Blog | Christian Calvillo and Karen Turner| Nov 2025

The announcement of Mossmorran's chemical plant closure by ExxonMobil marks more than the loss of 179 direct jobs, 250 on-site contractor positions and risking many more supply chain jobs in Fife and across the Scottish and wider UK economies. It represents a critical juncture in how the UK and other nations across Europe and beyond approach industrial decarbonisation—and a cautionary tale about what happens when policy creates incentives to move production rather than transform it.

In 2021, when Glasgow hosted COP26, our CEP Director put out a call for decision makers to focus on the risk of ‘offshoring’ emissions, jobs and investment in delivering on Nationally Determined Contributions (NDCs). She highlighted the extent to which Scotland’s emissions levels have been cut through the loss of manufacturing activity, citing the example of the end of large-scale steel production at Ravenscraig in 1992 and our consequent dependence on shipping steel products from other global locations. Sadly, this week’s news about the planned closure of the chemical plant at Mossmorran (which follows the closure of the Grangemouth refinery earlier in the year) heralds another drop in domestic emissions that will likely not translate into a reduction in global emissions, or our dependence on chemical products, but we will lose local, good quality jobs, investment and associated GDP.  

Now, as climate negotiations draw to a close at COP30 in Belém, Brazil, the global climate community still faces the same fundamental choice: pursue climate targets by decarbonising production where it currently exists or allow emissions-intensive industries to relocate to less-regulated jurisdictions. The Mossmorran case, just like numerous ones at home and abroad in the decades since Scotland stopped meeting her own steel requirements or the decline of the domestic oil and gas sector (e.g., job cuts in the Port of Aberdeen), demonstrates why the first path is not just economically preferable—it is essential to meeting genuine climate and just transition goals .

The Real Cost of Industrial Displacement

ExxonMobil's statement was explicit about the drivers of closure: "the UK's current economic and policy environment combined with market conditions, high supply costs and plant efficiency do not create a competitive future for the site." The company has spent 40 years operating Mossmorran as a cornerstone of UK chemical production. What changed is not the physics of petrochemistry—it is the policy landscape.

When a plant like the Grangemouth refinery or Mossmorran closes in Europe, the narrative often celebrates environmental progress with a shift away from ‘dirty’ industry. But the evidence tells a different story. The Centre for Energy Policy has long examined this phenomenon through rigorous research: displacement of domestic production activity frequently results in three simultaneous outcomes—reduction in domestic jobs, loss of domestic GDP, and a net increase in global CO₂ emissions. This reflects the reality of global industrial relocation driven by unilateral climate policy.  

Why does this happen? Because ethylene production, the base material for plastics, will not simply disappear, just as steel production didn’t end with the closure of Ravenscraig (which had been one of the largest steel production plants in Western Europe), and the refining of crude oil didn’t end with the closure of the Grangemouth refinery. Global demand persists. When UK or EU-based producers exit, production shifts to jurisdictions with lower regulatory costs and often less stringent environmental standards. The potential outcome is the same volumes of emissions, now located outside Europe's borders, beyond the reach of European climate accounting and often produced with older, less efficient technology. From a global climate perspective, this represents failure on both fronts, jobs are lost and emissions increase.

The Just Transition Framework and Global Climate Integrity

The Paris Agreement enshrines a commitment not just to decarbonisation, but to a "just transition", the principle that climate action must be paired with the retention and growth of decent work and economic prosperity, and which Scotland has put at the centre of devolved climate policy. This is not a side concern or a luxury. It is foundational to the legitimacy and sustainability of climate policy itself.

At COP30, the just transition framework is rightfully prominent. Mossmorran highlights a concrete challenge: a genuine just transition means addressing the industrial decarbonisation challenge where emissions are currently located. This principle creates several imperatives for policymakers.

First, it demands that unilateral climate measures be designed with carbon leakage in mind. The EU's Carbon Border Adjustment Mechanism (CBAM) represents one attempt to prevent displacement by ensuring imports face equivalent carbon costs to domestic production. Yet CBAM is imperfect—it captures certain sectors but not others, it comes into full force only in 2026, and it cannot retroactively save plants already closed. Mossmorran closed precisely because policy signals suggested the competitive environment would deteriorate further.

Second, it requires acknowledging that some industrial capacity is genuinely difficult to decarbonise at current technology levels and costs. Ethylene production using renewable hydrogen or carbon capture remains economically marginal. Rather than allowing such production to migrate to lower-cost, lower-environmental-standard jurisdictions, policy should target investment in cleaner production technologies at existing sites. This preserves jobs, preserves GDP, preserves industrial capability, and—critically—keeps emissions reductions within a framework where they can be monitored and verified.

The Global Emissions Paradox

Here lies the central paradox of uncoordinated climate policy: aggressive domestic measures that lack adequate leakage protections can simultaneously fail to reduce global emissions while causing significant local economic harm. A plant closing in Scotland does not reduce ethylene demand in global markets. It redirects that production to locations that may have lower labour and environmental standards, potentially resulting in higher emissions per unit produced.

This is not an argument against climate action. It is an argument for climate action that is globally effective and just. The alternative to displacing Mossmorran is not to abandon decarbonisation targets. It is to pursue them through a combination of:

• Technology investment: Supporting the development and deployment of low-carbon production technologies at existing facilities.
• Carbon pricing coordination: Working with trading partners to level the playing field for high-carbon industries, preventing unilateral policy from driving relocation.
• Workforce support: Investing in retraining and transition support for workers in affected sectors, which costs far less than rebuilding industrial capacity once lost.
• Supply chain integration: Recognising that losing domestic production of key intermediates (like ethylene) weakens downstream industrial capacity and reduces leverage for decarbonisation.

Why This Matters for COP30 and Beyond

The Mossmorran closure arrives at a moment when the global climate agenda is shifting from targets to implementation. COP30 will test whether nations can translate climate commitments into policies that work in practice—not merely in spreadsheets.

The Centre for Energy Policy's recent analysis, captured in our policy brief on this topic, demonstrates empirically what Mossmorran illustrates anecdotally: there is a strong case for addressing the industrial decarbonisation challenge where emissions are currently located.   

The just transition cannot mean leaving workers and communities to bear the full cost of unilateral policy while global emissions potentially increase. It must mean building the industrial and policy frameworks necessary to decarbonise production in situ, retaining jobs, maintaining GDP, and achieving genuine reductions in global emissions. This is always a preferable outcome to the alternative: jobs offshoring, GDP loss, and the failure to meet climate targets in both the short and long term.

As governments and industry engage in COP30, the Mossmorran moment should serve as a wake-up call. Climate policy designed without careful attention to global carbon leakage and workforce impacts may feel ambitious, but it risks being ineffective and unjust. The path forward requires policy integration, technology investment, and international coordination. Anything less risks repeating the costly lessons of Ravenscraig, Grangemouth and now Mossmorran in the case of Scotland, a globally recognised leader on the importance of a ‘just’ transition.

Image credit: Bill Kasman