Industrial decarbonisation and skills in Scotland

1. Executive summary

On 18 November 2025, the Institution of Chemical Engineers (IChemE) and the Royal Society of Edinburgh (RSE) hosted an expert roundtable to discuss industrial decarbonisation in Scotland and the associated challenges and opportunities for skills and economic development. The roundtable was chaired by IChemE President Professor Raffaella Ocone and RSE Vice President of Education Dr Janet Brown. This event looked at progress on industrial decarbonisation in Scotland, what the impact of this has been, what opportunities exist within the transition to net zero to develop the Scottish economy, how the skills market is (and should be) changing to reflect the growth of low emissions industries, and what needs to be done to support people affected by this transition. Attendees included figures from Scottish Government, academia, industry and professional bodies. This document provides an anonymised write-up of key themes from this discussion.

A number of key themes emerged at the roundtable including: a strong sense that Scotland has world-leading potential in areas such as carbon storage, hydrogen, renewable energy; an appreciation of the continued role of the oil and gas sector in both the current and future economy; the need for a genuinely long-term and integrated economic and social strategy for Scotland, with industrial decarbonisation sitting within this; and the need for governments to make bold and clear decisions about the future direction of Scotland’s economy.

2. Background

The Scottish Government has committed to reaching a net zero economy by 2045. While offsetting and capturing emissions is possible in some instances, the most effective and sustainable way to achieve a net zero economy is by eliminating or minimising sources of emissions.

The drive to decarbonise is already well underway in Scotland: there is increased investment in renewable energy, downscaling of fossil fuel facilities, and companies are increasingly implementing measures to minimise their emissions. Decarbonisation is having a particular impact on the energy sector. Scotland’s natural resources and access to the North Sea oil fields have made it an historic hub for the UK’s energy sector. Scotland’s other natural strengths, including its vast coastline, weather, and numerous lochs, also make it ideal for implementing a range of renewable energy technology.

These changes are not only altering how local economies operate, but also offer opportunities for economic growth. Investment in burgeoning industries creates new jobs and provides the chance to develop domestic supply chains to retain more wealth in the local economy.

Key to a successful net zero transition is ensuring that workers have the skills to meet a changing job market. This has the potential to be very disruptive as it is not just inwork training that needs to change. Demand is shifting to different qualifications and specialties, and course content in adjacent qualifications will need to change to reflect wider changes in industry. Care also needs to be taken that workers employed in highemissions industries can transition their skills to other vocations. The Royal Society of Edinburgh’s recent report Gaps, overlaps, and challenges: assessing the alignment of Scotland’s education reform agenda with national priorities1 highlighted the mismatch between current education and skills policy and the actual labour demands of a just transition. The recommendations underscored the need for more aligned thinking and targeted and sustained investment in training opportunities, including in relation to decarbonisation.

3. Key themes from the discussion

3.1 Current impact of industrial decarbonisation

Decarbonisation has been associated with both positive developments (renewables growth, investment in hydrogen and Carbon Capture Utilisation and Storage (CCUS)) and negative ones (closing or offshoring of various industries). However, the balance has largely been in favour of the latter, with much of the emission reductions to date having resulted from industrial decline rather than new low‑carbon growth. Industrial decarbonisation has had, and will continue to have, a significant impact on jobs for younger people, those earlier in their careers, those needing to redeploy to other industries, or communities where certain industries or companies are central to the local economy.

The Scottish Government and UK Government have supported the development of some important new initiatives in Scotland, such as the Acorn Project. However, the Scottish Government has only limited capacity to fund such projects, and much of the initiative in this area is reserved to the UK Government. There is ongoing concern regarding delays in major infrastructure projects, particularly CCUS, which are perceived as essential to Scotland’s net‑zero pathway.

A key challenge is the need to see these initial projects make the transition to independent economic viability – often, the upfront investment required of companies to transition to more renewable technologies is prohibitively high. There is a crucial role for government contracts to give industry certainty about returns on their investments into the future.

A challenge that has been seen in Scotland is the cancellation or pushing back of certain Scottish Government commitments in this area (for instance the recent reduction in the Energy Industries budget and cuts to the Just Transition Fund for the North East and Moray).

An important challenge is the need for investment all the way along the supply chain – public investment may be able to support a particular company in setting up, but that company may still have difficulties in becoming economically viable if the suppliers or market they will rely on are not healthy and developed.

3.2 Scotland’s assets and opportunities for economic growth

There was a strong consensus that industrial decarbonisation is a significant opportunity for Scotland and that the country has a unique combination of assets – large‑scale CO2 storage, abundant renewable energy, hydrogen potential, offshore expertise – that could underpin new globally competitive industries. Participants argued that Scotland should identify a limited number of strategic sectors where it can compete at scale and focus investment accordingly. Opportunities here were seen to include: hydrogen production and use; Sustainable Aviation Fuel; CO2 utilisation and derivative chemical production; industrial biotechnology; and advanced manufacturing.

The oil and gas sector was also seen as a crucial asset, but one that was under significant threat. It was recognised that the public and politicians too often did not see the wider value of this sector in providing vital inputs to a wide variety of other goods, products, and services across the economy. Participants felt that government should articulate a clear vision about the role of oil and gas in Scotland in the future to help the public better understand its importance, and to recognise the value of the contribution the sector makes.

Participants emphasised the need for public communication that links net zero to economic opportunity, rather than loss, to help the wider public understand this opportunity. It was suggested that talking about ‘reindustrialisation’ might be a more productive framing for winning over the public, rather than industrial decarbonisation. A recurring point was the need for long‑term industrial strategy. Without clear multi‑decade policy commitments, major private investment will not materialise.

3.3 Jobs, workforce transition, and skills

There was concern that, through the course of industrial decarbonisation, jobs were being lost in Scotland faster than new ones are being created. It was seen as important not to simply assume that the renewables sector will create enough new jobs to replace those that are lost from oil and gas, or that these new jobs will be accessible or enduring. A managed and coordinated transition was seen as essential to avoid loss of supply‑chain capability and workforce expertise. It was noted that Scotland’s engineering labour force is globally mobile and that without clear domestic opportunities, skilled workers will migrate to sectors or regions offering certainty. A key challenge is the fact that many roles required in the transition – such as construction, retrofitting, and welding – will be needed in large volumes but for relatively short durations. Relatedly, the number of people, and the mix of skills, required to set up new infrastructure (e.g. nuclear) is very different to those required for their routine operations.2 This raises questions about long‑term employment and training structures, and how systems could be reconfigured to meet the changing needs of the economy.

It was seen as crucial to not think that retraining has to mean ‘going back to the bottom of the ladder’ in terms of skill progression, and to find quicker pathways for technically competent people to move into new areas. There was also a recognition of the importance of allowing a more flexible approach to skills and training, with multiple different routes into careers and skills being the norm – including a greater emphasis on nontraditional routes, vocational courses, micro-credentials, micro-skills and reskilling. It was felt that there was no overall strategic plan for education and skills in Scotland, rather many individual siloed plans. Given the lack of clarity about the future, it was seen as crucial for the system as a whole to emphasise flexibility.

3.4 Reforming education and training pathways

Scotland’s education and training system must adapt to support rapid, flexible, and inclusive upskilling. Current pathways were seen to be too rigid, slow, and oriented around traditional qualifications to meet the needs of the future. Short courses, micro‑credentials, and modular training at all stages of life were seen as essential alongside more inclusive and alternative routes into engineering careers, particularly for communities affected by industrial decline. A strong call was also made for problem‑based and interdisciplinary learning, beginning in schools, to prepare future workers for a dynamic industrial environment. See for reference recent work by the RSE in this area: Interdisciplinary learning Scotland.

3.5 Policy levers and government action

Alongside regulation and incentives, participants noted the vital role of clear and consistent long-term strategic direction from both the Scottish and UK governments. There was a desire for Scotland to articulate a clear vision for its industrial future and commit to sustained support. It was felt that it would be helpful to depoliticise essential long‑term decisions on investment, skills, and industrial prioritisation, to ensure industry and individuals could be sufficiently confident to make long-term plans.

4. Conclusions and recommendations

Scotland’s economy is at a pivotal moment. Industrial decarbonisation presents major challenges. However, if strategically managed, the transition offers Scotland an opportunity for long‑term reindustrialisation, economic revitalisation, and international leadership in low‑carbon technologies. Key measures to help Scotland make a success of industrial decarbonisation include:

• A clear, long‑term industrial strategy for Scotland from the Scottish and UK governments, with a focus on areas where Scotland has world‑class potential.
• Coordinated investment to maintain and grow domestic industrial capacity.
• Flexible, inclusive reforms to the education and training system.
• Strong and sustained communication linking net zero to prosperity.
• A long-term, stable cross-party consensus for industrial decarbonisation in Scotland

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Download the Industrial decarbonisation and skills in Scotland roundtable summary (221KB, PDF)