Chamber and committees

I can give a concise answer. My discussions with the UK on hydrogen have not been in the space of GB Energy. They have been on the export infrastructure for hydrogen and on how are we going to get hydrogen from Scotland, which is going to be a major producer of green hydrogen, to our customer base, which is largely going to be Germany. We need that infrastructure, and we need to work with the EU on that, as well as on the technical aspects of the standards that are associated with the production and export of hydrogen.

The discussions have not been specifically on hydrogen projects. If GB Energy wants to do hydrogen projects—again, how it might do that is a question for it—I would suggest that there is an opportunity. I do not want to upset the convener by going back to talking about Grangemouth, but there is a big opportunity there for the production of blue, and then green, hydrogen. A lot of that would be made much more commercially viable if we had track status on carbon capture and storage as well.

I have been having those discussions around hydrogen, but not necessarily in relation to my focus on GB Energy, on the bill and on ensuring that we have the consent responsibilities that I want us to have.

Thank you very much, convener. Happy new year to you all. I thank you and the committee for inviting me to discuss our approach to the UK Government’s Great British Energy Bill as well as our reaction to the bill and some of the discussions that we have had with the UK Government on aspects of the bill.

The UK Government has said that GB Energy has been designed to do four things: the production, distribution, storage and supply of clean energy; the reduction of greenhouse gas emissions from energy produced from fossil fuels; improvements in energy efficiency; and measures for ensuring the security of the supply of energy. Many of the bill’s objectives, particularly the production of clean energy, are already commercially under way in Scotland, and I am keen to investigate how Scotland can benefit, given our current advanced status as a green energy-producing nation.

We already have a strong pipeline of clean energy and a growing supply chain. We are at the forefront of floating offshore wind development, and we have a depth of knowledge and experience of community and local energy.

To date, I have had very positive discussions with the UK Government about the role of GB Energy and how it will dovetail with our already well-established activity, communities and sectors. Those positive discussions have been framed by the joint vision statement that I signed with the secretary of state in late summer last year, which commits the Scottish and UK Governments, alongside our public bodies, to working together to maximise the public benefit of GB Energy’s activities in Scotland.

The bill will provide a statutory basis for Great British Energy as a publicly owned and operationally independent energy company and will give the UK secretary of state the ability to provide financial assistance to GB Energy to enable it to become operational.

Since our legislative consent motion was lodged in August, my officials and I have taken part in many discussions on the bill with the UK Government. I am grateful to my UK Government counterparts for the positive tone of those discussions.

The Scottish Government is broadly supportive of the bill, and we have been working closely with the UK Government to ensure that it delivers for the people of Scotland. However, there were issues with two clauses that we wanted to iron out. Our negotiations on the bill focused in particular on clause 5(4), which concerns the level of engagement that the UK secretary of state would have to have with the Scottish ministers when preparing a statement of strategic priorities for Great British Energy. I am keen to ensure that the bill contains proper recognition of devolved interests and that the Scottish Parliament has opportunities to scrutinise matters within its competence.

I am pleased to say that discussions have progressed well, and I have emphasised to the UK Government the importance of tabling the relevant amendment in a timely manner, so that we are in a position to give legislative consent to the bill. That will allow the Scottish Parliament and this committee to have sufficient opportunity to scrutinise the bill. We will lodge a supplementary legislative consent memorandum once the UK Government has tabled the amendment that we have been negotiating on.

I will continue to work with counterparts in the UK Government as its plans for GB Energy progress, not only in relation to the bill but once it has been passed. I look forward to answering the committee’s questions.

The main issue that I had to bottom out with UK Government ministers was the fact that, initially, Scottish Government ministers would be consulted only on the strategic priorities of GB Energy and would not be asked to give consent.

Given that much of the bill and the activity of GB Energy would be in devolved areas in which we have powers, we thought that it was particularly important that consent had to be given. It took us a wee while to go back and forth on that, but I am confident that we have reached a point at which the UK Government is satisfied that it should table such an amendment. I have not seen the amendments to the bill, as they have not been tabled, but should things go in the direction that I hope they will—I have had an exchange of letters with the relevant UK minister, Michael Shanks, which indicates that our concerns are being dealt with—we will be happy to give our consent.

We discussed that issue as part of our constructive engagement on the bill. There is now an understanding that it is important that we are asked to give consent, for two reasons. If we are asked to give consent, the committee will have the opportunity to scrutinise us on why we are giving—or are not giving—consent to certain things.

You rightly point out that we have the consenting powers associated with that. Our policy is well known.

I understand that, but I do want to answer Ms Lennon’s questions.

I have not had discussions specifically on the numbers that you have mentioned. Obviously, they have said that there is going to be employment at the levels that they have projected. Douglas Lumsden mentioned that, too. I think that that is a question for them. Have they overstated the amount of jobs associated with GB Energy?

Given that GB Energy’s priority will be the projects, it is quite difficult to put a number on the employment that will come from GB Energy. What were the 1,000 jobs? What were the 200 jobs? Are the 200 jobs associated with the operation of the company or are they associated with the projects? Forgive me, Mr Stewart, but those are questions that I have, too. I really hope that the UK Government takes the opportunity to come and speak to the committee about that kind of detail.

No. I am glad to hear that the UK Government has been invited to the committee because that level of detail is for it to provide and those questions are for it to answer. There have been high-level announcements and statements about what it will mean in terms of jobs for the area, where the offices will be situated and so on. We were very pleased that Aberdeen was chosen as the headquarters, but what that means in reality in terms of jobs—forgive me for saying so—is a question for Minister Shanks, as are questions around how the priorities might take shape.

We looked at what was required in terms of the legislation around that; it is not something that we are able to do under the current devolution settlement.

The concerns that you have just outlined are the same as my and the Government’s initial concerns when the draft was put in front of us. That is why we have worked so hard to ask for a change to the wording in clause 5 and to get agreement in clause 6 that we will be involved in the consultation around the direction that is given to GB Energy.

I feel confident that the change from “consult” to “consent” will allow future proofing to happen. I am also heartened by the willingness of the chief executive officer, Juergen Maier, to engage with me and the First Minister very early on in his appointment, and to talk about working together. There is also the Secretary of State for Scotland. It will be good for both Governments to have a relationship where consent is in statute, because that will ensure that the Scottish Government is treated as an equal partner.

There is a recognition that the Scottish Government is well ahead—particularly with the work that we have done with Crown Estate Scotland on ScotWind and so on, our onshore wind sector deal, our hydrogen strategy and community energy with the community and rural energy scheme. We are not just an equal partner but—I hope—a source of advice on how GB Energy will best operate in Scotland. From speaking to Juergen Maier, I certainly get the feeling that that will be the case. I have also offered that expertise and discussion to ministers, throughout the process of creating GB Energy. That is why I want the amendment to include the word “consent”.

I do not think that there are any risks. I have the programme for government here, which says:

“Reviewing Crown Estate Scotland’s governance and operating model to ensure it optimises its unique role in value creation and growing sustainable wealth for Scotland through helping deliver the supply chain side of the offshore renewable energy expansion. This will benefit communities and mitigate against climate change and biodiversity loss.”

That will not necessarily need any legislative change; it is about governance, the operating model and working with Crown Estate Scotland in that area.

The situation with regard to giving borrowing powers is quite complex. We do not have the powers to give Crown Estate Scotland borrowing powers. If borrowing powers are given to the Crown Estate in England and Wales, we would need to have a discussion about what that meant for Crown Estate Scotland and whether it wanted to go down the same route.

We would prefer that any activity and funding associated with the Crown Estate also came to Scotland. That is what we are looking for in relation to parity. We do not want to lose any funding.