WHAT is the missing issue in Scottish politics today? The national movement is preoccupied debating the pros and cons of a second referendum versus using the next UK general election as a plebiscite on independence negotiations.
The local media is focused (rightly) on the cost-of-living crisis, though with no great solutions to offer. And the few Scottish Tories around are waiting for Truss and Sunak to offer even more fantastic electoral bribes.
But here is the dog that hasn’t barked: Scotland is a uniquely energy rich nation, at a moment in history when energy supplies and energy costs dominate the global and domestic agenda. Yet our oil, gas and renewables capacity – and how to use it – is not centre of the national discussion.
Whoever is the next Tory incompetent to occupy Downing Street, they will have to confront the energy price and supply crisis or lose the subsequent election. The outcome of the Ukraine war depends on Europe’s ability to maintain solidarity in the face of Putin turning off the gas supplies. And soaring energy prices are about to spark a global recession.
Energy is the key to practically everything. And Scotland has oodles of energy resources coming out of its ears. So why are we not focused politically on seizing the moment, taking Scotland’s energy bonanza into our own hands and using it for the common good and the national interest? Because if we in Scotland don’t look after our own interests, somebody else will rob us blind in pursuit of theirs.
Let’s remind ourselves of Scotland’s energy potential – and the gap between rhetoric and reality. Last year, installed renewable capacity was circa 12.3MW and rising, compared to only 10.3MW in windy Denmark (which has been aggressively pushing renewables). This year, Scotland’s installed renewable capacity should hit at least 13.3MW, a rise of eight per cent. And we all know the statistic that Scotland has the preponderance of Europe’s wind generation potential.
However, the 100,000 jobs bonanza that John Swinney once promised from offshore wind never materialised, as ScotGov proved unable to force international energy companies to hire or buy locally.
This failure continues. The latest round of offshore licenses, whose preliminaries began in February, indicated that both the devolved Crown Estates Scotland and the Scottish administration are still unwilling or unable (with present powers) to screw the big energy companies to create local jobs or ante up serious cash for the privilege of making super profits.
Then there’s oil and gas. Yes, production is well down on the bonanza years of old. And yes, any new fields are expensive to develop. But there still exists substantial reserves of hydrocarbons in the Atlantic, to be exploited.
The price of natural gas is currently 125% higher than the start of the year. The price of oil has slipped in recent weeks – one effect of high forecourt prices hitting demand – but North Sea crude is still over $100 a barrel, which is a cash cow for the energy companies and the tax man. That would include the Scottish tax man, after independence.
This, of course, raises the thorny question of tackling climate change. The planet is burning, as we know from this summer’s scorching temperatures, but we have just learned a valuable lesson: if you close down coal and nuclear plants without having something to put in their place, and if you further run into an unexpected pandemic followed by a European war, then you get an energy crunch. And this drives millions of folk into penury, which will kill thousands of people from hypothermia this winter. The resulting giant leap in energy prices will sap consumer demand in other parts of the economy, ushering in a recession.
We can’t fix this catalogue of social and economic problems without an energy solution. That is not to say we abandon the drive to net zero. But it does imply that we need a plan to manage the transition from using gas to heat our homes and power our factories. Capitalist markets respond to instant price signals.
If you suddenly close coal stations and reactors, while Putin is monkeying about with Europe’s gas supplies, you create energy shortages overnight. So: prices shoot up instantly.
Again, that’s not a plea to burn dirty coal. It’s a warning that timing and a planned energy transition is everything.
Here in Scotland, ScotGov has pushed renewables and set its face against new gas and oil. The difficulty is we still use gas for making dinner and staying warm. I know all about the notion of substituting hydrogen for methane, but techy dreams don’t keep old people warm in January. For at least a decade (maybe two) we need gas as the transition fuel. Scotland has gas and should exploit it under public control.
The worst decision economically taken by the SNP Government has been to repudiate the decision of the party’s conference to create a National Energy Corporation and so bring all energy under some form of state control. The disastrous consequences of that decision have never been more obvious. The SNP leadership feared several things in repudiating party conference. Primarily it worried about finding the capital to develop energy infrastructure. But this can always be done as a state-private partnership which ensures public oversight.
Besides, in a world where energy prices are going to remain high, a Scottish public stake in oil, gas and renewables will only benefit the creditworthiness of the Scottish Government in international financial markets. If you want to reduce ScotGov borrowing costs post-indy, make sure we have a public stake in energy.
The SNP leadership also fears that by trying to manage the transition to net zero in a sensible way, it might come under attack from the Greens and so lose its majority at Holyrood. I respect that argument. But there is an even bigger danger threatening.
Namely, Scottish Labour mounting a successful comeback by fighting for policies that counter the collapse in living standards as a result of sky-high energy prices. The road to indy lies through exerting national sovereignty over Scotland’s energy wealth and cutting energy prices for Scottish citizens. Not doing that risks handing the political baton to a fake lefty such as Sarwar.
The present SNP leadership remains haunted by ghosts of the past. It worries that any move to exploiting energy as a weapon would raise the spectre of the old SNP campaign slogan ‘It’s Scotland’s Oil’. Two generations on, no one is suggesting you can build a new Scottish nation on oil revenues, but the energy question has not gone away, merely changed its form.
Scotland is still endowed with unique energy resources. Ignoring that fact during a global energy crisis is not just political maladroitness, it is perverse.
The current SNP strategy is to use international public opinion to shame the Tory government into either granting another referendum or agreeing independence negotiations after the Nats win a general election mandate. But we need a bit more leverage on our side than simply hoping Joe Biden or Donald Trump or the preoccupied leaders of Europe will phone Downing Street. And putting Scotland’s energy into play provides just that leverage.
