Chamber and committees

I am happy, as I am sure fellow ministers will be, to explore those issues further with Mr McArthur. Far from sounding a discordant note, I hope that all members recognise that ScotWind promises to be transformational in delivering economic supply chain benefits as well as a huge amount of renewable electricity generation.

We welcome the commitment of developers to invest an average of £1.4 billion in Scotland per project. That equates to more than £28 billion across the 20 ScotWind offshore wind projects. The two ScotWind projects that are in close proximity to the Western Isles are no exception. The 1.8GW link marks a major step forward in unlocking the renewable potential of the islands. Although we share the disappointment that has been expressed about the delay to the planned 600MW interconnector, we welcome the news that the interconnector that National Grid ESO now states as being required will be significantly larger than originally planned and will accommodate the energy generated from all known onshore and offshore wind in and around the Western Isles.

The timescale for such multimillion-pound projects has slipped in the past and the Scottish Government will continue to seek assurances that the interconnector will now progress swiftly and without further delay. Final investment will be subject to Ofgem approval and necessary planning consent. As Alasdair Allan did in his opening speech, we continue to call on Ofgem to ensure that the new 1.8GW interconnector is included in its final list of projects approved for accelerated development.

We strongly encourage National Grid ESO to explore all avenues to accelerate the timelines for our other ScotWind projects. We are pleased that it has announced its intention to progress with a transmission entry capacity amnesty, which might help to free up transmission capacity that is being held for some legacy projects that are not progressing.

Scotland’s long and positive association with renewables continues to go from strength to strength. It is central to our green recovery. In 2021, Scotland generated enough renewable electricity to power all households here for almost three years. That is a huge achievement.

We recognise the importance of energy generated in the Western Isles in contributing to the decarbonisation of Scotland’s energy supply and to our just transition towards net zero by 2045. We are pleased that National Grid ESO also recognises its importance and we call on Ofgem to ensure that the new 1.8GW link is included in its final list of projects for accelerated investment so that that vital piece of work can be completed well ahead of our 2030 targets.

In a moment; I will first make some progress.

As committed to in the shared policy programme, the A9 programme between Perth and Inverness is being taken forward subject to the normal statutory authorisation and business case processes.

As many members have done, I begin by expressing my sympathies to everyone who has been affected either by the loss of a loved one or by injury on our roads over this year.

As the Minister for Transport said, the accidents on the trunk roads, in particular, that members have been discussing are deeply tragic for everyone. Our road safety framework to 2030 sets out ambitious targets to reduce the number of accidents, and we are absolutely determined to deliver on those. That will require us to address the recent upturn in the number of accidents on the A9 while we continue to invest in the safety of our wider network and promote safety for everyone who uses it, the communities that it serves, and the businesses, services and individuals who rely on it.

That will require on-going investment to support a wide range of outcomes—reducing death and injury on our roads, of course, but also improving safety for communities and reducing the terrible loss that families, friends and individuals suffer whenever a loved one is lost, whether they are a driver, a pedestrian, a cyclist or anyone else.

Road safety, every bit as much as the climate emergency, demands of us a change in approach to transport after decades of rising road traffic volumes, with all the additional risk and the environmental damage that comes as a direct result.

I am about to turn to some of Mr Simpson’s comments, so let me make a little progress.

Road safety is about more than road design, and increased capacity is certainly no guarantee of better safety. Although the transport minister was right to say that the Conservative motion strikes a respectful tone, I genuinely wish that that was true of all the speeches that we heard, some of which appeared to be more interested in party-political point scoring or name calling than in dealing with genuinely serious road safety issues.

Mr Simpson recognised that different reasons exist for all accidents. That is true, but his focus was on one intervention only—dualling. He had little to say on issues around reducing road speed, reducing traffic volume, addressing driver behaviour or the very positive role that cameras can play, as Mr Ruskell mentioned—in fact, very few members did. In what should be a serious debate about road safety, Mr Simpson seemed more interested in slightly cartoonish imagined conversations between people whose politics he disagrees with.

Even if it is a niche debate, it is an extremely important niche. Not everyone is drawn to the slightly more technical aspects of such an issue, but the realisation of the project to which Alasdair Allan has drawn our attention will benefit huge numbers of people across Scotland, in particular in communities such as those that he represents.

Scotland has a long and positive history of harnessing renewable energy, and our capacity to generate it will have to increase to meet our climate change targets. Increased electrification and deployment of renewables to meet expected growth in demand will require significant investment in our electricity infrastructure, in order to maintain resilience and increase transfer capability between Scotland and the rest of the Great Britain market, as well as to meet our own increased needs.

As Liam McArthur says, our island communities, including those that Alasdair Allan represents, have a critical role to play in that, so of course we welcome the inclusion in National Grid ESO’s report, “Pathway to 2030—Holistic Network Design” of a new 1.8GW transmission line to connect the Western Isles. Alasdair Allan, in bringing the motion to the chamber, is quite right to highlight—as other members have done—that expectations are now on Ofgem to ensure that the project goes ahead.

The proposed line will accommodate the renewable energy generated from all known onshore and offshore wind in and around the Western Isles. That is a significant and important step, which will be key to enabling Scotland’s transition to net zero, as well as supporting long-term energy security.

We are well on the road to fully decarbonising our electricity system in Scotland, but it is vital that we continue to work together to enable all of those critical investments, while making sure that regulatory levers continue to drive down costs and increase benefits for energy customers as well as communities.

We must not repeat the mistakes of the past. We must ensure a managed and fair transition to net zero. That is why we will work collaboratively with the regulator, the UK Government and communities and industry to secure that just transition and harness opportunities across all sectors to build a better and more equal Scotland. However, we can do that only if the necessary infrastructure is in place to meet our growing renewable energy generating capacity.

As we move towards a net zero society, the electrification of heat and transport will increase our demand for electricity. It is vital that that demand is met by renewables and flexible solutions, rather than by fossil fuels and nuclear generation. Taking advantage of our extensive offshore wind resource will enable us to do that, but there must be a means to transport that power to where it is needed. Heat in buildings, for example, accounts for 20 per cent of Scotland’s greenhouse gas emissions. The climate change plan envelope for buildings, and our heat in buildings strategy, require more than 1 million on-gas homes to convert to zero emissions heat by the end of this decade, and for emissions from homes and buildings to fall by 68 per cent over the same period.

I visited the Western Isles back in May and heard directly from people there about the challenges of decarbonising homes and buildings on the islands. Changing how we heat our homes and use energy in our homes and buildings is fundamentally about addressing climate change, but it can also strengthen our energy security and, if we get the details right, can represent a stepping stone toward not just a greener but a fairer Scotland for everyone. That is why we have committed to continuing to make our homes more energy efficient and to decarbonise heat, with at least £1.8 billion being made available during the course of this session of Parliament.

Although the Scottish Government does not have the power to mandate community benefits, we expect delivery partners of the transmission link to work with local communities and ensure that they share in the benefits of the project.

Our seas are home to some of the best offshore wind resources in the world, and Scotland’s ambition to capitalise on our offshore wind generation capacity is part of the bold action that we are taking to become a net zero society. I am aware that projects in Scottish waters are at a competitive disadvantage compared to projects further south as a result of the more challenging conditions and the higher transmission costs. We are actively engaged in the offshore transmission network review to consider how the offshore transmission network is designed and delivered here in Scotland.

The decisions and actions that we take now will shape the Scotland that future generations live and work in. Recognising the undeniable benefits to our economy, the Scottish Government has consistently provided a supportive environment for both offshore and onshore wind over the past decade.

The Scottish ministers have made it clear time and again that we will use every lever at our disposal to maximise the wider economic returns for Scotland from the wind sector. ScotWind is the world’s largest commercial leasing round for floating offshore wind and puts Scotland at the forefront of offshore wind development globally. Together with the option fees for the clearing round, ScotWind will deliver more than £700 million in revenues to the public purse for the initial awards alone.

The Scottish ministers are considering how the ScotWind revenue should be invested to maximise the benefits for the people of Scotland. In addition, ScotWind will deliver several billion pounds more in rental revenues when projects become operational. That, too, will be invested for the benefit of the people of Scotland.

We do not need a remedial lesson in how Scottish Government finances work. Mr Kerr can take that up with his finance colleagues if he needs a lesson.

I reiterate our call on the UK Government to provide additional support to vulnerable consumers ahead of, during and beyond this winter, and I seek urgent clarity about the protection that consumers will have in the face of forthcoming price rises beyond April. Those consumers include many people living in rural communities across Scotland, who face higher living costs than others in more central areas.

Let us remind ourselves again that the devastating impacts of skyrocketing energy prices on consumers are caused by overdependency on natural gas. That is dependency that we must break, although Mr Kerr would suggest that we should keep locking ourselves into dependency on fossil fuels. Although our actions today can help to ensure that consumers are given vital support, we must also keep in mind the need to accelerate our transition to net zero heating and a decarbonised energy system.

It is now necessary, given the reversal of the commitment to a two-year price cap, to consider what the options might be after the first six months. I remind Mr Kerr that when the Scottish Conservatives were not busy promoting the UK Government’s disastrous tax plans, they were happy to welcome that two-year commitment when it was first made. It does not cut it to say now that six months is the right timescale or that this Parliament has all the powers that it needs.

This Parliament can do nothing yet to regulate energy prices or to break the link between gas and electricity prices that Labour colleagues rightly point out. The UK Government has been giving that commitment for a long time but it is hanging there, amid uncertainty about which minister will even be responsible for progressing it or when it might be progressed. We can do nothing in this Parliament yet to give people in Scotland the financial benefit of the cheap, clean, abundant, renewable electricity that is being generated in this country. This Parliament should be able to take much greater action to give people in Scotland the benefit of that renewable electricity and to tackle fuel poverty.

For the time being, until we have those greater powers, I ask members to agree to the LCM to ensure that people get the emergency support that they need and deserve.

I thank members for their consideration of the legislative consent memorandum in relation to the UK Government’s emergency Energy Prices Bill. As ever, when discussing reserved energy legislation, we must remind ourselves once again of the many vital actions that the Scottish Parliament could choose to take directly if the powers to do so were not reserved. That frustration is heightened today by the challenging timescales within which we have had to work in order to allow Parliament the time needed to consider the implications for Scotland.

Given the focus of the LCM on supporting people through the most acute energy prices pressures in living memory, I absolutely understand the speed with which the bill is progressing through the UK Parliament. Indeed, just before the recess, I oversaw our emergency legislation on support for tenants during the cost crisis, so I recognise—and I hope that members across the chamber will recognise—the very constrained circumstances in which we are considering the motion today.

Before turning to the specific issues requiring consideration, I want to emphasise just how much the urgent need for the intervention in prices, which the bill provides for, is driven by our vulnerability to gas prices. This crisis continues to highlight our reliance—indeed, our overreliance—on gas as a means of heating so many of our homes and buildings, which leaves our energy prices at the mercy of a hugely volatile market. Therefore, as we do everything that we can to support people through the crisis in the immediate term, it remains essential that we accelerate our transition away from fossil fuels for heat.

Meanwhile, no sooner had the UK Government introduced the emergency bill, which it seeks to pass at breakneck speed, than it cut short its flagship policy on energy support. The curtailing of the energy price guarantee by the Chancellor of the Exchequer last week has plunged households back into uncertainty about their bills and finances. Many households are already faced with making stark choices between providing food or warmth for themselves and their families. That is why we have called repeatedly for additional targeted support for vulnerable consumers. The chancellor’s reversal of what had been a two-year energy price guarantee makes the need for such support all the more urgent. We estimate that 860,000 households in Scotland now live in fuel poverty, with 600,000 households living in extreme fuel poverty. Therefore, although we have committed to doubling our fuel insecurity fund to £20 million as part of our emergency budget review that we are progressing, much more needs to be done with the powers and resources that exist at UK level.

I will move on to the issues in the bill that the Parliament needs to consider today. We have identified five clauses that require the Parliament’s consent. Those provisions cover the reduction of domestic energy bills, the reduction of non-domestic energy bills, support for meeting energy costs and the regulation of energy markets. The first four of the five clauses—clauses 13, 14, 15 and 19—relate to support for consumers in meeting energy costs.

As set out in the draft memorandum, the powers exercised under clause 13 could be used in a way that relates to devolved competence. The example that is used in the draft LCM is the use of the power to provide financial assistance to meet or reduce expenses for heating in cold weather. Based on the urgent need for people across Scotland to receive financial assistance to mitigate the impact of the crisis, the Scottish Government recommends that the Parliament consents to clause 13 and the related clause 14.

Clauses 15 and 19 will enable the delivery of support, such as the equivalent to the £400 delivered through the energy bills support scheme, to those who were previously not eligible. Examples of consumers who are eligible for that equivalent support are park home owners and students living in rented accommodation. Last week, the Cabinet Secretary for Net Zero, Energy and Transport wrote to the secretary of state to seek urgent assurance that everyone in Scotland who is entitled to it will now receive the £400 rebate.

Earlier this year, the Scottish Parliament raised concerns about second home owners benefiting from the energy bills support scheme discount. Our limited powers meant that we could not prevent second home owners from benefiting twice from the £400 energy rebate in the way that we would have wanted to. The cabinet secretary did, of course, formally request an amendment to the Energy Prices Bill to prevent such an outcome, but such an amendment has not been accepted.

Although that remains deeply disappointing, we have been given an explicit understanding that the forthcoming equivalent support will be awarded via an application process and will apply only to primary addresses.

Clause 22 gives power to the secretary of state to give directions to energy licence holders in response to the energy crisis, and is not limited to activities in reserved areas. Therefore, the Cabinet Secretary for Net Zero, Energy and Transport wrote to the Secretary of State for Business, Energy and Industrial Strategy to request that the bill be amended to require the Scottish ministers’ consent before any direction is given that affects a devolved area.

In coming to a conclusion, I express the hope that the latest forced regeneration at the top of the UK Government might also compel a reappraisal of some of the glaring gaps in its energy policies. A prime example of a step in the right direction would be an immediate commitment to require and fund a major programme of energy efficiency measures and improvements. That would not only make homes more comfortable and affordable to heat but improve our environment and security of supply, by reducing our dependence on fossil fuels and reducing the power that is exercised at the whim of countries such as Russia and its current leader.

Although I again reflect that the UK Energy Prices Bill is far less than it might be were the powers behind its creation available to the Scottish Parliament, it remains better than nothing. Consenting to the motion will allow the people of Scotland who are currently struggling to pay their energy bills and heat their homes to receive desperately needed financial assistance as quickly as possible. I therefore must recommend that the Parliament consents to the UK Energy Prices Bill as it stands.

I move,

That the Parliament agrees that the relevant provisions of the Energy Prices Bill, introduced in the House of Commons on 12 October 2022, so far as these matters fall within the legislative competence of the Scottish Parliament, should be considered by the UK Parliament.

To begin by picking up on that last point, I say to Liam McArthur that I will take his comments on board and discuss them with officials. If possible, I will update him in writing on the Government’s position.

I thank members for their contributions to this relatively short discussion of what we have all acknowledged is an urgent matter that must be considered quickly. It is widely acknowledged across the chamber that the process is not ideal, but it is clearly necessary; I welcome the fact that that has been recognised. Although it has been a short debate, it has been a helpful one, especially when we consider the very little time that we have available to consider the bill and its implications for devolved areas.

If we agree to the LCM, we will at least ensure that the money that is available can be provided to those who need it as soon as possible. The Scottish Government will continue to do what is within our powers to support people here in Scotland, but let us be clear that we need UK Government action, too—to ensure not only that all consumers can afford to heat their homes this winter, but that the UK Government tackles fuel poverty well beyond that timeframe and businesses can stay afloat.

As members know, we are working closely with the social sector and have established an official-led short-life task-and-finish group to consider the best approach to take from 1 April. That work includes consideration of the impact of measures in the short-term and long-term business plans of the sector.

We have lodged Government amendment 2, which is in the next group, to bring greater certainty to the social sector by enhancing the Scottish ministers’ reporting requirement under section 8 of the bill. That will require us, in the first half of January, to outline what will happen with any social sector cap—whether the current rent cap will expire, or be extended, suspended or increased.

We are working very closely with the sector to agree appropriate action and the enhanced reporting requirements. That engagement will secure certainty and the comfort that Mr Griffin is asking for well in advance of 1 April. I will describe what the Government’s amendment 2 will do in a little bit more detail when I move the amendment in the next group.

It is worth noting that section 8 already requires us to review the appropriateness, necessity and proportionality of the rent cap overall, going forward. That said, I will not be able to support amendment 1. I invite Mr Griffin not to press it.

I thank Pauline McNeill for lodging amendments 4 and 5 and for working constructively with us. Like Ms McNeill, we want tenants to have the information that they need in relation to an application by their landlord to raise their rent above the level of the cap, in response to having incurred increased costs related to mortgage interest, landlords insurance or service charges. It is important that tenants understand that, even though their landlord might have made an application, they are not required to pay any increase in rent until the process has been completed and the decision has been taken on whether that increase can be made.

I am happy to support amendments 4 and 5 and I urge members to vote for them.