£6bn Less for Scotland

The Political Economy of ScotWind

“The scale of opportunity here is truly historic. ScotWind puts Scotland at the forefront of the global development of offshore wind, represents a massive step forward in our transition to net zero, and will help deliver the supply chain investments and high-quality jobs that will make the climate transition a fair one.” Nicola Sturgeon, January 17th, 2022

“The acceleration of our offshore renewables capabilities over the coming decade presents enormous economic opportunities which must be seized in order to secure a just transition for our energy sector and a fairer, greener Scotland for everyone.” Humza Yousaf, October 17th 2023

“This is an era-defining opportunity for Scotland.” John Swinney, October 2024 at the Floating Offshore Wind Conference in Aberdeen

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£6bn Less for Scotland: The Political Economy of ScotWind

If good governance is to be measured against the public interest, the ScotWind auction should go down as one of the most egregious failures of resource management in the devolution era. By privatising the rights to Scotland’s offshore renewable energy generation to multinational corporations and foreign capital at rock-bottom prices, this wealth is being extracted rather than maximised and nurtured as a core national asset. As critics made clear, while this scheme would be a boon to private companies, and indeed to external state-owned entities, even the promise of supply chain jobs was inflated. New developments around the project have only underlined the stance taken by those who opposed such an approach to stewarding Scotland’s wind energy potential. Not only because it has immediate deleterious impacts, but also because for supporters of independence, it critically undermines the future industrial base of any fledgling Scottish state. That said, whatever your constitutional view, this issue requires renewed scrutiny across the board.

As reported in the Herald in 2022, despite the cacophony of celebratory Scottish Government press releases, Scotland stood to lose billions every year since the initial capital investment was not integrated with a long-term process geared towards banking the profits for the Scottish people. Dr Keith Baker, a researcher in fuel poverty and energy policy at Glasgow Caledonian University, explained at the time: “If the Scottish Government had listened, particularly regarding the need for an asset-owning public energy company and the development of a domestic renewable energy manufacturing sector, we would now be in a position to justifiably claim that the sell off would bring significant and demonstrable economic and social benefits to Scotland. However, as it is, we will see very little of those benefits, meaning the SNP and Scottish Greens have limited our capacity to meet our climate change targets, undermined our commitments to human rights, and undermined the case for independence”.

In early 2023, Independence Captured interviewed Craig Dalzell, Head of Policy & Research at Common Weal, who made the case in similar terms: “Had Scotland launched a national energy company capable of owning ScotWind, it would have been well placed to deliver billions in profits to Scotland every year that will now instead be shipped overseas to private shareholders or invested in the public services of those countries who have deployed their own nationalised companies in Scotland.”

The idea of a National Energy Company was indeed announced by Nicola Sturgeon at the SNP conference in 2017. But just as with the National Care Service, this could be largely attributed to headline-mongering, lacking both the political heft and the strategy to build these much-needed institutions. Typically, the idea was shelved and downgraded. SNP members, however, mobilised to raise the issue again. In 2021, they voted overwhelmingly for the policy at their conference. In the words of one delegate: “Our demand is for this new national energy company to have a remit to progressively take over the harnessing of distribution of Scotland’s immense renewable energy potential.”

In the weeks following, Monica Lennon MSP raised the issue in the Scottish Parliament in the context of rising wholesale gas prices. It was again rebuffed, as the SNP made clear the energy company pledge would not be revived. Undeterred, yet another motion on a publicly owned energy company - devised between Common Weal, the SNP Trade Union Group and the STUC - passed at the SNP’s October conference in 2025. This again was frozen out.

To bring us up to date, financial journalist Martin Williams, who has been providing rigorous coverage of the ScotWind story since its inception, has written an exclusive for the Herald. While it is not surprising, it should be no less vexing: “Crown Estate Scotland analysis shows only £25.6 billion of the £88.6bn expected to be spent developing the giant offshore wind projects is currently earmarked for Scotland. Union representatives are concerned that the ScotWind ‘disaster’ represents a direct transfer of wealth from local communities straight into the pockets of foreign rivals based on a strict, like-for-like comparison of identical windfarm projects.”

The report continues: “While a collapsing investment share means Scotland has effectively missed out, overseas economies have captured a massive £6.4 billion jackpot. This multi-billion-pound foreign windfall was driven entirely by international supply chains growing their slice of the total budget from 47.8 per cent up to 55.1 per cent, swallowing up the contract share that Scotland lost.” Just as Common Weal warned in a detailed 2022 policy paper: “Benefits within the Scottish supply chain have been overpromised. Current bids have been won with the explicit exclusion of supply chain commitments (though binding commitments will be part of future negotiations). However, lack of manufacturing capacity in Scotland means that promises may not be forthcoming if companies deem it cheaper to import material than to invest in the capacity to build it in Scotland.”

The SNP leadership were in hock to global investors and the likes of British Petroleum and Shell, rather than unions, progressive think-tanks and party members. They were both unable and unwilling to assert any kind of leverage that would counterveil the corporate appropriation of Scottish assets. At each and every turn expert advice, strong policy recommendations and repeated mandates were scorned, repudiated or ignored.

The two souls of Scottish independence

This exposes the central contradiction in contemporary Scottish nationalism, a topic we touched on with the passing of Tom Nairn. As James Foley, co-author of Scotland After Britain: The Two Souls of Scottish Independence, outlined: “Nairn correctly identified the nature of the emerging nationalism, which, in an era of footloose corporations, would be more about the pursuit of competitive advantage in transnational spaces, as opposed to the separatist or nativist ‘retreat’ into borders. This is indisputably true of Scottish nationalism and its parallel European movements in Wales, Catalonia and the Basque Country. All aim to take advantage of the higher-evolved trading spaces of European and global markets. Indeed, Scottish nationalists like to stress that they are leaving a smaller market for a bigger one.”

In a previous era, energy had been central to the idea and plausibility of Scottish autonomy. The North Sea oil discoveries of the 1960s and 70s transformed the communications and campaigning of the SNP, precipitating the popular slogan, “it’s Scotland’s oil.” At the same time, it also opened the door to new debates within the trade union movement and wider Scottish society, about the role and position of the Scottish working class in relation to evolving attitudes on the constitution. Unionists also had to deal with the challenges it presented, not only in maintaining the argument that Scotland could only survive as an economic dependency within the Union, but in facing down the idea that Scotland might, in fact, be more prosperous should it control and distribute this newfound oil wealth as an independent state.

The ability to own and redirect oil wealth to every Scot not only spoke to the potential of independence, but positioned the national movement in terms that were not wholly subservient to the forces of unfettered and unaccountable global capitalism. The modern SNP has turned that dynamic on its head. And as the world system ruptures, questions of energy self-reliance are only going to rise up the political agenda, reinforcing the long term damage that has already been done. Because, to quote Craig Dalzell once more, “even if we created a national energy company now, the auction for ScotWind has passed, and those resources will be developed by private interests, big oil corporations and foreign public energy companies.” Having squandered billions, we are already playing catch-up. So much for “standing up for Scotland.”

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