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Can “yesterday’s man” plot our energy future?

John Swinney will very soon complete a remarkable political comeback and be named Scotland’s seventh first minister.

With the Green’s jettisoned from government, and his party seemingly united, the veteran SNP politician will have an opportunity to reset the party’s policy agenda and focus in on economic growth.

But can “yesterday’s man” (Anas Sarwar’s words, not mine) set the path for Scotland’s energy future?

Yes he can, but he needs to make seven big changes.

Scotland should be well on her way to becoming a green energy superpower. The natural assets that will power the future are even more abundant than the hydrocarbons extracted from the North Sea to date.

John Swinney in talks with the SNP team
John Swinney meeting his team at SNP HQ, on May 6. Source: John Swinney’s X account

Aberdeen, in turn, should be booming. But it is not.

Instead, the city is forecast to have the slowest growing economy of any part of the UK, according to EY. Stalled green energy projects, together with unnecessary hostility towards our oil and gas sector, have left the city’s economy flat.

As a former finance secretary, he requires no lessons in economics. But I’d remind him that for every £3 we raise in corporation tax, £2 of it comes from the sector. It generated a record £9.4 billion tax take in 2022-23.

Not only is it propping up Scotland’s balance sheet, but that oil and gas that we need right now reduces our reliance on more carbon-intensive imports.

Proposed presumption

So, the first step he needs to take is to abandon his government’s presumption against oil and gas when the draft energy strategy is finalised this summer.

While the Scottish government’s position is largely symbolic, as these matters are reserved to the Westminster parliament. However, the proposed presumption against exploration for North Sea oil and gas has been met with compete disbelief.

The energy transition is going to take 25 years or more. There is quite clearly a sustained period of time where oil and gas will remain a crucial part of our energy mix. Honest John needs to be honest with the country about this.

Now unencumbered by Patrick Harvie and Lorna Slater, my second suggestion is that Swinney steps in to try and save Scotland’s only oil refinery at Grangemouth.

Refining capacity at Grangemouth is a key strategic asset, and its closure would be a disaster for the workforce and our energy security. The Scottish government has been missing in action on this issue – Swinney must change that fact.

Third, he needs to inject some much-needed pace into the energy transition.

Just days after formally abandoning Scotland’s 2030 climate targets, Humza Yousaf had a chance to seize back the narrative by announcing approval for two world-leading offshore wind development projects, Berwick Bank and Green Volt.

In the end, just Green Volt made it in time, Berwick Bank did not. It missed a deadline for a UK government scheme to sell electricity from the project into the National Grid. As such, it will need to wait for the next round of bids, in 2025.

Failure to get this through is symptomatic of the bigger problem facing our renewables developers: everything simply takes too long.

Squeezing the numbers

Fourth, the Just Transition Fund needs to be reinstated to £50 million per year minimum. The decision to cut it to little over £12 million this year was, frankly, scandalous.

Fifth, if the Scottish government wants to deliver the green workforce of the future, they need to provide adequate financial support to our universities and colleges, particularly those in the north-east of Scotland.

Number six on my list is to make meaningful inroads on hydrogen production in Scotland. The draft energy strategy referenced earlier places huge stock on the export of hydrogen to replace oil and gas revenues beyond 2030. I see little action from government that would lead to this becoming a reality.

Finally, and perhaps most controversially for what is left of the SNP-Green relationship, Swinney needs to oppose the windfall tax.

This deeply unfair tax grab focuses on just one sector. How on earth has the SNP allowed this to happen, and worse, become accepted?

Harbour Energy's Armada platform in aerial photo
Harbour Energy’s Armada platform

Becoming wiser

Tesco made more money in eight days last year than Harbour Energy did over the whole year. It is unforgivable for Scotland’s biggest industry to be targeted in this way. We need our government to stand up for the North Sea.

Abraham Lincoln once wrote “I do not think much of a man who is not wiser today than he was yesterday.”

Those employed in Scotland’s energy sector will hope the Swinney taking the reins is wiser than the one who brought the Greens into government.

The path to economic growth for Scotland runs through Aberdeen and its energy sector.

With Swinney’s support, Scotland can get its net zero ambitions on track – and Aberdeen can get its economy back.

Ryan Crighton is policy director at Aberdeen & Grampian Chamber of Commerce, which represents 1,250 companies in the north-east of Scotland.

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