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Professor Karen Turner 10 January 2018 |
Since January 2017, for those of us involved one way or another in the ‘world of energy’, a significant part of our time has been devoted to downloading, reading, discussing and responding to an extensive set of consultation documents broadly set around the Scottish Government’s draft Scottish Energy Strategy.
Just a few days before Christmas, the Scottish Government gave us an early Christmas present (the Scottish Energy Strategy), though it was one that we didn’t really have time to play with over the festive period. But as we now enter 2018, our thoughts are turning to give it our fuller attention. (I have to confess to spending some time with it on Christmas Eve (!) but, in response to some very odd looks from my better half, I packed it away as a New Year treat.)
Electric, hydrogen or an eclectic energy future?
So, did this Christmas present deliver any lasting joy for a Professor of Energy Policy? Its main analytical content is two new 2050 energy scenarios, for an electric and hydrogen future respectively. This broadly maps to two of the three scenarios presented in the UK Government’s Clean Growth Strategy, published slightly earlier in 2017.
While the Scottish strategy elects not to include a ‘third way’ (which may be a wise decision given the risk of focussing attention and potentially becoming a hostage to fortune on what would likely to be just one of a range of possible pathways between the two extremes), it does seem to be more explicit in terms of what may actually be involved in either of these worlds.
On one hand, this serves to emphasise the role of core policy areas such as energy efficiency. However, it also reflects what the current Scottish Government is prepared live with, for example in terms of continued hydrocarbons in industry and commercial transport, even if some obvious sources of these hydrocarbons do not feature in either view of the future. However, I’ll leave discussion of the future scenarios to my CEP colleague, Christian Calvillo, who specialises in the TIMES modelling used to compute them. Read his blog post Future energy scenarios in the Scottish Energy Strategy: What can we expect in 2050?
A welcome wider economic setting for thinking about Scotland’s energy strategy
Instead, I will allow the economist in me to comment on the brand new target announced in the strategy document: to achieve a 30% increase in the ‘productivity of energy use’ by 2030. For me the most interesting dimension of this new aim is not the target itself but what its inclusion implies (whether this was the Government’s intention or not).
As has been commented by others (for example, Alf Young’s article in the Times on 3rd January), energy productivity (each measurable unit of output – e.g. GDP – produced per physical unit of energy input) is not only determined by “squeezing more out of every unit of energy consumed across the economy”, it also depends on a wide range of factors across the economy, not least the industrial composition and growth of GDP. However, this fact in itself means that development of policy to support the Scottish Energy Strategy MUST take a wider view of what is going on in the wider Scottish (and global) economy.
This, coupled with the increased emphasis, as noted in the ministerial foreword, on recognising how closely decisions on energy are linked to “Scotland’s social and economic well-being, and the sustainable productivity and competitiveness of our economy”, this setting of Scotland’s energy system in a wider economic system context is to be welcomed.
Providing greater certainty for household energy investment
Finally, when I blogged on the draft strategy last January, I urged that the Scottish Energy Strategy must focus on people if its plans are to become executable. Thus, the intended new consultations on consumer engagement, protection and fuel poverty are to be welcomed. Nonetheless, there remain major challenges, especially in terms of the necessary transitions in how Scotland supplies and uses energy.
These will require a compelling picture or narrative as to how these can actually be made to happen, especially as people will be required to make significant changes in how they live their lives, and where relatively large private investments may be required. One issue is the need for a strong policy lead.
While both the electricity and hydrogen futures may be technically feasible, people need to know what they should be spending their money on. Recent news stories on the fall in sales of new diesel vehicles relative to petrol ones, even while genuinely low emissions vehicles are not yet widely available or affordable, may reflect how consumers are likely to respond in the face of uncertainty.
Another question that householders may be beginning to ask is “how long will I have a gas boiler”? Clear decisions on infrastructure investment to support electricity or hydrogen powered alternative futures may help people make better decisions.
Tags: Energy Blog