The closure of Scotland’s solely oil refinery subsequent 12 months has accelerated efforts in Holyrood and Westminster to plot a pathway for a inexperienced future on the sprawling industrial complicated at Grangemouth.
Petroineos’ choice to flip the location right into a fuel-import terminal, first trailed in November, will lead to a net lack of 400 jobs — a transfer the union Unite has known as “industrial vandalism”.
The disaster kinds Labour’s most critical check in Scotland, the place the social gathering gained dozens of Westminster seats on the common election in July.
After his victory, Sir Keir Starmer, prime minister, pledged to make saving threatened jobs at Grangemouth his primary precedence in Scotland.
Ed Miliband, the UK’s energy safety and net zero secretary, is working intently along with his Scottish counterpart, Gillian Martin, to stop the nation’s largest industrial web site withering into wasteland.
Close collaboration between London and Edinburgh might be crucial to fund nascent applied sciences, set pricing mechanisms and reshape provide chains to change from fossil fuels to low-carbon options.
Since July a government-funded process pressure known as “Project Willow” has been exploring choices for the event of inexperienced industries at Grangemouth to exchange the UK’s oldest refinery, constructing on research carried out by Petroineos for years. The group, suggested by consultancy EY, is scheduled to report again subsequent 12 months.
As the 2 governments scramble to safe an industrial future for Grangemouth past the import terminal plans, they’ve shortlisted three “credible options” recognized in Project Willow: low-carbon hydrogen, artificial “e-fuels” and sustainable aviation fuels. Other processes will even be thought-about and any investible propositions could possibly be funded by the National Wealth Fund, a brand new initiative launched by chancellor Rachel Reeves.
The complicated regulatory reform and prolonged development timeframes imply that any initiatives can be years within the making — a far stretch from the “shovel-ready” plans sought by the unions.
“We wish the previous government had started this work five years ago, but we have to start from here,” mentioned a UK authorities official.
Unite specifically has raised fears that the shift away from fossil fuels will exchange well-paid jobs with fewer, lower-paid roles, failing to meet the “just transition” promised within the pursuit of net zero ambitions.
“We are the first cab off the rank for testing what the ‘just transition’ means,” mentioned one govt concerned in Project Willow.
The examine, in accordance to paperwork seen by the Financial Times, has explored how hydrogen produced by pure gas or renewables might energy biofuel refineries and be extracted into artificial “e-fuels” to exchange petrol.
RWE has early-stage plans for a inexperienced hydrogen facility at Grangemouth by 2029. Ineos additionally has plans for a gas-powered “blue” hydrogen plant that will pump carbon dioxide into rock formations below the North Sea by way of the Acorn carbon seize storage venture on the north-east coast.
Acorn, promoted by the Scottish authorities, is awaiting UK authorities approval to transfer in the direction of commerciality.
Bioprocessing plants for e-fuels and sustainable aviation fuel, powered by green hydrogen, are other options that have been previously considered by Petroineos but will require government intervention to become commercially viable at scale.
The Scottish government would need to help foster new supply chains for gathering feedstocks for processing into low-carbon transport and aviation fuels. Used cooking oils, fish farm waste or sugar beet crops could be processed into fossil-free diesel and ethanol.
“We need government to unlock economic and technical barriers as biorefining doesn’t yet work commercially at scale,” the executive said. “Procuring the right feedstock and product pricing is where these projects rise and fall.”
Edinburgh Airport, which sources jet gas from Grangemouth, has already been working with Petroineos on the potential for SAF manufacturing, as aviation faces a UK mandate for lower-carbon gas to account for 10 per cent of jet provide by 2030, rising to 75 per cent by 2050. “We think there is a real opportunity for Scotland to corner this market,” the airport mentioned.
Forging an SAF manufacturing market in Scotland is “complex”, it added, however many associate airways need extra European capability as it’s principally produced in China and the US.
“The beauty of Project Willow is that it’s a blank canvas,” the manager mentioned. “The terror is that it’s a blank canvas.”