The Aberdeen & Grampian Chamber of Commerce’s latest Energy Transition report sounds the alarm for the UK’s North Sea energy sector, predicting the loss of up to 100,000 jobs within 100 days unless urgent action is taken.
The report highlights a decline in industry work across production, exploration and renewables, exacerbated by uncertainty surrounding the general election outcome.
According to the report, industry confidence in UK activities has plummeted to a record low due to concerns over high taxes and a potential exploration ban.
The looming job losses could result in a £30 billion investment shortfall, with leading investment banks cautioning that up to half of the jobs supported by the North Sea could vanish in just five years.
According to the Energy Transition survey, sponsored by KPMG and ETZ Ltd, companies anticipate that renewables will account for approximately 51% of their work by 2030, up from the current 34%.
Despite oil prices exceeding $80 (£62.6) a barrel, confidence among companies operating in the UK Continental Shelf is lower than during the financial crash and the pandemic, when oil prices plummeted to approximately $16 (£12.5) a barrel.
The Chamber calls for the next government to prioritise restoring confidence in the sector and proposes the establishment of an independent body to oversee the energy transition, similar to the Bank of England’s role in maintaining financial stability.
Furthermore, the report advocates for a renewed focus on renewable energy job creation, emphasising the need for investment in wind power manufacturing, hydrogen, carbon capture and decommissioning.
Despite industry efforts to shift towards renewables, challenges remain, with profitability and regulatory concerns hindering diversification efforts.
Recruitment challenges are also prevalent, with companies struggling to retain staff amid increased retirements and overseas project opportunities.
The report underscores the urgency for political parties to develop effective energy transition strategies, as the majority of energy sector companies believe that current proposals are inadequate.
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