Meeting of the Parliament 01 May 2025
Colleagues, today’s debate on Scotland’s hydrogen future is important, and I am pleased to open it. Hydrogen stands as a critical pillar of Scotland’s route to net zero by 2045. Alongside the development of offshore wind capacity, it is one of Scotland’s greatest industrial opportunities since the discovery of oil and gas in the North Sea. I will set out some of the progress that we have made to further develop the sector, the challenges that we still face and need to overcome, and why collaboration across Governments, sectors and borders will continue to be absolutely essential if we are to realise our hydrogen ambitions for Scotland and those for the whole of the United Kingdom.
As I have said many times, Scotland is committed to the target of reaching net zero by 2045. That ambitious target reflects our determination not only to lead by example in the UK and Europe in our response to the climate emergency, but, critically, to harness the vast economic opportunities that an energy transition presents for Scotland. The global shocks that we have experienced since 2022—geopolitical instability, energy market disruption caused by Russia’s illegal invasion of Ukraine and the urgent drive towards energy security in Europe—have only underscored the need to work together in Scotland, across the United Kingdom and with our international partners, particularly in continental Europe, to bolster our energy security.
A just transition remains at the heart of our approach. We are determined that no community—particularly not the ones that have powered our economy for generations—will be left behind as we move away from the burning of fossil fuels towards a low-carbon energy system. We are working to build a hydrogen economy in which the benefits of our energy transition are shared and that harnesses the full potential of our skilled workforce and world-class industries, both of which are the envy of neighbouring countries, as well as the natural resources that Scotland is so lucky to have.
Our hydrogen action plan offers a pathway to decarbonising hard-to-abate sectors. It can balance our power system, improve our energy security and, at the same time, secure high-quality jobs in our communities. Our hydrogen action plan and green industrial strategy dovetail to set out clear actions that will establish a thriving hydrogen economy in Scotland. Despite changing global conditions, we are firmly in delivery mode. We are not wavering from that ambition, and we have already made significant progress. We have a growing pipeline of more than 100 hydrogen production projects that are at varying stages of development, the majority of which are green hydrogen production projects. Those projects provide confidence in the future growth of the hydrogen economy in Scotland.
The UK Government’s hydrogen allocation rounds—HARs—are a vital mechanism for supporting low-carbon and renewable hydrogen production across the UK and providing revenue support to bridge the gap between clean hydrogen and fossil fuels. The first hydrogen allocation round—HAR1—delivered funding to two early Scottish projects—Cromarty hydrogen project and Whitelee wind farm—both of which are targeting production in 2026. A further eight Scottish projects, which were shortlisted last month in the HAR2 funding round, provide a significant boost to our progress on production capacity. Six Scottish projects have been boosted by capital funding awards from the UK net zero hydrogen fund.
In addition to the UK Government’s support, the Scottish Government has invested £30 million in the hydrogen sector. That includes £7 million in grants to 31 projects across Scotland via the hydrogen innovation scheme. That has been driving advances in renewable hydrogen production, storage and distribution and the innovation that is associated with that. A £3.1 million grant to Storegga’s Speyside hydrogen project in Moray is developing clean energy to help to decarbonise the whisky industry. I am immensely proud that our iconic whisky industry is one of the first movers in adopting that technology, which I think we will see happening at pace. Via the just transition fund, £6 million is also going to HydroGlen, which is a green farming pilot in Aberdeenshire. Additionally, the H100 project in Fife, a hydrogen for home heating trial that is run by Scotia Gas Networks and is the first of its kind in the world, is soon to commence. It is supported by £6.9 million in Scottish Government funding.