Chamber and committees

The supply chain development statement process has been carefully designed and is managed by Crown Estate Scotland to ensure focus is maintained on supply chain capacity and capability to develop and deliver offshore wind projects in Scotland.

Since the ScotWind announcements, Crown Estate Scotland have conducted webinars and engagement with a wide range of stakeholders, including trade unions, to provide information and updates on the supply chain development statement SCDS process.

The Scottish Government also continues to actively engage with the Just Transition Partnership, and individual trade unions, on a range of issues, including in relation to support for the Scottish supply chain and securing a Just Transition for our offshore energy workers.

The Scottish Government is committed to maximising the economic opportunity for the Scottish supply chain from our offshore wind potential, and ensuring a just transition that takes our existing skilled workforce with us.

The Scottish Government is working closely with Forth Green Freeport and Forth Ports as a consortium member, to ensure that it delivers maximum positive impact as soon as possible, including at the tax site in Leith where a renewable energy hub is being developed and a potential customs site at Edinburgh Airport. This includes regular engagement at official level to support the development of their recently submitted full business case.

Scottish Ministers have had a number of engagements with Forth Ports in the last few months about the company’s challenges and opportunities as they look to support a just transition to a decarbonised economy. This includes a visit of Cabinet Secretary for Transport Fiona Hyslop to Port of Grangemouth on 6 March 2024, a meeting between Deputy First Minister Kate Forbes with Forth Ports CEO Stuart Wallace on 12 July and a visit to the Leith tax site of Forth Green Freeport of Minister for Employment and Investment Tom Arthur together with UK Government Secretary of State for Business and Trade Jonathan Reynolds on 22 August 2024.

Green Freeports will play a crucial role in the Scottish Government’s commitment to a just transition to net zero, by creating clusters of high-tech manufacturing excellence in low carbon sectors and high-quality, well-paid new jobs within these sectors.

The National Electricity Framework is used by all sectors including, Local Authorities, NHS bodies, Universities and Colleges, Central Government inc NDPBs and agencies, Housing Associations, Charities etc. The split of % usage of the electricity framework is as follows:

No, the Scottish Government Electricity Framework is a single supplier framework awarded to EDF. Local community owned energy providers cannot be added as a supplier to the framework. However it may be possible for local community owned energy providers to enter into direct supply agreements with EDF under contractual agreements which could be established between EDF and the local provider direct with no involvement from Scottish Government.

The National Electricity Supply Framework is not mandated however all 32 Local Authorities use the framework and there is local authority representation on the Risk Management Committee who oversee the purchasing strategy.

Within the National Electricity Supply Framework no power is procured from community – owned energy providers.

The framework has been set up to supply electricity to all of the Scottish Public sector. The supplier on the framework is required to purchase power on the futures market through a risk managed hedging strategy. The strategy is owned by a Risk Management Committee who represent all of the main Public Sector bodies.

The framework supplier needs to ensure it has the capacity to secure forward purchases on behalf of all framework customers. The supplier also needs to account manage each individual customer organisation including billing, invoicing, meter reading queries, complaints, energy efficiency queries, and social value programmes within the framework. As well as managing the consumption for over 30,000 meters for electricity that are part of the portfolio. Therefore, the supplier needs to have capacity to trade large volumes and achieve Value For Money for the whole Scottish public sector.

There is no mandate for (a) local authorities or (b) other public sector organisations that are generating power, to sell that power to Scottish Government or the appointed contractor under the National Electricity Framework.

Ofgem administer a Smart Export Guarantee (SEG) scheme where renewable electricity can be fed into the grid. Customers can apply for a SEG tariff, where their generating system meets the SEG eligibility requirements.

EDF (the current framework supplier for electricity) have a SEG licence to facilitate this service.

This or any other arrangement a local authority or public sector organisation puts in place to sell power and find the best price in the open market, is outside the terms and conditions of the electricity framework. However, a local authority or public sector organisation can have an export arrangement in place and remain part of the wider portfolio.

The total electricity use provided for in the electricity supply framework is determined by the estimated consumption of all framework customers. This is currently estimated at 2,293, 227MWh (megawatt hours) with a value of £686.7m, which will vary each year, depending on customer consumption.

The Scottish Government has not made a recent assessment of the legislative requirement for Crown Estate Scotland to obtain market value in its transactions. An assessment is not required under the Scottish Crown Estate Act 2019.

Scottish Government do not (a) incentivise (c)inhibit or (d) discriminate against community owned energy providers. Scottish Government conduct all procurement in accordance with the Procurement Reform (Scotland) Act 2014 and the Public Procurement Regulations. Under Section 8 – General Duties of the Act, procurement authorities must:

“in carrying out a regulated procurement—

(a) treat relevant economic operators equally and without discrimination,

(b) act in a transparent and proportionate manner.”

To actively incentivise or discriminate any provider or group of providers would be a clear breach of the requirements of the Act.

The framework terms and conditions do (b) facilitate self generating sources to approach the Supplier, and there is a mechanism in the Terms and Conditions for local authorities to approach EDF to sell electricity which they have generated. The Framework also has included the option of Power Purchase Agreements.

The terms and conditions state that for the Supply of Electricity from a self-generating source the Supplier shall enter into a Power Purchase Agreement with such Scottish Public Sector Body on normal commercial terms. Such purchase shall stand entirely separate to the arrangements under the Framework and the Supplier shall not be under any obligation to sleeve the electrical output of such Public Body’s facility into the supply of electricity under the framework.

The Supply of Electricity agreement has also included the options of 6 different Power Purchase Agreement variations as part of the Statement of Requirements and the Terms and Conditions, these include.

Option 1 - A PPA entered into between the Scottish Government (Authority) and a third party generator. The generator is not a Client under the Framework. (Direct PPA)

Option 2 - A PPA entered into between the Contractor and a third party generator. The generator is not a Client under the Framework. (Indirect PPA)

Option 3 - A PPA entered into between the Scottish Government (Authority) and a generator. The generator is a Client under the Framework ( for example a Local Authority). Under this category of PPA the power sleeved into the Framework volume for use by the entire portfolio

Option 4 - A PPA entered into between the Contractor and a generator. The generator is a Client under the Framework. Under this category of PPA the power sleeved into the Framework volume would be for use by the entire portfolio.

Option 5 – : Export PPA where Client under the framework sells excess volume to the Contractor

Option 6 (as advice only) - Private Wire. This category is distinct from any of the above as it involves a direct physical connection between the generator and the buyer.

Overall the National Framework for the Supply of Electricity includes a statement of requirements and Ts and Cs which are agreed by the User Intelligence Group made up of public sector representatives (including representatives from local authorities). They have set out that the framework supplier needs to ensure it has the capacity to secure forward purchases on behalf of all framework customers. The Supplier also needs to account manage each individual customer organisation including billing, invoicing, meter reading queries, complaints, energy efficiency queries, and social value programmes within the framework. As well as managing the consumption for over 30,000 meters for electricity that are part of the portfolio. Therefore the supplier needs to have capacity to trade large volumes and achieve Value For Money for the whole Scottish public sector.

All of these aspects have been set out as well as the options of Power Purchase Agreements and the mechanism for local authorities to approach the Supplier to sell the power which has been self-generated.