A week on from the launch of the IPCC report on climate change and attention may be elsewhere already – but the threat of climate catastrophe has not gone away. Common Weal has produced so much work on getting not just to net zero but beyond to net negative that it can be hard to know where to begin. Even the 21 for 21 paper we published to coincide with the IPCC report might look daunting to some.
Where to start, then? We can wish Scotland was ‘good to go’ with transforming Scotland the day after tomorrow but the reality is that there is an enormous amount of work ahead even before we can get properly started. But doing things needed to accelerate that move is very possible and it would signal our serious intent. So, drawing from all our work, what might be some good starting moves if Scotland wants to get serious? Here are six things we could do right now which would fast-forward us towards a post-carbon future.
Start a Scottish Energy Development Agency
Setting up agencies can sound like ‘just extra bureaucracy’, but tackling climate change will involve a lot of bureaucracy because it needs a lot of planning. Much of the work is essentially a big engineering project and that needs proper development, preparation and management and if it is not done in a sensible, efficient way it will be chaotic, prone to failure and cost much more than it should. Planning for Scotland’s energy generation needs is comparatively straightforward because of our renewable energy resources, but if we want to have a proper energy storage system and even more significantly if we want to begin to make serious progress on taking the pollution out of heating, we need a fully-fledged nationwide plan. That’s what a Scottish Energy Development Agency is for and why creating one should be such a priority.
Set up a National Housing Company
Scotland has more than 2.3 million households and a dispiritingly small proportion of them are achieving the kind of energy efficiency that a net-zero Scotland needs them to achieve. There is no shortcut to this – they all need to be brought up to the right thermal performance and it is a labour-intensive job. So have a think about it; is the best way to get this done to get fitters to turn up to a house, fit it properly, get it inspected properly and then move to another house on another street, only to come back and do a second house on the first street a year later? That is clearly a horrendously inefficient way to get the work done; we need to go town-by-town, street-by-street and do the work in the most efficient way possible with specialist teams trained to bring entire neighbourhoods up to standard. That’s what a National Housing Company is for and spraying around grants and putting the onus on the householder is no substitute.
Get serious about regulation
At the same time that we need to be setting up a (not inexpensive) process for properly insulating existing houses, housebuilders are still building new houses that will subsequently need to be retrofitted because they’re just not achieving the right thermal performance standard. The madness of this should be clear to see for all, and it is only one example of many different kinds of public regulation where what we are demanding businesses do now isn’t good enough to achieve what we need tomorrow. Setting targets is easy – if the Scottish Government is serious about climate change, it should act quickly to make sure that we ‘do no more harm’, by regulating now to prevent us having to go back in years to come and fix the things we are doing now.
Create an industrial strategy
What will we insulate the houses with? How will insulate them? What technologies will be used to change our heating and who will make them? If fighting climate change is a big engineering project, we will need lots of materials, lots of technologies and lots of people with the right skills. The difference between a net zero strategy and a Green New Deal is that a Green New Deal uses the work necessary for net zero and designs it to achieve the right kind of social outcomes, creating good jobs and strengthened communities. These outcomes may not be in the interests of big business, and the private sector may be unlikely to invest to overcome some of the barriers (like shortage of tradespeople). What turns an ambition for net zero into a social transformation is an industrial strategy, a plan to guide economic development in a way that creates all the right outcomes and not just some of them.
Set up a National Land Agency
So much of Scotland’s climate change agenda is linked to land – for capturing carbon, for installing renewable energy infrastructure, for creating sustainable construction materials for retrofitting housing, for growing food in a way that doesn’t pollute. Depressingly, last year Scotland’s land actually became a net producer of greenhouse gasses rather than a ‘sink’ which is capturing them. So if we’re serious about climate change, we need to get serious about land: how it is used, how it is managed and how we plan our future on it. This should be the task of a National Land Agency.
Now tell people about all of this
Setting up agencies and fixing regulation is exactly how we do the planning and preparation for the transition we need to make and we can’t make that transition without it. Rushing to do ‘something (anything!)’ rather than planning to do everything properly is why we’ve made so little real progress on the difficult issues so far. But setting up agencies is not in and off itself exactly inspiring – so we also need to inspire. Because this process of transition has so many great benefits. It creates jobs – a lot of jobs. It is a wonderful way to build a new industry base. It will mean every person in Scotland lives in a warm house that is inexpensive to heat. It means we’re future-proofed with energy resilience. It means a better, revitalised landscape to live in. It means so, so much more benefit to people than just doing more of the same. The Scottish Government should start a public information campaign on how a just transition can change all our lives for the better, create enthusiastic public support for it and so get public consent to push forward to a better future for all of us.
As someone working in Scotland’s green energy sector I tend to agree with almost all of this. My one question mark would be whether we need a National Housing Company as, while the building retrofitting work must be coordinated effectively as you suggest, I think this could be done by the Energy Development Agency.
My suggestion is for SG is to consider extending the remit of Scottish Water to cover Heat and Energy Efficiency rather than necessarily setting up a new public company. SW are already leading the way in terms of large scale heat projects. Many heat projects require effective water management – indeed some are built on top of existing SW infrastructure and many more could be developed. Existing SW business processes are likely to share many similarities with dealing with an energy transformation – including use of their commercial arm, Scottish Water Horizons. As such there could be major economies of scale in extending their remit rather than setting up something new – although there may be legal reasons why this is tricky.
The elephant in the room is reserved powers to Westminster in the energy and heat area. Currently I believe these are likely to severely restrict what the SG can do to address the recommendations being made. My sense is that they may limit SG powers to focusing on off-gas-grid areas and energy efficiency improvements to buildings rather than any form of large scale heat transformation which inevitably impacts on fossil fuel use – a Westminster controlled issue.
As for the other suggestions, I very much agree we need stricter regulation sooner rather than later and a coordinated industrila strategy to benefit Scotland plc. I also agree that energy and land are inextricably linked and we desparately need to complete Scotland’s Land Register. This was supposed to be done by 2019 but has now slipped due to lack of resources at all levels. If we don’t know what land owned by public bodies across Scotland (which we don’t) then how can we implement low carbon energy solutions that need to utilise this land? It’s a serious gap that needs filling – but it is probably not an investment priority unfortunately.
Hi John,
Thanks for the comment. Let me respond like this – I am pretty neutral personally on what configuration of bodies are tasked to do this. In fact when we set out most of these proposals in the Common Home Plan (and also in Resilient Scotland) we do point out that in proposing these we recognise that there is already an architecture of agencies which exists and there is overlap. So for example Forestry and Land Scotland has a more limited remit than a full Land Agency but it has a good reputation and pretty strong existing relationships where they need to be. I would personally certainly start there for a Land Agency. But the corollary, we also want to see a National Infrastructure Company and I very much WOULDN’T use the Scottish Futures Trust as the basis for creating that because the proposal is not to expand on what the SFT does but to absolutely reverse it.
The reason I think the Housing Company makes sense is workforce; the biggest barrier to getting systematic retrofit done is workforce because there simply aren’t enough trained tradespeople and semi-skilled workers available to do it. I tend to think the ‘pipeline’ of training, guaranteeing employment and delivery of work is probably more likely to move quickly and efficiently if it is coordinated by a single agency – but that definitely isn’t the only option. The Scottish Water idea is interesting and links to another line of thinking I’ve been developing – but no space to go into that here.
The other reason I like the idea of setting these up is because it is a clear signal of intent. We certainly don’t mean the rather-to-common pattern of the Scottish Government creating (or announcing) these as an end in itself, a means to a press release. They need to be created with a remit and a detailed plan. It is our way of saying ‘tell people there is a real, coordinated plan and that you’re serious about this’. It’s also about creating a momentum that can’t just peter out when the cameras are off again.
My only disagreement is that the biggest barrier isn’t so much reserved powers as reserved finance. It is true that grid-connected electricity regulation and licensing is reserved but that is the part of the picture which is at the most advanced stage of development in terms of where it needs to go. We can’t find anything that reserves any of the powers needed over heat networks, non-grid-connected electricity (subsea for hydrogen generation), land management or house retrofit issues or agriculture policy (other than subsidy levers). But what IS a big problem is paying for the work. If Scotland could borrow and capture the tax receipts of the economic boost that would result it would pay for itself. But as things stand we couldn’t raise the large capital amounts needed and much of the resultant tax take would end up in London, meaning we couldn’t easily pay off the capital costs. This is not an immediate problem because our assessment is that, with the best will in the world, there are probably planning horizons of three or four years and no problem financing the planning phase. But at that point, as things stand, we’d hit the financing barrier.
Then again personally I think this is damn near the best economic and moral case we have for independence. Get us to or close to the ‘press the button’ stage and then campaign partly on a ‘set Scotland free to pursue the Green New Deal it needs and this is the economic boost we’ll get’ pitch. I continue to live in hope but there’s an interesting article in today’s Herald about the very real risk that the fact that ‘hot money’ is flooding into an ill-planned ‘green gold rush’ is going to manage simultaneously to set up a large market failure and at the same time fail to deliver the transition we actually need.
Robin
Thanks Robin.
Just a point on the whole reserved matters issue, I would appreciate your views. I agree the UK Gov holds the purse strings. But I thought it was far more than that. My understanding is that all matters linked to fossil fuel use (or, more pertinently, moving away from fossil fuel use) are reserved to Westminster. As I understand Scotland cannot adopt policies that allow us to significantly reduce our dependency on fossil gas. Given our heat system is almost entirely based on natural gas then it seems to me we are totally tied to whatever they decide to do in terms of fossil fuel policy. For example, the differential price between electricity and gas is something that cannot be addressed by Scotland, as I understand.
This effectively means the Scottish Gov has control over heat policy in off-gas-grid areas and building energy efficiency…which explains currently why much of the focus of Scotland’s heat decarbonisation policy is on efficiency improvements and solutions for ‘low regret’ areas. While we are ahead, to some degree, with policy around heat networks, England is way ahead in terms of the number and scale of heat networks being developed due to the volume of funding that’s been made available. We seriously need – as you point out – a national champion with considerable power to bring together disparate organisations and drive forward this low carbon heat transformation!
Just a point on the whole reserved matters issue, I would appreciate your views. I agree the UK Gov holds the purse strings. But I thought it was far more than that. My understanding is that all matters linked to fossil fuel use (or, more pertinently, moving away from fossil fuel use) are reserved to Westminster. As I understand Scotland cannot adopt policies that allow us to significantly reduce our dependency on fossil gas. Given our heat system is almost entirely based on natural gas then it seems to me we are totally tied to whatever they decide to do in terms of fossil fuel policy. For example, the differential price between electricity and gas is something that cannot be addressed by Scotland, as I understand.
This effectively means the Scottish Gov has control over heat policy in off-gas-grid areas and building energy efficiency…which explains currently why much of the focus of Scotland’s heat decarbonisation policy is on efficiency improvements and solutions for ‘low regret’ areas. While we are ahead, to some degree, with policy around heat networks, England is way ahead in terms of the number and scale of heat networks being developed due to the volume of funding that’s been made available. We seriously need – as you point out – a national champion with considerable power to bring together disparate organisations and drive forward this low carbon heat transformation!
OK, it depends how you look at it. There are two things that are reserved – oil industry regulation which basically means production and the charges and fees which define the retail price of energy. Both of these are outside the power of the Scottish Parliament. But the former doesn’t actually affect the decarbonisation of Scotland in terms of our domestic production of CO2, only the contribution to world CO2 coming from Scotland’s offshore industry. I don’t worry about that too much – in the sense that you can close oil production pretty quickly technically and even I would accept that we need to taper it out so not acting in the next couple of years isn’t that big a deal if we can’t. We need to grasp the thistle soon, but it wouldn’t be happening this year or next.
It’s the latter that is a wee bit of a red herring, the retail price of gas. There are some things where you can impact the behaviour of the public through pricing but somethings where you can’t. Roughly heating your house through electricity is probably about three times as expensive as with natural gas. So you could triple the cost of natural gas and it wouldn’t help, because replacing a heating system is expensive. To incentivise that you might need to quadruple the price of gas and that is not realistic – frankly there is a lot of fuel poverty in Scotland (though actually a lot of that is in rural areas which rely on off-grid heating like oil or LPG) and big increases in gas price would be horrendous. I’m firmly of the view that we shouldn’t ‘punish’ people into doing what needs to be done but to help them. So we’re proposing a major programme of installing district heating. It’s better and cheaper for customers so I can’t see there being any resistance and once it was done no-one is going to go back to gas. So it’s an intervention rather than a pricing process. Or at least that’s how we’d do it.
The problem is that putting in heat networks with a new build development is really very easy and that is what the Scottish Government is tinkering about with. It is little more than the impression of progress because in reality new build developments should be passive standard and so not need much heating in the first place… The problem (the MASSIVE problem) is retrofit and there nothing is happening. We’re very sceptical about widespread retrofit of air source heat pumps but this is being pushed hard by the big electricity companies as it basically hands them the gas market. But without major thermal improvement in the building they won’t and if the fitting of these is anything like as shoddy as the way insulation has been installed over the last 20 years they will fail. But politicians like it because again they don’t foot the bill for this, the household does. The cost ends up not dissimilar to the cost of a proper district heating system when you’ve added the extra generation, installed all the kit and reinforced the grid to make it all stable – but they don’t last forever and don’t work as well. Think of it – drilling big holes into every house in the country and fitting a big box on the back of them. I see it as yet another ‘magical get out’, a move that looks like it is doing something but won’t really work properly.
Let’s do it right and do it once through a major public works programme. (None of this of course is to say that it wouldn’t be really helpful to have the full range of reserved powers in Scotland. It would, it’s just not impossible to work around.)
Robin