Good morning and welcome to the 16th meeting of the net Zero Energy 먹고 and Transport Committee for 2023. The first item on the agenda is consideration whether to take items 5 and 6 in private. Item 5 is consideration of evidence that we will hear under item 4. Item 6 is the consideration of a draft report on the Scottish Government's air quality improvement plan. Are we agreed to take those items in private? We are agreed. We are agreed. The second item on the agenda is consideration of a draft statutory instrument, the Climate Change Scotland Act 2009, entering target amendment regulations 2023. I'm pleased to welcome Mary McCallan, the cabinet secretary for net zero and just transition. I'd also like to welcome from the Scottish Government Norman Munro, a solicitor and Philip Rane's deputy director to domestic climate change. Thank you for joining us today. The instrument is laid under an affirmative procedure, which means the Parliament must prove it before it comes into force. Following the evidence session, the committee will be invited at the next agenda item to consider a motion to approve that instrument. I just remind everyone that officials can speak under this item but not during the debate that follows. Cabinet Secretary, I believe you want to make a brief opening statement. Thank you very much and good morning committee. Thank you for having me along to talk about these amendment regulations. This instrument has been drafted following advice from the committee on climate change, of course, our statutory advisers, advice from them to modify our emissions targets through the 2020s. These modifications represent a technical adjustment to ensure that targets in the 2020s remain consistent with the latest methodology for carbon accounting. The advice from the committee on climate change was received in December 2022, and this came after requests from Scottish ministers to review our emissions reduction targets. That request is in line with section 2C of the 2009 act, which requires us at least every five years to seek advice from the committee on climate change to make sure that our targets are set at the right levels. The CCC's advice highlighted the need to ensure that our targets for 2020s remain aligned with what were significant revisions to international carbon accountings because of a recognition of peatland restoration and its role in reducing emissions. Currently, our targets through the 2020s are based on a legislative target of 56 per cent. That is based on advice that we received in 2017, which is now outdated and undervalues the role of peatland restoration. Those methodological updates impact all four countries, but they have more of an impact in Scotland for two reasons. For example, as compared with our colleagues in England and Wales, we have annual targets, whereas they do so over longer periods of time. The second reason that that has more of an impact on Scotland is because of how central peatland restoration is to our emissions reduction targets. Ultimately, the CCC has recommended that our annual targets from 2021 to 2029, which are set by a straight line from 2020, are adjusted to a line with the new international accounting for carbon. As I said, that instrument responds directly to that. Just as a final point, I would reinforce what the CCC and climate change have said themselves, that that is not a lowering of ambition. That 2030 target remains, as it previously was, just about reflecting better carbon accounting and developments in our understanding of peatland restoration in that period. Of course, our 2045 target remains unchanged as well. Thank you very much, cabinet secretary. I am just looking around to see if there are any questions. Mark, if you would like to start, please. Thank you very much for that. I suppose that this has come about because of our greater understanding of what is happening in the natural world and how that greenhouse gas inventory is changing over time. I am just wondering if you anticipate any other changes coming in later years, because I know that our understanding of blue carbon, for example, is increasing, although that is currently outside of the inventory. We do not really account for that. Could this be a game changer in terms of understanding more about the science and whether that might impact further down the lines? Is there any sense of that in terms of the international debate in the science community? Yes, thank you for the question. I suppose that in all aspects of our journey to net zero, I expect change and I expect development. I expect that in the way that we account for emissions, particularly in the natural world, and you are absolutely right to highlight blue carbon. It is often put to me that where we were five years ago, with our understanding of peatland emissions, we are now at that point with blue carbon and I do expect advances in that. I expect advances in technology and everything that we do has to be iterative because of that. I suppose that, just to round off my answer, I would say that we are statutorily bound to seek the committee's on climate change advice on those changes. We have to do that at least every five years. We will continue to do that following the legislation and therefore I do expect that there will be adjustments to be made as we move through our annual targets. I suppose that the flip side of that is that if blue carbon was brought in, it may affect the targets but it may also bring in solutions such as blue carbon, marine protected areas or sea grass or kelp restoration and it might open up opportunities for progress as well as having to account for an entirely new part of our biosphere in terms of our thinking with the inventory. Yes, absolutely. I want to see the science on blue carbon developing. That is partly why we are funding research in our academic institutions and supporting projects such as project sea grass. As to develop what I think we would all agree is going to be a very important part of our carbon accounting and our journey to net zero but with science that is just a little behind where we are in the terrestrial space. It will be a useful addition once we get to a settled position on it. That is, as you have said, all about targets and not lowering the ambition. The CCC that you mentioned also highlighted that key milestones are ambitious but a clear delivery plan on how they will be achieved is still missing and there is no quantification of how policies combine to give the emissions reduction required to meet Scotland's targets. What work has been done to address those concerns of the Climate Change Committee and ensure that even though previous targets may have been missed, those new ones might be achieved? Overall, I take the advice from the Committee on Climate Change very seriously. There are remarks in recent years, months have been, I would say, constructively critical about the pathway. My overall view is that we are making good progress. We are more than halfway to net zero but I am equally sure that the next phase of emissions reduction, particularly out to 2030, will be some of the most challenging parts of our journey that we have to go through. What are we doing to respond to that? We will officially respond to the Committee on Climate Change most recent advice in due course. Later this year we will lay a draft of the next full statutory climate change plan, which will look across the peace on Scotland's economy and society and demonstrate how emissions reduction will be achieved against their sector envelopes right across our economy. Of course, it will set that emissions pathway for each sector, and it will also include details of the costs and the benefits of the policies that it contains, so that full statutory plan, a draft of which we will be laid in November. On that, the current climate change plan commits to reduce car calamities by 20 per cent by 2030. The Climate Change Committee is saying that the current plans lack a full strategy with sufficient levers to deter car use. Given that we have known about that for a while, the CCC has said that for a while, what measures has the Government been looking at to meet that specific target and reduce transport-related emissions? For the purposes of today, because a lot of this work is still under development, I would point to the fact that we will be responding precisely to that point in the Committee on Climate Change advice very soon, and that will be built into our climate change plan, the draft of which we will be laid in November. Rather than today going into some of the detail of what my officials and I are developing, I would rather wait until we get to the point of publishing the response, and I will be more than happy to discuss some of that with the committee. The final question is generous in the sense that this instrument is about amending the targets. I know that you want to look at how those targets are going to be achieved, so I would allow one more question, and then I think that in fairness there are other people that want to come in, if I may. When will that be published, cabinet secretary? This year? The response? Absolutely, yes. It will come in advance of the climate change plan draft, and the draft will be laid in November. Part of the strength, but also the challenge of the targets that we have had is because they were met as a cross-party commitment by the Government. The Government was actually pushed to have tougher targets and annual targets, so in looking at how you translate the revised targets into the delivery plan for the climate change plan that is going to be produced or laid, as you said at the end of November, how are you going to keep that cross-party support that was important to set the ambitious targets in the first place, which you say have been kept for 2030 and 2045, if not the trajectory changing somewhat? Yes, absolutely, and I suppose I would just reiterate that point that even though I am here today talking about these annual changes, I think for myself and for my colleagues, our view of the challenge hasn't changed whatsoever, because we are still very much planning out to 2030 and very much out to 2045, but you are absolutely right that the very stretching commitments, particularly with 2030 and 75 per cent, were set on a cross-party basis across the Parliament. I am very keen to foster cross-party working as we agree how we are going to respond to them, and one of the ways that we are doing that is through a cross-party, cross-civic society group looking at the development of the climate change plan. It was formally chaired by Michael Matheson, and I will take over that now in this role, bringing together stakeholders, bringing together MSPs from across the chamber as we discuss key points of response to the climate change issues. I will continue that right up to the point where we are publishing the draft, and then, of course, it will be with Parliament to consider and to scrutinise. I think that that is all the question, so we will move on to agenda item 3. This is the formal consideration of the motion calling for the committee to recommend approval of these climate change regulations. I invite the cabinet secretary to speak to and move the motion. I commend the SSI to the committee as a necessary step in maintaining Scotland's credibility of our emissions accounting framework, and I move the motion. There is now the opportunity for members to make any contributions subject to anything that they have made earlier. Cabinet Secretary, you are technically allowed to sum up. I am not sure there is much that you would like to say, but I am happy for you to do so if you want to. I will just wave that, convener. I have said all that I want to do. Thank you very much. The question that we come to is motion S6M-08482, in the name of Mary McCallanby, approved. Are we all agreed? We are agreed. The committee will report on the outcome of this instrument in due course, and I invite the committee to delegate authority to me as convener to finalise the report for publication. Are you all happy? Thank you for that, cabinet secretary. Thank you and your officials, and I am now going to suspend the meeting to prepare for the next item. Welcome back. Our next item of business is an evidence session as part of our inquiry into Scotland's electricity infrastructure inhibitor or enabler of our energy ambitions. Today, we will conclude our inquiry by hearing from the Scottish Government to understand its vision for electricity infrastructure as set out in the draft energy strategy. We will also explore different themes that have emerged during our inquiry. I am pleased to welcome Neil Gray, cabinet secretary for wellbeing, economy, fair work and energy. Thank you for accepting our invitation, and congratulations on your new role. I would also like to welcome from the Scottish Government Claire Jones, head of onshore electricity policy, and Ragi Lowe, deputy director for onshore electricity policy. Before we begin, cabinet secretary, I believe that you wish to make a brief opening statement. Thank you very much indeed, convener. I really appreciate the opportunity to be before you today so early in my new role, and I appreciate the work that the committee is doing to investigate what is a really important area of policy. The Scottish Government's draft energy strategy and just transition plan sets out the actions needed to transform our energy system to reach net zero, while delivering maximum benefit for Scotland. We must take the right decisions now to capitalise on the enormous opportunities that this transition offers our economy, our citizens and our climate. We are fortunate to benefit from vast renewable energy resources, including significant offshore wind potential, substantial tidal energy resources and a well-developed onshore wind sector. Increasing levels of home-grown renewable supply will make energy more affordable, and in combination with technologies like hydrogen, batteries and pumped storage hydro, we can ensure that power is available when we need it. Scotland has the potential to be a powerhouse for renewable energy, electricity and green hydrogen to meet our domestic needs and, for Europe, exporting clean electricity as part of an integrated system with the rest of Europe and supporting decarbonisation of industry across the continent. The significant increase in installed capacity of renewable generation over the coming decade could mean that Scotland's annual electricity generation is more than double Scotland's electricity demand by 2030 and more than treble by 2045. That will enable Scotland to meet a large proportion of our demand through renewables alone, while still creating an export opportunity for our surplus. As the energy transition progresses, we will all see changes in the way that we use our energy resources. We will reduce heat demand by improving the energy efficiency of our homes and non-domestic buildings and decarbonise transport. That will come with significant co-benefits for people and society, including improvements in health and wellbeing, contributing positively to a just transition. Realising that positive vision for our future, however, rests on the delivery of more energy infrastructure. Significant investment in Scotland and the wider Great Britain electricity grid is needed to ensure clean, cheap renewable electricity can flow to where it is needed. Electricity transmission infrastructure in particular requires huge levels of investment to ensure that the grid does not become a barrier to net zero. In that context, it is important to acknowledge that we are part of the GB electricity system and the powers in respect to that system are reserved to the UK Government. We must therefore work together to enable those critical investments, ensuring that all regulatory and policy levers both reserved and devolved are used to ensure full grid decarbonisation, drive down costs and increased benefits for customers and communities. The Scottish Government has called for a more agile approach to network regulation for many years. The energy regulator's recent approval of local network business plans for the next five years and the decision to accelerate the delivery of strategic transmission investment are positive steps in that direction. The ambitious programme of infrastructure investment required to meet our net zero and interim targets relies on a high degree of confidence in the market. We are therefore clear that the UK Government's plans to redesign our electricity market through its review of electricity market arrangement, REMA, must be conducted with sufficient lead time, protecting investor confidence and ensuring that the critical infrastructure and investment needed today to protect consumers and keep us on the pathway to net zero is not delayed. That is why we are continuing to call for urgent reform to the grid connection, queue management and transmission charging regimes, all of which could lead to transformational change in much quicker time. We agree that the time taken to consent grid infrastructure projects needs to be accelerated, while still ensuring robust and balanced decision making. However, whilst the national energy infrastructure planning has been reformed in England and Wales, which set out a modern consenting regime, the equivalent in Scotland has not taken place as legislative competence for the energy consenting regime remains reserved to the UK Government, with the Scottish Parliament unable to legislate for the required reform like elsewhere in the UK. The Scottish Government has proposed solutions to the UK Government that would enable the changes required and we continue to call on the UK Government to urgently find a legislative solution. Finally, convener, let me thank the committee for your work on this important issue. I look forward to the report, which will provide crucial advice in the preparation of our final energy strategy and just transition plan. Thank you. Thank you very much, cabinet secretary. Before we go into the meeting, I'd just like to remind members and the audience who are listening that, as a farmer and landowner, I have electricity transmission lines across my farm in the form of 11 kv lines, 33 kv ring main lines and I'm in negotiation for 132 kv line to go through the farm. All of those will generate some income at some stage for the farm. I don't want there to be any doubt that I have some interest in these power lines and I will continue to make this declaration as and when I believe it's appropriate to do so, but I do not believe having made that declaration prevents me from doing my job as convener of this committee. I want everyone to know that and I'm delighted, cabinet secretary, that you've made the point, the outset that I was going to make at the end, that you will be using the report from this inquiry to inform decisions that you may. The committee does feel that it's a very important inquiry as far as the future for energy in Scotland. I'm going to come first to the deputy convener who's got some questions for you. Good morning and thank you for joining us, cabinet secretary. I want to focus on contract for difference auctions. Do you support the proposed use of multi-factor contract for different auctions and what other means are available for promoting a sustainable Scottish supply chain for wind energy? Contract for difference has made a difference. I think it's important to stress that. However, we would be looking for contract for difference to go further. For instance, in the space of marine energy, we know that the sector was looking for £70 million worth of investment, £20 million came forward. It's making a difference. We can see that in terms of the projects that are coming through, but we want to see contract for difference go much further than what it is at the moment. Clearly, inward investment is very welcome, but how do we ensure a Scottish supply chain for industrial manufacturing? We've got good news on that front recently, but I was in Japan to meet with the board of Sumitomo, who are coming forward with a large-scale inward investment project building a factory that will see the production of high-voltage cable for the offshore renewables industry in Scotland. The first, and I hope, will be a long line of inward investment opportunities that will see much better domestic production for the supply chain, particularly the offshore wind industry. We want to make sure that we are able to see jobs growth here in Scotland and that we are able to see a well-serviced supply chain that allows the opportunities that we have in renewables to come through. Can I maybe ask you to focus on what I asked, which was in relation to the Scottish supply chain? Certainly, inward investment is very welcome, including the Japanese announcement that you just made, but are you suggesting that the only opportunity will be on-servicing and not on manufacturing for the Scottish industry? No, absolutely not. The Sumitomo announcement, for instance, is for manufacturing. They are going to be manufacturing the cable that is going to bring forward to ensure that the offshore wind industry is supplied with the cable that is required. There is a worldwide shortage of high-voltage cable, so the fact that Sumitomo has chosen to put a factory here in Scotland is going to be very important to that, but I hope that that also brings confidence to other investors, both domestic and international, to be able to base their operations here. We are a world leader when it comes to offshore renewables. That fact was made very plain to me when I was in Japan and there are huge opportunities, but we need to make sure that we are given confidence to investors, both domestic and international, and that comes through the work that you are doing in the committee here today in the report that you are going to be coming forward with around ensuring that there is going to be sufficient capacity to be able to respond to the generation demand that is going to be coming through from our offshore potential. What are the potential impacts of changes to the CFD auction system, both in rules and operation, for example, in relation to price or achieving net zero? Previously, the previous Cabinet Secretary for Energy and also the previous Cabinet Secretary for Environment were keen on pursuing achieving net zero, but there may have been an argument to say that price should have rolled out instead. What are your views on changes to the CFD auction system? You may be aware that the UK Government is currently consulting on introducing non-price factors to the CFD regime, so looking at what are the other things that the regime itself can actually value beyond just cost. The UK Government has stated that that is partly in recognition that using drivers solely on cost means that there is the risk that the supply chain opportunities that could come out of this could perhaps be lost, so they are currently consulting on that at the moment. One of the key things that we would like to see is to understand how that would affect supply chain plans, which are currently part of projects that are worth more than 300 megawatts, particularly for offshore wind, and to get more detail from the UK Government on which non-price factors are going to be in play and how much credit will be given to each of those factors. I think that those are details that are still needing to come out from the UK Government. Finally, I would like to ask your views on how the market should be designed and what market mechanisms should be used to encourage the deployment of hydrogen electrolyzers and, particularly, Scottish-based manufacturing of such electrolyzers? The opportunities that we have to be a first to market and a world leader on particularly green hydrogen and using hydrogen electrolyzers is vast. We have a major opportunity here. What is going to be important is the fact that we are going to be producing a significant amount more offshore wind generation than we are going to be able to utilise, particularly if the grid capacity does not come up to speed. We are going to need to ensure that we are responding with hydrogen opportunity through that. Our hydrogen action plan gives a target for five gigawatts of hydrogen capacity by 2030. I would imagine that there is going to be a mix in terms of what we are using hydrogen for, both the localised usage but also feeding into the grid and potential for export as well. However, it is going to be an important factor for us to ensure that we are able to utilise the offshore, the renewables potential that we have, the significant over provision that we will have of renewables at renewable electricity. Some of that is going to need to be used through hydrogen and we need to make sure that we continue to be a world leader in terms of the opportunities that are coming through from that. You talked about the opportunity for production. I am interested particularly in the manufacture of hydrogen electrolyzers in Scotland. What are the enterprise agencies doing or are other public bodies or publicly funded bodies doing to support hydrogen electrolyzers being manufactured here in Scotland? We are working with enterprise agencies to ensure that we have a good supply chain in terms of the manufacture of items that are going to be needed and the components that are going to be needed going forward, but also to ensure that they are supporting business opportunities, both domestic and inward investment, to ensure that we are well servicing the potential that we have. I will make sure that we write to the committee with further information around the work that has been done with the enterprise agencies. Mark, you wanted to come in briefly on this. Just on supply chain, one bit of feedback that I have heard from parts of the renewable energy industry is that, while there are very strong targets in the energy strategy just transition plan, there is strong ambition there. Perhaps what is not there at the moment is a clear pathway towards development of the supply chain, a clear focus on which bits of the supply chain we want to develop going forward. Is that something that could come on the back of the energy strategy just transition plan or is it something that you are looking at changing perhaps as a result of the consultation and feedback? I am just trying to work out where that actually sits, that market and supply chain development. The Japanese announcement is incredibly welcome, but where does that sit within a wider plan for a supply chain for offshore? We have established a new offshore wind directorate within the Scottish Government to look directly at this, partly to learn from the process that was involved in the onshore wind sector and to ensure that we have a supply chain that, as much as possible, to continue to respond to the deputy convener's questions, sees a domestic supply chain as part of that. The Sumatoma announcement is important because that gives confidence to other potential investors. It also gives confidence to the potential that Scotland has as a renewable energy generator. Obviously, the energy strategy and just transition plan will be important in ensuring that we continue to put the policy levers in place that allow for the domestic supply chain to be put in place and to ensure that we are able to service the demands of the sector offshore. Just on onshore wind as well, we published our final onshore wind policy statement at the tail end of last year, which is to commit to a new ambition of an additional 12 gigawatts of onshore wind by 2030. As part of that process, we understand that we need to talk to industry about the things that we need in order to get us there. We have set up the onshore wind strategic leadership group, which is looking to work with industry experts across the piece to develop a sector deal, which will be later this year. That sector deal is going to look at things such as supply chain and things that could be barriers to the deployment of onshore wind. However, it is really key that that is having a really in-depth conversation with industry to understand what are the barriers here and how can Scottish Government help to remove those barriers so that we can get to that deployment ambition. On the finalisation of the energy strategy and just transition plan, the consultation closes today, so we will be taking stock of the many hundreds of responses that we have received and a lot of the engagement that we have been doing with stakeholders. As you suggest, a lot of that has been around the delivery side, what does the delivery plan look like for the strategy and on the supply chain side. I think that you can expect that the final strategy will have a stronger pathway through that supply chain and delivery. Before we leave this, cabinet secretary, there has been some discussion that the options for Scotland wind did not produce as much income as they might have done on the basis that more emphasis was put on the supply chain benefits of it. Can you just quantify that or dispel that rumour before we move on? First of all, the negotiations around the leasing round were obviously conducted by Crown Estate Scotland. However, the Scottish public pass is set to receive a significant amount of revenue over the course of Scotland. First of all, £750 million in terms of initial leasing options. The supply chain is important. That has the potential to raise £28 billion worth of revenue through the supply chain work, and there will be on-going rental costs, which could factor into the multiple billions of pounds coming back into the Scottish public pass. A significant opportunity has been realised through Scotland. Obviously, I am sure that Crown Estate Scotland and Government colleagues will be learning from that initial process in further leasing rounds. I look forward to the opportunity to discuss whether it is income or capital for Crown Estates and whether the money should remain within the Crown Estates or come into the Scottish person, which is a conversation that I have had with your predecessor. The next question comes from Regan Ash. Good morning to the panel. The committee has heard that the use of targets sends that signal to the regulator, and that allows for that forward planning for infrastructure particularly. Can you explain why targets have not been set for either solar or tidal? We are looking, as part of the discussions that we are having around the energy strategy and just transition plan, whether we should have targets for solar and tidal. I am considering that with the sector. If we were to set that, what the target would look like, and as we continue to consider that, we will obviously keep the committee updated on our decisions in that regard. What do you see as the main benefits or downsize in using targets to drive the progress there? Clearly, targets do drive investment and drive progress. On solar, we have a very strong industry in place already. There is a large amount, particularly of domestic solar production. Tidal is moving forward at a pace. One of the first visits that I had was with the First Minister to Nova Innovation in Leith, which is producing tidal generators that are currently being deployed in Shetland. They are looking at the opportunity of deployment elsewhere around the world. We have a huge opportunity there again for tidal and other marine production. As I said, we will continue to consider whether our targets for those two sectors would be appropriate and whether that would help to ensure that we continue to drive the growth of those sectors. As you rightly said, tidal seems to be very promising. We have some very high levels of innovation on that particular technology in Scotland, which is obviously exciting to see. Solar, in particular, seems to be quite complementary to wind. I understand that that can often be co-located where the wind turbines are and that, in terms of weather, it can often be generating perhaps when it is not windy, so it seems that those technologies have a place in the future. In that strategy, they do not seem to be receiving as much attention to either of those two technologies. Do you think that they will play a significant role in Scotland's electricity system going forward, or do you think that it is too early at the moment? Absolutely. I think that they will have a central role to play. Again, going back to that visit that I had at Nova Innovation, they were looking at the potential for innovation in the technology of floating solar, which they see as being a potentially landmark breakthrough moment for Scotland and our capacity, our generation capacity. Ms Reagan rightly speaks of the complementarity that there is, potentially there, but also in other markets where that technology can be exported and they are looking particularly at the Middle East. There are huge opportunities there. It absolutely will be part of our energy mix, and I am very excited as somebody hailing from Orkney where some of those technologies have been tested to be seeing that coming through so strongly. You have got some follow-ups on that, haven't you? Just one, please. On the solar energy point, cabinet secretary, so this committee heard from SolarEnergy UK, I think that they were called, that they wanted a six gigawatt target, I believe, for solar energy, and that would be really important and potentially game-changing. I hear what you say about the energy strategy, but you are the cabinet secretary. What is your view? Should that target be put in place? I have read the submission that came from SolarEnergy UK. I am very sympathetic to that, and it is something that we are actively considering. I do not want to pre-empt the process that is on-going at the moment in terms of whether or not a target would be appropriate, but suffice to say that we have heard the submission from the industry. We will certainly consider that. The next questions come from Jackie Dunbar, Jackie. Good morning and welcome. If you do not mind, I would like to talk about hydropower or ask questions about hydropower. I would like to know what the appropriate market mechanisms are for hydro, and how could those support some of the small-scale run-of-river and the large-scale pump storage? Hydropower has a huge potential, again, to ensure that there is consistent supply of renewable energy into the system. There is more work to be done there to ensure that the grid capacity is able to cope with that, and that the consenting regime is appropriate to ensure that those projects are getting off the ground quickly enough. We have a large potential, particularly for pumped hydro storage, and I would hope that the UK Government will listen to the requests that have been made around ensuring that the process can be as smooth as possible going forward. In regard to the UK Government, what discussions have you had with them regarding the hydro? You were talking about the grid capacity. I have been speaking to some small-scale folk who are saying that it is difficult for them to get onto the grid because they are just not producing enough, but there are lots of little ones that we could actually be benefiting from. The energy minister, Gillian Martin, met Andrew Bowie the day that Mr Bowie gave evidence to the committee on the UK Government's new energy bill. Some of the discussions featured the issue around capacity in the grid and ensuring that there was appropriate support in place to allow projects such as those to come on board and bring in Claire to provide supplementary information. Go back to your first part of the question, Ms Dubber, which was on the UK Government and talking to them about hydro support mechanisms. We are in regular contact with UK Government officials to discuss what we think long-duration energy storage, including hydro, needs in terms of it to be deployable. They launched a consultation last year, and we understand that a response to that will be forthcoming shortly. However, the Scottish Government has been very clear that, in order for hydro to be able to play the really vital role that we think it is going to play in the energy system, it needs a proper support mechanism. We are waiting on that and calling for the UK Government to take that role. In terms of grid capacity, it is quite difficult without understanding exactly where you are talking about, because the conditions in terms of how much headroom is in the grid can vary in a very short distance, in a very short geography, but the way the network is built, and without wishing to get too technical about this, I'll try to remain not too technical, the network is built in a way that you don't want to have huge amounts of headroom in the network everywhere, because if you do, then the cost of paying for that network can fall back to consumers, so the network's run quite tightly. Obviously, as we see more and more renewable energy projects coming on board, that headroom has kind of been eaten up, and you'll get to a point where, in a particular area, there's no available headroom without significant investment in the network. Obviously, the regulator of GEM has to be very careful in terms of how much investment to enable because of that primary duty towards protection of consumers and making sure that consumers aren't paying for massive bits of network that no one is using. I spoke a couple of months ago to someone in regards to the small scale ones, and they were saying that they were finding it difficult because they're not producing the capacity that is required that they're being overlooked, and that's what I was kind of asking if there's any way to get these guys on board. Sorry, the name escapes me just now, but I can pass it on to you later if that's helpful. I think that that would be useful, yes, thank you. We have regular conversations with both the transmission operators and the distribution network operators, and we have a group that's looking at connection for customers, both demand side customers with people needing electricity and also people producing electricity. So, if we could take some details, that would be great, we can feed that into that process. I'll have a look back just now, convener, in my diary to see if the name pops up and I'll come back later on. Jackie, can I leave it to you to inform the cabinet secretary's office, and if you think it's relevant as a committee issue, to keep the committee informed, and if it's more relevant as a constituency issue, that you do that, but the balance is for you. Just before we leave Hydro, cabinet secretary, if I may, is, sorry Jackie, I assume you've finished. There are some great examples of where water is used more than once to generate electricity, the tumble scheme, where it goes through five particular dams to generate electricity, which has got to be a good example. Perhaps a bad example may be the water going down to Lochaber, which goes through one generation scheme, but comes from three different catchments. One of the ones that I live in, in fact, the SPA. How is the Scottish Government going to encourage more holistic approach and more use of water that is being stored to generate as much electricity as possible? I think that the pump storage capacity is going to be really important for giving that consistent energy supply from renewables that we're looking for, particularly as we look to replace the fossil fuel base load that is provided. Obviously, we'll be looking to make sure that that is done in a holistic way, ensures that it is done most efficiently, and that it is done taking communities with us on that journey. We'll be making sure that we can keep those under consideration. I'll watch carefully, cabinet secretary, but the next question has come from Mark Ruskell. I want to go back to hydrogen. I was trying to explore, cabinet secretary, the Government's vision for hydrogen. We have targets in the energy strategy, five gigawatts of hydrogen by 2030, 25 gigawatts by 2045. I want to get a sense from yourself about where you see that generation coming from in the mix of blue hydrogen versus green hydrogen. Well, maybe there's a transition to green hydrogen. With a five gigawatts capacity, where we see that coming from and how that can shift over time. The importance of blue hydrogen is obviously that carbon capture and storage is going to be incredibly important for any blue hydrogen coming forward. Again, I would encourage the UK Government to move as fast as possible in confirming the Acorn track 2 status to ensure that that project can go forward. Really, the aspiration has got to be around maximising the opportunity from green hydrogen. I think that that's where Scotland gives us a huge opportunity. If we can ensure that some of the overprovision that we are likely to get from Scotland projects is linked to green hydrogen projects, then we have a huge opportunity to, similar with pump storage, to ensure that we have on-going energy security when there are dips in supply from other areas. I guess that blue hydrogen would come from Grangemouth, maybe on-site generation at Mossmorran as well. Beyond that, beyond Acorn, beyond what's part of that cluster, we're really looking at green going forward. I think that that's got to be the overall aspiration. Where there is complementarity that allows for blue hydrogen, I don't see where that would come beyond Grangemouth. It depends on the potential projects coming forward, but green hydrogen is really where the maximum opportunity is and where the big wins will come in my view. What about the infrastructure that we need to develop that? I mean, there's some big figures in there. It's a very nascent technology. We don't really have much in the way of infrastructure at the moment, so what do you see as the infrastructure that we need to put in place, particularly now in 2030? We'll need infrastructure near to where the offshore renewables is coming from. We've put forward £100 million fund to see that transition go forward and to hopefully encourage further investment to ensure that the technology can become commercialised and to see further infrastructure come through off the back of that. We're looking to work with potential producers to ensure that their plans align with where we are looking to go. I'm hopeful of that coming forward. In terms of just developing that vision for hydrogen and the hydrogen industry going forward, I'm interested to know where that work is now with stakeholders. It's quite clear to me in the energy strategy that there's a prioritisation of the use of hydrogen. There's a hydrogen ladder, so my reading of it is that the future is going to be less about using hydrogen to eat your shower in the morning, but much more about decarbonising how to obey sectors in industry. However, I'm just wondering how you're then on the back of the energy strategy developing that vision, that stakeholder vision, for what the hydrogen economy looks like in 2030 and 2045. We'll continue to work with stakeholders to develop that. I think that you're right. The use of hydrogen is going to be a mix. It's going to be about decarbonising hard-to-abate sectors and transport, for example. It also has the potential to supplement the gas grid and to see some of that hydrogen go into the gas grid, and also for export. I think that it's going to be a combination of all of that. However, the technology that is required for all those areas is, as you say, nascent. We are looking to support its production and commercialisation through the £100 million fund that we've got coming forward. We hope that there are going to be some announcements through that very shortly so that we can see a real path for the future of hydrogen and how we can meet our targets for 2030 and 2045. On to Acorn and the CCS cluster. I think that, as a recognition in the energy strategy just transition plan that it is needed, particularly for those hard-to-abate sectors, it's not really clear that there's any other pathway to decarbonise those sectors. However, there are still risks and uncertainties around the deployment of the technology, not least the track-to-process. What do we do if we don't have Acorn? Is there an alternative pathway in terms of energy? Are there other technologies, other avenues that could be explored or only exist in one basket? It's very challenging to see an alternative. Acorn, I think that carbon capture is absolutely critical. The Acorn project is the most advanced, it's the most secure, and it has the ability to get up and running incredibly quickly. We'll see a massive decarbonisation of our largest carbon emitter at Grangemouth. I would again encourage the UK Government to come forward as quickly as possible. As I heard the committee do when Mr Bowie was before the committee a couple of weeks ago, it's really important for not just Scotland's net zero ambitions, but if the UK is serious about its net zero ambitions, that carbon capture at Acorn continues to be progressed and progressed quickly. In terms of funding, there has been discussion in the chamber about Scottish Government's contribution to go over the emerging energy technologies fund. Can you provide some clarity as to what funding might look like for CCUS? We've provided funding through the Transition Fund for the Global Underwater Hub, and funding through the Just Transition Fund for a number of projects, including the skills passport and so on. There's a range of different funding streams that have gone in to support. There's also a commitment on CCS and that remains in play in seeking the UK Government to take action on track 2 so that we can accelerate that funding investment. Can you just give a picture about who will fund it? I mean, how will it be funded and the relative contributions of industry government within that? Is there clarity on that? I'll need to come back to the committee a little more detail on that. Yeah, that'll be useful. Okay, thank you. Thank you. Liam, I think that you've got some questions. Yeah, thank you for being here. Good morning again. Sticking with the energy strategy, Cabinet Secretary, you've inherited a draft energy strategy, which sets a presumption against North Sea oil and gas. And Ragnar Llyw conceded earlier on that there's no delivery plan underlying that at the moment, either for how to deliver that or for to mitigate the consequences of that decision. The context of this is a report out today which shows an overwhelming majority of people think that the UK should meet its oil and gas demand from domestic production rather than importing it. Cabinet Secretary, what's your view? Do you think that there should be no new exploration and production in the North Sea? First of all, the energy strategy and just transition plan is for consultation. We're currently consulting on the language that Mr Kerr has outlined and the finalised plan will reflect the consultation responses that we've received. I'm not sure whether Mr Kerr has responded to that with his views on the language that he's outlined around presumption against, but I'm sure that others will have and we will absolutely continue to consider whether that is appropriate. Obviously, consenting for oil and gas is reserved to the UK Government. It's not a decision for the Scottish Government to take. We believe that maximum extraction of oil and gas is not compatible with our net zero objectives, but we're cognisant of the fact that we're not able to turn off our requirement for the use of oil and gas overnight, so we need to take a pragmatic approach that meets our demand. That is going to be requiring the UK Government to have a much stronger climate compatibility measure and ensure that any decisions that it takes are within those climate compatibility measures. I'll just press you, cabinet secretary. You are the cabinet secretary. What is your view? I asked for your view on whether there should be no new exploration and production in the North Sea. As the new cabinet secretary, the committee would be interested in where you intend to take the portfolio. I've set out my view because this is not an area that I have responsibility for. Mr Kerr will be aware that the decisions around the consents for new oil and gas exploration rests with the UK Government. I don't think that that is something—in fact, I checked back the record—I'm pretty sure that it's not something that Mr Kerr asked Mr Bowie, who actually has a direct responsibility for this a couple of weeks ago. My view is, as I've set out, that maximum extraction of oil and gas is not going to be compatible with our net zero objectives. We need to take a pragmatic approach, recognising the fact that there is still going to be a demand for oil and gas to meet our on-going energy security going forward, but we need a much faster just transition, which includes the UK Government investing in areas such as carbon capture and storage and the grid capacity to allow us to take advantage of our massive renewables potential. I hope that the UK Government will come forward with a much stronger climate compatibility test to ensure that any new oil and gas coming forward meets net zero objectives. I had understood that energy was part of your portfolio, cabinet secretary, which is why I'll ask you. You've inherited a strategy that will refuse to countenance new nuclear energy, because the Scottish Government has said that we use the planning system, which it does have power over, to ensure that that doesn't happen. Again, cabinet secretary, what is your view and if the Scottish Government intends to continue with a presumption against new nuclear generation, why? Because we believe that it is an expensive technology and the safety and environmental impacts that come off the back of it. We think that there are huge opportunities coming forward for us in our renewables capability. It gives us cheaper electricity than what is coming forward from the new nuclear power stations that have been funded to a very costly extent by the UK Government and rests with the fact that our future energy security will come from renewables. On that exact point, oil and gas and nuclear currently provide a constant base load and a significant amount of it. From where will that base load come once torn s closes and once you've wound down the North Sea and when will your renewables be in a position to take up? The base load requirements and ensuring that there is energy security to supply the grid is the responsibility of the ESO, as Mr Kerr will be aware, but we are confident that the potential that we have for renewables that we have been discussing this morning in terms of not just onshore but offshore wind, our pumped hydro storage capabilities, our green hydrogen capabilities and the tidal renewable opportunities that are coming forward. The tide goes in and out twice a day and gives very clear and certain energy capacity. We have a huge opportunity to meet the demand that will be coming from Scotland's consumers. You talked about potential. When will that potential be realised such that the renewables that you have discussed take over the production of base load? I have already set out in my introduction the opportunity that the renewables production will give us by 2030 and 2045 doubling and trebling the demand that is currently being brought forward from Scottish consumers. I want to ask the cabinet secretary given that a decision is imminent from the UK Government. The Scottish Government has been asked by many campaigners to use its DOF power and its platform to challenge the Rose Bank proposal for the new oil and gas fields. Has that been raised directly by Scottish ministers or by yourself to the UK Government in recent weeks? As I have said in response to Mr Kerr, the decisions around new offshore oil and gas exploration is a decision for the UK Government. We have made very clear our desire to see that the UK Government has much stronger climate compatibility checks as part of that process and we await its decision in that regard. Is the Scottish Government for or against the Rose Bank proposal? I have already said that it is not our decision to take. It is for the UK Government to take a decision on new oil and gas exploration. We need to be pragmatic that we cannot switch off oil and gas overnight. That is not going to be possible. However, we want to see the UK Government come forward with stronger climate compatibility checks to ensure that any new oil and gas exploration meets our net zero ambitions. We will continue to discuss that with UK ministers as I am sure the committee will do. I think that we have pushed that about as far as we can and the cabinet secretary has given the answer that he is prepared to give. If I can move on to the next question, which is to ask the cabinet secretary what engagement has the Scottish Government had in remath, the very snappy title for the review of electricity market arrangements? We are continuing to discuss that with UK ministers. Officials judge that both of the Scottish Government judges that both of the suggestions coming forward, which would be a nodal pricing system or a zonal pricing system, have the potential to disadvantage generators here in Scotland, because Scottish supply often outstrips demand in each area. We are concerned with those risks for generators, but it is important to acknowledge that, at the same time, if they are designed well, they may have corresponding benefits for consumers, including business consumers. We continue to engage with the Department for Energy Security and Net Zero to understand implications for Scotland and to do what we can to inform their decision making process. If the gas price remains high, England encourages investment in renewables if the prices are linked, but it disadvantages the consumer. I would pay more for our electricity if it is generated from renewable resources. Are you happy with that? We clearly want to see a redesign of the electricity market. The situation over the last year and a half has demonstrated the absolute need for that redesign. What I am saying is that it is going to be important that the decisions taken by the UK Government do not impact negatively the generation capacity that is here in Scotland. This is absolutely central to your inquiry. Do not inhibit our ability to provide cheap, low-cost renewable electricity into the network. We will continue to liaise with the Department for Energy Security and Net Zero to ensure that, as best as possible, it is there for the decision to ensure that, as best as possible, that does not happen. I am not sure that the two go hand in hand, but my next question is, does the CCC recommend the establishment of a GB-wide electricity infrastructure delivery group? Do you support that? What do you think its immediate priority should be? I think that it is important that we have a network that is resilient and ensures the demand that is placed upon it from the generation capacity that happens. Often the extremities and not as close to consumers are reflective of that and does not discourage generation that is happening away from consumers. Any model for redesigning the grid network is going to be important to acknowledge that fact to ensure that we do not disadvantage or discourage generation coming particularly here in Scotland. The establishment of an electricity networks commissioner has recently happened. Has the Scottish Government made contact and what have they discussed? I have not made contact myself, but I will ensure that we check to see what correspondence has been had thus far. You may want to look to your right. There was nodding going on in that. I am sorry, cabinet secretary. I am trying to help you, but if you do not want to take it, do not take it. At official level, we have had a number of meetings. We sit on the steering group that supports the work of Nick Windsor, the champion. We have been engaged through a number of user groups that his work is also convening and have strongly put forward the need for grid reform to deliver on Scotland's both generating and consumer ambitions. I want to move on to planning. Quite clearly, the responsibility of the Scottish Government has been warmly welcomed by the renewables sector. Beyond MPF4, what work is the Scottish Government doing to aid the deployment of strategic developments? We hear constantly about frustration about length of time for consenting, but how could the consenting regime in Scotland be improved? What are you doing to make sure that that happens? Deputy convener is right that the planning legislation is ours, and MPF4 is an important part of that. However, the Electricity Act 1989 also comes into play here, where we do not have the full control over all elements of the consenting regime for infrastructure going forward. The interaction of the 1989 act means that there can be much slower decision making processes. For instance, if the local planning authority refuses or objects to a consent, it has to go to a public inquiry. MPF4 ensures that we have a very clear pathway, and we are continuing to discuss with Mr Bowie and other UK Government colleagues around how a transfer of powers around the 89 act would allow for us to have a much fuller package of ensuring a smoother but balanced consenting regime. If you had those powers, what would you do with them? It would do exactly as I have just said. We would be looking to have a much smoother, but much more balanced consenting regime to ensure that we have interacting with MPF4, a strategic look at where we are going to need that infrastructure, and ensure that we have prioritisation of that infrastructure going forward, while also taking communities with us, which is where the balance needs to be struck. The point that I was making around having a smoother process to give better certainty to those who are looking to come forward with the applications that we are talking about. You made the point about the need for strategic infrastructure. The developers want to see the faster construction commissioning of infrastructure and approvals, whereas there are others who want to see greater care and consideration taken with new transmission lines, which are perhaps more underground than Denmark has. Do you see the role of the Scottish Government just to streamline and speed up consenting? Or can you expand on what you were alluding to how the needs to be engagement with communities to take them with us on this journey? Do you really think that communities are aware of the sheer scale of what is going to be required to maximise our electricity infrastructure to take the benefits of both onshore and offshore wind? I think that you are probably right in that assessment that communities are possibly not aware of the full infrastructure requirements that they are going to be. However, there are a couple of things here. One is the need to understand that undergrounding in itself is not necessarily the full answer. Underground high-voltage cabling requires a significant amount of concrete, and so over a long period of time and over a long distance, which obviously has a huge environmental impacts of their own. It is also why ensuring that we come forward with a clearer sense of what we are looking to do, for instance, with the likes of hydrogen, of how we can utilise the energy in the locality rather than transmitting all of it is going to be really important. Obviously, taking communities with us is going to be really important, and understanding the scale of the infrastructure is going to be part of that process, and that is something that I am more than happy to take away and look at how we can do more to provide that information going forward. I was taken with an answer to the question that I think that, without putting words into your mouth, you were not sure that people across Scotland knew how much extra transmission we will need across Scotland to meet the demands and the needs of reaching net zero. Do you think that it would be helpful? I think that SSEN is talking seven years in advance, SPN, I am not sure, on the duration, but it is a relatively short term. Do you think that it would be more useful if we came up with a planned show of what would be needed to reach net zero as far as transmission is concerned? My mailbox is just overloaded at the moment, so perhaps like the national grid, but I do not think that anyone knows what is coming down the track to them. My question to you is, do you think that we ought to be honest with them and tell them now? I do not think that it is necessarily about honesty, because I do not think that it is necessarily a bad thing, and I do not think that we should be viewing it as such, but I do think that ensuring that people have as much information as possible as to the scale of the infrastructure that is going to be required and the demonstrable benefit that comes off the back of that to us all through a decarbonised network and through us meeting our net zero obligations. I am more than happy to take away and look at it in more detail. The fear is that it won 400 kV line running from Buley to Denny, for example. Are we going to need three more in five years time? Who knows? That is what no one seems to know at the moment what is going down the track. I think that that clarity would be helpful. Obviously, you would not expect me to comment on a particular proposal coming forward, but it is fair to say that we are going to have significant need for greater infrastructure to ensure that we meet the demand of generation and transmission. I am happy to take clear in at this stage to provide some further information. There are a number of different publications that set out what the strategic need in the network and GB is going to be. Remembering that Scotland's network is physically and economically integrated with the rest of Great Britain, Northern Ireland not being part of the GB system. It is the responsibility of the electricity system operators to set out a lot of those things, and they do so through their network options assessment. That sets out where transmission infrastructure is needed and what particular projects there are. Offshore, you have what was called the holistic network design, which was published last July and set out. Here is what we think an integrated grid offshore would look like. We are waiting a follow-up exercise to that holistic network design, which will bring in the rest of Scotland. The initial design only accounted for about 10 gigawatts of Scotland, so we have a follow-up exercise to do the rest of it. Those documents set out what the ESO thinks the network requirement will be, and here is when they need to be live and when they need to be brought on board. Those publications are out there. They are, of course, quite technical documents, but they do exist. Interesting reading as well. I think that the fear of communities is that they see one 400KV line. They want to know if it is two or three more that are coming down the line. Mark, you want to ask some questions on that. There are particular lessons that were learned on the back of Buley Denny, which took forever to get through, but there were landscape scale mitigations that were put in place. Communities came forward to see a reduction in the wire scape in the surrounding areas. There were substations that were moved, so there were some benefits that flew from the project. I am just wondering if that is something that is feeding into current thinking, because we have been here before with Buley Denny and the debate around undergrounding and everything else. Yes. The lessons from previous applications and previous infrastructure interventions will obviously feed into what comes down the track. I know and I am confident that those that are proposing any future transmission, I have to speak in generalities, but those that are proposing any future infrastructure investments will be cognisant of what has gone before. Just for clarity, I worked on the Buley Denny line and I never had concrete given us a reason for not undergrounding it. I had the only reason for not undergrounding it was the cost to the construction for it. Anyway, moving straight on to Monica Lennon. I think that you have got the next question, Monica Lennon. I want to turn to community energy, because we know that the Scottish Government wants to or is aiming to more than double community-owned energy in Scotland by 2032 gigawatts and to encourage shared ownership models. Cabinet Secretary, do you think that it is enough to encourage shared ownership models or should a more formal mechanism be implemented? I think that we want to continue to encourage better community benefit and community shared ownership models. That is where your community wealth building and policies come into play for the area that we have just discussed. It is a demonstrable benefit to local communities from particular infrastructure being put in place. We will have all had communities that are neighbouring to renewable or other energy projects looking to see discernible benefits. I think that we need to continue to encourage, but I would happily take Raggy in at this stage who has been closer to this over a longer period. The strategic leadership group that Claire mentioned, which we have with the onshore wind sector, which involves a number of partners not just from the industry itself but more broadly, including a representative for community energy, is working up a sector deal, which will contain further action both on the part of Government and on the part of industry to encourage greater amounts of community benefit and shared ownership. We are looking at some of the ways in which we can address some of the barriers to shared ownership, which include things like the mechanisms, the actual rules and regulations of the electricity markets themselves, but also ways in which communities can potentially access capital better to be able to invest. That work is on-going, and the sector deal will produce in the coming by the end of the year. I am grateful to Raggy for that update. Just coming back to the cabinet secretary, you seem to be keen on the encouraging side of it, which is fine, although the community wealth building, but we know that in other countries that have legislation, for example in Denmark, where the Danish Renewable Energy Act requires all new wind energy projects to be at least 20 per cent owned by local people. Would you be open to looking at similar legislation in Scotland to mandate locally owned stakes in renewable projects? I would absolutely be open to considering that. I think it is important that we continue to learn from international best practice where that is. You will have been aware that the First Minister during the S&P leadership contest was looking to see greater community or state ownership in energy production. I know that that is something that he and I share an interest in. I would be happy to consider what more might be possible along the lines of Monica Lennon's suggestion. Will that include co-operative models of energy schemes? Absolutely. I do not see why not. One of the things that I have been wondering about is how we can increase capacity building and training for local community energy projects including at an early stage. In terms of the community and renewable energy scheme or CARES, do you have any proposals to increase funding for that or other work to support innovation and improve capacity? We will absolutely look to take any suggestion that anybody has in terms of allocating additional funding. Obviously, we are in a particularly stretched public finance situation. The budget is currently fully allocated, but I would be more than happy to take a suggestion from Monica Lennon or the committee if there is a need or desire for a different intervention going forward. It is one of the biggest issues that affects energy and just transition at the moment. I just need to ask again, cabinet secretary, on the issue of Rose Bank, which is a very live issue, a decision is imminent. Is the Scottish Government in favour or opposed to the Rose Bank proposal? To be fair, I have set out my position and the Government's position quite clearly. I will rest at the response that I have given earlier. I will pass back to you, convener. Perhaps because I am remote today, it is not as clear to me as to others in the room, but I will listen back to this session carefully. Thank you, Monica. That was a nice try on that one. The next question comes from Fiona, followed by Mark. Thank you. Clearly, the UK energy bill is going to be incredibly important for everybody in this area. We want to see progress on that. We have obviously had a number of LCMs and the committee produced a report wanting to see some change in progress. We welcomed the attendance of Andrew Bowie, the UK minister, at a previous session, and he has indicated that there have been on-going discussions with the UK Government about some of the key amendments that are needed. Can you give us any indication of how that is progressing? Is there active engagement that would enable the consent of the Parliament to help to move that bill along? It is obviously needed for everybody, but there are quite clear concerns that we set out in our report. I agree with the deputy convener that it is an incredibly important piece of legislation. It is a piece of legislation that we support. We are continuing to encourage the UK Government to go further along the lines that I have set out around consenting and other areas, and the areas that the committee has suggested as well. We await further feedback from what Mr Bowie had set out himself a couple of weeks ago to the committee, but I hope that his ambition would go further than what he is currently stating, particularly on consenting, which is a missed opportunity. We need the point about consent from the Scottish Parliament, as opposed to the consultation aspects that are key in our LCM report. I just want to have reassurance that there is active dialogue taking place with the UK Government currently on the energy bill. Mark, I think that you have got a follow-up. Can I go back to the issue of community benefit for wind farms? When a lot of the wind farms were being developed in the early 90s, the community benefit payments levels were set at quite low—sometimes it is around £1,000—a megawatt. Some of those wind farms are now going for expansion, for re-powering. Do you think that there is an opportunity to be dramatically increasing the amount of money that communities are getting per megawatt from those projects as they seek to expand and become more efficient? We need to have those discussions. We also need to see greater consistency in where the community benefit money actually goes. Different areas of community benefit development trust go directly to local authorities to be distributed. I would like to see greater consistency in where those are distributed and for it to be more demonstrable the benefit that has been derived to the local community from having that project neighbouring them. I say that both as a Government minister and as a constituency MSP that has quite a substantial onshore wind footprint around my constituency. The ambition of an extra 12 gigawatts is huge. The potential benefit to communities is huge as well, regardless of whether that is through ownership or a small amount of money coming through community benefit payment. I absolutely agree with Mr Roskell. That is all the questions that we have. Thank you Cabinet Secretary and thank you to your officials. The next step will be for this committee to produce a report to Parliament on its inquiry in the coming weeks. I would like to reiterate what I said at the beginning. I think that this inquiry is going to produce some interesting evidence, which I believe that the Government and the Parliament should consider carefully as far as our aim in Scotland to reach our net zero targets, because I think that it will be crucial to allow us to achieve that. I can but encourage you, Cabinet Secretary, to give it credence when it comes out. On that note, I am going to conclude the public part of our meeting and we will now move into private session.


Ladies and gentlemen, it's my pleasure to be in friendly Ireland and deliver a speech at the East Timte Institute of International and European Affairs. It's not often that we have mutual visits to Dublin and Yerevan, but this does not decrease the warmth and friendly feelings both Armenians and Irish people emanate towards one another. The Irish proverb, what is seldom is wonderful and rude is annum is intact, yes? Probably contains much true in it, but in promoting political dialogue and strengthening friendship regularity of contact and meetings is a must. I have a particular feeling being here because with the Irish people, the Armenians absolutely agree with you, there are many similarities. We both have huge diasporas spread around the world, thus Armenians and the Irish meet one another on a daily basis in the United States of America, Canada, Argentina, Australia and other places. We share interesting similarities in belief systems, art, literature and architecture. Despite the fact that for a very long period of history, Ireland and Armenia represented the opposite frontiers of the Christian world. If it is a historical fact that the cousins of the modern day Irish, the ancient Galatian Celts were neighbors to our Armenian forefathers some 2000 years ago. It is also striking similarity of historical past that Christianity became the religion of the Armenians and the Irish quite early in history. Armenians were the first in the world to become a Christian state in the beginning of the 4th century. Another amazing and Christianity was introduced to Ireland in the beginning of the 5th century. Another amazing similarity is that the Armenians and the Celts are the two only peoples around the world which have richly decorated cross stones and which are of our civilizational heritage. The similarities of the cross stones are simply striking. By the way, UNESCO named the Armenian cross stone art as intangible cultural heritage of humanity. The political history of Armenia and Ireland have had some interesting futures too. An example of them is that one of the prominent Armenians of the 18th century Joseph Amin who was also a key figure in the Armenian liberation movement for more than 30 years was a close friend to one of the Irish national heroes and most political thinkers Edmund Burke and was greatly influenced by Burke's ideas. The fact that Irish academic institutions have been interested in Armenian history and culture cannot go unnoticed. Recently Chester Bitti Library published a book The Armenians Art, Culture and Religion which is a new assessment of the Armenian collection of Chester Bitti Library. This library has one of the largest collections of Armenians made of all manuscripts in Europe. Not only the close contacts since the earliest times and the preservation of those ties throughout centuries but also the strong civilizational links between the two nations simplicity towards each other and sharing similar or very close approaches on many international and regional issues have made our countries as natural friends. Currently the Armenian-Irish relations could have been much more developed given the existing potential for developing political, economic, touristic, trade and cultural relations. And together with my colleague Mr. Gilmour, Minister of Foreign Affairs and Trade of Ireland who will try to fill it to fill in this gap. Armenia pursues multi-vector foreign policy. On the regional level it is motivated not by attempts of capitalizing on differences between major powers but by partnership and cooperation. In building and developing such relations with our partners we believe in the principles of reciprocity, trust, goodwill, mutual interests and respect. These values are entrenched in our strategic relations with Russia, in our close friendly partnership with the United States, in our strong relationships with the European Union and in the meaningful cooperation with other regions. Many EU relations stand high in Armenia's foreign policy agenda. With the launch of the Eastern Partnership two years ago we have got increased opportunities of cooperation in all spheres of mutual interest. Armenia is strongly committed to making the most of those opportunities as we regard them not only as a useful mechanism for the advancement of the reforms process in Armenia but also for good spirited cooperation among the partner states. With this being said I would like to refer to the good progress in negotiations on the future association agreement between Armenia and the European Union which will define our new contractual relations for the years ahead. In terms of boosting and deepening of economic and trade cooperation we expect the established advancement of a deep and comprehensive trade area to be conductive to increase the economic relations with the European Union, Armenia's largest trade partner. The issue of visa facilitation remains of higher importance for us too. As we speak of partnership between participating states and the EU we bear in mind that the primary beneficiaries of this process are the societies on both sides. Therefore we must provide favorable conditions for our citizens to exercise their right to free communication, interaction and exchanges. We have strong indications from Brussels that decision on visa facilitation talks can be issued before the Eastern Partnership Summit in Poland this September. I would not go into the specificities in this respect and would rather turn to the recent developments in the two foreign policies, policy challenges that are of concern to Armenia as well as to the whole region and the international community in general. They are the Nagorno-Karabakh peace process and the Armenian-Turkish relations. The history of the conflict of Nagorno-Karabakh is well known. As a week ago the Washington Post coined it Karabakh was assigned by Joseph Stalin to the Azerbaijani Soviet Socialist Republic. So I would not go back to the period of 1921 when a group of Bolsheviks with just one signature decided to pass the Armenian territories of Nagorno-Karabakh and Nachitevan to recently create its state which in 1918 was named Azerbaijan. The ethnic cleansing successfully carried out in Nachitevan throughout the Soviet period felt in Nagorno-Karabakh. The desire of the Nagorno-Karabakh Armenians to implement their right to self-determination was reacted by massacres of Armenians in different parts of Azerbaijan. In this situation Armenia faced two options, either stand by and witness the total extermination of hundreds of thousands of Armenians in Nagorno-Karabakh and Azerbaijan or defend their right to survival. We chose the second option, an agreement signed in May 1994 between Nagorno-Karabakh Azerbaijan and joined by Armenia ended the military phase of the conflict. The OSCE means group co-chairs represented by the USA, Russia and France has been the internationally mandated negotiating format for this conflict. Here I would like to underline that the fact that next year Ireland will assume the chairmanship of the OSCE is of essential importance in terms of contribution to the negotiation process within the OSCE means group format. In the past there have been different approaches, proposals and suggestions by the means group co-chairs for the resolution of the conflict. The negotiations are currently conducted on the basis of the Madrid proposals that were presented to the sides in November 2007. And as history tends to repeat, 10 years after the QBST in 2011 the current Azerbaijani leadership currently also is unable to heed to the appeals of the international community to take a decisive step towards a peaceful settlement. The essence of the Madrid proposals are the three principles of non-use of force or threat of force, self-determination and territorial integrity. And fourteen elements, the main six of which were presented in the statements of presidents of the co-chair countries, Barack Obama, Dmitry Medvedev and Nikola Sarkozy, in the frameworks of the G8 summits in La Quila and Muscova in 2009 and 2010. Less than two months ago in late May ahead of the planned Kazan meeting the presidents and of co-chair countries made another statement in Deville, referring to their earlier statements added that the use of force created the current situation of confrontation and instability. This use again would be condemned by the international community. The three presidents strongly urge the leaders of the sides to prepare their populations for peace, not war. Anyone with the minimum knowledge of the political climate in the South Caucasus region knows well which of the sides of the conflict is preparing its population for war. Which of the sides is repeatedly threatening to use force? Which of the sides is preaching war? Which of the sides is multiplying its military budget and bragging about it? Which of the sides is propagating hatred towards the other side? Which of the sides is blockading the other and feeding tales of distorted history about the other? In this regard there was no shortage of practical proposals which could ameliorate the situation. The international community, the United Nations Secretary General, OSCE means group co-chair countries and different OSCE chairmanship including the current Lithuanian have made several proposals on consolidation of ceasefire and on withdrawal of snipers from the line of contact. Which were all rejected by Azerbaijan's side while Armenia and Karabakh responded positively. The presence of Armenia proposed to reach an agreement on non-use of force which was supported by international community. Azerbaijan rejected again. All principles and elements proposed by the leaders of the three co-chair countries have been conceived as an integrated whole. Armenia welcomed this approach while Azerbaijan rejects all the proposed principles but one. All the elements but one. Azerbaijan attempts to misrepresent that only one principle, the territorial integrity and only one element, return of territories, have priority over all others. That is why in Almaty in July 2010. The three co-chairs stated that all the principles and elements have been conceived as wholeness and no principle or element can be separated from the others or can prevail over the others. In Astana the US Secretary of State on behalf of the other co-chair countries reaffirmed this approach. We went to Kazan meeting initiated by President Medvedev and supported by Presidents Obama and Sarkozy with a positive mood and feeling that we could reach an agreement on the basic principles of the Nagorno-Karabakh settlement. In Dovile the co-chair countries had urged the presidents to come to an agreement in Kazan. President Obama in his forum conversation with the presidents had made the same appeal. The President of France Sarkozy had sent messages to the presidents as well. The President of Armenia Ser Sarksyan during his speech in the Parliamentary Assembly of Council of Europe in Strasbourg just before Kazan meeting stated that it would be possible to expect positive results. This in Kazan if Azerbaijan did not propose new amendments as was expected by the three co-chairs. Yet the Kazan summit didn't achieve a breakthrough because Azerbaijan was not ready to accept the last version of the basic principles proposed by the three co-chairs. The Azerbaijani side proposed 10 changes and amendments and that is the reason only the Kazan meeting did not result in a breakthrough. As soon as Azerbaijan gets rid of its big illusions that money stemming from oil revenues could become a major factor in the conflict resolution in favor of its interest. As soon as Azerbaijan gets rid of its attempts of directing all revenues for funding and new military adventurers then we can hope that progress in the peace process could be more visible. Azerbaijan would gain more by redirecting the resources and energy to peaceful discourse and at reaching a compromise solution. Concerning the Armenian-Turkish normalization process, the Armenian-Turkish relations were in a deadlock when the President of Armenia Ser Sarksyan initiated the normalization process with Turkey. The Armenian initiative met a positive response by the Turkish President and allowed us to attempt to make an investment in a durable rapprochement. Our position was reflected in the well-known approach of normalization of relations without any preconditions. It was the bottom line principle for setting the negotiations with Turkey. With this common understanding, we started, contacted and came to the agreements. From the beginning of the process up until now, this approach has been shared by the whole international community starting from the Swiss mediators to the Secretary General of the UN, the OSCE, the European Union, the United States, Russia, France and many other countries. Unfortunately, Turkey has backtracked from the Richard Bimmerns. Not only has it refrained from ratifying the protocols, but Ankara has returned to the language of preconditions that it had used before the beginning of the process. Turkey has attempted to link the Armenian-Turkish normalization process to the settlement of the Nagorno-Karabakh conflict, thus keeping its borders with Armenia closed and refusing to establish diplomatic relations with Armenia. Any Turkish attempts to link the normalization of its relations with Armenia upon its own perception of progress in the Nagorno-Karabakh talks harms both processes. This is a position that countries involved in Armenia-Turkey normalization and Nagorno-Karabakh peace talks representing the whole international community have emphasized several times. Turkey also uses the normalization process as a smoke screen for baseless argument that the adoption of resolutions on the Armenian genocide in various countries can damage the normalization process. Yet from the beginning of the process, we made clear both in our contacts with the Turkish partners as well as publicly that Armenia will never put under question the fact of the Armenian genocide or the importance of its international recognition. The negotiations between Armenia and Turkey were finalized by the signature of the protocols and now the only remaining step in this long-lasting process is the ratification and implementation of the Armenian-Turkish protocols without any preconditions and delays. And the international community expects exactly that from Turkey. Foreign Secretary Clinton was in Armenia last year on the national day of the USA. During the press conference echoing the international community's common stance on this issue, she observed that Armenia passed its way and that the ball is on Turkey's court and that Turkey should take the steps that it promised to take. I would like to summarize by a quote from the great James Joyce's novel, Ulysses, which the Armenian reader has the pleasure to read in Armenian. Bloom says, force, hatred, that's not life for men and women, insult and hatred. And everybody knows that it's the very opposite of that that is really life. What says Elf, love says Bloom. I mean the opposite of hatred. We the Armenians and Irish know well what hatred can lead to and what love can lead to. I should stop here and give the floor to your questions, thank you.


Good afternoon, folks. This is Steve Rhodes coming to you live from the shores of Delray Beach, Florida. This is your 1 p.m. update, and they have most of the U.S. Indices trading to the upside. The only one that is not is the Dow transports. It's off 89 points trading out of 15, 928. Otherwise, you've got the Dow trading up 67 points. The S&P 22, NASDAQ 160. That's a little over 1%. Russell up 6 tenths or 13 points. Semi's are up 22. You've got gold trading up 19. Oh, wrong. Sorry about that, folks. We've got that taken care of. I don't know how that happened. But it did. We've got gold trading up 19 bucks. Now, 18.17 is its print. Silver is up 33 pennies. That's trading out of 22.80. Let's go spend a little bit of time. Take a look at our nine panel market update chart. We begin by taking a look at the ES mini in the upper left-hand corner. Now, there is a new daily profile that is attempting to form. What we know about yesterday is price moved down, and then rejected the center of its bearish structure daily profile. That is a normal place for a countertrend move to find support. And that's exactly what happened yesterday. Got a new profile that formed today or is attempting to form. It's come and go a couple of times back here. The bottom of that box is right where the old center of the bearish structure it is. We're very close to it. So support right now 46-43 resistance all the way up at the 48-08 level. Yes, we could see a bounce all the way up to 48-08. If you take a look at the spot follow text, it's below its 50-day exponential moving average. As long as that condition remains, that can push the S&P 500 or the ES mini higher. In the case of the NQ, it got back and tested the top of its weekly profile and held. There is a new daily profile that is also attempting to form. Very equally distributed. I mean, the center is in the center. The top of that profile of resistance 15999. The bottom support is 15434. The US dollar index just continues to trade sideways out here. So nothing really to report on their gold likely targeting the top of that weekly profile. So heading up towards resistance again. And that's at that magical number of 182850. Right now you're trading 1817 silver likely up to its magical resistance level. And that's at the 2345 level. A light sweet crew taking out the top of its daily profile that did form yesterday. Next price projection is 8371. That's the 1.618 expansion of its current A to B equals CD pattern. And national gas yesterday confirming the rogement to mid indicator bottom from a week ago as price was able to close above that gap to the downside price targeting $4 and 36 cents. New profile folks in the 30 year treasury. It's got support or attempting to form support and 155 and six 30 seconds. Folks, stay tuned for the trader's edge show. Be proud to start your Tuesday. Have a terrific one.


I would very much love to see that point being raised when our minister comes in a short while. The fact that the question is not so much about making technologies as available as it is about assisting in reforming so that the right policies are there and then technologies will flow by themselves. How interested would you say that Mofaldar that the developing countries are in these issues? I mean, there are many.  I can just tell you that there is a big interest. African countries understand the relevance of diversifying the energy mix, because as he was saying, they are highly exposed to volatility of oil prices. And most of many of them are big importers. And so what you see is that several, many, many countries have strategies in place which state diversifying the energy mix by 2020, by 2030. But obviously they need support to attain those goals. So if you think about Kenya, Ethiopia, Tanzania, Morocco, Egypt, all of these countries, South Africa have policies, have strategies. They have strategies in place to meet a certain target in terms of diversifying the energy mix by bringing in either wind investments or solar or hydro power. It is on the agenda. It is very much on the agenda. Aarild. Is it working? Good. You were mixed of John Lennon and Lennon. John Lennon was saying power to the people right now. And Lennon said that socialism is planning an electricity and you said maybe development is planning an electricity. Now, one thing, I mean, how important is electricity in the overall development? It's one question I would maybe like to reflect on. But second, what you didn't mention is that in a lot of countries, there is huge subsidies for carbon, for fossil fuel consumption, and you can provide technologies, but you also have to change the basic, the pricing of this. And you didn't mention that, but I'm sure you have some thoughts that would be interesting to hear on this continued subsidies for fossil fuels where it should be the opposite. Yannick. It's clear that climate change will oblige us to rehabilitate long-term integrated planning. Whether it's Lennon or not, we still have to go back to long-term integrated planning. The idea that market forces left to themselves will resolve every single problem. I don't think you really have to be a died-hard to believe that. Often when you want to change the energy mix, it takes 50 years and you have to plan for it. Now, how do we finance the incremental cost? There are different options. I took the least controversial one, the tariff increase and carbon markets. But yes, one possibility is reforming the energy subsidies. The energy subsidies right now for fossil fuel are anywhere between 500 billion to 1 trillion. We actually had a few hundred billion dollars close, we don't know. And so if we could recycle these energy subsidies, we will have enough money to actually cover the incremental cost of renewable energy for the near-term compared to fossil fuel activities, fossil fuel energies. Now, there are plenty of innovative sources of finance when it comes to that. You have, for example, also curbing illegal financial flow. You have 21 trillion dollars right now illegally in some accounts. If it could be taxed as they will be normally taxed, 3% on 21 trillion, you end up with 630 billion. If you taxed at 25, you end up with 200 billion dollars. That is linen, but you have 200 billion dollars to finance renewable energy. So there are mechanisms. If you have the political will, there are mechanisms to do it. And especially if you have done your utmost to ensure that you can do it in a cost-effective manner before. I mean, having said that, let me say that some countries are already heading in that direction. And let us not forget that there are subsidies both on developed and developing countries. And some developing countries in Africa are already heading in that direction. You must have realized that some months back in Nigeria, government tried to reform subsidies and there was some upfield social riots. So these are sensitive agendas and they require considering a lot of considerations that are outside of the energy sector per se. This is one point that I also made during my presentation. Because you cannot reform subsidies alone. Yes. Because nobody wants to give subsidies. I mean, policy makers are not them. They don't like to give subsidies. But often they feel that they are obliged either for social reason or competitiveness reason. Because if they don't give tax breaks, for example, the business will go to another place. So it has to be part of a global effort to reform subsidies. What would you say you say today? About 10% of Africa is electrified. In rural areas. In rural areas. Africa is now the economy is growing very quick. In what kind of hurry are we? I mean, how fast will the need be for more energy? I had a slide there on infrastructure gap deficit that combined basically transport and energy. And I don't recall exactly the numbers, but it's something in the order of 25 to 50 billion dollars a year that is required to close the gap. So we need that we need everything to be in place quite soon with those ideas of the green market transformation. And so to meet those needs and challenges. The reason everybody speak about scaling up is because the window of opportunity is shrinking extremely fast. And the nightmare scenario is that we don't get enough money early enough to basically shift toward a green energy paradigm. And we end up needing a lot, a lot of money for disaster relief. And the time is definitely the essence. We need much more money and we need it fast with instruments that can scale up effort. So in Africa is a good investment because, you know, we don't have the issue of developed countries, which is a lot of retrofitting has to take place. Africa, they are making green field investments. So we do not want to lock in capital. A short last. Based on our first poll we took, Yannick, there's a lot of academics in the room. So all the teachers, when they saw that slide, which showed the dramatic increase in cost all in financing, that's really powerful for the classroom. So I'm stealing it. My question is from Afalda.  One issue that hasn't come up is the role of China. And it strikes me. We just did a recent study at a data that found that the two largest sectors that China is giving in both the government official flows and private finance are infrastructure and energy. And so we're talking about this huge capital problem. What role is China likely to play here? Can they help close this capital gap? But are they lending in areas that aren't going to be conducive to sort of sustainable development? It's a mix. So China is investing, for example, or will be investing in hydropower in Ethiopia. It will also be investing in railway in some countries. In other countries, it's investing in less environmentally friendly or making less environmentally friendly investments. But they are bringing capital flows to Africa and significant ones. Thank you very much. Very interesting. Thank you.