As part of a series of blogs aimed at getting to grips with the energy market and the failure to ensure workers and communities in Scotland benefit, STUC Policy Officer, Francis Stuart, looks at the role of the Scottish Government.
In the early 1980s, a company called James Howden & Co Ltd in Glasgow was at the forefront of wind turbine manufacturing, supplying the UK’s first wind turbine in the utility industry. However, the company lost Government support and stopped producing turbines in 1989. The main beneficiaries were the Danish manufacturing industry, who were also early adopters of turbine technology and heavily backed by Government.
Unfortunately for Scotland, things haven’t improved much since. The most recent ONS data indicates that the Scottish low-carbon and renewable energy economy imports significantly more in goods and services than it exports; to the tune of -£229 million.
Most recently, we’ve seen the ludicrous situation where work for EDF’s new £2 billion NNG windfarm off the coast of Fife is set to go to Indonesia and be shipped across the world, rather than go to the Bifab yards in Methil 15 kilometres away.
So who is responsible for this?
Last week we looked at the crucial role that UK energy policy plays. Yet while primary responsibility lies at UK Government level, there are also things that the Scottish Government can do.
Currently the Scottish Government has powers over planning consent for certain energy infrastructure application, including projects over 50MW. While a number of consents contain requirements about local construction and socio-economic benefit, in practice these requirements are often not upheld, with the Scottish Government claiming the requirements are not legally enforceable in Scotland. One way around this, given that environmental policy is devolved, may be to include requirements relating to the carbon footprint of construction.
Similarly powers over the ‘Crown Estate’ – the seabed around Scotland’s coast – have recently been devolved. This means that whenever the Scottish Government provide a lease for Crown Estate land, they now have the opportunity to apply supply chain conditions to that lease – ensuring projects provide local socio-economic benefit.
It is only right that as developers cash in on Scotland’s land and resources, workers and local communities should get something back.
We should also consider the role that direct Government intervention and enterprise support could have in yards such as those in Methil, enabling companies such as Bifab to better compete with European competitors.
However, direct and conditional support is unlikely to be enough. Over the last 30 to 40 years, a lack of concern about ownership has led to a plethora of overseas financial interests within the Scottish economy. This has led to the offshoring of jobs and tax revenues, limited transparency, and lessened the accountability that workers, communities and Government hold over multinational companies.
Back in the 1980s, public institutions like the National Engineering Laboratory (the NEL) in East Kilbride supported the development and utilisation of new technologies. While much of that public knowledge has been lost (the NEL was sold off to a German firm in the 1990s) there are still things the Scottish Government can do.
Firstly, the Scottish Government’s proposals for a publicly-owned energy company, could play an important role in developing renewable energy, restoring post-industrial ports, and capturing value from the low-carbon economy. However existing plans for a white-label retail supplier (essentially buying energy from existing producers and then selling it to consumers) are far too timid and will do little to change the generation mix or the nature of ownership within the low carbon economy.
Secondly, the Scottish Government’s plans for a Scottish National Investment Bank could also provide an opportunity to leverage in the huge levels of public investment that will be needed to address climate change. However, existing proposals look like they’d prevent the Bank operating like similar banks in Germany who have full borrowing powers as well as the ability to lend to the public sector.
Thirdly, there has also been talk of a National Infrastructure Company. This is much needed in-light of the collapse of Carillion; issues at Ferguson Marine Energy and the closure of the Caley railworks. However, to ensure workers, taxpayers and public service users are not simply asked to pick up the pieces of private sector failings, this needs to be based on an integrated 10 to 15 year infrastructure strategy which recognises the importance of collective ownership, not simply firefighting at times of crisis.
More radical proposals in these policy areas, coupled with the Scottish Government’s stake in Bifab and nationalisation of Fergusons, could form the basis of a much more interventionist strategy. While the Scottish Government’s Programme for Government framed many of its announcement around a ‘Green New Deal,’ in reality there was nothing on the role of publicly owned energy, transport and infrastructure companies. These are core components of what might make up a real Green New Deal in a Scottish context – one that is capable of decarbonising the economy while restoring good quality jobs to post-industrial communities.
Currently the Bifab yards sit below capacity with hundreds of workers having to choose between sitting on the dole or moving away from their families for work. Scottish Government intervention could, instead, enable these workers look out across the Fife coast and recognise steel turbines carved by their very own hands.
On 14 September, Fife Trades Council are organising a march and rally under the banner ‘Fife, Fighting for our Future’ as part of the fight for renewable jobs in Methil and Burntisland.
They are showing that workers and communities in Fife want to play their part in building a low-carbon economy and meeting climate change targets. If Bifab isn’t to go the same way as Howden’s 30 years ago, we need our politicians to support them.