Just Transition Summit 2025 – Briefing Paper

Purpose

This is a short briefing to support discussion among participants at the Just Transition Summit on October 29. The text synthesises the Commission’s insights and findings since its inception in 2018, particularly its second iteration beginning in 2022. It is intended to provide a common reference point for assessing the current status of efforts to achieve a just transition in Scotland, key risks and opportunities.

The potential scope of just transition issues is very broad. Rather than seeking to cover these exhaustively the paper aims to establish a sense of the relative priority and scale of major strategic challenges facing Scotland at this juncture, as well as measures to support meaningful breakthroughs.

We encourage all participant organisations to consider new commitments you will make to further a just transition for Scotland, for inclusion in our action agenda.

This is a live document and we want to hear from you.

Summit participants are invited to share views, both ahead of the Summit, during the event and in the immediate period following. Please write to us through the Just Transition Summit event app or by email to justtransitioncommission@gov.scot no later than November 5.

Your comments and suggestions may be published and will inform the Commission’s final report before the end of this Scottish Parliament.

Where are we now?

Scotland’s climate and nature transition is underway and, swiftly or otherwise, our emissions will fall over the coming decades, along with significant changes to agriculture and land use and a continual move to a more dangerous climate with greater climate and ecosystem risks. Climate change is one of the five key drivers of biodiversity loss, which is making our ecosystems less resilient and less able to continue to provide the basic requirements for life: clean air, clean water, productive soils, and natural resources. The way we use our land and sea in Scotland is driving habitat loss and fragmentation.

The central strategic risk before us on this journey now is as follows. The social and economic impacts of closures and phase-downs are likely to be clearly measurable and defined, as we have seen most clearly with the closure of the oil refinery at Grangemouth, as well as through wildfires, floods and drought. The impact of this, beyond financial considerations only, could take the form of redundancies, the loss of opportunities for young people, loss of communities, skills, industrial capacity and investment. The extent to which the public has confidence in a managed, fair and orderly process of decarbonisation and nature restoration will be determined by two principal factors. Firstly, are people impacted, including those with livelihoods tied to high emission or unsustainable economic activities, being supported sufficiently to plan and prepare for a transition to more sustainable work? Secondly, are the benefits of a healthy planet and the green economy clear and tangible?

Scottish Government approach

The Scottish Government is developing just transition plans covering core economic sectors (energy, transport, land use and agriculture, built environment and construction) as well as supporting planning on a more local scale for critical regions and sites. It has carried out extensive engagement to better understand the perspectives and experiences of people and organisations who may be impacted by the transition. Just transition was also established as a ministerial portfolio, in a global first, and forms one of the three pillars of the Scottish Government’s response to the climate and nature crises, along with mitigation and adaptation. The Scottish Government has set up two area-based just transition funds, for the North East and Moray, and more recently for Grangemouth.

The Scottish Government also established an independent Just Transition Commission (JTC) which has run in two iterations since 2018. The JTC’s advice has helped embed just transition principles in policymaking, informed planning work for sectors, sites and regions, and has established the principle that a whole-economy approach is required rather than a focus on energy in isolation. It has also supported work towards a monitoring and evaluation (M&E) framework and has advised on the conditionalities that should shape investment and policies for a just transition. The JTC’s current remit expires in May 2026. The JTC combines a consensus-building function by facilitating a sustained, evidence-based dialogue among principal stakeholder groups (including business, trade unions and environmental groups) and hearing directly from those at the sharp end of the transition, with an expert advisory role providing scrutiny and advice.

Social and economic trends

Macro-economic headwinds and the challenging fiscal picture have made progress on just transition issues more difficult but even more critical. The cost crisis Scotland has experienced since the Covid pandemic has been driven by high energy prices, with the marginal pricing of energy limiting the positive effect the expansion of renewable supply could otherwise have in reducing fuel poverty and lowering electricity costs for households and industries. The Scottish Government declared a national housing emergency last year. Local government budgets have suffered from a decade and a half of severe reductions, and with basic service provision under threat, this has severely reduced the capacity of local authorities to tackle the longer term challenges associated with the transition for the communities they serve. In Scotland we have seen stagnation in progress over the past decade in reducing both absolute child poverty and inequality, while fuel poverty has sharply increased in the last few years. Food production in Scotland relies on government subsidy and lacks the support to transition to the regenerative and sustainable farming outlined in the Scottish Government’s vision for farming.

International context

Scotland is internationally recognised as a leading example of how just transition principles can be applied to policymaking, but we now need to deliver measurable progress at scale to show proof of concept. The topic was embedded firmly in the international climate process through the United Nations Framework on Climate Change (UNFCCC) Just Transition Work Programme established at COP27 in 2022 and is also central to the Sustainable Development Goals. Every jurisdiction will at some stage have to consider how to manage the social and economic aspects of changes that reduce emissions and rebuild biodiversity. Scotland has the advantage of having committed to both of these challenging processes at a relatively early stage, having developed what began as a campaign from civil society groups into a major strategic goal to transition fairly to a resilient low carbon future that is fair for all.

Innovation for delivery

Against this backdrop, achieving a just transition will require a resourceful and innovative way of working across both the public and private sector, as well as new measures to ensure every penny of public money is deployed as efficiently as possible to achieve maximum social, environmental and economic returns. Scotland can no longer afford a “cheapest wins” approach. A just transition requires whole-of–government mainstreaming as a cross-cutting strategic objective, since by its nature the transition brings together policy areas that might otherwise be considered separate. This could be housing and peatland restoration, or regional economic development and green heat financing, or depopulation and forestry.

The Commission’s initial showcase of initiatives across the country shows just transition principles are starting to be successfully applied by resourceful and innovative individuals, communities and businesses to materially improve people’s lives.

Core topics

This section synthesises the Commission’s findings to date across the three core themes to be discussed at the Summit. It is intended to stimulate focused discussions. Participants are encouraged to consider whether the description below corresponds with your assessment, and how you would wish to see it enhanced.

Jobs and skills

Scotland needs a clear and credible plan for how the transition will be managed for critical sectors, especially the energy sector. Businesses, workers and public sector bodies (particularly our colleges and local authorities) require clarity, stability and confidence in the medium to long term policy picture to unlock investment, deliver the required infrastructure (particularly ports and harbours) and help plan for how to transition their activities away from high emission operations.

Top of the list must be a credible plan for the North Sea workforce, to be developed and delivered jointly by the Scottish Government and UK Government as a matter of urgency. Currently, workers fear a “cliff edge” transition, and significant redundancies are already underway. The plan must include meaningful support through the transition not only for those in operational roles, but also support staff such as catering crews. Decommissioning has the potential to play a significant role in phasing the transition and retaining the workers that will be needed for renewable expansion, retrofit and other sustainable economic activities.

Drawing lessons from the Grangemouth refinery closure as well as Port Talbot, our national and local governments must prioritise anticipatory site and region-based planning and delivery of targeted investment for high emitting sites as well as detailed plans for supporting those currently working in at-risk roles such as gas boiler engineers and vehicle maintenance to prepare for the mainstreaming of low carbon technologies in heating and transport. With 80% of Scotland’s land farmed, ensuring that farmers and crofters are supported in a just transition to regenerative and sustainable production is key, particularly by ensuring those doing the most for nature, but whose businesses may be vulnerable, are safeguarded and that rural communities and economies are therefore protected.

Colleges need more funding to deliver the skilled workforce of the future. Key growth areas are anticipated across nature-based jobs such as peatland restoration, woodland regeneration and creation, renewables and the associated supply chain, retrofit, construction and civil engineering. In construction alone, forecasts suggest an additional 256,600 jobs by 2029 (Climate Emergency Skills Action Plan). The simplified notion of a wholesale transition of the oil and gas workforce into renewables appears both unlikely and unhelpful at this juncture. Our skills development must be aligned with a robust strategy to diversify the economy as well as the workforce for new industries. This requires a serious long-term strategy to reverse the decline of the care, health, cultural and education services that underpin economic performance and sustain the entire workforce and are critical for adaptation and resilience, and will be key to success alongside directly-affected sectors. Achieving the transformation in a just manner requires that we significantly expand the number and quality of jobs, skills and pay in the low-emitting social and cultural infrastructure sectors.

Investment

The market-led approach to securing the investment required for principal elements of Scotland’s decarbonisation appears incompatible with both carbon budgets to 2045 and the aim that changes be achieved as fairly as possible. New financing models are required across a host of hard-to-treat issues if low carbon heating, retrofit, modal shift in transport, uptake of electric vehicles, nature restoration and peatland restoration are to be delivered at the requisite pace and scale and achieve an equitable distribution of costs and benefits. These all stand to be core aspects of a renewed Scottish economy, which can secure the futures of our young people as well as those moving out of high emission work and work associated with high biodiversity loss. Our policy community has developed a range of plausible approaches and interventions in some key sectors, for example the proposals set out by the Green Heat Finance Task Force. We now need key decision-makers to lead the change and prioritise the implementation of innovative financing mechanisms across sectors to ensure we make the most of the transition and its huge potential up-side.

Transformational political leadership such as setting clear dates for the phasing out of high emitting systems and technologies and clear targets for nature restoration will help unlock private investment by providing certainty to industry and financial institutions around the sequencing of market changes.

With public finances extremely tight, public money must be deployed with great care and where possible further the strategic goal of just transition. We should build on international good practice and the considerable expertise the public sector has already built up in routinely applying strategic conditionalities on public grants, procurement contracts, licenses and tax incentives, to develop specific just transition conditionalities. These should be geared towards a set of objectives with obvious value to a just transition, including supporting training and apprenticeship schemes in impacted communities, protecting workers through improving wages, security and reskilling, expanding domestic green supply chains, investing in local adaptation and climate resilience measures, securing community investment in the form of community benefit or community wealth funds, and achieving shared ownership or equity stakes to safeguard the long-term social and economic value of public investment.

Just transition conditionalities could be adapted and applied to, for example, the Just Transition Funds for Grangemouth and the North East and Moray, future ScotWind leasing rounds, economic development initiatives (Green Freeports, Investment Zones, Growth Deals) investments by the Scottish National Investment Bank to strengthen delivery against its codified just transition mission, the future agricultural support model, as well as public procurement for transport infrastructure.

People and place

The transition offers the opportunity for community wealth building to become a central feature of Scotland’s economic development. A community right to shared ownership of renewable energy developments should be established, enabled by new measures to (1) enhance the capacity of local authorities and communities to take advantage of renewable developments (for example through centralised provision of legal and technical support), and (2) unlock access to finance for local authorities and communities. Mandating community benefits and shared ownership are reserved matters, but the Scottish Government can lead on the issue by developing a clear strategy for success as the area of the UK with the most extensive experience of onshore and offshore wind developments.

This should include assessment and mitigation of the “postcode lottery” effect, which poses a risk to equity and regional cohesion since the costs and benefits accruing from the climate transition are not distributed evenly in geographical terms. Community rights to a healthy, restored natural environment should be delivered as part of infrastructure development through full implementation of National Planning Framework Policy 3.

Just transition challenges typically present at local or regional scales and require specific measures and monitoring at that level. Regional just transition planning will require a major new program of work with Scottish Government leading and coordinating efforts across 32 local authorities, public bodies, third sector, business and industry. The model for regional just transition planning should support the agreement and delivery of a long-term vision, based on evidence-based interventions, legislation and guidance and setting requirements as part of a core just transition offer. Local authorities should have a duty to deliver on this, matched by appropriate resource and competencies, and embedding a consistent practice of multi-stakeholder participation, information-sharing and collaboration across areas and regions. Regional plans should also be a critical vehicle for capturing metrics and indicators to assess performance, which in combination will provide a far clearer picture of progress at the national scale to inform the further development of strategy.

Action agenda: what will your organisation do?

Summit participants are invited to share specific actions you and your organisations will take to progress delivery of a just transition. Some examples of the kinds of commitments different organisations may wish to make are set out below for further discussion.

Scottish and UK Governments and local authorities:

• Commit to effective co-working between governments. As currently modelled in the joint work being carried out through the Grangemouth Future Industries Board, we need different levels of government to commit to the principle of proactive collaboration to support pragmatic delivery, particularly for areas of critical risk such as the oil and gas workforce.
• Apply just transition conditionalities to public money and contracts.
• Agree and operationalise a joined-up approach to regional just transition planning.

Scottish Government:

• Build on the foundations set for a long-term process of multistakeholder dialogue and consensus building.
• Embed measures of just transition progress in statutory reporting on the Climate Change Plan
• Establish a just transition monitoring and evaluation framework
• Following the Grangemouth refinery closure, urgently progress just transition plans for other high emitting sites, such as Mossmorran and Sullom Voe.

Business

• Produce company just transition plans in dialogue with workforce to support preparation for change including skills development and retraining
• Engage in good faith to support the implementation of just transition conditionalities, recognising their long-term strategic value.

Environmental groups

• Further develop understanding of industrial, social and economic needs in relation to greening.
• Work with all sectors to build ecological literacy to build greater support and effectiveness of resource investment in ecosystem resilience.

Trade unions

• Proactively support workers at risk to plan for their futures.
• Sustain constructive engagement with employers for effective transition planning.