Net zero jobs plans are fundamentally flawed, Miliband warned

Telegraph

2 days ago

Ed Miliband has been urged to slash taxes on the North Sea to prevent the loss of tens of thousands of jobs.
Researchers at Robert Gordon University (RGU) said oil and gas jobs were disappearing faster than new clean energy roles were being created as a result of the slower-than-expected deployment of wind farms.
It threatens the loss of tens of thousands of skilled British jobs by the end of the decade.
The RGU report warned that the offshore wind sector may only generate 29,000 jobs by 2030, while some 58,000 disappear from oil and gas – the equivalent of 200 jobs lost every week for the next five years.
Paul de Leeuw, director of RGU's Energy Transition Institute, said: 'You have to wait pretty well to the back end of this decade before there's enough capacity in the renewables sector to take all the people coming out of oil and gas.
'So there is a very valid, very real concern in oil and gas, in the world-class supply chain and the absolutely fantastic workforce, and they're saying 'actually, we're quite happy to work on the renewable agenda, but the jobs are simply not there'.
'It's a timing issue.'
To avoid heavy job losses, RGU said Mr Miliband, the Energy Secretary, needed to either attract a larger share of turbine manufacturing to the UK or reverse his ban on new North Sea drilling licences to temporarily boost oil and gas production.
Buying time
Mr Miliband has promised a 'just transition' in the North Sea, saying offshore wind jobs will replace those lost on oil and gas rigs.
He is targeting between 43 and 50 gigawatts (GW) of offshore wind capacity by 2030 as part of his clean power plans. The Government argues this will not only deliver energy security but also provide lasting employment for North Sea workers.
However, based on the industry's current trajectory, new jobs will not be created fast enough to match the decline in oil and gas.
In a worst-case scenario, researchers said the overall number of people working in offshore energy could fall by one fifth to 125,000.
It comes after energy consultancy BloombergNEF warned the Government was on course to miss its offshore wind deployment target by 10GW.
RGU said Mr Miliband could miss his wind power targets and still avoid job losses, but only if he attracted a larger share of turbine manufacturing to the UK or reopened the North Sea.
Prof De Leeuw said: 'Getting to the Government's target for offshore wind capacity would be an absolutely heroic achievement, especially in just the next five years.
'So if you might not get there, you want to keep your options open. We think you need to keep oil and gas going for just a bit longer, to buy more time for the cavalry to arrive in the form of renewable energy jobs.'
The RGU report predicted demand for between 125,000 and 212,000 offshore energy workers – including both those in oil and gas and those in renewables – by 2030.
This depends on various factors, including the amount of offshore wind capacity that is built, the share of turbine manufacturing that is done domestically, and the level of oil and gas production.
In nearly every scenario where Mr Miliband hits his upper target for offshore wind generation, or 50GW of capacity, the number of North Sea jobs either increases or stays more or less the same.
But in most scenarios where only 40GW or 30GW are delivered, large numbers of jobs are lost.
Government levers
BloombergNEF recently warned that Mr Miliband was on course to deliver just 33GW by 2030, with Ørsted's decision to cancel the massive Hornsea 4 project also viewed as a sign of industry turbulence.
Significant job losses are less likely if more money is spent on building wind farm equipment in Britain, RGU said. However, this may be beyond the Government's control.
Another way to ensure jobs are not lost in almost every scenario is to ensure oil and gas production stays at 700,000 barrels per day or more, compared to a current forecast of between 500,000 to 600,000 barrels per day.
This would only be possible if controversial developments such as the Rosebank and Jackdaw fields went ahead, as well as other schemes.
Prof De Leeuw suggested ministers could try to grow domestic turbine manufacturing by making supporting investments in factories, perhaps through the National Wealth Fund and state-owned Great British Energy.
But he warned the Government 'doesn't have all the levers' to ensure that happens, whereas the windfall tax on oil and gas producers and the ban on new licences were within its control.
While stressing the North Sea was still in 'managed decline', he added: 'It is very hard for the Government to make the renewables agenda go faster.
'But what they do have is all the levers on how to manage the decline in oil and gas, and particularly around what they do with the tax regime and the fiscal levers.'
Asked whether Mr Miliband should reverse the ban on new drilling licences, a key pledge in Labour's election manifesto, he replied: 'You have to get investor confidence to the highest point.
'What was in the [Labour] manifesto ... the world has moved on, but the policy has not. I do think there is room for selective licensing to keep activity going.'
The Government has been consulting on its plans for the North Sea, which include boosting employment through a variety of new sectors such as carbon capture and storage, hydrogen production and offshore wind.
It has also set up the Office for Clean Energy Jobs to ensure new roles are 'high-quality and paid fairly', and launched the so-called clean industry bonus to attract factory investments to coastal communities.
On Friday, a spokesman for Mr Miliband's department said: 'We have taken rapid steps to deliver the next generation of good jobs for North Sea workers in a fair and orderly transition as part of our plan for change, including by making the biggest investment in offshore wind and two first-of-a-kind carbon capture storage clusters.
'This comes alongside Great British Energy, headquartered in Aberdeen, which has already announced a £300m investment into British supply chains, unlocking significant investment and helping to create thousands of skilled jobs.'