In 2009, The Crown Estate identified 10 areas where it was prepared to grant commercial leases for offshore wind energy developments ( Appendix A, Figure A1). Collectively, these areas have a generation capacity of around 6.4 GW (Table 1). Marine Scotland subsequently progressed a Strategic Environmental Assessment ( SEA) of offshore wind in territorial waters which led to the publication of the Draft Plan for Offshore Wind Energy ( OWE), and an SEA Environmental Report in May 2010 (Marine Scotland, 2010a).
The Draft OWE Plan provides a strategic overview of where offshore wind development could be progressed in the short, medium and long term. The Crown Estate's initial 10 options were included in the Draft OWE Plan, but subsequent to this one of the sites (Bell Rock) proved technically unsuitable for development and the developer has withdrawn from the scheme. The Draft OWE Plan identified a further 25 medium term options that were considered to be potentially acceptable in environmental terms.
Table 1. Indicative capacity and size of short term OWF options in Scottish Territorial Waters
Short term Sites
Size ( MW)
Area (km 2)
Neart na Gaoithe
Consultation on the Draft OWE Plan and SEA Environmental Report began in May 2010 and concluded on 27 September 2010. The consultation included a series of regional and sectoral meetings. Over 800 consultation responses were received. The feedback received through this process has consistently emphasised the importance of considering social and economic factors when developing the OWE Plan, particularly around the potential impact of offshore wind on other marine industries and users.
Reflecting best practice in SEA, the environmental assessment was frontloaded and used to define the content of the Draft OWE Plan. However, environmental impact is just one of a number of considerations to be taken into account since SEA legislation requires plan making bodies to consider the impact of plans on material assets.
Marine Scotland therefore commissioned this study to undertake an economic assessment of the short term offshore wind options within the Draft OWE Plan to inform the finalisation of the OWE Plan and the Post-Adoption Statement. The study has focused on the short term options identified as there is greater certainty about these developments at this point in time.
The project has assessed the impact of development in the following broad areas of Scotland specified within the Draft OWE Plan ( Appendix A, Figure A1):
- North East: focusing on Beatrice;
- East: Inch Cape, Neart na Gaoithe, Forth Array;
- South West: Solway Firth, Wigtown Bay; and
- West: Argyll Array, Islay, Kintyre.
As no sites in the North or North West areas have been identified among the short term options, no development options from these areas have been considered within the analysis. Information on regional-scale impacts has also been combined to provide an indication of impacts at a national level.
The study has been undertaken by ABPmer in association with economic consultants SQW and Risk & Policy Analysts ( RPA) between December 2010 and February 2011. The project has been managed jointly by the Marine Analytical Unit ( MAU) and the Marine Renewables and Offshore Wind policy team within Marine Scotland supported by a wider Project Advisory Group (see Appendix B for list of membership).
1.1 Scope of Study
The study approach has assessed and compared the costs incurred by, and benefits arising from, different policy options and considered them against a 'do nothing' option (where there is no intervention). The assessment been prepared in accordance with Better Regulation Executive guidance on impact assessment 2 and the Green Book methodology ( HM Treasury, 2003) for economic assessment.
The key requirements of the study have been to:
- Provide a comparison of the economic and social benefits associated with the development of the short term options for offshore wind in Scottish Territorial Waters against any potential economic and social costs associated with it;
- Assess the distribution of costs and benefits amongst the public sector, different industries (e.g. fishing, tourism, shipping) and wider society, in order to establish who may bear the benefits and costs associated with the short term options;
- Consider the impact (in terms of Gross Value Added ( GVA) and employment) that the short term options will have on the regional economies affected, and on the wider Scottish economy. In particular, the study has sought to estimate the net impact on regional economies resulting from the manufacture, installation, operation and decommissioning of offshore wind sites, from any associated infrastructure development works that are required, and from any impacts on other marine activities; and
- Finally, through specific tests within an impact assessment, to determine the potential impact of policies on small firms and on competition.
This report focuses on the costs and benefits to other marine users and interests.
The potential environmental impacts and impacts on visual amenity associated with the short term options have been considered as part of the SEA. Although any impacts that have emerged from the SEA have been noted, valuation of these impacts was outwith the scope of this project, given the challenges of adequately valuing ecosystem services and the limited time for the study. Consideration of different approaches for distributing revenues from the short term options was also considered out of scope.
1.2 Report Structure
The report has been structured as follows:
Further information is provided in the Appendices, including detailed maps ( Appendix A), Stakeholder and Project Advisory Group engagement ( Appendices B, C, F) and sources of information ( Appendices D and E).