Scottish independence debate shifts to energy issues, (again)

Inverness airport (2)

Àrd-amas airson lùtha”: “Ambitious about energy”. This is the message that greets arriving passengers at Inverness Airport in the highlands of Scotland. The message occupies an entire wall of the main lounge and also explains, “the world’s best resources for wind, wave, and tidal power are here in the highlands and islands”. Observations regarding the ironies of sustainability-based salutations occupying walls of airports to be ogled by frequent flyers aside, these lines are worthy of reflection. For a start, witnessing such a domineering advert whilst the newspaper under your arm is stuffed with stories recounting the inevitable return of North Sea Oil and gas as the hot topic of the Scottish Independence debate, at least provided a timely reminder of the defining role energy policy has played – and continues to play, in the back-and-forth over the potential break up of a United Kingdom.

North Sea oil rig

As Ronald Kowalski discusses, in 1974  there was a resurgence of Scottish national identity, bolstered by the fact that the football team were performing well in the World Cup competition in West Germany. More powerful than this though, was the steep decline of the coal and steel industry between 1970-1974 orchestrated by the Heath Government. This period of destabilisation which had profound socio-economic ramifications for the East end of Glasgow – consequences still felt today, was met with protests and work-ins against the closures.

This drove many to search for political alternatives to policies coordinated from Westminster. Two years before, the Scottish National Party (SNP) oriented itself around a simple concept:  “It’s Scotland’s Oil”. This built on strong sentiments that financial flows generated from the oil-exploitation of the North Sea appeared to bypass several latitudinous degrees as they headed southward. The 1973 oil crisis made the North Sea Oil issue even more significant.

In the 1970 general election the SNP polled just 11.5% of the vote. By 1974, this had risen to 30.4% of the vote. BP had discovered the ‘Giant forties’ oil field in the North Sea and a rush for the ‘Black Gold’ was spurred by the Oil Crisis of 1973. Revealed decades later by a Freedom of Information (FoI) request made in 2005, was that the known extent of Oil and Gas in the North Sea, and the vastness of revenues that could be generated from exploiting these resources, were deliberately hushed up. It sounds like the stuff of wild conspiracy, but the originally classified documentation known as the McCrone Report is now freely available.

The 19-page document outlined that potential revenues of North Sea Oil could be vast. The consequences of this were also outlined, the report stating that an independent Scotland in control of these assets could make a Scottish currency the strongest in Europe on par with Norway, Scotland could be as rich as Switzerland, and would be in a position to lend to England, a situation it was claimed, “could last for a very long time”. The McCrone report was classified and not seen for decades. Given the rise of Scottish Independence, the publishing of the report could easily have transformed the entire history of the UK. Independence would have been a far more attractive and feasible prospect. The true extent of North Sea Oil and gas reserves were not admitted until later, by which time the fervour for independence had died down.

Bridge et al in an Energy Policy article on the ‘Geographies of Energy transition’, outline that “…the territorialisation of the UK is an unsettled project that is on-going and contested” (Bridge et al, 2013: 336). In recent weeks as the referendum on Scottish independence approaches, North Sea Oil has once again provided the terrain for some of the more bitter disputes between the Alex Salmond-led SNP and the Westminster Coalition. Recent plans have been announced to ‘fast-track’ drilling for the remaining supplies of North Sea Oil. Salmond has outlined the creation of a  ‘Norwegian style’ approach to North Sea resources in an independent Scotland, including an ‘Oil Fund’, where 10% of revenues are set aside for future generations, which could total around £10 billion pounds a year for the remaining decades of production. David Cameron however, argued that given the unstable and fluctuating nature of Oil Markets, remaining resources could be better managed by the “broad shoulders” of a United Kingdom. These announcements were made within a few miles of one another in Aberdeenshire, the heartland of the UK’s oil industry.

Scottish wind farm_tcm9-204219 (2)

Then there is the environmental issue. As Andy Rowell points out, it may be that carbon reserves could increasingly be seen as liabilities rather than assets, as the climate change issue becomes increasingly a more serious one. Thus, he argues, North Sea Oil could become a ‘stranded asset’. However, there is another side to the SNP energy strategy. They have committed to discontinuing nuclear power in Scotland which may prove challenging.  This strong direction has however created new innovative drives on the renewables front, with an ambition of 100% renewables by 2020. Scotland appears to be charging ahead with this aim, with 40% of electricity consumption met by the renewables sector in 2012. This was “significantly higher” than the rest of the UK, and anyone that has holidayed in Scotland will be aware of the immense availability and potential for the development of wind energy.

Taking a ‘Varieties of capitalism’ approach of Soskice and Hall (2001) the devolved Scottish Government seems to be taking a more ‘coordinated’ approach regarding policy implementation, especially in relation to its low carbon ambitions. Policy direction has been articulated in an attempt to make Scotland the “Saudi Arabia of renewables.” This entails being industry leaders in wind, wave and tidal, and a variety of projects, ‘test labs’ and innovation hubs have emerged to meet this aim.

It’s been a while coming, but once again energy dominates the Scottish independence debate in a variety of ways. What remains to be seen is whether Scotland continues to be “ambitious” about a low carbon transition, or whether important funds are devoted to the increasing expenses of draining the “black gold” to its last drop.

Dr Phillip Johnstone is a Research Fellow at  the Sussex Energy Group in SPRU at the University of Sussex.

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