Chamber and committees

The document that I talked about—

We are working with local authorities and COSLA on that matter in particular, because quite a lot of that is coming at a local level. We have the heat network fund, but I am happy to have conversations about whether any more capacity is required.

One thing that Scottish Government money can do is leverage private investment, which you have seen already. I have had quite a lot of conversations, particularly with council leaders, who have said that that initial support from Government means that they can leverage private investment in heat networks. I will not give detail on whom I spoke to or on the conversations, but an awful lot of private investment out there can be leveraged as a result of what we are doing with the heat network fund.

There is £18 million in my portfolio for nature restoration. You are, however, right to point out that forestry and peatland restoration have a big impact on nature restoration. I have a limited amount of detail on another person’s portfolio but, if we look at it in the round, the peatland restoration budget has an uplift of 32 per cent, but that is Ms Gougeon’s portfolio. We have £53 million for the forestry grant scheme, which is an increase of about £9 million.

I will not comment on a live legal proceeding.

I just want to say that I will follow up in writing with the committee where it has asked for detail. I give another apology to Mr Doris, whom I contradicted. He was right that we give an allocation to the Climate Change Committee—I think that it is a couple of hundred thousand. We have it at £368,000, so there we go. I have got that on the record, and my apologies to Mr Doris.

I will use the example of the licence conditions for the ScotWind contracts. The companies and the consortia that bid for those licences have to sign up to the conditions, which include local content with regard to the supply chain. As a result, there is a huge economic benefit to the whole of Scotland—not just the north-east and the Highlands—because we will have companies that are setting up and growing as a result of realising that the supply chain capacity will have to increase. That will not be done by any one region but by the whole of Scotland. By local content, we mean the content of the supply chain in Scotland. Those who were putting the licence conditions together made sure of that. I am looking at Mr Matheson, who was instrumental in that.

The devolution settlement had not happened when most oil and gas was discovered, so we did not have those conditions in place previously. As a result of the devolution of the Crown Estate, we have been able to work with the Crown Estate on licensing the sea bed for offshore wind power generation to ensure that licences come with conditions. However, there will also be conditions around some of the grants and loans that are associated with SNIB and with some of the support that companies get from our enterprise agencies. Some of that is to ensure that there is local content.

You talked about golden handcuffs. The approach is quite light touch, because it is obvious that the supply chain will be anchored in Scotland, as that is where the skills already are. If we get the conditions right, we will have a supply chain that is not just anchored in Scotland; we will potentially have orders from the oil and gas supply chain and orders for ScotWind, so the supply chain will have to vastly increase capacity to be able to serve those two industries. The term “handcuffs” may be overstating it, because it is a no-brainer that the supply chain will be in Scotland, as we already have a very healthy energy supply chain in Scotland, which will have to increase its capacity to serve both sides of the energy sector.

Thank you for the opportunity to talk to the committee about the net zero and energy part of the draft Scottish budget.

The budget for the portfolio is £900 million, which is an increase of £221.1 million from 2024-25. I appreciate the work that the committee is doing in its pre-budget scrutiny; as always, it is an important part of a much longer and wider process.

It might be helpful to set this conversation in the context of the Scottish Government’s overall approach to this year’s budget. The First Minister and the Cabinet Secretary for Finance and Local Government have made it clear that this budget focuses on delivering progress and laying the foundation for Scotland’s long-term success, and that it is set against continued and unprecedented challenges to public finances. The budget focuses resource across the four priorities that are set out in the programme for government, with which we are all familiar: eradicating child poverty, growing the economy, tackling the climate emergency, and ensuring high-quality and sustainable public services.

My joining you today is mainly about the third of those priorities—tackling the climate emergency. In 2025-26, we intend to commit £4.9 billion across all portfolios to investments that will have a positive benefit for climate. The £900 million net zero energy budget will strongly contribute to the other priorities as well, as we scale up renewable energy, restore Scotland’s natural environment and tackle fuel poverty. I hope and strongly believe that we all share those objectives across the Parliament.

I look forward to discussing the net zero and energy budget in detail.

As Mr Matheson will know intricately, Scottish Government ministers have powers to consent to developments of all types in the Crown estate, the sea bed and the landmass of Scotland. If we were to merely be consulted on things that were happening with GB Energy, that would take away from that power. A requirement for consent would dovetail with the consents that come to us.

The issue is really important when it comes to the strategic goals of GB Energy. Initially, when GB Energy was floated as an idea before the election, we all asked about what it would be. I am keen that we are an equal partner in the strategic actions that GB Energy takes. It is not there as a competitor to other operations; it must add to what we already have in Scotland. Having “consult” instead of “consent” means that, whatever those strategic priorities end up being, we would be consenting to them.

As the company develops, I want to see those strategic priorities provide additionality to what is already in the energy sector in Scotland and increase capacity in areas where required. For example, I am keen that whatever GB Energy is doing in the community energy space does not reinvent the wheel. We already have Local Energy Scotland, which is an organisation that was set up by the Scottish Government. I do not want to see another body—it would be confusing for the public and I do not think that there is any need for it. I was able to discuss with Michael Shanks how we could work together so that, if we already have vehicles in Scotland for activity that GB Energy is carrying out, we would be able to use those organisations and add the funding to their capacity, rather than have separate entities set up and badged with GB Energy. Those are a couple of examples.

If the strategic priorities require our consent, it means that, as it develops—I do not think that GB Energy is fully developed yet, but that is the point—we have the proving part in place such that, whatever direction it goes in, it must be with the consent of the Scottish ministers. It is very early days in relation to what GB Energy will achieve.

Yes. We look at EU alignment in absolutely everything that we do, both in terms of whether we give consent and in terms of our own bills. Nothing in this bill suggests anything in relation to EU alignment, so I am content in that area. It is a short answer, but effectively there is nothing that is an issue.

In principle, yes.