Source · Select Committees · Scottish Affairs Committee
Recommendation 17
17
Accepted
Grangemouth case highlights government inaction on preparing for industrial job losses.
Conclusion
The Grangemouth case is the energy transition’s canary in a coalmine. It has illustrated the need for Government’s active stewardship in the energy transition. Petroineos advised the Committee that the UK and Scottish governments were aware of its plans to cease operations at the refinery five years ago. Both the UK and Scottish governments should have acted sooner to prepare for the resulting job losses and set in motion a feasibility study for future industries at the site at a much earlier point. This lack of action created an employment gap and trauma for the local community that could have been avoided. Petroineos, in collaboration with the Government, local authorities and trade unions, ought to have produced a comprehensive exit plan. (Conclusion, Paragraph 124) 58
Government Response Summary
The government agreed with the committee's conclusions regarding past failures at Grangemouth and detailed its subsequent actions, including a £100 million support package, a training guarantee, the Project Willow feasibility study, and a £14.5 million seed fund to transform the site.
Government Response
Accepted
HM Government
Accepted
We agree with the Scottish Affairs Committee’s conclusions on preparation for Grangemouth. Petroineos’ first made its intention to cease refining operations public in November 2023 ahead of the company confirming this position in September 2024. Despite this the previous government had not undertaken planning for the future of the Grangemouth refinery, and no efforts were made to prepare for the refinery’s closure and the impacts on the community and workforce. Within weeks of this Government being elected, working closely with the Scottish Government, we put together a £100 million package to support the community, and invest in the local workforce, along with tailored support to secure good alternative jobs. To date the Grangemouth Training Guarantee has supported 269 ex-refinery workers with training. Alongside this, we launched the Project Willow feasibility study to identify low carbon and clean energy business models that could be developed at the site. This study drew on expertise from the workforce, local community and key stakeholders with an interest in Grangemouth to identify the site unique competitive edge and how it can be transformed into a low carbon and clean energy hub. We continue to work closely with the Scottish Government on options for investment in Grangemouth having established the Grangemouth Investment Taskforce which has received over 140 enquiries to date. We are calling on investors to come forward to seize the opportunity that Grangemouth presents to transform it into a low carbon and clean energy hub. To deliver this, we have announced a £14.5 million seed fund to support these projects, which will work alongside the National Wealth Fund’s £200 million commitment for co-investment opportunities at Grangemouth.