Paul Wheelhouse, MSP, Minister for Business, Innovation and Energy outlines the Scottish Government’s decision to not include UCG in Scotland’s energy strategy. The moratorium on fracking is still in place and a decision will be taken on this technology following the completion of the scientific review and full public consultation over this winter 2016/2017.
Click on the picture to hear him in the Chamber and the text of his speech is also given below:
“This Government is taking a clear and consistent approach to understanding the potential role for emerging technologies that could be used to further develop Scotland’s hydrocarbon resources. That approach is one of caution while we gather and consider evidence on those new technologies. A precautionary approach is the right approach, and it is one that has been widely supported by communities, industry and other interested parties.
I am aware that there have been some recent examples of misunderstandings regarding the different technologies involved. Therefore, it would be useful to take a moment to reiterate our position on unconventional oil and gas, before I turn to the separate issue of underground coal gasification.
On 28 January 2015, the Scottish Government put in place a moratorium on unconventional oil and gas, which means that no such activities can currently take place in Scotland. That moratorium covered hydraulic fracturing, or fracking as it is often referred to, and coal-bed methane. The moratorium followed the publication of a comprehensive report by our independent expert scientific panel on unconventional oil and gas. I encourage members to look at the report to refresh their memories on its detail. The report recognised that, although there was a considerable body of international research and evidence on unconventional oil and gas, there were gaps in key areas of evidence, including on climate change impacts, public health and decommissioning.
The moratorium on unconventional oil and gas ensures that no fracking takes place while we explore in detail those and other issues—like traffic and economic impacts—before holding a full and comprehensive public consultation. I can confirm today that the independent projects that we commissioned to examine unconventional oil and gas in more depth are nearing completion. As was widely reported at the time, there were delays to commissioning the transport research project and, despite acting swiftly to resolve those issues, that sequence of events has had an inevitable effect on the timetable for completing and publishing our research. I assure members that the final project reports—which will form one of the world’s most wide-ranging investigations into unconventional oil and gas—will be published in full as soon as possible after recess.
As members are no doubt aware, there are strongly held views around Scotland on unconventional oil and gas, and real concerns in communities. We must recognise, listen to and respond to those concerns. That is why the publication of the research reports will be followed by an extensive public consultation that will take place in winter 2016-17 as planned. The consultation will give people in Scotland the opportunity to consider, scrutinise, debate and set out their views on those technologies and the evidence. Given the seriousness of the issue, that is the right and proper way to proceed. To make a decision now would be to deny the people of Scotland a voice on that crucial issue.
I turn to a different technology, and one that is also very much a matter of interest to communities around Scotland, particularly around the Firth of Forth. Underground coal gasification—or UCG—is a process for converting coal into gas via combustion, while still underground. The technology requires two wells to be drilled: an injection well through which gases are pumped to create high-pressure combustion of the coal, and a production well through which the resultant syngas can be brought to the surface. Syngas is a mixture of gases—methane, hydrogen, carbon monoxide and carbon dioxide—which can be used as fuel or as a feedstock for chemical products.
Unlike hydraulic fracturing or coal-bed methane, there are very few examples of UCG technology being used commercially anywhere in the world. In recent years, however, there has been interest in deploying the technology in Scotland and, through the Coal Authority, the UK Government has issued coal mining licences for potential UCG sites in the Firth of Forth. I stress that no planning or environmental consents for UCG have been issued in Scotland. Planning and environmental protection are fully devolved matters and both consents are necessary before a development could begin.
On 8 October 2015, the Scottish Government put in place a specific moratorium on UCG—separate to the moratorium on unconventional oil and gas—using the planning powers available to the Scottish Government, so that evidence on that technology could be gathered and considered. To develop that evidence base, we asked Professor Campbell Gemmell, professor of environment research, policy, regulation and governance at the University of Glasgow, to undertake an independent examination of UCG. I advise members that Professor Gemmell’s report has now been published and copies are available at the rear of the chamber. I thank Professor Gemmell for his work and for preparing a confident and comprehensive assessment of the technology.
The report, which has been informed by literature and through in-depth interviews with academics, industry, non-governmental organisations, community groups and regulators, notes that there are substantial coal resources in Scotland that could potentially be exploited by UCG technologies, with the greatest reserves of coal being in central Scotland, Ayrshire, Clackmannanshire and east Fife. The commercial value of those reserves, if utilised for UCG development, would of course depend on gas market prices and competition, the quality and volume of gas, consistency of throughput and other economic factors.
On potential impacts from UCG, Professor Gemmell’s report makes a number of observations that I believe raise serious concerns over the future of this industry in Scotland. First, there are very few comprehensive or peer-reviewed studies that examine the environmental and health impacts. Where impacts have been documented, they have been from trials rather than from full commercial-scale activity.
Where the industry has operated, typically at a pilot or trial scale, there is emerging evidence of significant environmental impacts including soil contamination and exposures of workers to toxins resulting from major operational failures. A number of failures in Australia have resulted in prosecutions being brought. Professor Gemmell also raises concerns that the current regulatory framework is insufficiently clear and would need to be improved to protect the environment, public health and workers’ health and safety.
I turn to the important issue of climate change. Professor Gemmell notes that UCG produces a variety of greenhouse gases, many of which are without current viable market outlets. He concludes:
“Climate change and decarbonisation targets would be very seriously impacted by unmitigated releases of UCG GHGs (greenhouse gases) if operated at scale, making the achievement of current or stronger commitments much more difficult if not impossible.”
That would particularly be the case where gas production was not combined with a suitable removal, storage, offset or compensation method—for example, carbon capture and storage.
Professor Gemmell concludes that a step change in the availability of robust data and science would need to take place before the technology could be reliably assessed. In his words, a “very substantial transformation in available data” would be needed. In conclusion, Professor Gemmell states: “it would be wise to consider an approach to this issue based upon a precautionary presumption”.
He states: “it would appear logical … to progress towards a ban”.
Having considered the report in detail, the Scottish Government’s view is that UCG poses numerous and serious environmental risks, and on that basis the Scottish Government cannot support this technology. Accordingly, UCG will have no place in Scotland’s energy mix at this time.
I acknowledge the interest that there has been in the technology in Scotland and I am confident that any companies with an interest in UCG would aim to operate to the highest standards. I also acknowledge the shortage of reliable information that Professor Gemmell was able to identify. I am grateful to him for the lengths that he went to, which ensured that he reached out to a broad spectrum of interested parties and community groups both in Scotland and worldwide.
I will therefore ensure that there is sufficient opportunity for views and evidence to be brought forward and considered as we develop and consult on our energy strategy for Scotland, which will set out an energy mix for the future that does not include underground coal gasification. Today, I wrote to the Secretary of State for Business, Energy and Industrial Strategy setting out the Scottish Government’s concerns. I have asked him not to grant any further licences for UCG in Scotland and to revoke all existing licences.
I understand that the UK Government is also considering its position on UCG, and an announcement is due shortly. I expect that the Conservative members in the chamber may have thought to familiarise themselves with the position that is likely to emerge. However, it is a matter of great regret that this Parliament does not have the necessary powers over the licensing regime for UCG. The Scottish Government therefore intends to continue to use the planning powers that are available to us to ensure that UCG applications do not receive planning or environmental permission. I cannot predict what clean energy technologies may be available in the decades to come, but what is certain is that the coal resource will still be there.
The position on UCG that I have announced today is a clear validation of the evidence-based approach that this Government is taking. We live in a world where the pace and scale of technological innovation is increasing. That is a testament to our collective ingenuity and it must be supported and embraced wherever possible. However, when necessary, we must be ready to pause so that we can consider and interrogate the evidence and be ready to act accordingly, which I believe we have done today.