Minerals sector holds key to Highland development and net zero goals
As Scotland advances ambitious housing targets and the transition to green energy, a less visible but vital sector is coming into sharper focus: minerals.
At the recent annual Savills Scottish Property Outlook event in Inverness, industry experts gathered to discuss the future of land use, rural investment, and infrastructure in the Highlands. Among the speakers was Peter Erskine from Savills Minerals & Waste team, who delivered a compelling presentation on the role of mineral extraction in shaping Scotland’s future.
“Mineral extraction may not sound like the most high-profile topic,” said Erskine, “but I hope you leave with a clearer understanding of why the sector matters – not just today, but for the future.”
From sand and gravel to lithium and rare earths, minerals underpin everything from housebuilding to renewable energy infrastructure. Each new home requires around 60 tonnes of sand and gravel, and with the UK government targeting 300,000 new homes annually – and NPF4 in Scotland outlining a minimum need for 200,000 plus new homes over a 10 year period, demand for construction aggregate may increase.
In 2023, the UK used nearly 13 million tonnes of sand and gravel to build 212,000 homes. Meeting the UK government’s target would require 18 million tonnes – a 40% increase. Yet planning permissions are lagging behind. For every 100 tonnes consumed, only 60 tonnes are being approved for future extraction.
The Highlands is Scotland’s largest mineral-producing region, but the picture is more complex than it appears. The majority of this is crushed rock, and one major quarry accounts for the bulk of output – with over 90% exported to England and Europe. When figures for crushed rock are excluded, permitted reserves for sand and gravel in operational Highland quarries equate to just six years of supply. Some dormant sites may be reopened, and new locations could emerge – but only if planning and investment align.
Beyond traditional aggregates, the energy transition is driving demand for critical minerals such as lithium, cobalt, and rare earth elements – essential for batteries, solar panels, and wind turbines. Currently, the UK produces none of these on a commercial scale, leaving it reliant on global supply chains.
In response, the UK government launched a Critical Minerals Strategy in 2022, aiming to reduce dependence on imports and develop domestic sources. Mapping by the Critical Minerals Intelligence Centre has identified potential across Cornwall, North West England, Wales, and the Highlands. While exploration is still at an early stage, the geology of the Highlands offers promising signs.
Challenges remain. Global prices for minerals like lithium have dropped, and policy decisions abroad – such as price support schemes in the US – can shift the economics quickly. One UK processing project has already relocated to the United States in response.
Recent success stories across the sector have sparked growing interest. Companies like Cornish Lithium have now produced battery-grade lithium hydroxide, and similar developments could emerge in Scotland. However, producing these critical minerals at a commercially viable scale remains a significant challenge.
Erskine still sees genuine potential for Highland landowners and communities. Savills is already supporting clients in exploring mineral rights and negotiating agreements with operators. Ultimately, success will hinge on factors such as mineral quality and concentration, planning frameworks, and prevailing market conditions.
The presentation concluded with insights from Savills Natural Capital team, who offered a complementary perspective focused on enhancing natural resources rather than extracting them. In the Highlands, where land is both heritage and opportunity, the future may lie in balancing both.