The Scottish National Party (SNP) has called on the UK Government to redirect an estimated £5 billion ($6.7 billion) in tax revenues and windfall levies collected from North Sea oil and gas operators into the Acorn carbon capture and storage (CCS) project near Peterhead.

The demand follows political pushback over changes to federal capital grant allocations announced in the latest UK Budget statement. As first reported by The Scotsman, only £12 million of the initial £200 million ($268 million) capital grant committed to the Acorn development has been disbursed to date, leaving the remainder of the promised support to be delivered through state loans or equity investments.

SNP Westminster leader Dave Doogan criticized the restructuring, arguing that revenues generated from Scottish offshore energy resources should directly fund regional decarbonization infrastructure. The Acorn facility is identified as a core component of Scotland’s net-zero transition, with the potential to support up to 15,000 regional energy jobs.

Responding to the opposition, UK Energy Minister Martin McCluskey confirmed that while the initial £12 million ($16 million) drawn down by developers remains secured, all remaining and future financial support for the Acorn site will transition from direct capital grants to loan and equity instruments.

“For the remainder, and for any future support, instead of it being through grant funding, it will be through loans and equities,” McCluskey stated, adding that the adjustment allows the government to retain an ownership stake and secure a return for taxpayers.

The Department for Energy Security and Net Zero clarified that the capital grant reduction formed part of a broader reprioritization across federal infrastructure budgets to support increased defense spending.

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