The choice that we face in Scotland is whether we trust them—the folk who threw £400 billion in taxes from our oil revenues up against the wall—or whether we trust ourselves, the people of Scotland, to make decisions that are in our interests on issues such as new licences, to ensure that that huge energy wealth is serving our citizens. The next step in securing that very future is for members to support the motion in the name of Stephen Gethins.
The rest of this Official Report will be published progressively as soon as the text is available.
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