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Regional Growth and the Net Zero Transition: Scotland
How Scotland can accelerate sustainable growth and the net zero transition.
Read time: 7 mins Added: 20/10/25
Regional approaches to sustainable growth and investment are critical to the UK’s net zero transition. In the latest of edie and Lloyds Corporate & Institutional’s roundtable series, leaders from housing, infrastructure, energy, transport, finance, and academia gathered in Edinburgh to probe Scotland’s specific challenges and opportunities.
Despite having some structural advantages, Scotland faces some significant bottlenecks when it comes to decarbonisation at a national level. The country is legally committed to reach net zero by 2045, five years ahead of the UK, and continues to generate very high levels of renewable electricity, and capacity. Yet, participants at edie and Lloyds’s latest roundtable discussion were clear: Scotland could risk falling behind on decarbonisation progress if barriers are not tackled in connection to grid constraints, policy uncertainty beyond 2030, skills gaps, and an increasingly challenging conversation about costs.
Held a few days after the Edinburgh Fringe festival in August, this high-level roundtable was conducted under Chatham House rules – giving business and sustainability leaders from organisations of various sizes and sectors the opportunity to express their challenges and identify new opportunities for driving sustainable growth and investment.
Changing the narrative
The conversation began with a discussion around the current ESG climate, and how geopolitical agendas are affecting approaches to both sustainability and net zero.
Some of the attendees noted a distinct change of narrative in recent years, signified in part by some banks withdrawing from the Net Zero Banking Alliance. However, it is important not to downplay the overwhelming public support that still exists for net zero – indeed, the UK Government’s latest Public Attitudes Tracker reports 80% of people are concerned about climate change (37% “very concerned”), with net zero awareness at 91%. This is emphasised by the continuing take-up of GHG target assessment and validation, particularly in Asia, where SBTi validation is seeing increasing engagement by businesses.
To drive net zero efforts within organisations, the participants agreed that sustainability teams must find better ways of communicating about net zero, particularly when it comes to making the transition tangible by clearly demonstrating the success and value of net zero work. Through clear shareholder value, and a change in terminology to avoid increasingly ‘controversial’ terms such as ESG, buy-in could be more easily achieved across all parties, end users and providers.
Financing the Just Transition: Beyond the five-year window
The discussion turned to the Just Transition – and specifically who should pay for the changes required, and how. The participants agreed that currently there is no durable framework that gives investors confidence over the long-term. While Scotland has established a Just Transition Commission to advise ministers, there is a lack of clarity when it comes to how we will deliver our national goals. A clearer understanding of how different actions will be financed is an element that several of the experts argued they required to unlock private capital at scale.
Ecological concerns also hamper the Just Transition, one participant pointed out, with conflict often arising between necessary construction and interest groups working to improve biodiversity and the environment. An example that was given related to the building of wind farms: the approval of the 4.1GW Berwick Bank offshore wind farm came with stringent seabird compensation measures after sustained objections from conservation groups, which added to costs and could have affected the project’s investibility. This provides a clear example of how ecological tensions need to be carefully managed, if deployment is to accelerate.
Overall, clearer long-term policy direction is required to create a more global and systemic view of the transition, prioritise long-term solutions over short-term environmental benefits, and focus on the bigger picture to drive through positive change.
A group of senior Scotland regional leaders from housing, infrastructure, energy, transport, finance, and academia at an exclusive roundtable.1
Renewable energy pathways
The next point discussed by the roundtable participants related to obstacles that remain on the path to renewable energy. The single greatest barrier, they argued, is the grid. Scotland is rich in wind resources but poor in its capacity to move power south, or plug in new projects quickly.
Another challenge relates to regional energy usage caps in Scotland, with participants questioning what hitting those caps would mean for renewables. Several participants again argued that more needed to be done by the Scottish Government to encourage the investment and capacity expansion that is needed to meet longer-term goals. Policymakers’ current focus on 2030 targets is helpful in identifying immediate actions, the participants agreed, but this still fails to offer what is needed long-term – leading to investors avoiding committing to new large projects in the face of significant risk and uncertainty.
Parallel approvals and funding decisions are starting to flow in a wide range of important projects – from subsea links to onshore renewables – but community impacts, planning capacity and consenting remain live constraints to their roll-out. Participants argued for coordinated, place-based delivery: align network upgrades, housing, manufacturing and skills, so communities see local value from hosting infrastructure.
One solution to these challenges is greater collaboration between policymakers and investors. The participants argued that business must do its part to drive the transition, with increased readiness to take risk from some companies reliant on a more encouraging policy environment. If delivered in tandem, these factors can encourage greater investment in the transition, supported by greater incentives to mitigate risk around uncertainty.
Green Skills
The final issue raised during the roundtable was that of green skills. The Scottish Government is taking steps to embed green skills across the country as part of a Just Transition to net zero. This includes the development of the Energy Skills Passport to support oil and gas workers to identify routes into several roles in the offshore wind sector. However, the roundtable participants agreed that more could be done to drive green skill growth, and more guidance could be provided on which skills are needed to drive the net zero transition.
At an educational level, one attendee said, there is currently misunderstanding around what constitutes green skills – in effect, an identity crisis. This stems from individuals gaining sustainable skills and then leaving the sector in which they have been trained, creating uncertainty around how those sectors will contribute to the transition longer term.
The lack of take-up of apprenticeships has also created issues with the pipeline of skilled workers, widening the gap, participants agreed; many apprenticeships now lack support and suffer from a poor image among students. One potential solution mentioned during the discussion was to develop a nationwide marketing campaign that makes technical and vocational work routes more aspirational, backed by local delivery partnerships.
Driving long-term, sustainable growth
Ultimately, Scotland’s positioning – with strengths in clean energy services, a deep engineering base, and proximity to North Sea storage – is a strong foundation for sustainable growth and investment. The task now, participants agreed, is not so much about ambition as about action to empower delivery: aligning policy, networks, finance and skills so that decarbonisation projects go full-steam ahead and ‘green jobs’ become the majority.
Commenting on the roundtable discussion, Graham Arnold, Regional Head for Scotland, Corporate & Institutional, Bank of Scotland, said: "Scotland's commitment to achieving net zero by 2045 presents a unique opportunity to generate sustainable growth. By leveraging our abundant renewable energy resources and fostering collaboration across sectors, we can drive significant progress towards our climate goals.”
Graham Arnold Regional Head for Scotland, Corporate & Institutional, Bank of ScotlandThe key lies in aligning policy, finance, and skills development to ensure that decarbonisation projects are not only ambitious but also actionable. This holistic approach will enable us to create a resilient and sustainable future for Scotland.
Francesca Sharp, Director, Sustainability and Client Advisory, Bank of Scotland, added: “The transition to net zero is not just an environmental imperative but an economic opportunity for Scotland. By investing in skills and infrastructure, we can unlock new avenues for growth and innovation.”
Francesca Sharp Director, Sustainability and Client Advisory, Bank of ScotlandThe challenges we face, such as grid constraints, require a concerted effort from both the public and private sectors to unlock. Together, we can overcome these barriers and position Scotland as a leader in the global green economy.
What’s next?
Both Lloyds and edie look forward to the final roundtable in Birmingham, before presenting the full results of this collaborative series later in the year.
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- Bernice Maxton-Lee, Climate & Sustainability Lecturer, University of Edinburgh
- Euan McVicar, Non-Executive Director & Chair, University of Aberdeen
- Francesca Sharp, Director, Sustainability and Client Advisory, Bank of Scotland
- Gary Connor, Director & CTO, Nova Innovation Ltd
- Graham Arnold, Director, Infrastructure & Project Finance, Co-Head for Scotland Corporate & Institutional Banking, Bank of Scotland
- Kathryn Dapre, Head of Sustainability, CALA Group
- Katrina Leese, Head of Treasury, Stagecoach
- Luke Nicholls, Publisher & Series Host, edie
- Nadia Wheeler, Partner, TLT
- Nick Pollard, Group Finance Director, Link Group
- Richard Nimmons, CEO and co-founder, The Carbon Removers
- Stacy Angus, Chief Executive, Osprey Housing Group
- Stuart MacGregor, Chief Financial Officer, Forth Ports
- Tom Barclay, Group Chief Executive, Kingdom Housing Association
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