The headline announcement of Freeports in the Chancellor’s Budget made it clear that they will have an important role in regeneration and supporting the delivery of the UK’s clean energy revolution.

With four of the successful bidders on the south coast, one in the East Midlands and three in the North, the Chancellor’s focus on those Northern freeports in his speech demonstrated the potential political role they will play in the UK government’s ‘levelling-up’ agenda.

The Northern locations in particular will have the added advantage of the Treasury being close at hand in Darlington and the UK Infrastructure Bank sited in Leeds, but what is the position north of the Border?

No agreement has been reached with the Scottish Government on the number or location of freeports in Scotland, and there have been reports that the UK government may consider establishing special tax status freeport areas in Scotland if that remains the case.

Scottish emphasis on net-zero as well as regeneration

The Scottish government has indicated its intention to adapt the UK government’s Freeport proposals into a new model of “Greenports”, focused on inclusive growth, fair work practices and delivering a carbon net-zero economy. This subtle change of title reflects, amongst other things, Scotland’s aspiration to be the lead country in green credentials among the home nations of the UK.

The Scottish Government’s survey analysis on ‘Scotland’s economic performance- economic development zones’, published on 21 January 2021, has a clear emphasis on the role Greenports can play in supporting Scotland's ambitious long-term climate change target to be carbon net-zero by 2050 (which will be brought into sharp focus later this year with COP26 in Glasgow). If these do come to fruition, it is hoped that Scotland’s global stranding in the renewable energy, biotechnology and low-carbon transport sectors could be complemented by a Greenport network that improves connectivity, increases exports, and strengthens the ecosystem for these industries.

What are Scottish Greenports?

Much like the UK government’s Freeport proposals, Greenports are intended to be secure custom zones, usually located around seaports or airports, where business can be carried out inside a country’s land border, but where different custom and tax rules would apply. Like Freeports, Greenports should offer operators and businesses similar incentives, but the SNP Manifesto pledge makes it clear employers will be required to pay workers within the zone a real living wage and adopt the Scottish Business Pledge, to support sustainable and inclusive growth in local communities and contribute to Scotland’s transition to net zero.

Scotland’s Renewable Sector

Greenports are intended to help drive the delivery of a green economic recovery, post-covid, by supporting the energy sector – in particular offshore renewable energy projects and green hydrogen. With one of the largest offshore resources in Europe, offshore developments require landside hubs and facilities to provide a strengthened quayside. With the Scottish Government’s stated aim to generate 50% of Scotland’s overall energy requirement from renewable sources by 2030, expect Greenports to be used as a tool to attract business and investment to Scottish ports in order to boost the offshore wind sector in particular.

Regeneration and job creation

Again, like Freeports, a principal aim of Greenports are to revive disadvantaged towns and cities through infrastructure investment. Greenports should create significant employment opportunities. The Greenport itself is likely to have a halo effect, whereby demand increases for commercial space in the surrounding area as well as, potentially, an increase in demand for local housing. Critics of the Freeport system point to job displacement and diversion of economic activity from other locations as being a key feature of them, rather than direct job creation and economic growth. There is conflicting evidence for both sides of the argument, but the view appears to have been taken within the Scottish government level that that the benefits of Greenports outweigh any potential adverse impacts.

Streamlined planning procedures

There is no detail yet in terms of how Greenports would be authorised under the planning system. Some existing permitted development rights may be relied upon, express planning permission may be required, and there may be scope to utilise the proposed “masterplan consent areas” once they are brought into force. Whichever route (or combination of routes) is used, it will require the public and private sector to work collaboratively to deliver Greenports.

Planning may also have a role to play in the decarbonisation of ports and port-activities through the authorisation of infrastructure such as EV charging points, hydrogen and ammonia fuelling, and shoreside power.

Conclusion

The Scottish Government’s proposed Greenports have the potential to reinvigorate and regenerate parts of the country by driving investment in infrastructure, creating new jobs, and harnessing Scotland’s renewable resources to boost local economies. Further, Greenports provide an opportunity to ensure that Scotland remains an attractive destination for investment, to increase connectivity with international markets, and to assist the transition to net zero in terms of both its infrastructure and the wider economy.