Just Transition

Green concerns raised over Scottish Government’s Just Transition Fund

Environmental campaigners have raised concerns that millions of pounds from the Scottish Government’s Just Transition Fund have been awarded to an oil tycoon, controversial projects and a private sector group backed by the fossil fuel industry.

Taxpayer funded grants from the Just Transition Fund (JTF) include £5m awarded to an organisation chaired by oil tycoon Sir Ian Wood, and £2m to the Net Zero Technology Centre, which is backed by oil firms including Shell and BP.

Another £14m was given to a “contentious project which will destroy a vital community park”, said Friends of the Earth Scotland, which argues that the JTF should directly benefit workers and communities and not just the private sector.

The Scottish Government said the £500m fund — a decade-long initiative — is designed to help communities across the north east and Moray, and support projects which contribute towards the region’s transition to net zero. The government said it had “engaged extensively” with workers, trade unions, communities, businesses and local authorities in the region.

At the recent SNP Conference in Aberdeen, Scotland’s first minister Nicola Sturgeon announced £50m worth of awards for 22 JTF projects. 

Over £14m will go to the Energy Transition Zone (ETZ), which has been opposed by local residents in Torry, Aberdeen, where St Fittick’s Community Park will be destroyed to make way for the project. Campaigners argue that alternative sites should be considered.

The Scottish Government can’t throw money at oil tycoons to ride over the wishes of local people and badge it a Just Transition.

Ryan Morrison, Just Transition campaigner

The ETZ is a plan to build sites for the development, production, assembly, storage and distribution of energy infrastructure, in the hope that this will encourage ‘green’ companies to come to the area. 

The ETZ’s backers include Opportunity North East (ONE) – a “private development sector catalyst” group chaired by Sir Ian Wood, which was awarded £5m by the JTF. The ETZ has been given £53m in public funding from the UK and Scottish Governments and £5.7m from ONE.

Those voicing opposition to ETZ include Ishbel Shand, a member of the Friends of St Fitticks Park campaign. She referred to the first minister’s speech at the SNP conference, when Sturgeon condemned the UK Government over “massive hand-outs for the wealthiest at the expense of everyone else”.

Shand told The Ferret: “Yet the same Scottish Government has just handed almost £20m from the Just Transition Fund to an oil billionaire’s pet projects, on top of the over £50m it already received from Scottish ministers and the UK Government. All of this public money to industrialise a lovely wee park – the last accessible place for one of the most deprived areas in the city – in pursuit of fantasy job figures and a dream to make Aberdeen the ‘net zero capital of the world’.”

Shand added: “Local doctors have deplored the plan to trash the park, the local community has rejected it and the media has been scathing. One can only suppose that the government, having backed a white elephant, are determined to feed it bales of public money in the hope that it will all work out in the end, when the predictable result is much more likely to be large amounts of elephant excrement”.

Another project funded by the JTF is the Net Zero Technology Centre (the Centre) which will receive £2.1m for research and development of — what Friends of the Earth Scotland (FoES) described as — “controversial nature-based solutions and inefficient green hydrogen”.  The Centre, formerly known as the Oil and Gas Technology Centre, was established to support the oil and gas industry and lists major oil companies as partners on its website. They include the oil giants Chevron, BP, and Shell. FoES argues that green hydrogen is an “expensive and inefficient use” of renewable energy.

A sum of £100,000 will go to the NESS Energy Project to research the feasibility of carbon capture and storage retrofit at incinerators. NESS is an energy from waste facility to process the non-recyclable waste, supported by the councils of Aberdeen City, Aberdeenshire and Moray. 

A just transition is about workers and communities, but millions of pounds from this fund is going to private sector led business groups

Ryan Morrison, Just Transition campaigner

According to FoES, however, the Scottish Government has commissioned an independent review of how to cut climate pollution from the waste management sector, so it is “pre-judging the outcome of that review” by paying money to investigate whether carbon capture can be affixed to an incinerator. Anything that supports incineration risks, FoES argued, further locking Scotland into burning waste rather than reusing or recycling it.

The environmental group also claimed the Scottish Government has not provided information on the criteria used to determine successful applicants, or what guarantees are in place to ensure there will be worker and community benefit in return for public money.

FoES Just Transition campaigner Ryan Morrison told The Ferret: “A just transition is about workers and communities, but millions of pounds from this fund is going to private sector led business groups. There is no mention of how the ministers will make sure this £50m will create positive outcomes for workers and communities or help them to shape this transition. There are serious questions to be asked if the fund isn’t going to directly benefit workers and communities — and how is the Scottish Government ensuring it will tangibly protect livelihoods and improve lives.”

“Communities in Torry are actively fighting back against Ian Wood’s Energy Transition Zone plans which would see their local park sacrificed in pursuit of profit.  

The Scottish Government can’t throw money at oil tycoons to ride over the wishes of local people and badge it a Just Transition. 

“There are smaller amounts of money made available for exciting community and worker-led projects like North East Rail. If this fund is to have a lasting effect of driving a worker and community-led transition, future allocations must drive money into people’s hands to shape a zero carbon future, rather than becoming another cash pot for private sector-led business groups.”

Investment in north east Scotland will provide long-term returns through sustainable business growth, increased productivity and high-value green jobs.

Jennifer Craw, ONE chief executive

A Scottish Government spokesperson said its focus in year one of the project has been on ensuring that workers and communities benefit from investment by “supporting a skills passport for offshore energy workers, transforming the way that workers can move between sectors”. This support, the spokesperson argued, would benefit workers currently employed in oil and gas to “capitalise on the employment opportunities” presented by the transition to net zero.

“We are also investing in research, pilot projects and skills hubs which will support universities, colleges and businesses to provide workers with the skills needed for a successful transition away from fossil fuels,” the spokesperson said.

“We are funding a pilot exploring participatory democracy in the region, including through the use of climate assemblies. Funding of £1m a year, over the lifetime of this parliament, has been ring-fenced for participatory budgeting – which will allow communities to directly support local projects – and another £1m earmarked for the first year to support Social Enterprises in the region.”

Jennifer Craw, ONE chief executive, said the region has a “clear economic vision backed by effective private-public partnerships”. She added: “Through ONE, industry is consistently co-creating, developing, co-investing in and delivering impactful projects in key sectors with regional and national partners. Investment in north east Scotland will provide long-term returns through sustainable business growth, increased productivity and high-value green jobs.”

ETZ chief executive, Maggie McGinlay, said the JTF is “hugely welcome” and its successful projects will “accelerate its ambition to reposition North East Scotland as a globally recognised net zero energy cluster”.

She added it is of the “utmost importance” to equip people with the necessary skills required to take advantage of the “vast opportunities that energy transition will bring” and this is “particularly the case in offshore wind, hydrogen and CCUS where we will see a significant increase in activity” over the coming years. 

Aberdeen City Council did not respond to our request for a comment.

Cover image: President Kagame meets with Sir Ian Wood, Chairman of the Wood Foundation | Kigali, 10 November 2016. Photo credit: Paul Kagame

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