Flagship SNP Government fund creates few renewables jobs

The Herald Scotland

18 hours ago

Supporters of the Inch Cape windfarm off the Angus coast claim it will be able to generate enough green energy to power half the homes in Scotland while making a major contribution to the UK economy.
Development work is expected to be completed in 2027 following more than £3.5 billion investment in the UK's energy infrastructure. We are told this should include a significant boost for the Scottish supply chain.
Take a closer look, however, and it appears that Scottish suppliers are only in line to get the scraps from the table.
The bad news comes after a report found last week that the Just Transition Fund has created a risible number of jobs since it was launched amid fanfare in 2021.
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Inch Cape held an event in Montrose town hall earlier this month to highlight the opportunities for local firms to win business.
This is the kind of talk that SNP ministers love.
But the contracts for the supply of the most valuable and labour-intensive elements of the 72-turbine project were awarded to firms based overseas long ago.
Chinese businesses were engaged to supply the foundations and towers for the turbines.
Smulders of Belgium and Germany's Siemens Energy won the contract for electrical transmission infrastructure, some of which will be produced in Wallsend, Newcastle.
Vestas of Denmark will supply the giant turbine blades for the windfarm.
Scotland does not have a suitable production facility, despite SNP Governments making lots of noise about putting the infrastructure in place to ensure the offshore wind supply chain prospers.
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There was excitement in June last year when Vestas announced that it was considering developing a turbine blade production plant on the site of Leith docks in Edinburgh.
Such a plant would expect to bid for work that may be awarded by the firms that are considering developing a new generation of floating windfarms off Scotland.
However, the Leith site will face competition for investment by Vestas from other places as the company weighs up opportunities in the global market.
Asked when the company expected to decide whether to go ahead, a spokesperson said: 'Vestas has identified the Port of Leith as a possible location for a wind turbine blade manufacturing facility.
'A final investment decision has not been made and will be based on several factors including the viability of the business case and the market outlook.'
The spokesperson said Vestas would utilise its existing network of production plants to fulfil the Inch Cape contract without elaborating. Vestas has plants on the continent and one on the Isle of Wight. This produced blades used on SSE's Seagreen windfarm off Angus but is now focusing on onshore projects.
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Scottish firms have had to battle for a share of the smaller contracts for Inch Cape windfarm work.
The Inch Cape website states that around £150m has been spent with 125 Scottish companies to date. That works out at around £1.2m each.
In terms of long-term jobs impact, Scotland must make the most of the 50 jobs that are expected to be created at the Montrose operations and maintenance base.
The profits generated on the output from the windfarm will go to ESB of Ireland and Chinese-owned Red Rock Power which have equal stakes in the project.
The companies may claim they deserve to do well after sticking with a project that has been years in development.
However, the scheme benefited from crucial UK Government support that will be funded by households.
The windfarm will get revenue support under the Contracts for Difference programme. It won an award in the fourth CFD allocation round held in 2022, which was topped up in round 6 last year.
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Banks around the world will also share in the spoils. Some 22 lenders sighed up to support the funding round completed by Inch Cape's shareholders in January. The exercise will have provided work for armies of well-paid advisers.
To put the Scottish employment numbers in perspective, Equinor has said the Rosebank oil field development it plans to complete West of Shetland will support around 1,600 jobs at the height of construction work and 450 UK-based posts during the operations phase.
But former first minister Humza Yousaf condemned the UK Government's decision to approve the Rosebank development in September 2023.
His predecessor Nicola Sturgeon claimed then that work on Rosebank risked slowing the green transition and the jobs that came from it.
During Ms Sturgeon's term as FM, in 2021, the SNP Government struck a collaboration deal with the Scottish Greens and turned against the oil and gas industry.
Since the agreement unravelled in April last year, the SNP Government led by John Swinney has vacillated about what line to take on oil and gas ahead of the Holyrood elections that are expected to be held next May.
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The Scottish Government has yet to publish a final version of the draft energy strategy issued by Ms Sturgeon in January 2023, which said the development of renewables should be accelerated. The draft recommended a presumption against further oil and gas exploration in the North Sea.
The future of Rosebank was cast into doubt after a Scottish court ruled in January that approval was unlawful because it failed to take account of all the related emissions. Equinor will have to submit a fresh environmental impact assessment that provides the data required.
However, the green jobs promised by Ms Sturgeon and predecessors have not materialised.
Last week came fresh proof that the centrepiece of Ms Sturgeon's job creation strategy has had negligible impact.
In a bid to keep supporters in the SNP's North East Scotland heartlands onside Ms Sturgeon announced the £500m Just Transition Fund in 2021.
The fund was suspended following the first two years of applications as MSPs expressed serious concern about its effectiveness.
It was reopened to applications in May although the SNP Government has yet to publish the refresh of the just transition strategy that it promised.
A report issued quietly by the SNP Government on July 7 noted the fund had created the grand total of 110 jobs in the first two years and supported 120 others. This followed a £43m outlay.
The authors insisted nonetheless that the fund had provided the foundations for economic and environmental change by supporting initiatives such as the development of a skills passport to help oil and gas workers transition to renewables.
That will probably provide little comfort to the 250 Aberdeen workers who are set to lose their jobs under the cost-cutting programme announced by North Sea oil heavyweight Harbour Energy in May.