How the UK’s new government should start working on a just fossil fuel transition in the North Sea

Following Denmark’s example

They could start by looking at Denmark. Its transformation journey shows that halting new licenses is just one step in a long process. The next step for the Danes was to use the momentum to build consensus around the future of oil and gas resources. To do this, the Danish government commissioned a long-term impact assessment of canceling further licensing rounds and setting a phase-out date, which concluded that there would be little benefit from continuing production beyond 2050. This in turn paved the way for a political consensus that resulted in a phase-out date that provides reliable market signals and long-term investment stability during the transition period.

“But think of the job losses,” the Conservative opposition might respond – brazenly overlooking the fact that they excluded workers when they designed the North Sea Transition Agreement with industry in 2021. When you think back job insecurity due to volatile oil and gas prices and the deep scars of an unmanaged British economy coal AND steel in the event of changes, it is reasonable to expect that employees will demand “there is no ban without a plan“regarding the future of oil and gas licensing. It also makes it easier to understand why the last questionnaire suggests that oil and gas producing regions such as north-east Scotland are overwhelmingly concerned about climate change and have little confidence in the industry to deliver the benefits of the transformation for workers and communities.

A transition with minimal casualties cannot be achieved without a meaningful transition plan. To be successful, such a plan requires the commitment of national and local governments, the fossil fuel and cleantech industries, and trade unions. This represents a new approach to transition planning in the UK, but it is not an untested experiment. Danish climate partnerships model serves as an example to follow. Indeed, partnerships played a key role in co-designing the roadmap for implementing Denmark’s climate commitments, and close cooperation between stakeholders laid the foundation for convergence on the phase-out.