As the UK battles energy security, soaring energy prices and a cost-of-living crisis with inflation rising at its fastest rate for 40 years, the challenge of a just transition has never been more imperative.
The concept of a just transition recognises that while the move to net-zero is vital, it must be equitable.
I joined Scotland’s second Just Transition Commission (JTC) as a commissioner in 2021 to help progress the ambition that the energy transition would create benefits and opportunities for people across Scotland. Along with 15 fellow commissioners, we have hit a key milestone with the launch of the ‘Making the Future: Initial Report of the 2nd Just Transition Commission’.
The principle of a just transition must be entrenched into policy planning and delivery. The report sets out our initial thinking and strategic priorities for consideration by Scottish Government. It highlights the economic sectors due to be addressed by Just Transition Plans from the Scottish Government over the next 12-18 months which include energy, buildings and construction, transport, and agriculture and land use. The report also sets strategic priorities and recommendations around finance, social infrastructure, and Scotland’s international role.
Scotland has long been recognised as a global leader in energy production and distribution, renowned for pioneering innovation and engineering excellence. The burgeoning renewable and clean energy sectors offer significant opportunity for the Scottish economy and people. However, as we decarbonise our existing energy industry and develop a new energy system, we must ensure we retain current capability whilst building new capacity.
Our current energy system lacks the resilience it requires to manage instability in the energy market and volatility in our weather. The reinvention of our energy system is a huge opportunity for Scotland and the UK. But, to enable the critical investment we need to make us future ready, we also need clarity around policy, regional development and balance of value generation across society. The Commission has identified strategic priorities that include the need for clarity around the transition, with clear sectoral annual targets and development of shared strategic objectives across government and industry.
An energy roadmap will help to close the investment gap and drive down the cost of clean energy solutions and our ability to deploy the technology at scale. The plan needs to incorporate investment for testing and deploying disruptive solutions, the creation of a more entrepreneurial environment to support the growth of an agile and future focused SME community, and a clear focus on workforce planning. This is an opportunity to create a diversified economy, targeting areas of high skill capability as well as levelling up and revitalising regions in need of redevelopment.
The report recognises that renewable energy projects are being hindered by infrastructure constraints, recommending investment in transmission and distribution infrastructure in addition to building capability and capacity in the supporting planning and permitting regulators. It also proposes the current transmission charging scheme needs urgent reform as it discourages investment in Scottish solutions and inflates local costs.
Stimulating innovation is key to delivering supply chain diversification and its incremental growth, efficient manufacturing, and end-to-end ecosystems. The report recommends innovation enablers such as test and demonstration sites be established, capitalising on existing infrastructure while investing in new alternate solutions. This will not only create jobs but also ensure Scotland does not miss out on the opportunity of this clean energy revolution. We have a rich history of innovation and engineering entrepreneurship, and in solving complex problems as shown by the success of the North Sea, it is critical we are at the vanguard of innovation and technology development in this new era of energy.
As the UK contends with further energy price increases, without urgent action there will be a rise in fuel poverty and a looming health and social crisis. Tackling this is a fundamental driver for a just transition and the report sets the expectation that “affordable clean energy must be available to all”.
The Energy Trilemma of balancing security, affordability, and sustainability is real, and the perennial issue of pace continues to be a theme. We must accelerate the speed of closing the investment gap and technology gap to achieve a net zero future that will provide Scotland with energy security, sustainable jobs and an energy system fit for the 21st century.
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