MENU

Social Channels

SEARCH ARCHIVE

  • Type

  • Topic

  • Sort

Simon Evans

08.09.2014 | 4:30pm
UK policy Scottish Independence: How would we divide up our oil, wind and gas?
UK POLICY| September 8. 2014.16:30
Scottish Independence: How would we divide up our oil, wind and gas?
  • Twitter icon
  • LinkedIn icon
  • Email icon
  • Messenger icon
  • WhatsApp icon

The build up to the 18 September Scottish independence referendum has now officially reached fever pitch. With polling suggesting a vote for independence is a real possibility, the question of how the union might be divided has taken on a new significance.

Scotland and the rest of the UK are closely interdependent for energy infrastructure and fossil fuel resource. So how would the UK divide up its oil, wind and gas resources with an independent Scotland, and what would it mean for each of the new nations’ efforts to decarbonise?

North Sea oil and gas

Thelargest energy prizein economic terms is North Sea oil and gas. Some 40 billion barrelshave been extractedso far and anything from 2 to 24 billion barrels remain, depending whoyouask.

苏格兰政府苏格兰会说right to 90 per cent of future North sea oil and gas tax revenues. That’s based on drawing a boundary in the North Sea that is equidistant from the shores of England and Scotland.

This method is called the ‘median line’ or ‘equidistance principle‘. It was used when the UK, Norway and Denmarkcarved up oil and gas rightsin the 1960s, before the North Sea oil rush began.

But since then, a disputed settlement over North Sea rights for Germany, Denmark and the Netherlands concluded the equidistance principledoes not have legal weightand other factors can be considered.

The UK government’sreviewof boundary issues lays out the legal principles that would apply in any settlement. It notes that fisheries boundaries were drawn in 1999 along the line of equidistance, marked in blue on the map below. Civil legal jurisdiction is based on a simple line of latitude, marked in red. This would be more favourable to Scotland.

Screen Shot 2014-09-08 At 11.52.55

Source: HM Government ”Scotland analysis: Borders and citizenship

A Scottish governmentreport使用蓝色的读出an line in estimating future shares of oil and gas tax revenues. Thisvery detailed academic reviewof the legal principles and precedents around maritime borders concludes the line should be pushed further south, in Scotland’s favour.

However, the final boundary would have to be negotiated between an independent Scotland and the rest of the UK.

Relative populations arenot a central considerationin maritime boundary disputes, so it seems most likely that the median line would be the starting point for negotiations.

On that basis Scotland would gain the lion’s share of future North Sea tax revenues. Full Factreportsthat Scotland would get 84-95 per cent of revenues,according to the Scottish government, or 73-88 per centaccording to the HMRC. Both calculations are based on the median line and vary only in their estimates of production and tax rates for the various oil and gas fields.

In 2012/13 an 84 per cent share of North sea tax revenues was worth £5.6 billion. But future revenues arehighly uncertainand aredependenton oil prices and the costs of extraction, among other factors.

Can Scotland cut emissions while maximising fossil fuel exploitation? Scottish climate minister Paul Wheelhousetells RTCChe recognises the question is important, but that there will be demand for oil and gas in the short to medium term. And of course the same question applies whether the UK isdividedor not.

Electricity supplies

So much for the fossil fuel. What about the electricity generating capacity?

Scotland’s electricity supplies are much lower-carbon than the rest of the UK’s. In 2012 Scotland got a pretty stunning 69 per cent of its power from a combination of renewables (purple area, below) and nuclear (light blue area).

Screen Shot 2014-09-08 At 15.13.46

Source:DECC electricity generation and supply figures for the home nations, 2012

Scotland plans to generate the equivalent of 100 per cent of its electricity from renewables by 2020. It would keep nuclear and conventional power plants open, generating more than 100 per cent of its needs in total and notionally exporting the non-renewable part to England.

Scotland has 43 per cent of the UK’s wind capacity and pumps out 92 per cent of its hydroelectric power, and is set to continue to dominate renewables production on these islands, reflecting its abundant resources of wind and space. DECCsays可再生能源的投资价值£300亿公顷ve been announced in the UK since 2010, of which £14 billion is in Scotland.

Taking the UK as a whole – including Scotland – 12 per cent of our electricity came from renewables in 2012. (The amount has sincerisen.)

Screen Shot 2014-09-08 At 15.14.10

Source:DECC electricity generation and supply figures for the home nations, 2012

If Scotland gained independence, it would make the electricity supply of the rest of the UK less green.

On 2012 figures, the rest of the UK excluding Scotland got only 9 per cent of its power from renewables, and only 17 per cent of electricity from nuclear power.

Screen Shot 2014-09-08 At 15.13.59

Source:DECC electricity generation and supply figures for the home nations, 2012

So it might seem like losing Scotland would make it more challenging for the rest of the UK to meetthe EU target to source 20 per cent of energyfrom renewables by 2020.

It isn’t clear how this target would be divvied up if Scotland votes yes. But it’s fair to assume the UK would continue to rely on renewables from north of the border unless the target is amended, post independence.

EU rules allow for the UK to meet its target by importing renewable electricity from other member states, or even to simply buy renewable energy ‘credits’ from countries that have exceeded their target.

The UK government says the rest of the UK could choose not to pay the bill for subsidised renewable power from an independent Scotland. But it couldn’t forego Scottish renewable electricity imports overnight because it needs the power to keep the lights on. Scotlandsupplies4.6 per cent of demand in England and Wales.

The UK as a whole is already anet importerof electricity, getting around five per cent of its supplies via interconnector cable mainly from France and the Netherlands. Simon Moore, senior research fellow for energy and environment at right-leaning thinktank Policy Exchange says:

“It would be difficult [for the rest of the UK] to immediately replace all imports of Scottish generation including wind, conventional and hydroelectric power.”

Moore explored the potential for new interconnectors in a Junereport. Plans to boost interconnector capacity across the channel would allow England to increase imports from the continent a bit, he says, while plans to link up with Norway would further boost potential. But both will take time.

At this stage it is almost impossible to say how the energy systems of Scotland and the rest of the UK would fit together, post independence, although Westminster hashad a go.

Moore suggests it might be easier to retain a UK electricity grid than to split 100 years of joint grid investment, for example, but detailed discussions wouldn’t begin until after a yes vote. He concludes: “I don’t think anyone really knows what will happen.”

Expert analysis direct to your inbox.

Get a round-up of all the important articles and papers selected by Carbon Brief by email. Find out more about our newslettershere.