Paul Wheelhouse talks fracking, nuclear and relations with Westminster

Written by Liam Kirkaldy on 14 December 2016 in Inside Politics

In walking a tightrope between different energy interests, Paul Wheelhouse will need all the diplomacy he can muster

 

When Paul Wheelhouse told his mum he was joining the SNP, she was sceptical, to say the least. Asked how she reacted, he says: “She, well, she questioned my judgement, I think.” 

Wheelhouse has been a minister in the SNP government since 2012, moving from environment and climate change to community safety and legal affairs, and then ending up most recently as Minister for Business, Innovation and Energy. As you might expect, he is an enthusiastic supporter of his party. But growing up, and while attending university, he was a Tory.

“It’s a constant source of…” Wheelhouses pauses, “well, embarrassment and amusement to my colleagues, I think.” “They poke fun at me occasionally,” he adds.

Born in Belfast and having moved to Edinburgh when he was three, Wheelhouse grew up in a Conservative-supporting family, though he says his great granny – a Labour provost – would have been horrified by his family’s leanings.


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Still, joining the Conservative Party and becoming active in party politics while at university in Aberdeen seemed the natural thing to do. It was only after graduating with a degree in Economics that he began to drift away from the party his family had supported.

“They seemed increasingly irrelevant to what I saw as the challenges facing Scotland,” he says, “as well as harsh in tone and increasingly out of touch with what was going on in Scotland. I had mixed feelings around the time of the devolution debate. I changed my mind and I did vote for the Scottish Parliament at the very end, but when I told my mum I was joining the SNP in 2003, she found that quite a challenging bit of information.”

Elected in 2011 as part of the South Scotland regional list, Wheelhouse’s journey into government seems an odd one. Though, he says, despite his mother’s consternation at his move to Scottish nationalism, she has now “come over from the dark side” too.

He says: “The SNP is a social democratic party with a European tradition, which is one of the reasons I was attracted to it. I very much believe we have to have a strong economy, which was probably the one thing that kept me in the Tories, but I was increasingly uncomfortable with their social message and their lack of interest in community.”

This disillusionment, which began during Margaret Thatcher’s government, continued to grow through John Major’s time in charge.

“Initially he seemed like a nice guy,” he says, “but he was a nice guy that was in charge of what was becoming an increasingly harsh party, and the Euroscepticism and jingoism was something I found unpleasant. I don’t want to be dismissive because I am sure there are very good people in all parties and I am not implying that anybody that is on the Conservative benches is motivated by any of those things, but for me it was a real turn off.”

When Wheelhouse moved to the Borders from Edinburgh, his shift in political view moved further.

“I got a different taste of life. It was a small village I was living in, everyone was familiar with each other and there was a strong sense of community ties, with everyone looking out for each other. That probably enhanced even further my sense of being part of a community and wanting to support others, rather than just thinking: ‘I’m alright, Jack’. I had neighbours who I wanted to help, and they wanted to help us.”

It was then he decided to become a community councillor, while becoming increasingly interested at what was happening at national level.

“It was my ex who challenged me to stand. I was mouthing off at a debate in advance of the Scottish Parliament elections in 2003 and I remember John Swinney, who I greatly admired, was leader at the time and he was coming under quite a lot of opposition with all the other parties ganging up on him, but there was a sincerity about his ambition for Scotland, and I thought – how dare they give him such a hard time about this.”

“At that stage I wasn’t a parent, but I was aspiring to be one, and I was thinking, ‘what will there be for any children I bring up in the area? What will keep them in the area, if they want to be?’ I couldn’t see where quality jobs would be coming from with the policies in place at the time, so it was important for me to be part of a movement with real ambition for areas like mine, and so it was a game-changer for me.”

He adds: “I’ve never looked back, and I will not – and I stress this in the strongest possible terms – be returning to the Tories. Some people move more right wing as they get older, I have probably been moving more left. Also, since I became a father, I have become more interested in the environment as well.”

If moving to the SNP and then becoming an MSP has suited him, his increased interest in the environment also seems to have worked out. His first ministerial position was in environment and climate change – a post now established as a cabinet position – and it is easy to see how that experience would help inform his role in business, innovation and energy, given the role of renewables in both.

Which is not to say the transition has been an entirely smooth one. Wheelhouse has a background in economics – he worked in consultancy before getting elected – and he was pleased to get a role involving business, even if at the time of Nicola Sturgeon’s reshuffle no one had anticipated that he would now be grappling with the effects of Brexit along with normal day-to-day issues.

The vote to leave the EU, he says, “has made life a little bit more challenging”, even if some of the effects of Brexit are clearly still unknown.

And while that is an obvious challenge, it is not the only one, with Wheelhouse also tasked with navigating the SNP’s approach to fracking. In fact, some critics have suggested it was Ewing’s perceived support for fracking that led to him being moved on to rural affairs.

Environmental groups argue the technique, which involves injecting a mixture of liquid, sand and chemicals into rock to reach shale gas reserves, poses a risk to public health and could cause local environmental damage, while pointing to the effect further gas extraction could have on climate change. Its supporters, meanwhile, argue it would bring tax revenue and create jobs, while lowering demand for imports from abroad.

The debate has been a heated one and the Scottish Government responded by putting a moratorium on fracking while it commissioned research to be used to inform a public consultation. There are definitely easier issues he could have been handed on his first days in office. So how did he feel about being responsible for walking the tightrope between the pressures on both sides of the debate?

He nods: “It was a mixture of excitement and trepidation. Obviously, on an issue like this, you are not going to be able to please everybody and at some point someone is going to be upset with what you do. I am finding with planning decisions as well, you try and treat it as a quasi-judicial process – you look at the evidence and you try and see what the best decision is in the public interest, but you are always going to upset someone. That is inevitable with any planning matter, and this is in the same sort of territory. So it does make you nervous.”

He adds: “But then, I’ve had challenges before. I had the Offensive Behaviour Act [in his justice role], and in my tenth day into my job at environment and climate change, I had to make a statement on a climate change target from a year before I was elected, so that was a challenge to come into as well. But, you know, it’s part of the job and if it was easy it wouldn’t be as intellectually stimulating or as much of a privilege as it is.”

It is an issue which really seems to have gripped the SNP membership, and you need only look at the amount of debate that has gone on at conferences since the growth in membership to see there is a strong opposition within the SNP grassroots to the idea of fracking for onshore shale.

But on the other hand, some of the opposition seems surprising given the way the party has been energised and motivated by the role of North Sea oil and gas to the Scottish economy, along with questions over who owns it and where the profits go.

So why is fracking different? Surely, the SNP grassroots should be pro-fracking?

He says: “I’ve never thought of it in that way, in terms of the comparison between the two positions. It’s been understandable there has been very strong public interest, with support in some quarters but scepticism in others, because the resource that has been identified by the British Geological Survey in the Midland Valley sits right under the most populated part of Scotland.

“That’s not to say that people wouldn’t be interested if it was in a rural area as well, because there are considerations about the environmental impact and equally on smaller communities that might be affected, but clearly a large proportion of the Scottish population live over the area that is likely to be of most interest to the industry, and therefore that creates a very significant level of public interest in the future for those families and communities that live in that very important part of Scotland.

“So there is always guaranteed to be a strong degree of public interest in it and a degree of concern over the impact it will have on people’s property or on their health and wellbeing. That is why it is so important we have commissioned the research, having identified the independent panel and having identified there were gaps in information. There was pressure from some quarters to make a decision one way or another, and I respect the passion on both sides, but I think it was important we filled those gaps as best we could to come together with a comprehensive understanding of the impacts of this potential industry in Scotland, and then put it out to the people of Scotland, business organisations, stakeholders, environmental organisations, to take their view as to what this evidence is telling us.” 

But you don’t need to commission a study to know that without cutting emissions somewhere else in the economy, further drilling for oil and gas is going to cause greater climate change. When the Scottish Government talks about environmental concerns in this context, presumably it is talking about localised effects – critics warn it has been linked to water pollution, as well as earth tremors – rather than the effect of emissions on global temperatures.

This, to Wheelhouse, is too simplistic. He says: “While I accept that if you are burning fossil fuels and you don’t have a means of capturing the carbon it will have a net impact on emissions, it is important to understand the quantity and the potential scale of the industry, and its likely impact on emissions in Scotland. We have got ambitious climate targets, which are likely to become more ambitious in the near future, with the legislation Roseanna Cunningham will take forward, and in that context it is important to look at what this would do to our ability to deliver on those climate targets.

“As with every other aspect of the work that has been commissioned, people know there may potentially be a health impact, there could potentially be a positive economic impact, or there may be a transport impact – decommissioning issues and regulatory issues need to be investigated. But there is a difference between knowing there is an issue and trying to define the scale of that issue, and that is what the research is trying to do – bear down on the numbers and find out the range of values between low and high, in terms of these various factors.

“It is important to try and bring some light to the debate. There has been a lot of heat on both sides and it has been quite acrimonious at times. The government’s duty is to try to act always in the public interest and to take an evidence-based approach to decisions like this. We have a duty to both sides to do this fairly and that is why we have taken the path we have. We came under pressure to make a snap decision, but I think that was the wrong sentiment at the time, and we have committed to producing evidence which should allow a well-informed debate. I think we have gone beyond what other jurisdictions have done anywhere else in the world, and we are taking a precautionary approach in the meantime.”

In the course of the conversation, Wheelhouse’s answers are characterised by a careful diplomacy. In fact, looking back at his description of how his mother reacted to his move from the Conservatives to the SNP, it is tempting to wonder if it may have been an understatement.

Still, it is a useful skill to have given the way the SNP has sought to position itself between competing interests. On nuclear, for example – a form of generation the SNP has, at least historically, been fiercely opposed to – Wheelhouse walks a careful line.

The Scottish Government will not give consent to new nuclear plants, yet Wheelhouse also makes a point of highlighting that EDF – which operates Scotland’s two nuclear plants – has “a very important role to play” until plants are decommissioned. “I have great respect for them as companies,” he says, “but we have a position which is not to commission new nuclear power and we believe our future is better placed through investment in renewables.”

“There are obviously concerns within Scottish society over the intermittency of some renewable sources, which is why we also back the UK Government changing its policy in allowing a route to market for new pumped hydro storage – to provide a responsive, on-demand supply of electricity to deal with intermittency.”

The new energy strategy, out in January, will examine how Scotland can move from large plants generating electricity to a more distributed system of power generation, made possible by new technologies.

And because of the way that energy policy sits between being a reserved and devolved issue, Wheelhouse’s job, more than any other in the Scottish Government, demands constant interaction with Westminster. And, certainly in the past, the relationship has appeared, at best, a strained one.

In July, SNP MSP John Mason accused the UK Government of launching a “relentless and sustained assault on the renewable energy industry” after a PwC report found that more than 12,000 jobs had been lost in the solar sector as a result of Tory subsidy cuts.

Then in October, SNP MP Calum McCaig, the party’s energy and climate change spokesperson at Westminster, stood at his party conference and accused former Secretary of State for Energy, Amber Rudd, of having “taken the hatchet” to the Scottish renewables industry.

He said: “Onshore wind, solar, biomass – all cut. Industries which had the potential to flourish and bring down costs substantially while cutting carbon emissions were sacrificed on the Tory altar of austerity, at the same time as we are putting billions and billions of pounds – at a much, much higher rate – into nuclear power.”

Wheelhouse is not a politician you would associate with phrases like ‘taking the hatchet’ or accusations of ‘relentless and sustained assault’ on renewables. Yet he has first-hand experience of dealing with his government’s UK counterparts. How would he describe the Scottish Government’s relationship with Westminster? Has it been strained?

Wheelhouse takes a more measured approach than others in his party.

“It’s hard to say in terms of the interpersonal relationships with ministers previously, because I am new to this role, but certainly there is a challenge, and there needs to an understanding of what Scotland needs to develop its energy strategy, on both sides, and we need to work together where we can. I have tried to take the approach since I took on the post in May that I am a new minister and since Greg Clark [Secretary of State for Business, Energy and Industrial Strategy] has come in, he is a new minister too in this field, so we should give the relationship a chance, and to be constructive and positive where I can.

“I intend to do that, but it has been frustrating, because there have now been several bits of correspondence between the First Minister, myself, the cabinet secretary – several since May – where we have not had a response at all. I am still seeking an opportunity to meet with Greg Clark to discuss issues of mutual interest.

“Obviously, they have a lot on their plate with Brexit, but so do we, and the industry cannot afford to wait for those opportunities to arise by chance. We are offering the time and we need the UK Government to do the same to have those discussions.”

Still, given Wheelhouse has yet to meet with Clark, and letters have gone unanswered, it does not sound great. In fact, it sounds like Wheelhouse is being diplomatic again.

“I would describe the situation as not being optimal. It takes two to tango and we need some willingness from the UK Government to engage with us. We have had Baroness Lucy Neville-Rolfe [Minister of State for Energy and Intellectual Property] up to meet with the Cabinet Secretary and myself, and we welcome that engagement, but we need to have a proper discussion with Greg Clark about the issues affecting the renewables industry and the oil and gas industry.”

Amber Rudd’s time in charge of the Department of Energy and Climate Change – now abolished, with energy policy moved into the control of the Department for Business, Energy and Industrial Strategy – was characterised by an emphasis on gas-fired energy generation, along with nuclear. The move was seen in Scotland as a bad omen for the renewables industry. Was Wheelhouse surprised by that emphasis on gas and nuclear?

“I was disappointed, definitely, but not entirely surprised because, coming into post, that seemed to be the direction of travel. Since the 2015 general election, the UK Government has been pulling back from supporting key industries in the renewables industry. We believe that for less money, the UK Government could get more electricity quicker, and on a more sustainable basis than they will through support for Hinkley C. The cost of electricity they will be buying through Hinkley C, £92.50 per megawatt, is already much more expensive than onshore wind, and onshore wind is continuing to drive down its cost through innovation in turbine design. I think it is a mistake. We respect their mandate to do it at a UK level, but we fundamentally disagree with the decision.”

Wheelhouse says the decision to axe DECC has not made a massive difference on a practical level, to interaction between Scotland and Westminster, in part, because many of the officials from DECC have been transferred into the new department, and so the same relationships can exist.

But symbolically, he says, it carries greater significance.

“I don’t know whether it was a case of revenge, or if DECC had overstepped the mark. It may have been a bit of a trimming of the wings by the Treasury. We have to work with the structure that is there, my own portfolio covers energy, innovation and enterprise and the department that has been created at a UK level does something similar, but I do think there are some internal politics at play, in terms of the perceived overreach of DECC when it was run by Ed Davey. It was perceived as quite a powerful department within the coalition government, so it may have been a case of trimming back its wings.” 

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