The future of Grangemouth, Scotland’s industrial hub, has taken a significant turn with the release of the long-awaited Project Willow report. Published on March 19, 2025, the report outlines nine potential pathways to transform the site into a low-carbon industrial powerhouse. This comes on the heels of Petroineos’s decision to decommission the Grangemouth oil refinery, which has been a cornerstone of Scotland’s energy sector for over a century.
The ambitious plan is backed by a combined £225 million from the Scottish and UK Governments. The Scottish Government has pledged £25 million through the newly established Grangemouth Just Transition Fund, while the UK Government has committed £200 million to unlock the site’s full potential. These funds aim to attract private investment, secure jobs, and drive regional economic growth.
First Minister John Swinney emphasized the importance of Grangemouth’s skilled workforce and industrial heritage in achieving Scotland’s net-zero goals. “We will leave no stone unturned in order to secure the future of the Grangemouth refinery site,” he stated, highlighting that this initiative is a key step toward a sustainable economic future.
UK Energy Minister Michael Shanks echoed these sentiments, describing the project as a cornerstone of the government’s Plan for Change. “We will build on Grangemouth’s expertise and industrial heritage to attract investors and secure a long-term clean energy future,” he remarked.
Key Proposals from Project Willow
The £1.5 million feasibility study conducted by EY identifies nine transformative projects that could reshape Grangemouth into a low-carbon hub. These proposals span three main areas:
Waste Management:
- Hydrothermal upgrading for hard-to-recycle plastics.
- Chemical plastics recycling.
- ABE biorefining to convert waste materials into useful products.
Bio-Feedstock Development:
- Converting Scottish timber into bioethanol.
- Anaerobic digestion of bioresources.
- HEFA (Hydroprocessed Esters and Fatty Acids) technology to produce sustainable aviation fuel (SAF) and renewable diesel.
Hydrogen and Offshore Wind Integration:
- Replacing natural gas with hydrogen.
- Using hydrogen to produce methanol and low-carbon ammonia for shipping and chemicals.
These initiatives are projected to create up to 800 jobs by 2040 and require an estimated £3.5 billion in private investment. The projects align with Scotland’s broader ambitions for low-carbon manufacturing and renewable energy leadership.
To accelerate progress, Energy Minister Michael Shanks and Acting Cabinet Secretary for Net Zero and Energy Gillian Martin co-chaired a meeting of the Grangemouth Future Industry Board on March 19. The board includes local industry leaders, Falkirk Council representatives, trade unions, and other stakeholders. The focus is on marketing the proposals outlined in Project Willow to attract private investors.
Both governments have also committed to reviewing policy recommendations from the report to ensure that public funding is effectively deployed. Additionally, tailored skills training programs have been introduced for refinery workers, guaranteeing support for those transitioning into new roles within emerging industries.
While the plans are ambitious, they are not without challenges. The closure of the oil refinery will result in significant job losses in the short term, with hundreds of positions set to be eliminated this year alone. Moreover, many proposed projects will not begin production until after 2030, leaving a potential “jobs gap” that could take years to bridge.
Union leaders have expressed concerns about this transition period. Unite’s general secretary Sharon Graham warned against creating “another working-class wasteland” and called for immediate action to prevent deindustrialization in Falkirk. However, First Minister Swinney remains optimistic about securing private investment to fill this gap.
The transformation of Grangemouth is part of a larger £100 million Falkirk and Grangemouth Growth Deal package jointly funded by both governments. This initiative aims to support local energy projects and foster economic growth in the region.
The National Wealth Fund will also play a critical role in co-investing alongside private entities. To qualify for funding, projects must deliver positive economic returns, drive regional growth, or contribute significantly to climate change mitigation efforts.
Grangemouth’s transition represents a microcosm of Scotland’s broader journey toward net-zero emissions by 2045. By leveraging its industrial expertise and embracing cutting-edge technologies such as hydrogen production and sustainable aviation fuels, Grangemouth has the potential to become a global leader in low-carbon energy solutions.
As both governments work hand-in-hand with private investors and local stakeholders, Grangemouth stands at a pivotal moment in its history—poised to redefine itself as a beacon of sustainable industrial innovation in Scotland and beyond.
