Publication - Progress report

Climate change monitoring report 2024

Published: 28 May 2024
Directorate: Energy and Climate Change Directorate, +3 more … Agriculture and Rural Economy Directorate, Environment and Forestry Directorate, Offshore Wind Directorate
Topic: Energy, Environment and climate change
ISBN: 9781836013389

The fourth annual statutory monitoring report against the updated 2018 Climate Change Plan, as per the Climate Change (Emissions Reduction Targets) (Scotland) Act 2019.

Supporting documents

9. Chapter 8: NETs

9.1 Part A - Overview of sector

Negative Emissions Technologies (NETs) are yet to be deployed in Scotland as they rely on carbon capture and storage (CCS) to deliver negative emissions. Whilst some technologies that could deliver negative emissions are currently deployed, such as energy from waste, these facilities would require retrofitting with carbon capture technology and a route to storage to be considered a negative emissions technology.

The Climate Change Plan update (CCPu) includes policies and proposals for supporting and enabling early deployment from 2029 onwards. We currently do not track progress against the NETs envelope in the CCPu. In our last CCP (Climate Change Plan) Monitoring report, we committed to undertaking a feasibility study on NETs deployment in Scotland. This was published November 2023 and will help inform the development of our NETs policy going forward. The results of this study demonstrated the reliance of NETs deployment in Scotland on the UK Government’s policies regarding carbon capture, usage and storage (CCUS) Cluster Sequencing, in particular on delivering the Scottish CCUS cluster at pace, as well as the possible benefits of including removals in the UK ETS (Emissions Trading Scheme).

The CCPu sets out the following policy outcomes for the sector. Given that this sector chapter appeared first in the CCPu (2020), there are no indicators for these outcomes. In the next CCP we will update the policy outcomes and include indicators to track progress against these updated outcomes.

Detailed feasibility study 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, in this report we use data from the Office of National Statistics (ONS): Low Carbon Renewable Energy Economy (LCREE) publication. The LCREE data presented in this report 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. Over the next few years we will work to develop a more 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 emissions removals will need to play in reaching net zero, as highlighted by the IPCC Working Group 3 report. 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 regard to carbon capture and storage.

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

The review indicated 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 and key policy decisions since the time of the CCPu, including:

The UK Government’s decision in October 2021 not to award the Acorn Project during the Track-1 phase has delayed the deployment timeline for the carbon capture and storage system required for NETs.
While the UK Government’s Powering Up Britain announcements on 30 March 2023 reconfirmed their commitment to four UK CCUS clusters by 2030, and started the Track 2 process highlighting Acorn as one of two projects “best placed to deliver on Government objectives for Track-2”, only eight out of 20 shortlisted and 41 initially eligible Track-1 Phase-2 projects were taken forward to the negotiation stage. No NETs projects were included in this list.
Despite UK Government updates on Acorn/Track 2, there is still no timeline for a final decision on Acorn and the associated range of emitter projects.
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 Combined Cycle Gas Turbine (CCGT) power project, it is unlikely that a new NETs power facility will be developed in the 2020s.

We have since gained further knowledge and evidence of what scale of NETs can be delivered in Scotland and to what timescale, through undertaking a NETs feasibility study. The study considered the feasible pace and scale of NETs deployment in Scotland. To do so, the authors examined existing sites in Scotland which emit biogenic carbon and could deliver negative emissions if paired with CCS infrastructure, as well as biochar production. The study then explored the potential for new sites, including Direct Air Capture. To determine the feasible deployment of these technologies, the study modelled three pathways for NETs deployment, all of which assumed that the Scottish Cluster would be active and able to permanently store CO₂ by 2030. The pathways differed in the level of government action, such as policy supports, market design, or funding to support NETs.

This study estimated that the maximum Negative Emissions Technologies (NETs) potential achievable in Scotland in 2030 is 2.2 MtCO₂/year (60% of the available biogenic CO₂ emissions), based on existing and future potential sites and given technical, economic and other constraints. This is significantly lower than the stated NETs ambition in the CCPu of 5.7 MtCO₂/year by 2032. With additional policy interventions from both the UK and Scottish Governments, this figure could potentially reach 6.8 MtCO₂/year by 2045 with technologies such as direct air carbon capture and storage (DACCS), bioenergy CCS (BECCS), energy from waste (EfW) and biomethane and distillery sites all playing a role.

As noted in the 2022 and 2023 monitoring reports, it is therefore clear 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 policy shifts since the publishing of the CCPu in 2021 including – critically – the UK Government’s decision to not allocate the Scottish Cluster as a Track-1 cluster for delivery in the mid-2020s. With the right policy interventions from both the UK and Scottish Governments, outlined in the feasibility study, these technologies can meaningfully contribute to our climate change goals and negate residual emissions from hard-to-abate sectors. This further evidence will be considered as we undertake the next full CCP.

Developments in monitoring arrangements since last report:

No changes.

9.2 Part B - Progress to Policy Outcome Indicators

Policy Outcome: Cross-sectoral social and economic

Indicator: FTE employment in Low Carbon Renewable Energy Economy Indicator

On-Track Assessment (Milestones/Targets):Year-to-year change

Most Recent Data: 2022

Data Source(s): Office of National Statistics: Low Carbon Renewable Energy

Economy (LCREE), Time spent of Green Tasks

Assessment: Too early to say

Commentary:

In 2022, the Scottish low carbon renewable energy (LCREE) sectors were estimated to provide 25,700 jobs.^[36]

The estimates of LCREE are based on a relative small sample of businesses and hence are subject to a wide confidence interval. Scottish LCREE employment in 2022 is above the average of previous years but the difference is not statistically significant.

The trend shows an decrease in employment in low carbon renewable energy sectors in 2022 in comparison to 2021 with an estimate of 25,700 FTE jobs. — Employment in Low Carbon Renewable Energy Economy, FTE^[37]

LCREE only shows employment in roles in industries directly involved in the transition to Net Zero. This means that possible CCUS-related activity carried out by firms in sectors not targeted by the survey might be missed and statistics on jobs may undercount the economy's actual labour allocation to these activities.
The Office of National Statistics (ONS) also released experimental statistics on a wider perspective of green activity in the economy with their time spent on green tasks release.
These statistics reflect green activities in both LCREE and non-LCREE sectors. The 2024 publication with data for 2023 has not yet been published.

9.3 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 (Available here) and a horizon scan of international deployment of NETs (Available here). A detailed NETs feasibility study was published at the end of last year, containing recommendations to government and proposed NETs implementation pathways.