Financing a just transition

The energy transition across the North East will be further boosted by £25 million from the Scottish Government’s Just Transition Fund.

The £500 million, 10-year Just Transition Fund was established to accelerate the energy transition in Aberdeen and the North East, and establish the region as a world-leader in the transition to a net zero economy.

Delivery is ongoing of projects from year one of the Just Transition Fund, backed by £50 million of multi-year capital grant funding, including a skills passport for offshore energy workers, work to develop supply chain pathways, promotion of emerging technologies, and investment in community projects like ecovillages and local climate assemblies.

The Scottish National Investment Bank will use this latest funding to leverage further private investment in the energy transition across the North East.

First Minister Humza Yousaf visited Aberdeen South Harbour to see how a £400 million expansion project will support the North Sea Just Transition.

The First Minister said:

“Delivering on our climate obligations is an absolute priority for this Government – but so too is our unwavering commitment to ensuring the journey to net zero is fair and just for everyone.

“Scotland is an energy-rich nation and the oil and gas industry has made a vast contribution to our economy, while its workers are some of the most highly-skilled in the world.

“But Scotland’s oil and gas basin is now a mature resource and, as a responsible government, we must take action to ensure the sector, and the communities it supports, are supported in a transition to cleaner, greener energy system.

“The North East has long been known as the oil and gas capital of Europe. It can now become the net zero capital of the world.

“Our draft Energy Strategy and Just Transition Plan sets out a very clear vision to capitalise on the enormous opportunities that a net zero energy system offers the industry, our economy and our climate.

“The Just Transition Fund for the North East and Moray is already helping communities seize these opportunities. By using a portion of the Fund to support the Scottish National Investment Bank, we can leverage further investment in the region to ensure a fair and just transition for the energy sector, and for the people of Scotland.”

Bob Sanguinetti, Chief Executive of the Port of Aberdeen, said:

“Port of Aberdeen has been at the heart of the nation’s energy industry for more than 50 years and our vision is to become Scotland’s premier net zero port. Our transformational South Harbour expansion will help make that a reality.

"The Scottish National Investment Bank has invested £35 million in the project, which supports the Just Transition and will unlock growth in offshore wind, hydrogen, and decommissioning. The cash injection announced by the Scottish Government today will provide vital support to others in advancing their energy transition efforts.”

Willie Watt, Chair of the Scottish National Investment Bank, said:

“Investing in the transition to Net Zero is a core mission for the Bank. Since our launch in November 2020 we have invested over £225 million in businesses and projects supporting the move to Net Zero, and our capital has leveraged in more than £475 million from other investors.

“We welcome this additional capital which, like the funds we have invested so far, we will invest on commercial terms and look to leverage additional private sector capital to support of the North East economy.”

Background

A consultation on the draft Energy Strategy and Just Transition Plan is open until 9 May 2023.

Energy System and Just Transition - Independent Analysis is available on the Scottish Government website.

Port of Aberdeen | Scottish National Investment Bank (thebank.scot)

Just Transition Fund: year one projects - gov.scot (www.gov.scot)