Our next item of business is an evidence session on the outlook for business investment, focusing on businesses working in the renewables sector. The purpose of the session is to provide members with an overview of the outlook for the renewables sector in Scotland and to look towards the challenges of 2023. It is the third in a series of meetings that we are having in order to look at the current economic pressures facing businesses.
I?welcome Jonny Clark, who is managing director of ITPEnergised; Claire Mack, who is chief executive of Scottish Renewables; Jon O’Sullivan, who is director of onshore wind and solar at EDF Renewables; and James Reid, who is operations director at ?FES Energy.
If witnesses and questioners could keep their answers and questions as short and as concise as possible, that will help us to get through as much as we can.
There will be a range of questions from members, and I will first focus on the recent budget announcement in Scotland.
There are significant pressures on the Scottish budget and many sectors are feeling constraints. However, renewables is recognised as a sector that requires investment and growth. We have the cabinet secretary here next week, so we are interested in your reaction to the budget and whether you think that it has made enough commitments. The recent Climate Change Committee report said that Scotland was starting to fall behind in some areas and that we need significant investment and pace. Has the budget delivered enough to do that?
I invite Mr Clark to come in first. I will then go to Claire Mack.
Good morning. I thank the committee for the opportunity to give evidence.
In high-level terms, there is always more that we would like to see being done. However, we recognise that there are many pressures on the budget.
The biggest challenge for us is around attracting and developing our talent. We need to see investment into a pipeline of skills development for the long term. We are talking about investment in a sector where the infrastructure takes months and years to develop and is then operational for decades, so we therefore definitely need to take a long-term view.
In summary, it is good to see the progress that is being made. Obviously, the consultation on the renewed energy strategy is out, and it was good to see some of the content of that. The direction of travel is good, but more could always be done.
Claire Mack, do you share that view? There was the announcement about the hydrogen action plan and the funding for that, and funding through non-domestic rates targeted on the sector. The issue of skills is often raised with the committee. Is that recognised enough as the key component by the Government? We are talking about renewables investment. Is there more focus on the sector and not enough on the pipeline of people and skills?
As everybody knows, we are in quite unprecedented times. We have an incredible project pipeline in renewables that is greater than we have ever seen before across a wider range of technologies. Of course that comes with skills demands.
In general, one of the key pressures currently is the wider business environment and getting projects in the pipeline moving. Therefore, we were really pleased to see in the budget a remaining focus on low-carbon projects and support for the renewables sector. With the pipeline that we have, that is genuinely the greatest industrial opportunity that we have in Scotland, and it is really important to recognise that. Certain amounts of organic growth will go along with that, but other elements will need to be managed. We will need to rely on some public sector resources, such as skills development. Some relatively unseen elements might not necessarily come to mind first of all.
We were pleased to see a settlement for local authorities—an extra £550 million—because of our reliance on them to enable our projects to go through the planning system. The planning system is hugely important to us. Research that we did around 2020 showed that we had lost around 20 per cent of our personnel in planning departments in the decade. They are key enablers of projects. The ability to get funding is really important—that is a business environment point—but planning is also a key enabler of projects. We are therefore keen to see planning protected as part of an economic strategy for Scotland, as we see such things coming together as parts of the jigsaw that will create the projects and the pipeline that will then drive economic benefit, which will, we hope, improve our overall budget situation.
However, we need to be quite clear about the pressures on local authorities and where their choices lie. Planning might not be their priority, but I am keen to highlight to the committee that it is a key enabler of the economic growth that we are all looking for.
What about the impact of inflation in relation to local authorities? Although there is an increase in the funding, the real-terms situation is different. How does the impact of inflation and rising costs affect your sector?
You are absolutely correct. Projects in the renewables sector go through different phases. I have talked a bit about planning. Projects sit on people’s desks—they are desk-based projects at that point—and they then become finance projects and construction projects.
We face exactly the same pressures that everybody else in the construction sector faces. I am sure that the committee will have heard from them about commodity price increases. The Office for National Statistics has reported increases in steel prices of 70 to 100 per cent. Steel is a critical component of our projects. Solar photovoltaic panels were a real success story in cost reduction because of serial manufacture and various other elements, including ease of installation. In effect, the price increase of around 10 to 15 per cent for those has erased the cost reduction, so we have gone back to the start on them.
We are in a perfect storm. It is not just about commodity price increases; supply chain constraints are really starting to impact and bite on renewables projects.
On the way in which our projects come together and are financed in general, people will work between delivering and generating electricity for the merchant market, which means that they hedge at a specific price in advance—nobody could have expected the huge increases that we have seen there—and hedge in another way through the contracts for difference market, which offers a fixed price for the product. Many were not able to insulate themselves against the increase in costs. They bid into the auction at a specific price, based on what they felt would be the on-going stability that we have seen in the United Kingdom for the past decade. We are in a very difficult place in terms of that perfect storm.
The other area where, because of high demand, we are starting to see real change is the supply chain—not only are prices going up, but availability is very difficult. Therefore, as well as the increased costs for commodities and labour, we are starting to see unusual things such as up-front payments to secure a supply chain.
Thank you, Claire; you have touched on a number of areas that other members will look at in more detail.
James Reid, do you wish to add anything? The initial question was around whether enough came out of Scottish the budget to support the sector and increase the pace of change that we need to see.
Thank you for the question. Similar to Jonny Clark and Claire Mack, I think that the budget is positive in terms of the investment and funding that have been suggested. Historically, one of the key issues for us in relation to onshore projects has been the timeframes for which the funding has been available. A lot of the time, that funding has been open for maybe a year. That has now changed, which is important. Keeping those funding calls open is key to helping those projects go.
I still see an issue with private clients. I think that the funding is very good for the public sector but, when it comes to industry, for example, it is about how we encourage and attract the investment for those guys to get involved. We are still seeing nervousness in some parts of the market about investing in projects. A lot of that is down to current cross-market constraints. There are positives, but there is still a bit to go in terms of how we encourage investment.
Thank you. Jon O’Sullivan, would you like to add anything to what has already been said?
Good morning. I probably do not need to introduce EDF but, on behalf of EDF Renewables, I will say that we are one of the leading UK and Ireland renewable developers and, globally, we want to be one of the world’s leading energy companies. We are happy to be here today and to support the Scottish Government’s ambitions to hit net zero by 2045.
I will not add anything in response to the budget question, because I think that my colleagues have covered that, but I will say that there are knock-on effects, and there are other areas where that partnership approach with the Scottish Government could help in relation to the budget. For example, the grid is one of our challenges. Obviously, as Claire Mack said, working with and investing in the grid will help to unlock the projects, so budget is needed there. Even if that does not come directly from the Scottish Government, there is a role for enabling that. I think that the route to market and contracts for difference have already been mentioned, and we could work with the UK Government at Westminster on setting more ambitious budgets there to help unlock the pipeline of projects that we have in Scotland.
Other members will come on to issues of skills and jobs but, as a Mid Scotland and Fife MSP, I know EDF Renewables well as a company. What are the challenges in placing contracts in Scotland? Obviously, we want to see more contracts based in Scotland and more communities getting the benefit of renewables, at the same time as making the shift from fossil fuels over to renewables, which is important for our climate change targets. We want to see the benefit of jobs and skills as well. Other members will go into more detail, so a brief answer would be helpful, but what do you need in order to invest more into Scotland and local communities?
09:45
The brief answer is that we are very aligned in that we would like to have that investment in the supply chain in Scotland. We are working very closely with our supply chain and urging our key contractors and suppliers to invest in Scotland and create those jobs in Scotland wherever possible. I will maybe come on to an example later.
Please give us the example now. I will then invite Fiona Hyslop to come in.
Okay. There is the Neart na Gaoithe offshore wind farm project, which I am sure that the committee knows well. More than 50 jobs will come about in the local area as a direct result of that wind farm and the operations and maintenance phase. A large recruitment campaign for that is planned for this year. It is maybe too early for me to comment on exactly how easy that recruitment will be, but we are certainly already seeing a great deal of interest in those jobs, and we are hopeful that it will go well this year. There is a genuine and tangible commitment to those 50 jobs in Eyemouth around the NNG project.
That is welcome. We want to see more jobs, particularly in the area that I represent, and particularly in the Levenmouth area, which had a high employment rate but lost a lot of jobs through deindustrialisation. Renewables offer potential for that area, which we want to see fully realised.
Good morning, and thank you for joining us. I will cover the outlook for investment for businesses, looking at current constraints, but also at what you see as opportunities.
I will stay with Jon O’Sullivan from EDF for now. There are issues around the UK autumn statement, the latest support for businesses in energy, and yesterday’s announcement on business support for energy in particular. I do not know the implications of energy use for you as energy companies yourselves. It would be helpful to get a sense of that—or do you more see the knock-on cost impact in the supply chain? What are the current constraints around business investment for you as a company?
That is a great question. We have touched upon the cost increases that we are seeing. As a business, it is fair to say that we have great ambitions for Scotland, and a great pipeline. I think that we have 500MW in operation at the moment, another 500MW or so in construction, and at least another 500MW to 1 gigawatt in our pipeline. We would like to contribute a substantial amount to Scotland and the net zero targets.
The reality is that it is a tough time with all the cost increases on inflation and all our raw materials. As Fiona Hyslop rightly said, our suppliers are struggling. It is no secret that the annual results of wind turbine manufacturers are not very positive. We then need to work together with the supply chain, the developers, the owners, and the Scottish Government in more of a partnership approach to try and release those projects and offset those costs.
I will put this question to Jonny Clark. Are there any direct impacts of the increasing energy costs and so on for you as a company, or are they more from the supply chain?
Interestingly, the impact for us is that there is more work for us to do for our clients in supporting the likes of Jon O’Sullivan and developers and other utilities.
Also , around 30 per cent of our revenue comes from corporates and industrials—and, not surprisingly, we are seeing a lot of approaches from corporates and industrials that are struggling with the increasing costs of energy and looking at how they can hedge that. To go back to the point that James Reid made earlier, they are then looking at how they can finance those, because that is a significant capital cost to them as a business. Ultimately, that will support them from an operational point of view in giving them security on their energy costs, which is what a lot of them are trying to do.
The short answer is that we are then seeing an awful lot more work opportunities as a result of those pressures, particularly on energy costs. It is a double-edged sword—because the next challenge for us is how we resource that.
That is interesting. We are also looking at different sectors, such as hospitality, where there is a different impact.
I will put this question to Claire, before I move on to opportunities. Based on your membership, what is the current status of constraints in relation to investment?
In the investment environment, the outlook is quite poor. That is largely because of macroeconomic issues, but there are some things closer to home. The key message is that we need to make the environment in Scotland as good as possible, because although Jonny Clark spoke about—and Jon O'Sullivan and James Reid will speak to members about the same thing—the fact that projects are under way, and said that there is plenty of money, the issue is about getting that together and in the right place, and we face huge competition from other countries. Yesterday, I spoke to one of our members about creating operational bases, and we discussed the fact that, in Poland, they face no business rates at all—zero—which is a huge difficulty for us. We understand that there are certain necessities of public finance, but because we stack up against countries that are close to us, we have to be mindful of international competition for projects and finance; that is key.
The other thing is linked to your first question about what we need. We need structured support programmes. I talked about organic growth, but there are also managed elements of that, and two of the elements that I will highlight relate to heat. In its review of the Scottish Government’s programme of work, the CCC identified that our programme of work on heat decarbonisation is far behind where it needs to be. We could bring together a very focused set of structured projects in that area to create a portfolio that is attractive to investors, which would create certainty about there being a longer-term programme. A rural heat fund would be very helpful. There are areas where we know that we have to act fast. In doing so, we can hopefully not only address business growth but also reduce cost to consumers, because a key part of the macroeconomic picture is inflation that is caused by additional costs on households.
The other area that we have touched on in the past is support for the small to medium-sized enterprise supply chain, particularly in the renewables sector. The SME supply chain is a huge component of the Scottish economy. We have business support agencies—South of Scotland Enterprise, Scottish Enterprise and Highlands and Islands Enterprise—but we feel that there is an opportunity for a programme that is much more focused on the SME market. I run an SME, and in order to meet what my members want I am having to grow it very quickly. That creates a lot of pressure for small businesses that do not necessarily have the internal resources that they need to look at their finance systems, grow their management capability and think about what is needed for a rapidly expanding business. That is a very important thing that we could do to help support our SMEs to grow quickly to meet the pipeline and the opportunities that we have.
The other area is ports and harbours, which are absolutely critical. Those areas could effectively operate as sort of silicon valleys, so we await—with ever more bated breath—announcements on green ports and free ports, because they will be important drivers, not only of the port infrastructure, but also in attracting innovative entrepreneurial SMEs. We have a fabulous backbone of those in the energy industry in Scotland, and it would mean being able to capitalise on that and then translate it into the people and skills development that we are looking for.
Fiscal incentives are also important—Jonny Clark touched on this topic. There are certain impediments to people improving their building structures and to adding things such as solar on to projects, because doing so enhances their business rates liability. We are keen to see that pulled away so that we can push forward on decarbonising industry. Scotland has taken the lead in so many areas, and decarbonisation of industry is another key area in which we would love to see movement quickly.
We would also like to see detailed fast tracking of projects, and a lot of that sits within the planning system. I am delighted to see the level of detail and care that went into the national planning framework 4, which is due to be considered in Parliament this week. We were very pleased to see a number of the key messages that industry put forward in that document. Those messages were heard and put down on paper, which will genuinely help us to build in more areas sensitively, and it will also allow us to build at a quicker rate. The resourcing of planning is key to the rate of building.
I will stay with you, Claire. What opportunities do you see in the draft energy strategy and just transition plan, which was published yesterday? You talked about issues for SMEs. Perhaps the committee needs to consider those, given our focus on the just transition. It will be really helpful if you give us your initial reaction to the strategy.
We were really pleased to see the energy strategy, which was published yesterday alongside the just transition plan. Those things go together. People in Scotland are at the heart of the energy transition, for obvious reasons. We have driven the energy economy of the UK for the past 50 years, and there is no reason why that should not get bigger and better. That message comes through in the energy strategy.
It is great to see holding ambition and increased ambition in relation to offshore and onshore wind, which are the two key employers here in Scotland. That is very helpful. We are also delighted to see a conversation about a target for tidal energy, which is a key early-stage opportunity. We have seen two projects come to commercial viability through the contracts for difference mechanism. That is a brilliant opportunity, not just because we have a massive coastline that we can take advantage of, but also because we have companies producing mobile and modular technologies that can easily be exported in the tidal space.
Working on a target for tidal and wave projects is really important. Those projects are at an early stage, but the opportunity is there for the taking, particularly in relation to the supply chain. That industry in particular has continually demonstrated a commitment to local supply chains, which is something that we should capitalise on.
Thank you. James, do you want to comment? Have you had a chance to reflect on the draft energy strategy and just transition plan that was published yesterday? I want to give you an opportunity to talk about investment outlook opportunities and anything that you want to pick up on in relation to current investment constraints for your business.
I have not had a chance to read the draft strategy, although I read the statement on it last night.
As a business, we see the renewables and energy industry market in construction as our highest area of growth, certainly for the next couple of years. Jon O’Sullivan and Jonny Clark have both touched on some of the significant barriers that might stifle some of that investment. Unfortunately, the big barrier is the grid. It is the biggest problem that we face right now. Most projects that we encounter—onshore, solar and battery—are being heavily constrained by constraints on the grid. For example, we have three projects that are worth about £10 million that have gone on hold over the past three months. One is a heavy industry user, one is a hospital and one is—[Inaudible.] Essentially, they have been put on hold because the grid is saturated due to flow constraints.
I would love to invest and bring more people into the business—I am currently looking to do that—but I need to be mindful that there is a risk that projects might fall off or not happen because of external constraints. That key barrier needs to be addressed somehow, perhaps by people who are cleverer than me.
On the skills front, Jonny Clark made the good point, and I agree, that one of the key barriers to upskilling is access to the apprenticeship levy. We have employed six graduate apprentices this year. I went through the process of trying to get two of my project managers on to electrical engineering degrees to try to upskill them in renewables, too, but I found it incredibly difficult to find universities that are able to offer apprenticeship levy-supported university courses. When I looked down south in England, that did not seem to be as much of an issue, but students have to live in England, so that was not an option for us. If that assistance can be improved, it will help with upskilling in the industry.
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I know that my colleagues want to cover more skills and training issues. If it is okay with you, convener, I will ask Jonny Clark to comment on the energy strategy. Jonny, is there anything that you want to say about the investment outlook and what comes through on that in the strategy?
My overarching comment is that there is great content and great aspiration but the devil will be in the detail on attracting the inward investment to make it all happen. That will include the organisations that we represent and others at all scales. Among the clients that we work for, it is overwhelmingly the case that the capital does not come from Scotland. In fact, much of the investment comes not from the UK at all, but from overseas. It is critical to keep Scotland an attractive place to invest as well as an attractive place for people to be based in to deliver the pipeline—which is potentially huge, notwithstanding all the barriers that we see daily. The fundamental thing is to turn the strategy into a detailed action plan.
Finally, I ask Jon O’Sullivan to reflect on the opportunities for investment, perhaps informed by the energy strategy, if he has had a chance to look at it.
I have. We have been invited to comment formally, so I will not pre-empt that. However, my personal reflection on the energy strategy and just transition plan is that it is very positive and we will be very supportive of it. The one bit that has not been focused on is the clear targets that are being set in the strategy. We think that they will be really valuable for us as an industry. We can align around the key targets in relation to megawatts per renewables technology for onshore and offshore wind, which will help to give the market confidence to make those investments and allow us to manage the risks. We welcome the direction that the strategy goes in.
You have partly pre-empted Graham Simpson’s question. Jamie Halcro Johnston wants to ask a supplementary question, but I will bring Graham Simpson in first as he has a question on targets.
I think that most members of the committee are very keen on solar, which James Reid commented on. Your sound is not that great, James, and I did not pick up everything that you said. However, you seem to be saying that not enough is being done to introduce some of the projects, and that you are aware of several projects that are at risk of not proceeding. Is there enough in the energy strategy that was announced yesterday—for people who have read it—in relation to solar energy? I also have an interest in hydrogen, but let us stick to solar for now.
I apologise for the sound. Can you hear me now?
Yes—please carry on.
We are a contractor. That is our business, so we are naturally at the coalface and we see it when projects do not go ahead due to inflationary pressures or market issues and things like that. Right now, the common denominator in the issues for most projects is the grid. That is one of the real barriers.
We are only a small part of the wider renewables industry, and Jon O’Sullivan and Jonny Clark will be able to comment on their experiences, too. However, in recent times, since the energy price increases, we have seen a massive influx in inquiries from people who want to invest in solar and offset their electricity usage, as well as improve their carbon emissions.
The problem is that, in some instances, they cannot do that because the grid will not allow it. The grid is constrained or would be cost prohibitive. Do not get me wrong: in some areas, Scottish Power, SSE and other companies have upgrade plans that might be four, five, six, seven or eight years away, but we are talking about the here and now. Last night, I looked at how far away the 2030 energy target is, and it is 83 months away. How many projects can we build by then?
The problem for you is the grid. Claire, you have read the strategy that was announced yesterday. What is your thinking on what it does or does not say about solar?
Solar is an important component of the story. It is one of the most accessible and scalable renewable technologies as it can work both at the domestic level and all the way up.
We need to have a conversation about community benefit for solar, which is new. As things stand, community benefit contributes a huge amount to the Scottish economy. About £1 million a month comes in through it, although how that is distributed is variable. There is a good conversation to be had about that. If we were to look at the system all over again, we might view certain characteristics differently given our current issues with domestic and business energy costs. We might be more directive about where we put some of that money. Energy efficiency measures would also be an important part of that conversation and one to think about.
Industry will have its chance to comment. Like Jon O’Sullivan, I do not want to pre-empt what it will say, because I have not had a chance to speak to anyone in the industry about the strategy. However, solar is a relatively underused technology in Scotland for many reasons.
First, there are grid issues. Solar is an interesting technology. If you speak to National Grid, you will hear that solar is one of the technologies that it has found more challenging to integrate in the system because we have fewer historical records on how it generates. We have good records for wind, but there were not so many good records for large-scale solar. That is a key issue that has been managed in the south of England. However, we are now in a different place. We have worked out how to build volume in generation, and the issue is integration. Scotland has some key technologies that will help us on that, such as pumped storage hydro, which is really important.
The issue in relation to rolling out more solar is permitted development rights, particularly for businesses. They would allow businesses to offset some of their energy costs. It is not necessarily a grid issue, because they would be using the solar power on site. Again, a lot of regulatory detail needs to be worked through in order to remove costs and make it effective and efficient for businesses to install solar.
Solar is an important part of pushing the decarbonisation of industry agenda. I refer back to the point that I made earlier about business rates. There are some enabling factors that will genuinely help us to link solar to other objectives, such as the decarbonisation of industry and potentially hydrogen, if we choose to go down that route.
Solar is an underused technology. There are some barriers that it is within the Scottish Government’s gift to address in order to help to enable its roll-out. The Scottish Government has been active in funding energy efficiency at the domestic level, but there are certain upgrades that businesses would need to make to roof space. If you are going to mount solar on roof space, other investments sometimes need to go alongside it that bump the capital investment issue.
The Scottish Government could not only extend some of the programmes that we have in order to support that, but extend that support to households and commit to continuing that funding to help households to make better use of electricity and offset their living costs. That could involve helping them to move to electric heating so that they can make best use of the solar that they have or enabling them to make capital investment in smaller-scale batteries to enable flexibility from a product such as solar power.
I would have to go back and check the figures, but the figure that sits in my head is that you can basically kit out a house with solar for around £4,800. If we compare that with what the UK Government is contributing to households to try to manage and mitigate energy costs, which would be the better long-term solution? We need to have a clear conversation about that.
I do not know whether any of the other witnesses want to say anything. They should not feel that they have to. I see that Jon O’Sullivan wants to comment.
I remind witnesses and members that we have a number of questions to get through so it would be helpful if they could keep questions and answers as concise as possible.
I confirm that, as part of EDF and EDF Renewables, we have direct plans to invest in solar in Scotland this year. We have a number of projects in our pipeline, which are mainly rooftop solar on a commercial/industrial scale for some of the big companies that we are working with. I probably cannot share exact details now given that contract negotiations are on-going, but we hope to invest in solar in Scotland this year.
I agree with what everybody has said about the grid constraint, but it is not just about the actual physical infrastructure. It is also about capacity in the DNOs and transmission operators in terms of their people and resources. It is therefore about infrastructure and people. The other thing to flag is that, in order to deal with that, some of our clients are starting to look at setting up their own IDNOs to try to circumvent or address that issue.
What is an IDNO?
It is an independent distribution network operator, which basically means that they will operate their own grid.
I do not think that anybody is unaware that Scotland and the United Kingdom are seeing fairly substantial labour shortages across the board. The transition to net zero will increase the demand for certain skills and occupations. How significant will that constraint on skilled labour be on the renewable energy sector?
On the back of that, how confident are you that the skills and education system will deliver the pipeline of people and skills that you need?
I ask Claire Mack to kick off on that.
Although I said that the investment outlook is quite poor, the skills picture is relatively good. There is certainly interest in and ambition for renewables here in Scotland. In our recent survey of student numbers, we saw a 70 per cent increase on three years ago, so 22,000 students are currently studying in Scotland in the renewables sector and associated spaces such as engineering. We will experience skills shortages, but we are starting to gear up. Again, it is about focusing effort on that area.
I am also keen to highlight what industry is contributing. We are not talking only about the public sector and colleges and universities in the education sector. We are working to uncover the strong framework of vocational training that we have in renewables. Returns from members in the past few months suggest that there are at least 20 resource facilities around Scotland in the private sector and industry. Our members are working to set up or are delivering apprenticeships and in-house training facilities—they are investing in learning, hiring apprentices and upskilling existing staff to demonstrate the industry’s commitment to upskilling people to plug the skills gaps that we face.
The messages that are coming from industry are all about upgrading, enhancing and expanding facilities. One of our service group members has said that 500 of its employees received training or upskilling in 2021, and 20 apprentices were employed that year. I will leave that point there. The picture is good, although that does not mean that we have covered everything.
There are other challenges, such as skills shortages. One issue is finding enough people and having the ability to bring in people from elsewhere. There are skills gaps. That requires training and upskilling, but we also need to think about skills cannibalisation. As we develop renewable energy projects here, renewable energy projects are being developed across the world, including by a number of international companies. Employees who reside in Scotland have an open door of opportunity to work across the globe on other projects. It is about making Scotland one of the best places to live and work to ensure that our companies can keep people here to work on projects.
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What indication have you seen of people transitioning out of the oil and gas industry into renewables? Has there been any significant movement?
Absolutely. The heart of that is the SME base that I talked about. We are starting to see a lot of crossover there. Offshore Energies UK, the trade association that primarily focuses on the oil and gas sector in the north-east, talks about 75 per cent of various SME members transitioning into the offshore wind space, so they are very active in that skills transition area.
We did some research in 2019 that showed that around 80 per cent of oil and gas workers are aware of and alive to the impacts of climate change on their career choice and future job opportunities, and three quarters of those are keen to reskill and would take the opportunity to do so if offered. There is a strong will there, and we are seeing movement in the SME sector, but it will never be “Job done.” The scale of the pipeline in Scotland should not be underestimated, and we need focused effort on SMEs and individual skills training to meet the challenge.
Would John O’Sullivan like to comment?
I was smiling, because I have an oil and gas background—I will not mention the company. I have a personal interest in helping the just transition from oil and gas into renewables, and I have great examples in my team who have done that recently. They would probably say that the oil and gas sector is a key focus, but we see transferable skills from other industries as well. The automotive and various other manufacturing industries have good relevant transferable skills that we will need for transitioning into the renewables sector if we are to hit the 77,000 jobs by 2050 that is suggested in the energy strategy that was published yesterday.
Oil and gas is a huge focus and a fruitful place, but we need to cast our net wider. We need to work backwards from that 77,000 in partnership with industry and Government to make sure that skills flow through and we hit that 77,000.
This issue is close to my heart, because it is far and away our biggest challenge. We are a technical adviser in the low-carbon energy space. We have around 100 people and are headquartered here in Edinburgh. Most of our staff are employed in Scotland, and a big challenge for us is accessing the talent pool—we cannot get enough people.
To give you some statistics on that, we are growing at a little over 20 per cent per annum, and our projection for next year is to do the same. We are trying to fill 10 roles at the moment and are looking to bring in another 10 graduates per annum on top of that, and it is really challenging.
I will give another statistic to add a bit more colour to that. It is also taking longer to find people. We are all fishing in a relatively shallow pool; our clients, contractors and other consultancies are all looking for people with the same skill sets. As Claire Mack mentioned, it is a global market, and for us in the past year filling a role has gone from taking seven weeks to 17 weeks, but the demand is still there. I hope that that gives you some context.
One important part of addressing that challenge is developing strong relationships with further and higher education institutions and identifying talent at an early stage so that we can bring people in and train them up. People can go anywhere. We even have people based overseas in places such as Argentina, the US and mainland Europe as a result of trying to access a more diverse talent pool that is not only locally based.
Those are the challenges that we face and that we are all facing. Because of our aspirations, I do not see that slowing down. Various reports written from a research and development perspective have recognised that there is insufficient capacity in the market to meet our ambitions and those of other nations. There are not enough people, resources or equipment. That is definitely a challenge for the industry and for global aspirations for decarbonisation.
James, what is your experience?
We have employed 41 apprentice electricians and pipe fitters. We had a target of 52 apprentices, but the colleges did not have spaces for that number. Without setting the cat among the pigeons, we are not sure whether that was just a hangover from coming out of Covid lockdown in March 2021. Our next intake will be in April or May this year. We will very closely watch what trade placements are available in the colleges. I touched on the apprenticeship levy in an earlier answer. That would help businesses and SMEs with upskilling our staff.
Claire Mack touched on how companies are investing in training, which we have recently done. We spent £25,000 on upgrading our training facility and creating a dedicated workspace for renewables such as solar PV, battery storage and electric vehicle charging, so that we can train our apprentices and upskill our existing electricians to meet future demand. From the perspective of private industry, there is a real appetite and hunger for change.
To pick up on skills shortages, I will set out the biggest problem that I have seen—I am not sure whether this comes from wider economic impacts. We pay our electricians in line with Scottish Joint Industry Board rates, which are the industry standard. In the past six months, I have noticed companies paying 30 to 40 per cent above that, because of demand. I understand that, but the problem is what companies do with that additional cost. Do they absorb it, or pass it on to clients? Passing the cost on to clients can seem counterintuitive, because it might put a project at risk by making it uneconomical.
It will be interesting to see whether the labour market settles down in the next six months to a year. There is also the potential for a recession in the wider economy. I think that the renewables industry will buck that, but it will be interesting to see how it reacts.
I thank the panel for being here. I will pick up on points that have been made about skills and supply chains.
Claire Mack spoke about the interest and ambition here. We have heard that we may have the right skills but not necessarily in the right place. Thinking about Scotland as a whole, we can identify what we need. However, I am thinking of SMEs not only in the central belt or in existing energy hubs but across Scotland, especially in rural areas, where we want sustainable and viable economies. I am interested in the barriers that you, or the people with whom you work, have identified around ensuring that we have the right conditions and people in those places to enable SMEs to function.
In terms of barriers to getting the right people in the right place, one significant barrier to which we need to be alive is lack of data. That is one of the problems that we have as a sector.
As a trade association, Scottish Renewables has created our own model to enable us to model jobs in the here and now. Our model, on which we worked with the Fraser of Allander Institute, tells us that we currently have 27,000 people in the workforce. The reason why we have had to do that is that the data that comes through from the ONS at central level does not give us what we need. It does not allow us to know what the situation is here and now, or to track what is going on in energy transition. That is a key point for the committee to alight on.
On the point about geography, I come back to vocational training. I am a huge advocate for vocational training, having been to some of the most productive economies in the world—for example, Switzerland, whose model is very much led by vocational training. Skills Development Scotland has done a lot of work over the past few years on vocational training. I urge the committee to look at that, because it can allow us to have a wider geographic reach, and to get more specific technical skills embedded in the economy. It also allows for public-private partnership and fast tracking people through the system.
When we spoke to our members about that, they agreed that they were struggling to recruit staff with the required skills levels. They also felt that they were having to provide their own supplementary training to get exactly what they needed to deliver projects.
That is part of a partnership approach, of course, but we need to be aware that it is not enough simply to open up more college and university places and academic routes; the vocational route needs some focus as well. I come back to my comments about support for SMEs. Their capacity to provide training is more limited, so if we can use what we have to help support a targeted programme of work with SMEs around skills and upskilling, that would do us a lot of good service.
In the rural space, it again comes down to where companies are located. The Global Energy Group in Nigg, which I referred to earlier, has put 500 of its employees through its in-house training centre, and James Reid talked about FES Energy’s in-house training centre. In addition, companies such as R J McLeod are providing civil engineering training and skills uplifts, covering a lot of different skill sets.
We have good data from the survey on what we need in the near term, but we also need to keep a focus on the longer term. I highlight two constraints in that regard. One is lack of data that enables us to look at and track what is happening properly, so that we can divert resources to exactly what we need, where and when we need them. Secondly, we need to support some of those SMEs in their endeavours to help with the skills challenge that we have.
I come to James Reid with a similar question. Have we got the targeted support and approaches right to ensure that we are supporting skills in the right places? I am thinking in particular of places in which we might not expect that kind of economic development but which might really benefit from it.
It is all intrinsically linked to the pipeline. Unfortunately, the majority of work is in the central belt and north-east—that is typically where a lot of our work is. However, we have a business that works out of Oban on the west coast. We are actively looking at how we target renewable projects on the west coast; with that will come skills development, and we can get people trained up and whatever else. The question then is how we unlock the pipeline to allow us to invest in those projects and get the right people. It is intrinsically linked in that respect, and the answer may not necessarily be clear.
10:30I will make a point about ease. Claire Mack touched on a very good point in relation to strategies and trying to get a clear path. It needs to be made simple. For example, in the past six months, I put three or four of my team on to heat-pump training to try to get them MCS certified, and I found that incredibly challenging. The Energy Skills Partnership did some work on that. There were six to seven courses that people could do, and they then had to do something else and then something else. We are trying to reach a target of so many thousand heat pumps being installed within a certain timeframe, but there is a lot of red tape to try and cut through. It is about trying to streamline those pathways and make them as clear and concise as possible, not only for employers but for colleges and accreditation bodies.
We could probably talk about skills all day, so I will move on to my next question, which is about supply chains. I know that Gordon MacDonald will probably pick up on the issue, as well, but I will put this question to Jonny Clark.
How confident are you not only that we have the resources in terms of materials or the connections for obtaining them for Scottish use but that there is long-term security? You said earlier that demand for your work is high right now, but how confident are you that there is sustainability in those supply chains to secure demand into the future?
The short answer is that I am not that confident, sitting where we are right now. However, if we do something about it now—which we need to—we could ensure that it happens.
Reflecting on the previous comments, I note that the workforce is more flexible than it has ever been. Particularly after Covid, people have become way more flexible and adaptable about where they live and where and how they work. We in Scotland need to capitalise on what Claire Mack mentioned earlier. We are world leading in our ability to deliver renewables projects and provide advice on and equipment for low-carbon technologies.
I will give the committee a couple of examples. We are working in places such as Taiwan, the US, west Africa, sub-Saharan Africa and the Caribbean. We are exporting our know-how from Scotland to deliver projects in those places. We need to attract talent to Scotland because we are seen to be a world-leading location for providing that kind of know-how and capability.
That goes back to the point that a lot of people stay where they study and that a lot of people go and study where they think that there is a centre of excellence. We must ensure that Scotland is, and stays, a centre of excellence. That is the starting point from the point of view of the sustainability of the supply chain, and we must do that right now, because other parts of the world are catching up, if not overtaking.
I will put a similar question to Jon O’Sullivan on Scotland’s supply chain and the range of renewables that we are speaking about.
What are the important things for us to focus on to ensure that we have the right material and infrastructure in the right place for 10, 20 and 30-year sustainability?
I will provide some concrete positive examples of where we have invested in the Scottish supply chain recently: Forth Ports, Muir Construction and Inland and Coastal Marina Systems. Those are examples of where it is happening and where there is a positive outlook. However, we share the views that were expressed in the comments about this being a significant challenge for us. We want to do more with the supply chain in Scotland, but it is a competitive global marketplace. We are working with our supply chain to encourage investment in Scotland, and I believe that positive things are happening.
I know that a significant component of the onshore wind sector deal that is being discussed and worked on relates to the supply chain and how we can do more on that in Scotland. EDF Renewables is looking forward to contributing to that and, again, getting more concrete targets for what we can do across Scotland to help us to unlock our project. Obviously, if we do not do that, there will be increased costs of delays and of other companies having to come in from—[Inaudible.]—and so on. My key message is probably that the more proactive that we can be the better. Being proactive with regard to the supply chain now will unlock the skills, supply chain and longer-term pipeline that we all want.
Claire Mack, I will come back to you on the issue of global supply chains. This question might seem to be a bit out of left field, but given political and other uncertainty in various parts of the world, what back-up plans or mitigations are you and your members thinking about with regard to human rights issues that are involved in supply chains, materials extractions and environmental rights surrounding materials extractions and those kinds of things that your members engage in?
That is a really pertinent question because one of the things that we need to be aware of is that our demand for rare-earth metals and other commodities will have an impact somewhere else. Our members are mindful of that. As an industry, my membership as a whole is committed to the living wage, compliance with modern slavery laws and all the fair work practices that go alongside that. As an industry, we pride ourselves on that.
On the wider strategy for how to ensure that we have an ethical supply chain, a great deal of that now comes through different areas. A lot of that comes through ESG—environmental, social and governance—measures that are being demanded by the finance sector, as well. As part of those commitments, people have to have good knowledge of where their commodities come from and how their people are treated.
On the specifics, in Scotland, I am not aware of any programmes that go beyond the living wage and commitments on modern slavery laws. However, as an industry, we are aware of that, as well as the need to think ahead about the circularity of our product. Particularly in Scotland, in the onshore wind sector, we are very much focused on a repowering programme. Again, that came through yesterday in the energy strategy. We can make use of taller turbines, which will create a body of other products that will need to be removed and either recycled or reused. Again, the industry has been quite active on that to date. For example, in the case of one of my members, Renewable Parts, its entire business model is predicated on trying to create second life and to enhance life for older products. The commitment is definitely there.
As you said, it is very much a global issue and one that we would look to engage on through larger trade association partners—perhaps those based in Europe—but we are also thinking about contributions from the industry to platforms such as the United Nations climate change conference of the parties, or COP. We will always be a key part of that agenda.
Good morning. I will follow up on a point that Claire Mack mentioned about how we measure economic success in renewables. There is no doubt that there has been good progress in the role of energy production in cutting emissions in Scotland, particularly through onshore wind energy. However, it is probably fair to say that that has not yet translated into the maximum number of job opportunities. In 2010, the Government’s “A Low Carbon Economic Strategy for Scotland” promised 130,000 renewables jobs by 2020. I remember being told that we would be the Saudi Arabia of renewables.
Claire, you mentioned the recent report by the Fraser of Allander Institute, “The Economic Impact of Scotland’s Renewable Energy Sector—2022 Update”, which estimated that the number of renewables jobs was 27,000, which is about a fifth of the target.
The first thing that struck me was that that was an estimate, because we do not seem to gather data on renewables jobs. The second thing that struck me was that, yesterday, when the cabinet secretary outlined the draft energy strategy and just transition plan, he used the term “low-carbon jobs”, which I think that Jon O’Sullivan mentioned, and the potential to reach 77,000 jobs. Obviously, that includes jobs in the nuclear industry. Then, during the discussion, he used the phrase “green jobs”. Three different terms for renewables jobs were used in the course of one discussion.
There is clearly a gap in the data, so what exactly should we measure when it comes to the economic benefits of the expansion of renewables? How do I and other politicians know that we are maximising the opportunities? You will all be able to tell me that companies are awarding contracts to Scottish firms and have created X jobs, but you will probably not tell me when the contracts go to overseas firms. How do I know that we are getting the maximum number of jobs and, if we are not, whether there is a barrier?
It is only fair to start with Claire Mack because she mentioned the topic and Scottish Renewables commissioned the work from the Fraser of Allander Institute in the first place.
One of the key points to make on the difference between the first jobs figure that you quoted and where we are today relates to the pipeline. That is what everything comes back to. You need projects to create jobs. We have a lot of opportunity in new technologies, such as floating offshore wind and the tidal sector, in which there is a ground-up alignment with existing oil and gas skills, so you do not start from zero but from a good base.
On the measurement issue, we have basically used a model that was devised by the oil and gas sector to help to understand more about the energy market in Scotland. The issue that you raise about the difference between a low-carbon job, a green job and a greening job is one that Skills Development Scotland is considering through the climate emergency skills action plan. There is good analysis of that in the plan, and SDS would be better able to help you than I am on the measurement of that.
We are constrained by the fact that we do not have a distinct industry code for renewables. I go back to what I said about the changing shape of projects. At some point in the process, we are heavily reliant on lawyers and planners for contracts and constraints and then we are heavily reliant on the construction sector, so the jobs picture changes shape over the course of a renewable energy project.
Longevity comes in operations and maintenance, where about 50 per cent of the jobs are. That is the bit that we need to understand because that is where you will have jobs for the next 10 to 40 years. The pipeline of construction will give you a boost. As we all know, when you construct something such as the Queensferry crossing, you see a boost in the economic figures that go alongside it. We are no different when we are in that phase, but the on-going piece is operations and maintenance. That is rooted in Scotland because that is where the projects are. It includes vessels that help us to get out to wind farms and drone operators who help us to survey them—all that kind of stuff—as well as new jobs that are part of the sector.
Maximising opportunities is about understanding where we are now and being able to meet future demand. One way to maximise opportunity is to get better data now to help us to forecast better so that we understand what we need and are able to use as many as possible of the people that we currently have in the country to meet that need.
Following the path of the oil and gas sector is also really important for maximisation of opportunities. That workforce has been heavily mobile, and the sector has heavily exported not just the product but people. We are really keen to see that in Scotland and, as a trade association, we have looked for targeted and focused support from Government to help to build export capability. We have amazingly wide reach—we are in about 72 countries—but, as with most other sectors in Scotland, it is a narrow exporting base, and we need to broaden it to be able to maximise the opportunities.
Those are important points, but I am still struggling with why we are not measuring any of those things at the moment. Why do you have to do the work? When we politicians set targets, why do you have to measure what progress is being made on them?
Through the current system, we have good data on oil and gas projects. Part of the energy transition is that it is hard for firms to do the returns in a way that would be meaningful but gets down to granular-level data.
For example, R J McLeod works across a number of different civils projects. Some of them are roads and rail and then there is work on renewables projects. The way that you do the return impacts the data that you get. One of the problems is that capacity and resource mean that companies struggle to give the granular level of detail that we need because they are sometimes working on renewables projects and sometimes they are not. For example, those who work for EDF Renewables—which continually works on renewables—are quite easy to identify. There is a devil in the detail issue.
10:45Another critical issue is that the Office for National Statistics had to pivot quite quickly to manoeuvre itself to work on Covid data, and things that we had spoken to the ONS about—such as how we get a better handle on what is going on in the wider economy and in the renewables sector—were put to one side to allow it to do that. Now that we are coming back into an economy that looks a bit more normal, the ONS needs to look at those things in quick order to get us to a point at which we can get better data. That is certainly the message that has come from my colleagues at the Fraser of Allander Institute. The issue lies with getting the microdata, as they call it, from companies and being able to translate it, through to the way that the ONS reports, to get something more meaningful. To be fair, capacity at the ONS was constrained because of the key work that it was doing on reporting on Covid impacts.
I turn to Jon O’Sullivan from EDF Renewables and ask him the same question. Jon, you said that there were gaps in the energy strategy in respect of some of the targets around production. For me, the biggest gap related to jobs. What is the target for jobs?
You might think that I want that target so that I can assess whether you are delivering jobs in Scotland and not handing contracts overseas, but a target would flag up where there was a problem with the capacity in the supply chain or whatever the reasons were for jobs not coming to Scotland. I presume that you would support having proper data so that we can not only hold your feet to the fire to ensure that you are creating the 50 jobs in Eyemouth that you mentioned, which I have a keen interest in, but ensure that that is the maximum number of jobs. If there is a barrier to that, we need to break it down.
I could not agree more. We want to have our feet held to the fire. We have a good reputation for delivering on our promises, and we need to work together with Claire Mack and as an industry not only to set clear targets for 2030 and 2050; we need to break things down to see whether we are on the right trajectory in 2025 and 2030 so that we will hit the targets and there are no unwelcome surprises at the end, and we do not realise that we should have been more proactive in doing more now.
I would welcome work to consolidate and standardise the targets on megawatts and jobs, and on the right terminology and how we measure. Maybe another key performance indicator to measure success is gross value added. That has been quite a well-used and well-known term in measuring the positive impact on the economy.
There is, I hope, a good discussion to be had as part of the consultation on the energy strategy and just transition. Let us clarify the KPIs and measure our success in achieving net zero.
James Reid has a keen interest in ensuring that we maximise supply chain jobs in Scotland. How do I know that companies such as FES Energy are getting those opportunities and that they are not, in effect, being offshored? Is that a challenge that you face, or is so much work going around that it is actually fine?
That is a good question. I think—
I am sorry to interrupt. We are running a bit short of time, so I ask the witnesses to be brief. That will be the last question from Colin Smyth; I will move on to questions from Jamie Halcro Johnston. Two remaining members may wish to ask questions, and I want to give them time to take that opportunity.
Please go ahead, James.
I think that there are probably two facets—[Inaudible.]
We are having a problem with James Reid’s connection, so I will move on to Jamie Halcro Johnston while we see whether we can get him reconnected.
Thank you, convener. I will make my two questions very short, and I will put them both to Claire Mack.
We have already talked about constraints on the network. That issue has been highlighted. As a member from the northern isles, I know well the issues around grid upgrades and the like. I want to look beyond that.
Work is being done by organisations such as ReFLEX Orkney, which is coming to the cross-party group on islands today to talk about how we can use energy better locally. There is a real concern. I was looking at some figures from the Renewable Energy Foundation—you may have better ones—that say that, in 2020 alone, 3,460 gigawatt hours at a cost of £243 million were lost to constraint payments. That is energy that could be better used in communities. How can the sector do more? How can we as a country use that better and avoid having to spend that money not producing energy? We could be putting that into local homes and businesses.
We put the same question to the National Grid. We asked whether it believed that constraint payments are still the most efficient way to run the network, and it said that it believed that they are, for the moment. The network infrastructure build programme is phenomenal. Let us also not forget its contribution to jobs. Those jobs are certain because it is a regulated investment base that the National Grid works from.
A lot of the constraint issue is to do with management of the grid and not having enough capacity on it, but some of it is down to the very nature of renewables. There is intermittency and, for things such as solar, the generation happens when demand is lower. The key way to overcome that is to grid build. That is a long-term plan. It would be hard to see an investment in grid infrastructure at the moment that would be wrong; there are a lot of “No regrets” in there. Continuing to build the grid is really important in a country that has such an abundance of energy.
The other key area that we need to look at quickly and specifically is storage. Again, Scotland has some key geographic characteristics that mean that it is the place to develop new, innovative storage, as well as to rely on some tried and trusted sources, such as pumped-storage hydroelectricity. We have some phenomenal companies. You mentioned Orkney, which has been working on hydrogen into transport as a key area.
We also need to look at different types of storage, including shorter duration stuff such as batteries, and how they integrate into more localised energy systems. Jonny Clark might want to add a little on that. Pumped-storage hydro is longer duration. There is also interseasonal storage and the role of hydrogen in our economy. That is a key area in which we are able to start to build out some new infrastructure and innovative product, with new skills and technologies that will be of use everywhere else in the world. The integration point is the key question now. The constraint burden can be reduced by creating new technologies and innovative approaches to integration that will help to alleviate the problem.
I have a couple of brief points on that.
We should definitely be looking at storage technologies so that we can optimise capacity and use the full capacity that is there. That would address the first issue to some extent. We are doing quite a lot of optimisation work on those assets, looking at what could be co-located as another generating technology that is negatively correlated with the existing one and/or storage technology. We are starting to see more of that, although there is a financial and economic overlay to that.
On innovation, we are the technical adviser on the low-carbon infrastructure transition programme, funded by the Scottish Government. We are seeing all sorts of interesting innovative technologies coming through that. There are other, similar things happening that are really important to addressing the point that you have raised.
When I speak to people, there is a real concern that we are spending money not to produce energy at a time when we need energy and people’s bills are so high.
I will leave it there, convener.
Does Michelle Thomson have a question?
Yes, convener. In the interests of time, I will be quick.
I thank the witnesses very much for everything that they have said so far.
I want to go back to the focus of the session, which is the outlook for business investment. I want to ask about your perceptions for women in your sector: women-led SMEs, women in renewables generally, and women in the just transition. Given the very fulsome comments about data, can you make it clear whether your comments are merely perceptions, based on anecdotal evidence, and where you do not have the data collectors in place? On the back of that, where would you need to see data collectors in place?
Could Claire Mack lead off on that? In the interests of time, I will just go around the panel.
I can go quickly on that. There are a lot of different issues in there. When industry has come to the Government to look for a sector-deal approach, gender has been one of the key areas. The black, Asian and minority ethnic workforce is really important in there, too. One of the ways in which to secure more commitment is through the onshore wind sector deal in Scotland and the offshore wind sector deal with the UK Government, which sits predominantly in Scotland because of where the projects are. There are targets in the energy strategy, and there is always a quid pro quo. How we do things is a really important part of that.
The other point to make is about the breadth of different jobs within the renewables sector. We have seen that come through the energy sector in the past. I have spoken to my colleagues in oil and gas and they, too, have concerns about diversity in their workforces, because the very nature of the work tends at times not to be family friendly. Offshore work can be very difficult in that respect.
The world is changing in the sense that there is flexible working and more family-friendly working environments are opening up. In renewables, the breadth of jobs can really support our diversity aspirations.
If I look at where our members are saying there are skills gaps and shortages, I see that there are such gaps and shortages in environmental specialists within planning and consenting, for example. Again, that is open to much more flexible types of working and more diverse intakes. The jobs of welders, fabricators and turbine technicians are open to people from all walks of life. That is part of the diversity agenda, and it is something that the industry takes as part of its values.
That is linked to the question that Maggie Chapman put to us earlier. We want to do the right thing. We are a positive industry, and we want to be seen to be doing the right thing. How we present ourselves to the world is crucially important.
What about the question about data, the current status, and how you know whether that is true?
Linked to the offshore wind sector deal, we have data direct from industry that is broken down in that way. I guess that we need to do a little bit more of that. That comes back to that ONS issue. If something is an important criterion in what we want to see as part of the just transition, it is something that we should be speaking to the ONS about in relation to microdata gathering, what it is that we want to know about, and what is important to us.
I sense that Jonny Clark wants to come in on that, given that he was nodding.
Yes. On data, I can talk only from the perspective of our business. Our workforce is split 50:50 male and female. One of the things that we are keen to do is to encourage more women coming out of science, technology, engineering and maths courses into the industry. There is a lot of interest. We are proactively talking to people involved in further education and higher education courses to try to get in there and talk to the students to raise the profile of the opportunities across the board in the renewables industry. That is really important.
To go back to the talent pool challenge, we need as diverse a talent pool as we can possibly access.
Do Jon O’Sullivan and James Reid have anything to add? I appreciate that it is a vast topic.
We have a policy called “Everyone’s welcome”, which focuses on diversity, inclusion and gender. On measuring success, we are seeing more women in leadership positions across the board. As a company, we would support an industry-wide initiative to track the KPIs.
I am 100 per cent behind what Jonny Clark and Jon O’Sullivan are saying. I do not think, from my perspective—[Inaudible.] The reality is trying to get interest very early on. That starts with STEM. That—[Inaudible.]—high school and college leavers to increase that pool.
Thank you, James. Your line was breaking up a little bit, but I think that we got the gist.
I thank all the witnesses for their contributions to our evidence session, which will be really helpful to our work in the new year.
11:00 Meeting suspended.