The UK is losing the skills and supply chain it needs to meet its net zero ambitions as a growing share of energy sector jobs, investment and innovation moves abroad, a new report has warned.

Aberdeen & Grampian Chamber of Commerce’s 41st Energy Transition Survey, published today, shows an ‘alarming exodus’ of business activity and talent away from the UK Continental Shelf (UKCS), with almost half of firms reporting staff leaving the UK to work in other energy regions.

UK firms are increasingly shifting focus to overseas operations, with 66% expecting to increase their international workforce by 2030 and most anticipating that the bulk of their work will take place abroad within the next five years. 

Of the more than 100 firms polled that are active in the UKCS basin, 25% said they were not optimistic about the long-term future of the UK as an energy hub focused on the delivery of net zero.

With the UK facing ambitious, legally binding decarbonisation targets, including a 68% emissions reduction by 2030 and 81% by 2035, the report warns that declining activity across renewables, electrification, and decarbonisation technologies threatens to undermine the country’s ability to deliver net zero using domestic supply chains.

The slowdown is taking a toll on energy industry optimism, too, with this year’s survey highlighting a deepening crisis in domestic confidence, as the value of UKCS work fell across all measured categories, including renewables and and low-carbon energy.

“This is a wake-up call for policymakers,” said Russell Borthwick, chief executive of Aberdeen & Grampian Chamber of Commerce.

“We are training a world-class workforce and building the technology to lead the energy transition – but that talent and investment is increasingly being deployed overseas. 

“If we continue to erode competitiveness through incoherent energy policy and excessive taxation, we risk offshoring the entire supply chain that is essential to the UK’s future energy system.

“You cannot deliver net zero by exporting your industrial base.”

With tax and licensing rules now the first and third most pressing issues cited by respondents, energy firms are looking to the UK Government to provide some kind of reassurance and to take the lead in bolstering the sector wide push for decarbonisation.

Among the most supported actions were issuing new North Sea licences with lower emissions than imports (91%), and ending the Energy Profits Levy (EPL), which 89% believe would boost investment and job creation.

It isn’t just the UK Government being criticised, however, with the survey finding equal dissatisfaction aimed at the Scottish Government.

Most notably, the lack of a formal Scottish Government Energy Policy is viewed as a critical issue, with 90% of energy firms agreeing that the absence of an energy strategy is damaging investor confidence.

Almost half of the companies polled also said that green energy roles could never fully replace lost oil and gas jobs, despite the Scottish Government’s much heralded Just Transition plan, which aims to move oil and gas workers into clean energy and renewables as part of a commitment to achieving net zero.

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Those efforts have already included £87 million for securing the future of the Grangemouth refinery, along with a training package for workers there to move into renewable energy roles, with the first minister, John Swinney, saying their skills are ‘key to Scotland’s net zero future’.

As this latest study shows, however, these stop-gap measures will not be enough to secure the long-term move to net zero.

“The UK has the talent, the technology and the track record to lead the global energy transition – but we are now at serious risk of falling behind due to fragmented thinking and short-term policymaking,” said Bob Drummond, CEO of clean energy group D2Zero.

“Energy transition isn’t a switch we flip overnight – it’s a series of complex, interconnected projects that require sustained momentum.

“This report lays bare a critical truth: if we don’t act decisively, the infrastructure and ingenuity we need to build a low-carbon future will be deployed elsewhere. And once that capability is gone, it will be extremely difficult to rebuild.”

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