Climate Change Plan: monitoring reports 2022

Chapter 8: NETs

Part A - Overview of sector

This sector was new to the CCPu. To date NETs technologies have not been deployed as they rely up carbon capture and storage (CCS) to deliver negative emissions. Whilst some technologies that could deliver negative emissions are currently active, such as energy from waste, these facilities would require retrofitting with carbon capture technology and route to storage to be considered a NETs technology. The CCPu includes policies and proposals for early deployment from 2029 onwards. However, once we have clarity on the UK Governments support to deliver CCS in Scotland, we will provide a comparison of emissions reduction against the envelope as laid out in the CCPu.

The updated Plan sets out the following policy outcomes for the sector. Given how new this sector chapter is, there are no indicators for these outcomes.

Detailed feasibility studies on NETs will assess the opportunities for negative emissions in Scotland, and identify applications with the greatest potential, including specific sites where possible

CCUS: the continued development of CCUS technologies and systems is prioritised to ensure these can be rolled out commercially and at scale by the late 2020s.

Bioenergy: a cross-sectoral approach for the appropriate and sustainable use of biomass in energy applications is agreed and implemented (taking into account competing land and feedstock uses).

Just transition and cross economy impacts

We wish to understand and report on the broader just transition and cross-economy impacts of our emissions-reduction activities in addition to these sector specific policy outcomes and indicators. To do this, we use data from the Office of National Statistics (ONS): Low Carbon Renewable Energy Economy (LCREE) publication. The LCREE is based on survey data of businesses which perform economic activities that deliver goods and services that are likely to help generate lower emissions of greenhouse gases, for example low carbon electricity, low emission vehicles and low carbon services.

The LCREE indicator is narrowly defined and, while useful within its limited scope, does not give us the full picture of the impacts on workforce, employers and communities and progress towards a just transition.

This year we have also included ONS experimental statistics that look at green activity in the economy. These stats reflect green activities in both LCREE and non-LCREE sectors.

Over the next few years we will work to develop a meaningful set of success outcomes and indicators aimed at tracking the impacts of our policies on a just transition to net zero.

Sector commentary on progress

The CCPu included Negative Emissions Technologies (NETs) as a sector chapter for the first time, recognising the important role that, as recently recognised by the IPCC Working Group 3 report, emissions removals will need to play in reaching net zero. The ‘learning by doing’ approach set out in the CCPu more widely was also identified as being particularly important in the case of this sector, given the considerable uncertainties around technological development and dependencies on UK Government action, particularly with regards to carbon capture and storage.

Policies included in the NETs chapter recognised these challenges and uncertainties and sought to acquire an evidence base to allow for further policy development. We have now undertaken an initial review of evidence.

The review indicates that NETs in Scotland can deliver at scale in due course but not at the pace assumed in the CCPu. This is due to various shifts in evidence since the time of the CCPu, including:

• The UK Government’s decision to not allocate the Scottish Cluster as a Track-1 cluster for delivery in the mid-2020s, impacting on when carbon storage underpinning NETs will be available, and industries’ appetite to invest in NETs technologies. The Scottish Government are still pushing the UK Government to reverse this decision;
• The availability of home grown sustainable biomass to supply large scale power bioenergy with CCS (BECCS); and
• No public commitment to date by a commercial operator to employ a NETs model for a single large power station in Scotland. Given lead in times for development of such a facility and proposals for CCS deployment for the Peterhead CCGT power project, it is unlikely that a new NETs power facility will be developed in the 2020s.

We are now gaining further knowledge and evidence of what scale of NETs can be delivered within Scotland and to what timescale, through undertaking a NETs feasibility study. This further evidence will be worked up over 2022 and will be considered as we develop the refreshed Energy Strategy and next full Climate Change Plan. The 2023 monitoring reports on the CCPu will also provide an opportunity to consider further the evolving evidence around the role of NETs.

Developments in monitoring arrangements since last report:

No changes.

Part B - Progress to Policy Outcome Indicators

Policy Outcome:

Cross-sectoral social and economic indicator

Indicator

FTE employment in Low Carbon Renewable Energy Economy

On-Track Assessment (Milestone/Targets)

Year-to-year change

Most Recent Data: 2020

Data Source(s): Office of National Statistics: Low Carbon Renewable Energy Economy (LCREE), Time spent of Green Tasks

Assessment : Too early to Say

• In 2020, the Scottish low carbon renewable energy (LCREE) sectors were estimated to directly provide 20,500 jobs, down from 21,700 in 2019 and from a high of 24,000 in 2016.
• The estimates of LCREE are based on a relatively small sample of businesses and hence are subject to wide confidence intervals. LCREE employment in Scotland in 2020 is similar to previous years and the difference is not statistically higher or lower than any previous year.

Source: Scottish Government presentation of ONS stats

• The ONS also released experimental statistics on a wider perspective of green activity in the economy with their time spent on green tasks release. These stats reflect green activities in both LCREE and non-LCREE sectors.
• This release showed that in 2019 Scotland achieved an all-time high of hours spent on green tasks and proportion of workers doing green tasks, including workers who spend more than 20% of their time on green tasks.
• The proportion of workers doing green tasks in Scotland was 36% in 2019, up from 23.8% in 2004. Workers who have spent more than 20% of their time doing green tasks was 14%, up from 9% in 2004.
• The proportion of overall hours spend doing green tasks in Scotland was 7%, up from 4.9% in 2004.

Source: Scottish Government presentation of ONS stats

Part C- Information on implementation of individual policies

Outcome 1: Detailed feasibility studies on NETs will assess the opportunities for negative emissions in Scotland, and identify applications with the greatest potential, including specific sites where possible.

Policy

In 2021/22 carry out a detailed feasibility study of opportunities for developing NETs in Scotland ready for the early 2030s. This will identify specific sites and applications of NETs, including developing work to support policy on Direct Air Capture and its role within NETs in our future energy system

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

Studies to build our evidence on NETs and inform the scope of a detailed feasibility study have been commissioned and published within 2021/22. These outputs include research on bioenergy feedstock availability (include link) and a horizon scan of international deployment of NETs (link).

A detailed feasibility study has been scoped and is currently out for tender.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

The feasibility study is currently out for tender, with a successful consultancy expected to be identified and commence work in early June.

Through the subsequent months, the study will assess the existing NETs evidence base, interview NETs stakeholders and conduct analysis into the opportunities and barriers to NETs deployment.

An output containing recommendations to government and proposed NETs implementation pathways is expected by the end of 2022.

Policy

From 2022, based on the outcomes of the feasibility work, we will provide support for commercial partners to develop NETs proposals.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

We have continued to build our evidence of NETs feasibility through studies on bioenergy feedstock availability and international NETs deployment. This work will be bolstered by a detailed feasibility study that has now been scoped and issued for tender.

We are simultaneously engaging with those key stakeholders which have the ability to implement NETs in Scotland to better understand the support that the Scottish Government may be able to offer.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

Initiated in 2022 supported by the EETF.

Timeframe and expected next steps?

Initiated in 2022 supported by the EETF

A successful consultancy will be identified and commence work on a feasibility study in early June. This work is expected to report in late 2022.

As evidence on NETs accrues via the feasibility study and further stakeholder engagement throughout 2022, we will begin to formulate support measures for commercial partners.

Policy

Put in place a continual process to review the development of NETs and progress against its envelope.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

This is assured by internal governance boards.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

Timing and arrangements to be confirmed.

Policy

We will work with UK Government to ensure that they bring forward suitable mechanisms to support the development of NETs business cases in relevant sectors.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

New to the CCPU

Recognising that many NETs support mechanisms are reserved to the UK Government, we are working with relevant departments to ensure support for prospective NETs developers in Scotland.

In particular, and following the outcome of the UK government’s cluster sequencing process in which it failed to award the Scottish CCS cluster track 1 status, we have championed the timely deployment of Scottish CCS infrastructure as being essential to enabling development of NETs.

Work with the UK has further involved engaging with relevant consultations. In March 2021 we responded to the Call for Evidence on greenhouse gas removals (GGRs), and are currently engaging with a new call for evidence regarding the possible inclusion GGRs in the UK emissions trading scheme (ETS).

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

Scottish Government response to UK Government Greenhouse Gas Removals consultation submitted in March 2021

Timeframe and expected next steps?

We will continue working with UK Government to foster the necessary support for NETs in Scotland.

The UK Government recently indicated that the process for Track 2 CCS cluster applications will open later this year, and we will continue to promote the rapid deployment of the Scottish cluster as being essential to both Scottish and UK NETs ambitions.

We will remain involved in UK Government-led stakeholder engagement on the GGR ETS call for views up to its conclusion in June 2022, and work to ensure subsequent steps are suitable to the development of NETs business cases in Scotland.

Outcome 2: CCUS: the continued development of CCUS technologies and systems is prioritised to ensure these can be rolled out commercially and at scale by the late 2020s.

Policy

Support the development of NETs technologies within Scotland.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

This has been significantly impacted by the UK Government decision on the CCUS cluster, as discussed in Part A. 80m funding has been made available via the Emerging Energy Technologies Fund to enable the Scottish CCUS cluster to continue and accelerate the deployment of carbon capture technology.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

£80m funding has been made available via the Emerging Energy Technologies Fund to enable the Scottish CCUS cluster to continue and accelerate the deployment of carbon capture technology.

Policy

Support the inclusion of NETs in the development of strategic, industry lead pathways for CCUS infrastructure in Scotland.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

This has been significantly impacted by the UK Government decision on the CCUS cluster, as discussed in Part A.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

N/A

Policy

Funding through the Scottish Industrial Energy Transformation Fund to consider the development of NETs demonstrators

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

NETs demonstrators to be considered for inclusion in subsequent calls of SIETF.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

As for SIETF

Timeframe and expected next steps?

As for SIETF

Policy

Provide a focus on integrating NETs projects with CCS infrastructure through the Emerging Technologies Fund.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

This has been significantly impacted by the UK Government decision on the CCUS cluster, as discussed in Part A. 80m funding has been made available via the Emerging Energy Technologies Fund to enable the Scottish CCUS cluster to continue and accelerate the deployment of carbon capture technology.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

£80m funding has been made available via the Emerging Energy Technologies Fund to enable the Scottish CCUS cluster to continue and accelerate the deployment of carbon capture technology.

Outcome 3: Bioenergy: a cross-sectoral approach for the appropriate and sustainable use of biomass in energy applications is agreed and implemented (taking into account competing land and feedstock uses).

Policy

We will publish a Bioenergy Update in early 2021, laying out our current position and understanding of the role of bioenergy in the energy system and setting out in more detail how we will move forward.

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

We published the Bioenergy Update on 24 March 2021

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

We published the Bioenergy Update on 24 March 2021

Policy

In 2021, building on the Bioenergy Update, we will establish a cross sectoral Bioenergy Expert Working Group to consider and identify the most appropriate and sustainable use for bioenergy resources across Scotland. It will also assess the volume of bioenergy resources that we can grow or produce within Scotland, and confirm the level of import that we believe is compatible with a sustainable global trade in bioenergy

Date announced

CCPu 2020

Progress on implementation since time of last report / CCPu

We have stablished an internal bioenergy policy working group working to review the availability of sustainable biomass and the most appropriate use of these finite resources across the whole energy system. This group will also consider how best we can engage with the broad range of experts and interested parties relating to bioenergy.

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

N/A

Timeframe and expected next steps?

Ongoing meetings of the working group and expert panel over the next 24 months. Gathering evidence and sharing knowledge across multiple sectors. Engagement with UK Government in the lead up to their Biomass Strategy due to be published by 2022.

Policy

By 2023, in time to inform the next Climate Change Plan, we will publish a Bioenergy Action Plan, incorporating the learning developed by the expert working group and our understanding of the options to use Bioenergy in both NETs and other applications.

Date announced

CCPu 202

Progress on implementation since time of last report / CCPu

See above

Have any implementation indicators / milestones been set for this policy? If so, most recent data for progress against these.

See above

Timeframe and expected next steps?

To be developed from the findings and recommendations from the Working Group and Expert Panel (see above).