Scottish Budget 2020-2021: carbon assessment

2. High-level Carbon Assessment of 2020-21 Budget

2.1. Portfolio Expenditure and Associated Emissions

14. Total estimated emissions attributable to the 2020-21 Budget are 9.5 Mt CO2-equivalent. Table 2 shows overall spend and emissions by the individual portfolios and further, how these emissions arise. Emissions remain broadly proportional to spend, except for Rural Economy, Transport, Infrastructure and Connectivity and Social Security and Older People, where emissions per unit of spend are slightly higher. Health and Sport, Communities and Local Government, Rural Economy, Transport, Infrastructure and Connectivity and Social Security and Older People are the largest Budget items, with the highest emissions.

15. Expenditure is shown net of income, in line with the Budget, and emissions are calculated on that basis.^[1]

Table 2: Portfolio expenditure^[2] (TME excluding non-cash items) and emissions

Portfolio	Spend £m	Estimated GHG emissions (thousands of tonnes of CO2 equivalent)
		Domestic			Total
		Direct	Indirect	Imported
Health and Sport	£14,970	375.4	586.5	963.6	1,925.4
Communities and Local Government	£11,323	645.2	408.8	1,077.7	2,131.6
Finance, Economy and Fair Work	£6,241	20.9	235.8	585.1	841.7
Education and Skills	£4,126	102.3	110.5	362.3	575.1
Justice	£2,774	80.4	105.6	221.5	407.6
Transport, Infrastructure and Connectivity	£3,325	377.9	106.1	596.8	1,080.8
Environment, Climate Change and Land Reform	£435	7.5	11.5	70.9	89.9
Rural Economy	£745	967.3	142.6	164.1	1,274.1
Culture, Tourism and External Affairs	£349	7.9	16.7	23.8	48.4
Social Security and Older People	£3,788	223.5	141.4	705.4	1,070.2
Government Business and Constitutional Relations	£16	0.5	0.6	1.3	2.4
Crown Office and Procurator Fiscal Service	£129	4.0	5.1	10.4	19.5
Scottish Parliament and Audit Scotland	£103	3.1	3.9	7.7	14.7
Total	£48,323	2,816.0	1,875.1	4,790.4	9,481.4

16. Direct emissions account for 30 per cent of the total; indirect emissions for a further 20 per cent – a large proportion of which is caused by electricity generation. 51 per cent of emissions attributable to Budget expenditure are generated outside Scotland and are embedded in imported goods and services.

17. Figure 1 demonstrates graphically the results for individual portfolios and the split by type of emissions (direct/indirect), and also whether the emissions are domestic or imported. As the graph highlights, the emissions intensity (carbon emissions per pound of spend) of individual portfolios are broadly similar. The exception is Rural Economy, where the emissions intensity of spend is higher.

18. A large part of this expenditure is linked to carbon-intensive production methods (carbon sequestration through forestry is not taken into account. Note that in the second part of Figure 1, the scales vary by portfolio.

Figure 1: Estimated domestic and imported GHG emissions (thousands of tonnes of CO2 equivalent) by portfolio and generating industry.

Scottish Government Budget 2020/21

2.2. Emissions by Industry Source

19. Figure 1 confirms the continued importance of domestic energy production and its emissions across the Scottish Budget. In addition to this, for Rural Economy, the support of farming activity leads to significant levels of methane and nitrous oxide emissions.^[3]

20. Total emissions broken down by industry are shown in Figure 2. Some 29 per cent of the Scottish Government's carbon footprint is caused by the use of Energy, Water and Waste, followed by Manufacturing (21 per cent) and Agriculture Forestry and Fishing (17 per cent).

Figure 2: Overall Government spending - Industry sector share of emissions
(domestic direct and indirect, plus imported GHG emissions)

21. To reduce the emissions from Government spending, decarbonisation of the energy sector remains an important policy aim. As the sector is decarbonised, the carbon intensity of the sector in the Environment Input-Output model will fall, with a consequential reduction in carbon emissions recorded in the use of electricity^[4].

2.3. Domestic and Imported Emissions

22. In addition to direct and indirect domestic emissions, the assessment takes into account the emissions generated outside of Scotland in the production of imported goods purchased as a result of Government spending (e.g. food, machinery, IT equipment).

23. Figure 3 demonstrates that imported emissions make up around a half of emissions from Budget spend. There is however a difference between the sources of domestic and imported emissions. Expenditure on Energy, Water and Waste accounts for the largest share of domestic emissions, while expenditure on Manufacturing generates the largest share of imported emissions (followed by Energy, Water and Waste).

Figure 3: Domestic and Imported Emissions - All portfolios

Figure 3a: Domestic emissions by industrial sector

Figure 3b: Imported emissions by industrial sector

Figure 3c: Domestic and imported emissions, thousands of tonnes of CO2 equivalent and percent

Figure 3d: Domestic and imported emissions by industrial sector