Scottish Climate Change Consultation Background The Bill will create a framework for action until 2050 – this is a long-term framework and will, hopefully, outlast this and many future administrations and, therefore, other single initiatives currently in place. The Bill can serve as a vehicle to introduce measures in the future. We may not need these measures and we cannot anticipate the exact measures which will be needed, but using secondary legislation in the future can allow government to react quickly to changing circumstances while still ensuring parliamentary scrutiny. REMINDER: All discussions will be recorded though non-attributable To find out more:

Workshop 1 (A&B): Enabling businesses to take action What can the Scottish Government do to help organisations and business take action on climate change? Supplementary Questions: What specific legislative or regulatory changes are needed to help business take positive action on climate change? What legislative or regulatory frameworks are currently preventing business from taking action on climate change? What incentives could the Government provide to help business take action? Are there currently any perverse incentives in place which prevent business from taking action? –How could these be amended? Additional: What else can the Bill do to help sustainable economic and business growth in Scotland?

Workshop 1 (A&B) Notes: Enabling businesses to take action Changes to legislation and regulation Government, particularly local government, may want at some stage to introduce variable changing in order to incentivise action on climate change by business. This would mean higher charges for less climate change friendly options, products or behaviours. For example, varying parking rates depending on level of vehicle emission. Alternatively, there may be charging regimes which currently create perverse incentives which are enshrined in statute but which might be usefully altered or repealed. –Perverse incentives emanate from policies or practices that induce unsustainable behaviour. This may occur as an unanticipated side effect of policies designed to achieve other objectives. Participants may want to think about – Waste Transport (staff commuting, delivery, business travel) & Parking Planning Capacity for local/site specific renewable energy Energy efficiency Building standards / modernisation See chapter 8 for more information

Workshop 1 C&D: Holding Government to account What should the Scottish Government be required to include in its annual reports? Supplementary Questions: Thinking of specific areas, what needs to be included in the report so that the framework remains robust and Government can be held to account (i.e. export emissions, impact of programme expenditure, etc)? Is a process of Parliamentary scrutiny the appropriate way of holding the Scottish Government to account if targets are not met? –If not why? What additional scrutiny processes could be applied and how could this be best achieved? Additional: How can climate change fit into existing reporting and scrutiny frameworks such as Best Value Guidance?

Workshop1 (C&D) Notes: Holding Government to account Reporting Strong reporting requirements will strengthen accountability for achieving emissions reductions and ensure that important information is published regularly and consistently. The Scottish Government proposes that the Scottish Ministers report annually to the Scottish Parliament including t he net Scottish emissions for greenhouse gases gas ( There is a range of other issues related to climate change on which the Bill could require the Scottish Government to report on. Some examples are: –What effect Scottish policies will have on international emissions –An assessment of the impacts and risks of current emission levels –The capacity of Scotland’s renewable energy sector Scrutiny The consultation does not propose that a new scrutiny system on the Scottish Government should be created to compliment existing Parliamentary scrutiny but it does seek views on whether this is sufficient, what needs to be included in annual reports by the Scottish Government, and whether new functions be kept at arms-length from government (i.e. given to a public body). No system of sanctions is proposed if government does not achieve targets or budgets. See chapters 7 & 8 for more information

Workshop 1 (E&F): The role of the wider public sector How strong is the case that the Bill should have enabling powers to introduce new duties on public sector bodies to take action on climate change? Supplementary Questions: What would the benefits and drawbacks be of introducing new duties (or enabling powers for these) on the public sector in the Bill? If new duties were created, what should they include and why? Should the Bill contain enabling powers to create a requirement for public sector bodies to produce regular reports of how they are tackling climate change? If so, what specific measures/actions should be included in the report and how often should they be produced? Additional: How can existing frameworks such as Best Value Guidance be strengthened or adapted to place a greater emphasis on climate change and emissions reductions?

Workshop 1 (E&F) Notes: The role of the wider public sector Duties The public sector has a key role in reducing emissions in Scotland due to its size, the policies it is responsible for setting and delivering and its leadership position in Scotland. In 2005, the public sector employed 23.4% of the Scottish workforce. Using the public sector to reduce emissions can continue to be done through voluntary measures such as the Scottish Climate Change Declaration 39. However, as it becomes more difficult to reduce emissions, some organisations may be reluctant to take action. The proposed Bill could, through the inclusion of specific enabling powers, serve as a vehicle to introduce various measures at a later date if it is deemed necessary. Various duties are placed on the public sector in Scotland. One potential measure to reduce emissions could be to place a duty of some sort on certain parts of the public sector. This consultation does not propose to define exactly what a duty would be if the Bill was to contain enabling powers to introduce one at a later date. Any such proposal would be likely to require further consultation when secondary legislation was brought forward. Examples of potential duties are: –a requirement to evaluate projects or policies to determine emissions, –a duty to consider climate change in policies and decisions –a duty to take account of emissions in procurement contracts. Reporting Another possible measure which could be introduced is a reporting mechanism for certain parts of the public sector on action being taken to reduce emissions or, in addition, to adapt to climate change. See chapters 7 & 8 for more information

Workshop 2 (A&B): Getting there – the pathway to 2050 What are the benefits & drawbacks of setting annual targets for reducing emissions? Supplementary Questions: How could steady year-on-year reductions be achieved? Should the Bill include an interim point target(s)? What are the benefits and drawbacks of setting an interim target now for the Bill? –If set, how should the level be chosen and for what year should it be? Should the Government be allowed to borrow emissions from the following budget period to cover unexpected rises in emissions? If yes, what should be the limit (For example, in terms of a percentage of the budget period) on the amount of emissions which the Government can borrow from a following budget period? Additional: Should the target be based solely on CO 2 or should it include all six of the main greenhouse gases (CO 2, CH 4, N 2 O, 3 F-gases)? –Why?

Workshop 2 (A&B) Notes: Getting there – the pathway to 2050 (chapters 5&6) Interim Targets The later cuts in emissions are made, the greater they must be to have the same effect, they will also be more expensive. It is the total amount of greenhouse gases emitted over a particular time which causes climate change, rather than the amount of emissions in any single year. The graph opposite shows two emissions reduction path with different trajectories. The areas under each trajectory, which represent the total amount of emissions over the period, differ: the darker area shows how delaying emissions reduction results in greater cumulative emissions. Therefore, the setting of a single point reduction target does not, determine the total emissions produced over a period. What is “Emissions Budgeting”? An “Emissions Budget” refers to the aggregated quantity of emissions which are permitted during a specified period. Factors which could be taken into account when setting budgets include economic growth, technological progress, business competitiveness or social impacts. Banking and Borrowing Banking and borrowing would allow the Scottish Government to carry unused emissions over to later budget periods or allow it to bring forward emissions allocations from future budget periods. This would provide a means of allowing for unexpected rises in emissions. Rises may due to abnormally cold winters, or the temporary shut down of a nuclear power plant; increasing the reliance on fossil fuels. Banking may incentivise the Government to over perform. Borrowing will allow the Government to correct unexpected spikes at the end of a budget period. However, unlimited borrowing may reduce certainty for business.

Workshop 2 (C,D&E): Getting there – ensuring reductions to 2050 What are the benefits & drawbacks of setting annual targets for reducing emissions? Supplementary Questions: How could steady year-on-year reductions be achieved? Should the Government be allowed to borrow emissions from the following budget period to cover unexpected rises in emissions? If yes, what should be the limit (For example, in terms of a percentage of the budget period) on the amount of emissions which the Government can borrow from a following budget period? On what basis should targets be set to ensure a real reduction of emissions? (For example, source emissions versus an end-user inventory, or a combination of individual targets for energy efficiency and renewable electricity?) Additional: Should the target be based solely on CO 2 or should it include all six of the main greenhouse gases (CO 2, CH 4, N 2 O, 3 F-gases) or CO 2 alone? –Why?

Workshop 2 (C,D&E) Notes: Getting there – ensuring reductions to 2050 What is “Emissions Budgeting”? An “Emissions Budget” refers to the aggregated quantity of emissions which are permitted during a specified period. Factors which could be taken into account when setting budgets include economic growth, technological progress, business competitiveness or social impacts. Banking and Borrowing Banking and borrowing would allow the Scottish Government to carry unused emissions over to later budget periods or allow it to bring forward emissions allocations from future budget periods. This would provide a means of allowing for unexpected rises in emissions. Rises may occur due to abnormally cold winters, or the temporary shut down of a nuclear power plant; increasing the reliance on fossil fuels. Banking may incentivise the Government to over perform. Borrowing will allow the Government to correct unexpected spikes at the end of a budget period. However, unlimited borrowing may reduce certainty for business. Inventories The Greenhouse Gas Inventories measure emissions produced in Scotland; they are unlikely to show explicitly progress made in certain areas such as reducing energy demand, improving energy efficiency or increasing renewable electricity generation in Scotland (as Scotland is a net exporter of electricity and the grid is UK-wide) To create an end-user inventory, the figure for emissions from Scotland’s power stations and oil refineries is replaced by a measure of the electricity and fuel consumed in Scotland. Here all electricity consumed within Scotland would be counted and converted to an emissions equivalent. This method would reflect any reductions in Scottish energy demand and highlight any reduction in carbon emissions due to the use of renewables. The end-user inventory would still count emissions from other products that are exported, such as whisky, food products, chemicals and office machinery. An end-user inventory would take into account consumption of electricity, better taking into account reducing energy demand and renewable electricity generation Separate targets could be given for energy demand and renewable electricity (where it is within devolved competence) but this would give Government less flexibility as to where to reduce emissions See chapters 5 & 6 for more information

Workshop 2 (F): Getting there – maximising benefit to 2050 What factors should be taken into account when setting the level of emissions budgets? Supplementary Questions: Is there anything unique to Scotland or particular Scottish regions that needs to be taken into account when setting budgets? Are there particular sectors or groups of individuals that are likely to be disproportionally affected by the Bill? –If so, who are they and what are the likely effects? How can the Bill account for and mitigate any differences to create a more equitable (i.e. socially) framework e.g. in the setting of budgets etc? Additional: Should the Government be allowed to borrow emissions from the following budget period to cover unexpected rises in emissions? If yes, what should be the limit (For example, in terms of a percentage of the budget period) on the amount of emissions which the Government can borrow from a following budget period?

Workshop 2 (F) Notes: Getting there – maximising benefit to 2050 (See chapters 6 & 8 for more information) Maximising Benefit Many regions have economic activity unique to their region or related to their heritage e.g. Whisky distilling. Different sectors or communities will face different challenges and opportunities e.g. raised energy costs may disproportionately affect low-income groups or energy intensive businesses; remote communities have specific transport needs. Banking and Borrowing Banking and borrowing would allow the Scottish Government to carry unused emissions over to later budget periods or allow it to bring forward emissions allocations from future budget periods. This would provide a means of allowing for unexpected rises in emissions. Rises may occur due to abnormally cold winters, or the temporary shut down of a nuclear power plant; increasing the reliance on fossil fuels. Banking may incentivise the Government to over perform. Borrowing will allow the Government to correct unexpected spikes at the end of a budget period. However, unlimited borrowing may reduce certainty for business.