19:09 Ian Blackford (Ross, Skye and Lochaber) (SNP)

I think it right that in any debate concerning green energy, we should begin by mapping out exactly what is at stake for all of us. As we know, this is not just about the economy; this is existential. As has been said before,

“We are the first generation to feel the effect of climate change and the last generation who can do something about it.”

By now we should all know the very real threat of climate change, but we also need to know about the opportunity that can come if we make the transition away from fossil fuels and that is what I intend to talk about this evening. Meeting the challenge of climate change is in our self-interest, if we are even to survive, but it is equally in our self-interest to reap the rewards of the economic opportunities that new, green technologies offer us in Scotland and across these islands. We in Scotland know those opportunities more than most, because the industries of the future are already putting down strong and sustainable roots.

Once operational, this will provide several billion pounds more in rental revenues, and every single penny can then be invested for the benefit of the people of Scotland. There will be a green energy windfall for Scotland from the natural bounty that is our green energy potential. In the middle of a cost of living crisis, that vision and that outcome simply cannot come quickly enough. At the heart of the agenda is a very simple truth: this is Scotland’s energy, and it needs finally to be used for the benefit of Scotland’s people.

As well as the production, use and ownership of this green energy, there is another crucial element that must not be lost, and that is securing the full economic and industrial benefit from it. I am glad to say that each ScotWind application was required to include a supply chain development statement setting out its supply chain goals and committing developers to meet them during the various stages of their projects. Through those statements, developers have now pledged an investment of £28 billion in the Scottish supply chain. This is the crucial point: in every single area of green growth, this has to be the model that we all pursue. It is not nearly enough just to produce the energy; it is every bit as important to stimulate and grow the industrial base and the jobs that flow from that energy resource.

Offshore wind may have the most momentum, but it is only one of the many opportunities that have the potential to grow. I am delighted that, only in the last number of weeks, my friend and colleague in the Scottish Government, our net zero Cabinet Minister Michael Matheson, has published our draft energy strategy and just transition plan. That plan contains the ambition to grow the full range of green energy opportunities, including pump storage, tidal, solar and of course green hydrogen. The ambition is to create an additional 20 GW of capacity by 2030—enough to power around 6 million homes, which is far more than the number of households in Scotland. This increased capacity would account for the equivalent of nearly 50% of all current energy demand of households and businesses.

The hon. Gentleman is correct. There is a significant opportunity for hydrogen in the distilleries in his own constituency, in mine and right through the industry. I will go on to talk about the Skilling report that I published on behalf of the SNP a few months ago. It mentions the ability to generate five times as much green energy by 2050 as we are doing today and to grow from just over 12 GW up to 80 GW. There is an enormous opportunity within all that for hydrogen in the domestic economy and for exports.

When we talk about the domestic economy, it is important to dwell on the fact that, if we have the ability to upscale our energy production to the extent that that report has indicated, there ought to be a competitive advantage for industry. We must ensure that we get to net zero and reduce our carbon footprint but we must also create a competitive advantage. The holy grail is to ensure that we can strengthen sustainable economic growth and ensure that that ability to generate green energy creates a competitive advantage for industry that drives up investment and productivity and improves living standards.

But my goodness, let us think about the economies of scale in doing that in the context of the cost of living crisis that we are suffering from today. I say to the hon. Member for Caisthness, Sutherland and Easter Ross, whose constituency is in the highlands, that it is an absolute disgrace that so many of our constituents, and our pensioners in particular, are living in fuel poverty when the highlands and islands are generating so much green energy potential, never mind the impact of the cost of living crisis. I say to the Minister that we need to look at the mechanisms of setting a price in the energy market, which has been a considerable factor in putting so many of our constituents in the peril they are in. In the context of Scotland, we are producing six times as much gas as we need, yet suffering from the mechanisms of the market that are forcing our people to pay for energy to an extent that they should not be.

Absolutely. I hope the Minister appreciates that I am trying to do this in as consensual a manner as I can, but we have to learn from the mistakes in setting energy policy. We have to recognise that, to a large extent, the bounty of North sea oil is now in the rear-view mirror, but we did not benefit from that bounty or from the £350 billion-plus of tax receipts that the UK Government have taken from it. Of course it is galling for people in Scotland to be paying a price for the failure of energy policy in the UK, whether that relates to fossil fuels in the past or green energy in our future.

I will make some progress so that I can leave the Minister some time to respond. On hydrogen specifically, the plan maps out how we can develop 5 GW of power by 2030 and a further 25 GW by 2045. This would provide a clean and sustainable alternative to fossil fuels and would help us to decarbonise heavy industry and transportation.

It is estimated that there will be £48 billion of annual green hydrogen exports to Europe by 2050. We talked about the potential of North sea oil in the 1970s but, my goodness, Scotland’s green energy potential is enormous. Scotland can become a substantial green hydrogen exporter, delivering thousands of jobs. That hydrogen potential is also a priority in supporting the fastest just transition for workers, communities and businesses in the oil and gas sector.

The latest plan builds on the £0.5 billion just transition fund that is already being rolled out by the Scottish Government. Just transition funding has already been allocated to support the development of a skills passport, to create an advanced manufacturing skills hub in Aberdeen and to develop a pilot scheme with the national energy skills accelerator to determine the skills required for an energy transition. This includes transitioning skilled offshore workers into jobs in carbon capture and storage, and decommissioning or diversifying oil and gas business models into renewable energy portfolios, including the offshore wind, carbon capture and hydrogen sectors.

All of this good work is under way, but I am afraid it does not tell the whole story because, although many good initiatives are powering ahead, another reality has been evident for far too long. I am sorry to say that, when it comes to green energy, both Scotland and the UK in general are being held back by the UK Government’s toxic mix of lack of action and lack of ambition. It is fair to say that Members are used to hearing me criticise the UK Government in such terms, so they might be tempted to dismiss the criticism as predictable or standard fare. But if they will not listen to me on this, maybe, just maybe, they will listen to the head of the CBI. I am conscious that this debate comes after weeks of heavy and pointed criticism from Tony Danker, and those criticisms are worth repeating in full for the record. Tony Danker said he is

When will carbon capture and storage be given the go-ahead in Scotland? Let us show that we are determined to deliver on net zero, and for us in Scotland that means 2045 at the latest. Will the Minister take this opportunity to deliver on the UK Government’s past promises?

Obviously, we will continue to have that debate on Scotland’s future and our independence, but in the here and now I would make this plea to the Government tonight: whatever the constitutional future holds, the opportunity of this green industrial future is something that we can and should be working on together. This is in Scotland’s interest, it is in the UK’s interest and it is in this planet’s interest. But if this Government are willing to work together, they need to change course urgently. They need to start to listen to people such as Tony Danker at the CBI. A good start would be ending the unfair transmission charges in Scotland, investing properly in tidal and, finally, green-lighting the Acorn Project. If we can agree to work together on that agenda, not only can we share all the benefits that green energy provides, we can protect this planet that we all call home.

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19:28 Graham Stuart (Conservative)

Let me begin by congratulating the right hon. Member for Ross, Skye and Lochaber (Ian Blackford) on securing this Adjournment debate. I agree with him that green energy in Scotland has a great future, and it plays a key role in bolstering the UK’s energy security and driving greater energy security for the nation as a whole. That will be important in ensuring a cost-efficient energy system consistent with net zero, while creating value for money for consumers and taxpayers. I am also grateful to the other Members who have contributed, through interventions, to the debate.

The right hon. Gentleman has made some interesting points. There was precious little praise from him for any Government policy. He said that some might regard him as taking normal trite separatist lines, which is true. The truth is that Scotland, which has a population lower than that of Yorkshire, disproportionately, per capita, is able to invest in green energy through the CfD system. It is able to do so because of the levy, effectively paid through the CfD, which is from all the bill payers of Great Britain. That is allowing the transformation of Scottish energy. Without that—without the base of all the electricity and gas bill payers across this country—Scotland would not be able to deliver the huge potential that it has. If the right hon. Gentleman thinks that green energy is an argument for independence, I would say to him and his separatist colleagues that the absolute opposite is true. It is access to the whole of Great Britain, the integration with all the bill payers of Great Britain, that is allowing Scotland, as part of this United Kingdom, to lead the world. Of course, he talks in the way that, sadly, he and his separatist colleagues always have done. They are always talking down what we are doing. We have done more on offshore wind than any other country in Europe. We are second only to China in the world now and we transformed the economics of it. That was this UK Government, this Conservative Government.

The right hon. Gentleman suggested in some way that the UK Government lacked ambition. This is a Government who hosted COP26, who led the world from 30% of GDP covered by net zero pledges to 90%, who were the first of any major economy to legislate through the Climate Change Act 2008 and to move to put net zero into law. Ambition is not something that this country lacks at all. The right hon. Gentleman did not reflect any of that progress. We have led Europe and we have led the world and people would not know that if they listened to the right hon. Gentleman.

The Government have committed fully to decarbonise the electricity system by 2035 subject to security of supply. Our carbon budget 6 trajectory suggests that we will need to build all low-carbon technologies at or close to their maximum technical limit to meet the twin challenge of accelerating decarbonisation and servicing increased demand.

We are absolutely committed as a Government to the renewables industry across the UK. Scotland has benefited from, and will continue to benefit from, UK investment in energy and energy efficiency. The Secretary of State has received a letter from the Scottish Cabinet Secretary for Net Zero, Energy and Transport outlining Scotland’s energy strategy proposals. The Secretary of State is considering those and will respond in due course.

Since we are talking about ambition, I note that this is about not just ambition, but delivery. The Climate Change Committee reported in December:

“Scotland’s lead in decarbonising over the rest of the UK has now been lost. Progress is now broadly the same as the UK as a whole. There are now glaring gaps in the Scottish Government’s climate plan and particular concerns about the achievement of the 2030 goal to cut emissions by 75%”.

I find this quite extraordinary, because I asked the Minister specifically to reflect on the Royal Society report that called for a ring-fenced pot of £50 million so that we can get up to 11 GW. I also asked specifically about the assessment he made on the £20 million that is there. The simple fact of the matter is that we are being held back. We have the windfall tax on oil and gas producers, which could be used to step up that investment to make sure that we get to net zero by the target dates. The Government can do more.

Hydrogen and carbon capture utilisation and storage will be critical to delivering UK energy security, highly-skilled jobs and economic growth, and will help the UK to reach net zero. That is why we have set an ambition of up to 10 GW of low-carbon hydrogen production capacity by 2030, including four—yes, four—CCUS clusters by 2030. Scotland has a key role to play in that and other areas. I must now come to a close, but I thank the right hon. Gentleman for securing this debate.

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