SNP ministers were warned oil and gas slump driving renewables investment out of Scotland
Ministers were also told that Scotland’s forecast share of ScotWind manufacturing spending has fallen over the last three years.
SNP ministers were warned a slump in oil and gas investment risked driving the renewable energy supply chain out of Scotland, new documents have revealed.
The Scottish government was also warned that Scotland's forecast share of ScotWind manufacturing expenditure has fallen from 27 per cent in 2023 to 20 per cent in 2026.
The revelation comes as the SNP government comes under pressure from the fossil fuel industry and political rivals to back new oil and gas projects in the North Sea after the party voted at its annual conference to scrap the controversial “presumption against” new developments.
SNP energy minister Stephen Gethins told The Scotsman it could be another year before an official position on oil and gas is confirmed by the Scottish government in its much-delayed energy strategy.
But the Scottish government is also facing pressure from climate campaigners calling on SNP ministers to oppose the Rosebank oil field, which would produce around 200 million tonnes of carbon if approved for environmental consent by the UK government and has no energy security argument like the Jackdaw gas field which received a permit last week.
New documents have revealed a risk register presented by industry body, Scottish Renewables, in January warned of a major threat to offshore wind development.
The organisation stated that “historic lows in O&G investment” were “driving supply chains out of Scotland” and having “impacts on operational renewables too.” The document warned over a “genuine challenge to meet grid build out”.
The warning was delivered directly to senior ministers at a meeting of the national strategy for economic transformation delivery board, co-chaired by then deputy first minister Kate Forbes and attended by then net zero secretary Màiri McAllan, who is now John Swinney’s education secretary.
READ MORE: Jackdaw gas field approval cannot be distraction from wider crisis facing Aberdeen and the North Sea
The documents show the renewables industry concerns over Scotland's existing energy supply chain that could be undermined before offshore wind projects are able to replace lost work.
Separate correspondence released by Crown Estate Scotland also shows Scotland's forecast share of ScotWind manufacturing expenditure has fallen from 27 per cent in 2023 to 20 per cent in 2026. Officials pointed to changes in project assumptions and the increasing use of international suppliers as projects developed.
It comes after The Scotsman revealed that floating ScotWind developers are poised to hand their contracts back to Crown Estate Scotland as the industry rallies around a handful of projects to get them up and running amid fears over investment for the emerging technology.
Scottish Conservative energy spokesman, Liam Kerr, said: “These documents contain a stark warning from Scotland's renewable energy industry itself.
“Ministers knew in January that the SNP’s presumption against new oil and gas, and the chilling effect that has had on investment in the North Sea, has actively hampered the development of new industry.
READ MORE: North Sea chief demands action from Andy Burnham to open 'bigger pipeline' of oil and gas projects
“No wonder the so-called ‘just transition’ they repeatedly promised just hasn’t transpired for thousands of workers who have lost their jobs.”
He added: “When even Scottish Renewables are telling Kate Forbes and Mairi McAllan their cliff-edge approach to developments like Rosebank and Cambo isn’t working, that tells you something.
“But John Swinney still hasn’t backed Rosebank, he hasn’t changed SNP policy and the Scottish Government’s energy strategy is now three and a half years overdue.
“The SNP now need to explain what action they took over this warning, how they are protecting Scotland's energy supply chain and how they will stop a just transition becoming a transition out of Scotland.”
Energy minister Stephen Gethins said: “The decisions around Jackdaw and Rosebank were delayed because the consent process was found by the courts to be flawed. It is important that the UK Government learns from that process.
“We need to see a parallel track approach to the energy transition, in which North Sea oil and gas production is managed alongside the increasing deployment of renewables. We are clear that in addition to replacing the Energy Profits Levy, the UK Government must make decisions on North Sea oil and gas projects on a case by case basis, with climate compatibility as required by law and energy security as key considerations. And it is absolutely critical that if any new production goes ahead, then the economic benefits should be felt in Scotland, rather than flowing to the Treasury.
“Scotland has been world leading in its deployment of renewables including in our offshore wind sector. However, the biggest threat to Scotland's offshore wind supply chain is uncertainty and UK policies that undermine the sector. The UK Government must reform unfair transmission charging and ensure the Strategic Spatial Energy Plan fully reflects Scotland’s offshore wind pipeline. Failure to do so risks investment, jobs and supply chain growth.”
SNP energy minister, Stephen Gethins, said: “The decisions around Jackdaw and Rosebank were delayed because the consent process was found by the courts to be flawed. It is important that the UK Government learns from that process.
“We need to see a parallel track approach to the energy transition, in which North Sea oil and gas production is managed alongside the increasing deployment of renewables. We are clear that in addition to replacing the energy profits levy, the UK government must make decisions on North Sea oil and gas projects on a case by case basis, with climate compatibility as required by law and energy security as key considerations. And it is absolutely critical that if any new production goes ahead, then the economic benefits should be felt in Scotland, rather than flowing to the Treasury.
“Scotland has been world leading in its deployment of renewables including in our offshore wind sector. However, the biggest threat to Scotland's offshore wind supply chain is uncertainty and UK policies that undermine the sector. The UK government must reform unfair transmission charging and ensure the strategic spatial energy plan fully reflects Scotland’s offshore wind pipeline. Failure to do so risks investment, jobs and supply chain growth.”
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