A major feasibility study has outlined nine low-carbon and renewable energy options for the future of Scotland’s Grangemouth oil refinery, one of the UK’s largest industrial sites. With the refinery set for decommissioning this year, stakeholders are exploring ways to repurpose it into a green energy hub, aiming to attract investment, retain jobs, and build on its rich industrial heritage.
Grangemouth’s Strategic Advantage
Grangemouth has been a cornerstone of Scotland’s industrial sector for over a century. Opened in 1924 as Scottish Oils, the site benefits from several strategic advantages that make it attractive for redevelopment:
- Extensive industrial and commercial space
- Existing energy infrastructure assets
- A highly skilled workforce
- Strong transport links via rail, air, and motorways
- Access to the Forth Green Freeport
- Proximity to major cities like Edinburgh and Glasgow
- Established connections with leading universities and innovation centres
The study, commissioned by EY, emphasizes that these strengths position Grangemouth as a prime candidate for sustainable industrial transformation.
Three Core Areas for Redevelopment
The proposed options fall into three categories: waste processing, bio-feedstocks, and offshore wind energy support. Each option involves advanced technologies that align with Scotland’s long-term sustainability goals.
Waste Processing Innovations
Waste management is a key focus, with three proposals that convert waste materials into valuable resources:
- Hydrothermal Plastic Recycling: Converts hard-to-recycle plastics into recycled naphtha and vapour (pyrolysis oil). Estimated cost: £120-250M.
- Dissolution Plastics Recycling: Uses chemical processes to dissolve and refine plastics back to a near-virgin state. Estimated cost: £25-100M.
- Acetone Butanol Ethanol (ABE) Biorefining: Utilizes bacterial fermentation to process carbohydrate-rich waste into biofuels. Estimated cost: £215-265M.
Bio-Feedstock Developments
Turning biological materials into energy sources is another major pathway. The study highlights three key bio-feedstock projects:
- Second-Generation Bioethanol: Converts Scottish timber into bioethanol through fermentation. Estimated cost: £350-870M.
- Anaerobic Digestion: Breaks down organic waste to generate biomethane, reducing reliance on fossil fuels. Estimated cost: £15-310M.
- HEFA (Hydroprocessed Esters and Fatty Acids): Transforms Scottish-grown oil seed crops into Sustainable Aviation Fuel (SAF) and renewable diesel, utilizing low-carbon hydrogen. Estimated cost: £740-900M.
Supporting Offshore Wind Expansion
Scotland’s offshore wind industry is growing rapidly, and Grangemouth could become a critical hub for energy transition:
- Fuel Switching: Replacing natural gas combustion with low-carbon hydrogen to reduce emissions. Estimated cost: £210-250M.
- E-Methanol & Methanol-to-Jet: Using hydrogen to produce methanol, which can be converted into SAF. Estimated cost: £1.7-2.1bn.
- E-Ammonia Production: Producing low-carbon ammonia for the shipping industry and chemical sector. Estimated cost: £2-2.5bn.
Government Backing and Investment Drive
The transition of Grangemouth, dubbed Project Willow, has received strong political and financial backing. UK Prime Minister Keir Starmer recently pledged £200M from the National Wealth Fund, while Scotland’s First Minister John Swinney announced an additional £25M for a Just Transition Fund to attract private investment.
Scottish Energy Minister Michael Shanks emphasized the commitment to Grangemouth’s transformation, stating, “We are leaving no stone unturned in securing a long-term industrial future, creating jobs, and driving economic growth.”
Investment and Workforce Considerations
Project Willow is expected to create up to 800 new jobs by 2040, supporting a smooth transition for existing workers. The UK and Scottish governments are jointly reviewing policy recommendations to secure further investment.
Scottish Secretary Ian Murray highlighted the economic importance, saying, “The publication of this report is a milestone in securing Grangemouth’s long-term future and supporting its workforce.”
With a century of industrial expertise and a skilled workforce, the redevelopment of Grangemouth could cement its place as a leader in the UK’s clean energy transition. The coming months will be crucial in securing investor confidence and pushing these proposals forward.
