Scotland has emerged as the fastest-growing region in the UK’s net zero economy, with new research highlighting a significant expansion in green business activity since 2022. According to a report by the Energy & Climate Intelligence Unit and CBI Economics, Scotland’s green sector has grown by 20.1%, surpassing the national average.
North East Scotland Emerges as a Net Zero Hub
One of the key regions driving this growth is North East Scotland, which now contributes 5.1% of the UK’s total net zero economy. This figure is expected to rise further with the development of the Energy Transition Zone—a 30–40 hectare innovation hub focusing on renewable energy solutions, particularly floating offshore wind and green hydrogen.
Energy generation remains the primary driver, accounting for 41% of the economic value generated by Scotland’s net zero economy. Scotland’s natural resources and strong offshore wind capabilities have positioned it at the forefront of this transition.
“This is unsurprising given Scotland benefits from natural advantages in renewable energy, such as onshore and offshore wind,” the report states. “Scottish strength in net zero looks set to continue with the government’s flagship Great British Energy being headquartered in Aberdeen.”
Economic Impact and Job Creation
Since 2022, the net zero economy has added £9.1 billion in gross value added (GVA) to Scotland’s economy, now making up 4.9% of the country’s total economic output. Employment in this sector has also surged by 19.5%, equating to 16,500 new full-time jobs, bringing total employment in net zero businesses to 100,700.
Across the UK, the sector now supports 951,000 full-time equivalent jobs, with 273,000 of those directly within net zero businesses and an additional 678,000 through supply chains and related services.
Private sector investment has been instrumental in driving this expansion. Since 2019, net zero businesses across the UK have secured £23 billion in private investment, supplemented by £1.1 billion in Innovate UK grants.
High Productivity and Wage Growth
The report underscores the sector’s high productivity levels, with net zero jobs proving 38% more productive than the UK average. Each full-time role within the sector generates an economic output of £105,500, significantly above other industries. This increase in productivity has translated into higher wages, with an average salary of £43,076 for workers in net zero businesses—considerably above the UK median wage.
Other regions, including Yorkshire & the Humber, Northern Ireland, London, and the South East, have also witnessed impressive productivity growth, with net zero job productivity exceeding regional averages.
Political and Business Reactions
The report highlights that the net zero economy has grown by 10.1% over the past year alone, contributing an additional £7.7 billion to the UK’s economy. It has also emerged as a major driver of employment, investment, and innovation, solidifying its role as a cornerstone of the UK’s transition to a sustainable future.
Louise Hellem, chief economist at the CBI, emphasized the sector’s rapid expansion: “Our analysis has consistently shown that the net zero economy is growing at a faster pace than the rest of the economy. This reflects growing investor confidence that adapting the economy to climate risk will secure huge competitive advantage through inward investment, export opportunities, and mitigating volatility of high exposure to international energy markets.”
First Minister John Swinney echoed these sentiments in a press conference last week, stating that the green re-industrialization of Scotland would create “good jobs, well-paid jobs, and a resurgence of economic opportunity.”
SNP MSP Jackie Dunbar reinforced the economic potential of the sector, saying, “Adding £9.1 billion to the economy and 16,500 jobs since 2022—Scotland is already seizing the economic opportunities of net zero. Across the UK and the world, we are seeing politicians seeking to undermine the transition. To combat this, it is essential that people see the vast economic benefits of taking action against the climate crisis in their daily lives.”
