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A Low Carbon Economic Strategy for Scotland: Scotland - A Low Carbon Society

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1.3 Strategic Objectives and Immediate Actions.

The focus of central and local government and wider public sector activity will be directed at areas where most added value can be achieved. This is outlined in the strategic objectives and immediate actions for government and the wider public sector summarised below.

Transformation across the whole Economy

Opportunities exist for every business and industry to adapt to and exploit low carbon markets, and these should be reflected in business plans and industry-led strategies, focussing on two areas: saving money through efficiencies; and making money through new market opportunities.

Objective 1: Sustainable and resource-efficient businesses. Helping all businesses in Scotland become more competitive by using resources more efficiently, proactively adapting to climate change impacts and generally adopting sustainable business practices.

Immediate Actions:

  • through the Strategic Forum and working with SEPA, the Scottish Government will ensure the streamlined and coordinated delivery of public sector support, to aid the transition to a low carbon economy;
  • Government, Enterprise Agencies and other agencies will take a joined up, collaborative approach with industry and business groups to maximise leverage on resource and will work with Industry Advisory Groups to help integrate sustainable, low carbon development into business plans, industry-led strategies and delivery plans;
  • the Scottish Government's Energy Efficiency Action Plan26 sets out a programme of activity on energy efficiency including actively promoting the provision of energy efficiency advice to businesses in Scotland, through the establishment of a single Energy and Resource Efficiency Service similar to the Scotland's Environmental and Rural Services27 ( SEARS) model. This will streamline the support provided by the Energy Savings Trust, Carbon Trust, Enterprise Networks, Business Gateway and others;
  • the Scottish Government and local authorities will work with company supply chains to support the planning, design and construction of long-life infrastructure and the retrofit of existing infrastructure;
  • the Scottish Government, working jointly across the public sector will implement the Scottish Sustainable Procurement Action Plan 28 and promote its uptake by the wider public sector, generating business opportunities, recognising better low carbon solutions;
  • the Scottish Climate Change Impacts Partnership ( SCCIP) 29 will work with the enterprise, and other agencies, Business and Industry Advisory Groups to provide tailored, sector-specific advice and intelligence on key risks and market opportunities resulting from climate change; and
  • the Enterprise Networks and Zero Waste Scotland will promote the business benefits of sustainable business practices including product lifecycle analysis, business model innovation and increasing the use of ICT to reduce travel.

Objective 2: Sustainable and competitive industries.Supporting Scotland's industries to exploit low carbon business opportunities to accelerate industry growth, build low carbon supply chains, diversify into new markets and technologies and promote long-term ambition and resilience.

Immediate Actions:

  • the Scottish Government and Enterprise Networks will work with the investment community to stimulate greater investment in low carbon opportunities and infrastructure;
  • the Scottish Government, Local Authorities, Skills Development Scotland ( SDS), the Scottish Funding Council ( SFC) and the Enterprise Networks will ensure that the support they offer in relation to the Curriculum for Excellence, skills and learning and leadership development actively promote the issues and opportunities relating to the low carbon transition;
  • the Enterprise Networks and Scottish Development International ( SDI) will develop and disseminate further market intelligence on the scale and nature of global opportunities, and benchmark global best practice;
  • SDI will promote Scotland's low carbon 'brand' strengths and investment propositions overseas, and support the development and internationalisation of Scottish low carbon companies and R+D expertise and, supported by the Scottish Funding Council, SDI will work with companies to develop international market strategies which include the marketing of low carbon credentials where appropriate. The Low Carbon Skills Fund, aims to enable employers to upskill and reskill their employees and capitalise on the business and economic opportunities presented by developments in the renewables and low carbon fields. This new approach to the funding of employer training is to enable employers to access short, bite sized, flexible learning that will meet specific business needs;
  • The Scottish Government will work with the SFC to ensure that our investment in colleges and universities fully integrate the needs of the low carbon economy into future spending priorities and we will also work with SDS to ensure that the skills demands for a low carbon economy are taken into account in the provision of National Training Programmes and flexible training opportunities. Future guidance letters to partners will reflect these expectations;
  • The Scottish Government will work with SDS, the SFC, Sector Skills Councils, learning providers and employers to analyse future skills demands, develop and refresh relevant qualifications, courses and vocational frameworks that will ensure the supply of skills from Colleges, Universities and other providers meets current and anticipated future demands;
  • The Scottish Government and SDS will establish a group to develop and implement a skills framework that will outline specific energy efficiency training interventions required and how these will be delivered. Specifically on renewables, the Renewables Action Plan Skills Framework, commits the Scottish Government to work with partners in education and industry to better understand future skills requirements and ensure adequate training provision to meet sector needs; and
  • The work of the Scottish Energy Advisory Board highlights significant employment growth and skills requirements within the wider energy and low carbon economy. The Energy Advisory Board is working with partners to address the challenges of making sure we have the right skills, in the right place, at the right time.

The overall objective of low carbon innovation must be to maximise the long-term benefit to Scotland by securing our competitive advantage in the technologies where we can be global leaders, as well as leading to an absolute reduction in greenhouse gas emissions. It is about identifying the right innovative low carbon technologies, and ensuring that public sector support is aligned to realise the potential.

Objective 3: Supporting the right innovative low carbon technologies.Ensuring Scotland capitalises on its natural advantages, natural environment and the expertise of our leading researchers, future support for low carbon innovation should be focused on areas where Scotland can secure maximum competitive advantage.

Immediate Actions:

  • the SFC will support Universities who to respond to challenges of the energy technologies identified by Scottish Government in this Strategy. The Energy Technology Partnership, MASTS and other research pools, working with innovative industry and the Enterprise Agencies, will be well placed to attract support for the translation of research excellence into economic advantage for a low carbon Scotland;
  • the Scottish Government will work with the Energy Technology Partnership, the SFC, Enterprise Agencies, the Scottish European Green Energy Centre and European Structural Funds to establish new technology hubs/alliances to act as focal points for low carbon innovation in the Energy sector. These will Link to EU and UK funding programmes and attract overseas R&D investment;
  • the proposed Scottish Energy Lab will also act as a demonstration hub, providing the test facilities for each of these key technologies to develop international collaborations;
  • The Environmental Clean Technologies( ECT) Strategic Partnership (Enterprise Networks, SEPA, Scottish Funding Council supported by the Scottish Government) will deliver coordinated support for businesses and academia within the emerging Environmental and Clean Technologies sector. This will focus on the priority actions recently identified within the ECT strategy including industrial cohesion and awareness raising.

Objective 4: Funding technological innovation. Developing the key technologies for demonstration by refocusing and reprioritising innovation support going forward. Given the difficult funding context for the public sector over the next decade, Scotland must maximise competitive advantage by focusing support on those technologies where there is greatest chance of success.

Immediate Actions:

  • the enterprise agencies and wider public sector should ensure, through continuous development of funding metrics and assessment methodologies, that the appraisal of all projects receiving business or innovation support are considered specifically for climate change impact and low carbon economic benefit as part of the wider criteria for the assessment for funds, in order to facilitate the development of the low carbon economy and to ensure that support is available across the whole economy;
  • to give initial support to this activity, and to the development of the technology hubs set out above, the Scottish Government will reprioritise the £15m of innovation funding available in the Lowlands & Uplands European Structural Funds Programme towards the low carbon economy. This match-funding could create a potential £60m of support with contributions from the private sector and other public sector funders and is a significant commitment at a time of fiscal constraint; and
  • the Scottish Government will work with UK and EU funding bodies such as the Technology Strategy Board, programmes and industry to bring world-leading university research in low carbon technologies to demonstration and deployment.

Transforming the Energy Sector

Transforming the energy sector in Scotland will play a pivotal role in the development of a low carbon economy, providing a unique combination of benefits, including reduced greenhouse gas emissions, energy efficiency, enhanced energy security, less volatility in the energy sector, and increased share in key global markets. Through timely and unprecedented levels of investment in the electricity, heat and energy efficiency sectors, the step change in activity will open up enormous opportunities for businesses across Scotland.

Objective 5: Securing funding and de-risking investment.Attracting long-term finance and secure investment in the Scottish energy sector through understanding the issues, opportunities and global dynamics of finance, as well as the importance of creating an attractive landscape with adequate funding and support.

Immediate Actions:

  • the Scottish Government will continue to support the Scottish Low Carbon Investment Project and annual Conference, a unique forum for Government, international finance, utilities and developers of low carbon projects to engage directly on investment opportunities and continue to develop a shop window of investible opportunity in Scotland through the project portal, identifying opportunities for collaboration and aggregation;
  • the main actions from this years international conference included:
  • A commitment to hold a conference next year focusing on finance for investment in energy consumption and resource efficiency.
  • Development of a 'Thought Leadership' circle and engagement around the immediate agenda e.g. CCS, Energy Efficiency, Offshore Wind Route Map and Supply Chain, infrastructure etc.
  • Continued analysis of funding challenges and identification of solutions including public/private partnering for marine renewables infrastructure, quantification and analysis of elemental construction risk for offshore wind, debt solutions for marine technology commercialisation.
  • Establishment of CCS-Cluster Investment Plan study, identifying how Scotland can provide Europe with a large scale carbon storage opportunity, starting by looking at how carbon capture from Scottish emitters can be transported and stored in the North Sea;
  • the Saltire Prize which promotes transformational technologies that help unlock the marine renewable energy potential in Scotland and is helping to achieve Scotland's future renewable energy ambitions; and
  • the Scottish Government announced on 6 July 2010 grants of £13m, awarded to five marine energy projects from the WATERS fund (Wave and Tidal Energy: Research, Development and Demonstration Support). This fund will help develop wave and tidal energy technologies, driving down costs and moving them closer to commercial operation.

Objective 6: Develop world leading policy frameworks and create a comprehensive infrastructure.Ensuring delivery of the clean, affordable and secure electricity supply required to meet climate change targets and create a competitive position across low carbon energy sectors whilst delivering economic benefits for Scotland.

Immediate Actions:

The Scottish Government will support a co-ordinated approach through:

  • The Scottish Energy Advisory Board ( EAB), a high-level, open and informed engagement between Ministers, the energy industry and other relevant bodies;
  • FREDS will continue to build a partnership between industry, academia and Government which draws on their expertise and networks in order to most effectively develop Scotland's renewable energy industry;
  • As a sub-group of the EAB, the role of the Offshore Energy Programme Board is to strategically drive and co-ordinate the public sector's collective contribution to the growing offshore energy opportunities, seeking maximum benefit for Scotland;
  • A number of specific action plans are being taken forward across the energy sector:
  • Renewables Action Plan 30
  • Renewable Heat Action Plan 31
  • Marine Energy Road Map 32
  • Offshore Wind Route Map 33
  • National Renewables Infrastructure Plan 34
  • Carbon Capture and Storage ( CCS) Roadmap 35
  • Conserve and Save, the Scottish Government's Energy Efficiency Action Plan36;
  • Marine Scotland will introduce a one stop shop approach to licensing for marine renewables and integrated marine planning, underpinned by sound science; and
  • SEPA will produce an energy position paper, in recognition of the increasing importance of the energy sector to the Scottish economy .

Transforming the Built Environment

The built environment offers one of the most tangible expressions of low carbon opportunities and challenges to business, investors and householders. It offers two broad areas of opportunities for the construction industry and wider supply chains, reducing the current energy and carbon emissions associated with new and existing buildings and secondly, exploiting low carbon design of buildings and neighborhoods, as well as innovation in sustainable building technologies in both domestic and global markets.

Objective 7: Moving towards a low carbon built environment.Reducing carbon emission, through all phases of the building process, from design to construction, through operation and maintenance, within the new and existing building stock.

Immediate Actions:

  • the Scottish Government is working jointly across the whole Scottish public sector to demand a higher level of performance through procurement by implementing the Scottish Sustainable Procurement Action Plan37 and the Scottish Government's Construction Works Procurement Guidance38;
  • the Scottish Government will continue to encourage local planning authorities to prepare heat maps to inform strategic development plans and policies for renewable heat through local development plans; and
  • the Scottish Government Energy Efficiency Action Plan39 sets out a number of actions on improving energy efficiency across the built environment including:
  • Within available resources, continuing to provide ongoing support and financial assistance for energy efficiency in existing housing, levering investment from energy companies and private householders wherever appropriate;
  • investigating options for financing mechanisms for major energy efficiency measures in private sector housing;
  • proactively developing district heating as a discrete policy area within energy efficiency, including supporting a number of local heat mapping and feasibility projects over 2010/11;
  • actively promote microgeneration, most notably by; seeking to maximise Feed in Tariff and proposed Renewable Heat Incentive investment in Scotland; and supporting the development of a Scottish Microgeneration Certification Scheme ( MCS) certification body and exploring other barriers that hinder widespread participation in MCS;
  • The Scottish Government are working with UK Government and the energy companies to ensure that a proportionate share of their supplier obligation is targeted in Scotland, for instance in relation to:
  • The UK Carbon Emissions Reduction Target ( CERT), providing home energy efficiency improvements. This is expected to be worth over £300 million for the period 2008/11.
  • 'Better Billing 'Smart' meters' are to be installed in every home by 2020 encouraging better household energy management.
  • The Scottish Government will work with the UK government to ensure that the ' UK Green Deal' financing initiative to maximise opportunities for Scottish businesses. The initiative is being developed for 2012 and will support fabric improvements in both domestic and non domestic buildings that will be paid for through savings in energy use.

Objective 8: Exploiting and integrating low carbon building technologies into the design and construction process.Helping to develop, commercialise, test, demonstrate and market innovative new building technologies and materials and integrate these into the design process alongside passive technologies.

Immediate Actions:

  • the Scottish Government is currently exploring opportunities with the European Investment Bank for a potential retrofit programme for Registered Social Landlords ( RSL). It is anticipated that this will provide loan funding for RSLs to install microgeneration and renewable technologies to improve the energy efficiency of their stock;
  • the Scottish Government will support the development and uptake of innovative energy efficient solutions and new building technologies and solutions through:
  • supporting European funded projects for energy efficiency measure, in particular district heating projects, which will improve efficiency and cut emissions as well as delivering financial benefits to the occupiers of the homes and businesses;
  • investing £13.5 million per year for community renewables and microgeneration;
  • Environmental Clean Technologies Partnership40 (Scottish Enterprise, Highlands and Islands Enterprise, SEPA and the Scottish Funding Council) will deliver coordinated support for businesses and academia within the emerging Environmental and Clean Technologies sector; including the priority actions recently identified within the ECT strategy including for sustainable building technologies.

Objective 9: Promoting low carbon building design at all scales from neighbourhood upwards,To encourage development of walkable, well-connected places.

Immediate Actions:

  • Building on the Scottish Sustainable Communities Initiative ( SSCI), a report will be published next spring which will illustrate a wide variety of approaches to delivery of low carbon, sustainable communities and the industries which support them.
  • The Scottish Government will evaluate, promote and disseminate the lessons learnt from Scotland's Housing Expo so that the skills and expertise available in Scotland in approaches to designing economic low carbon homes is more widely known about and understood. Many of these projects demonstrate the value of a 'passive energy' design approach which uses new technologies in their proper context and act as exemplars for new-build and the retrofitting of components to reduce energy use in existing housing.
  • Architecture and Design Scotland 41, the Scottish Government's champion for good design in the built environment, will provide advice and access to skills to assist designers, clients and constructers to realise low carbon developments with the most sustainable layouts and in the most appropriate places.

Decarbonising Transport

Scotland needs to move towards a decarbonised transport sector by 2050. Global demand for low carbon vehicle technology is expected to grow exponentially over the next 20 years in response to demand for renewable energy, rising fossil fuel prices, the need for secure fuel supply, and new technology investment. With a global market of £345 billion for alternative fuel vehicles and £0.5 billion in Scotland, the sustainable transport sector presents a growing opportunity for the Scottish economy.

Objective 10: Reducing the need for travel.Promoting development which reduces the need to travel, facilitates travel by public transport and freight movement by rail or water, and provides safe and convenient opportunities for walking and cycling and securing the necessary infrastructure to do so.

Immediate Actions:

  • Government is developing the infrastructure required to support electric vehicles. Providing viable alternatives to domestic air travel (high speed rail);
  • Transport Scotland will continue to work with both Department of Transport and the High Speed Two company to promote and develop the case for high speed lines to Scotland;

Objective 11: Widening travel choices.Encouraging lower carbon options, like public transport, car clubs, car sharing and cycling and walking.

Immediate Actions:

  • The Scottish Government, working jointly across the whole public sector to support public sector leadership in the use and promotion of Low Carbon Vehicles LCVs and associated infrastructure development. To meet the target of 100% of publicly procured vehicles to be LCV (except certain exempted 'specialist' vehicles) by 2020; and
  • the Scottish Government aims to meet the actions set out in Energy Efficiency Action Plan on energy efficiency across transport sector.

Objective 12: Encouraging both energy efficient driving and supply chains. Creating a demand at home and internationally for Scottish expertise in low carbon transport technologies.

Immediate Actions:

  • the Scottish Government, and wider public sector, will support the Low Carbon Vehicle Procurement Support Scheme to provide in the region of £4.3m to the public sector for the procurement of over 100 new low carbon vehicles LCVs and publicly available charging infrastructure;
  • the Scottish Government, and wider public sector, support the roll out a national network of fast charging points, smart grid and vehicle to grid technology; and will continue to support the unit costs making low carbon vehicles a more viable and appealing option to consumers;
  • Scottish Government will continue to support investment in biofuel, and hydrogen research and development to make LCVs a more viable and appealing option to consumers; and
  • Environmental Clean Technologies Partnership42 will deliver coordinated support for businesses and academia within the emerging Environmental and Clean Technologies sector; including the priority actions recently identified within the ECT strategy including for sustainable transport sector.

Scotland's Resources

Scotland's rich and diverse environment is a national asset and a source of competitive advantage for Scotland. As a nation we trade on its quality, so its continuing health and improvement are vital to sustainable economic growth, and the effective use of sustainable raw materials and natural resources all the more important. Many of Scotland's economic growth sectors such as tourism, agriculture and the food and drink sectors depending on our high quality air, land and water. It is important, therefore, that the Scottish Government and wider public sector take action to conserve and enhance Scotland's environment, supporting these critical sectors in the transition to a low carbon economy and ensuring sustainable economic growth.

Objective 13: the development and uptake of emerging technologies. Encouraging industry to develop sustainable practices that support economic growth, and protect the environment through efficient resource use and minimising waste and pollution.

Immediate Actions:

  • the Scottish Government and wider public sector will work with the Technology Strategy Board in considering the feasibility of developing a new innovation platform for water, which will focus efforts in two main areas: firstly the prevention and mitigation of flooding; and secondly the management of drought and water shortages;
  • Scottish Water will evolve from a successful utility into a dynamic water agency, becoming one of the largest generators of renewable electricity in Scotland. It will support the bid to hold the 2015 World Water Forum, as well as assisting in establishing a Scottish centre of excellence modelled on the Stockholm International Water Institute;
  • Centre of Expertise on Climate Change is being established by Scottish Government to consider the impacts of climate change and reduction of green house gases on economic growth and sustainability across rural and environmental industries. This will include simplifying access to scientific expertise across Scotland; and enhancing synergy of effort and stimulate innovative, scientific thinking, in support of policy;
  • Zero Waste Scotland is currently running a plastics capital grant of £5M to drive the development of a plastic recycling facility in Scotland. Currently Scotland exports baled plastics for reprocessing elsewhere. Having the capacity to deal with this material here in Scotland would not only help drive recycling but it will also add value to this valuable resource here in Scotland;
  • Scotland should consider the merits of becoming a centre for processing and recovery of rare earth metals for domestic and global technology markets, which could be built from the availability of these materials in waste electronic goods.

Objective 14: Setting a policy and regulatory framework. Supporting the growth of industry and protecting the environment and available natural resources.

Immediate Actions:

  • Scottish Government is developing a Land Use Strategy for Scotland43 to be laid before Parliament March 2011;
  • Scotland's Zero Waste Plan sets out to create a stable regulatory framework providing confidence for investment and innovation and will see high levels of resource re-entering the economy, reducing Green House Gas emissions;
  • the Scottish government and SEPA to work in partnership with industry and support agencies on a prioritised, sectoral approach to developing an integrated and enabling framework for regulation and advice, supporting innovation and enabling activities to reduce emissions whilst protecting the environment;
  • the Environmental Clean Technologies Partnership44 will deliver coordinated support for businesses and academia within the emerging Environmental and Clean Technologies sector. This will focus on the priority actions recently identified within the ECT strategy including for environmental monitoring and instrumentation sector and water supply and waste water recycling sector;
  • SEPA have commissioned research to identify raw materials critical for the Scottish economy, and identify supply risks and opportunities for Scottish businesses. A key aim is to ensure that the resources required for the transition to the Low Carbon Economy are available for Scottish business; and
  • SEPA will develop a clear position and reference appropriate methodologies for the quantification of environmental improvements as a result of the delivery of the low carbon economy. SEPA will also work with partners on an integrated approach to environmental monitoring and reporting.