Energy is central to Scotland's economic growth. So where does it sit in the new Scottish Government?

Ardersier Port, Moray Firth - sits at the centre of the Inverness and Cromarty Firth Green Freeport. Taken on approach to Inverness Airport.

Following the Scottish Government's cabinet and ministerial appointments, I was interested to note that Energy no longer featured distinctly in the Cabinet portfolio title for the first time since 2021.

Energy now sits with Stephen Gethins MSP, Minister for External Affairs, Europe and Energy - a junior ministerial role. Anyone working in or close to the sector knows that energy sits at the centre of Scotland's economic growth in every part of the country - material to jobs, skills and the regional economic clusters that will drive recovery.

Despite this it no longer has a seat at the Cabinet table. Why?

Energy policy is, and always has been, a reserved policy area. Planning sits at a Scottish Government level and will sit with Hannah Mary-Goodlad, Shetland MSP and Minister for Public Finance.

There's good reason that overall energy policy sits with Westminster - we have one single energy market and one energy grid across the UK. We import and export energy through interconnectors to European countries, and our energy security has major interdependencies that cross borders and jurisdictions. Perhaps the greatest strength of the renewables and green technology agenda is precisely that it offers us a sustainable and secure energy future, built on an extraordinarily energy rich island nation, with deep industrial heritage and skills to match.

Perhaps, then, the First Minister's decision signals a more streamlined approach, recognition that energy policy is largely reserved, and that the Scottish Government has more than enough to focus on in this parliament. If that is the case, then bravo. For business, confusion over policy responsibilities across the two parliaments only serves to hinder progress and create duplication.

Looking at the full list of Cabinet Secretaries the word "energy" does not appear once. In a country whose economic future is as bound up with energy as Scotland's, it is however a notable absence.

The recent parliamentary debate brought forward by Stephen Gethins MSP, entitled "Scotland's Energy", was in many ways a statement of constitutional position rather than a policy prospectus. It makes sense that the SNP-led Scottish Government must maintain its view that energy powers should sit in Scotland's hands. But Stephen Gethins himself, as a junior minister without a cabinet seat, is perhaps the most honest signal of where those powers actually reside.

And the scale of the opportunity here is extraordinary. Scotland is rich in hydrocarbons, wind, wave, tidal and nuclear potential, with significant infrastructure advantages including deep water ports, world-class North Sea skills and heritage, and world class facilities such as the European Marine Energy Centre (EMEC) in Orkney. Tidal stream energy is a case in point. Scotland is home to the world's largest operational tidal stream projects and holds around a quarter of Europe's entire tidal energy resource. Contracts For Difference (CfD) support has been awarded to many developers, but tidal policy does not sit at the heart of GB Energy's Strategy, which is materially affecting the ability to raise capital and scale.

It is an area the Scottish Government could push hard on, yet it now sits with a junior minister. It is perhaps also worth noting that Scotland never ultimately published its energy strategy, which in itself may reflect a quiet acknowledgement that the meaningful levers sit elsewhere.

EMEC's proposed DeepWind floating offshore wind test site, 20km west of Orkney, is a further example of world-class infrastructure awaiting the policy and funding support.

CFDs provide vital support in getting projects to commercialisation, in scaling emerging technologies and in ultimately reducing their capital cost. The route to commercialisation is also the route to lower energy bills in the long term. I acknowledge this is often a difficult argument to make and a harder one for consumers to hear. Those off the gas grid who depend on heating oil have faced exponential cost increases. I wrote some months ago that I felt something of a fraud, spending my days in support of the transition whilst living in a cottage with oil central heating, entirely exposed to the doubling in heating costs driven by the war in Iran.

What politicians heard on the doorsteps during the Scottish Election campaign is that energy costs are crippling households. Farmers face significant increases in red diesel costs with no sign of relief. These are real pressures that the energy transition must address, not sidestep.

And then there are curtailment costs, amongst the most perverse charges that ultimately land with consumers. We are producing too much energy because our infrastructure has not kept pace, and people end up paying more on their bills as a result. A head in hands moment.

The energy system is far from fully evolved, and the complexity of the issues are real. But that complexity is precisely the argument for strong, focused representation.

So where does that leave us? Energy policy is ultimately the reserve of Westminster. Ofgem, NESO, DESNZ, GB Energy, DBT, NWF, National Grid amongst others all operate at UK level, feeding into one system. The decisions on CFDs, transmission investment, grid upgrades and significant sovereign funding for innovation and supply chain development are taken there.

Understanding that landscape, knowing how to navigate it and making the strongest possible case within it is not optional for businesses operating in Scotland's energy transition - it is essential.