The Key Ideas

#35 Create a National Energy Company to build all new energy generation in Scotland in collective ownership

A National Energy Company would have two important functions. One is to begin to bring the energy system in Scotland back into collective ownership. The other is to capture for Scotland much more of the manufacturing and design employment which should come along with Scotland having some of the most impressive natural assets for renewable energy generation in Europe.

The current model is an economic disaster for Scotland. Private developers (often foreign-owned) are granted permission to erect energy-generating infrastructure. They then do this on land that they buy or by renting land from large private landowners. They then import the technologies to generate the energy from overseas manufacturers and erect them, often using short-term agency labour. From that point onwards they harvest the energy generation tariffs from the government and the energy corporations. The developer gets rich, the landowner gets rich, the overseas company that makes the technology gets richand Scotland gets some temporary jobs in erection and then a smaller number of jobs in maintenance. It is an incredibly generous way for the commons to provide its energy needs, gifting most of the economic benefit to wealthy individuals and corporations.

A National Energy Company can change these economics. First it can borrow from the National Investment Bank against the future revenues which come from the electricity which will be generated. This will then allow the company to operate on publicly-owned property or purchase any land or other rights necessary to build the generating infrastructure. Once this is installed,   the profit it is generating will return to the company and not be exported to developers who are often based overseas.

Another crucial difference is that a National Energy Company can choose where to source its technology fromand can choose Scotland. As well as installing technology, a National Energy Company would be a manufacturing business which builds the technology and a national research centre which would develop the next generations of energy technology. It is that next generation of technologies where the opportunity for developing a substantial export business opens up. It also enables it to do things the current market is notin particular, installing substantial amounts of energy storage. The need for energy storage is discussed in chapter nine, but the potential economic impact of designing, building, and installing energy storage technology in Scotland now is enormous.

As well as electricity generation, the National Energy Company should look at large- and medium-scale heat generation. Working closely with the National Housing Company, it can build and install district heating systems (where one boiler serves an entire block of houses or flats via insulated piping, greatly improving efficiency). It should also be involved in exploring next generation heating technologies such as heat recovery from disused mining infrastructure or inter-seasonal heat-store, where large heat stores collect solar heat in the summer months and then store it for use over the winter months.

This business model faces some substantial problems and uncertainties, mostly deriving from the UK Government's attacks on the funding models for renewable energywhich hit Scotland hardest. However, as the economic viability of new technologies improve, it can only be hoped that a viable renewable energy sector in Scotland, and a substantial national company which creates large numbers of jobs in the high-skill manufacturing sector and installs substantially greater amounts of energy storage will be possible.