Publication - Consultation paper

Offshore renewable energy developments - good practice principles for community benefits: consultation

Published: 30 Nov 2018

Draft version, for the purposes of public consultation, of the Scottish Government's Good Practice Principles for Community Benefits from Offshore renewable Energy Developments.

36 page PDF

309.3 kB

36 page PDF

309.3 kB

Contents
Offshore renewable energy developments - good practice principles for community benefits: consultation
8. Case Studies

36 page PDF

309.3 kB

8. Case Studies

8.1 Case Study 1: East Ayrshire Coalfield Initiative

The East Ayrshire Coalfield Environment Initiative is a successful partnership between the local authority, conservation bodies and industry, which has been working over the last 10 years to enhance, conserve, and promote the environment in East Ayrshire.

The initiative aims to support communities in the coalfield region to live and work within a high quality natural environment and derive a sense of pride from their local landscape. The initiative holds regular events and has volunteering opportunities for those interested in nature conservation or looking to enjoy the outdoors.

Find out more at: http://www.ea-cei.org.uk

8.2 Case Study 2: Scottish Landfill Community Fund

The Scottish Landfill Community Fund (SLCF) is a tax on the disposal of waste to landfill and is charged by weight on the basis of two rates: a standard rate for active materials; and a lower rate for less polluting (referred to as 'inert') materials. The Scottish Landfill Community Fund will replace the UK Landfill Communities Fund over a transitional period from April 2015 until March 2017. The Scottish Landfill Community Fund will maintain the private status of contributions, facilitating the ability of projects to receive match funding from public and European sources.

The Scottish Environmental Protection Agency (SEPA) has created an interactive Scottish Landfill Communities Fund Screening tool which allows a potential SLCF project to see if they are within 10 miles of a landfill site or transfer station. Projects will be able to apply for monies from the Fund later in 2015, and will apply to Approved Bodies. SEPA will be publishing their list of approved bodies on their website.

Find out more about the Scottish Landfill Tax and Scottish Landfill Communities Fund at: https://www.revenue.scot/scottish-landfill-tax/scottish-landfill-communities-fund

8.3 Case study 3: Oil in Shetland

"[In Shetland], a charitable trust currently worth £217 million was set up in 1974 to accept money from the Sullom Voe oil terminal. This fund dispenses millions of pounds a year (£11million in 2011) to the Shetland community, providing services such as support for the elderly and infirm as well as funds for local cultural and sporting activities. One notable finding from the comparison of oil and wind income in Shetland, is the importance of strategic legacy planning: income from oil in the form of the Shetland Charitable Trust is currently being used to fund the planning and construction of the Viking wind farm, which is then projected to deliver a return of £23 million per year back to the trust, on top of community benefit payments to the local community of £1 million per year. The future of the trust, and local investment, will thus be safeguarded even as oil levels decline. If the income from wind energy can be harnessed in a similar, strategic way, either at a community or a regional scale, then communities around Scotland can plan for their future development."

Excerpt from http://www.all-energy.co.uk/__novadocuments/28619

8.4 Case Study 4: Offshore Infrastructure

"The UK Government's Offshore Wind Industrial Strategy sets a pathway for the creation of 30,000 FTE jobs and delivery of £7 billion GVA to the UK economy by 2020 through a strong growth delivery scenario. The strategy adopts a variety of programmes aimed at ensuring UK based companies benefit from this burgeoning industry, including requiring developers to produce a supply chain plan when they apply for government funded revenue support. The Scottish Government has also been working closely with its enterprise agencies to ensure companies throughout Scotland benefit from the development of offshore wind, and a range of programmes and policies already exist or are in development, including Scottish Enterprise's Offshore Wind Expert Support Programme which pro- actively engages with Scottish supply chain companies to ensure they benefit from the deployment of offshore wind in Scotland. This is in addition to the developer's own programmes, such as SSE's Highland Portal, which facilitates trade and engagement between SSE, local suppliers and service providers. The portal provides a platform for the company to promote opportunities originating in the region, enabling local suppliers to have visibility of SSE opportunities, register as a supplier and respond to notices free of charge.

In this sense the offshore renewable energy industry is similar to the oil and gas sector, where the majority of infrastructure is based offshore but benefits have accrued to onshore communities across the nation through investment and job creation associated with manufacturing, operations and maintenance activities and the establishment of global centres of excellence"

Scottish Renewables, 2013. Find out more at: https://www.scottishrenewables.com/publications/scottish-renewables-offshore-renewables-community-/

8.5 Case Study 5: The Coastal Communities Fund (CCF)

The CCF is a UK Government programme which aims to see coastal communities experience regeneration and economic growth through projects that directly or indirectly create sustainable jobs and safeguard existing jobs. The Fund is equivalent to 50% of the revenues from Crown Estate marine activities. The CCF priorities in Scotland have included:

  • from small and medium size coastal communities with a population of around 60,000 or less, facing economic challenges;
  • that promote sustainable economic growth and jobs through economic diversification activities in coastal communities that enable the growth of local businesses;
  • that complement strategic regeneration initiatives within coastal communities.

An example project funded under the CCF is the Argyll and Bute Forest. A grant of £71,285 was given in 2013 to fund a part-time Business and Marketing Manager, a new workshop and equipment and promotional materials. The award will help to support the business to establish a range of products and a customer base quickly, enabling the business to employ people locally and ensuring BFL can meet the ongoing the costs of maintaining the forest. The CCF has contributed to a range of projects including: water sports facilities and apprenticeship schemes in Argyll and Bute and in Moray, renovations to Skye Sailing Club's boathouse in Portree, developing the Arran Coastal Way and creating slipways and moorings in Leverburgh, Port Ellen and across North Ayrshire to promote and safeguard jobs in tourism.

Find out more at: http://www.biglotteryfund.org.uk/global-content/programmes/uk- wide/coastal-communities

8.6 Case Study 6: RWE Rhyl Flats Offshore Wind Farm Community Fund

Rhyl Flats was constructed throughout 2008 and 2009 and began generating energy in July 2009. It is currently the largest operating renewable energy scheme in Wales and one of the most powerful offshore wind farms in the UK. The Rhyl Flats Wind Farm fund will invest over £2 million into local activities and projects in communities surrounding the site..

  • The base level of the annual fund is £90,000 for the 90MW wind farm per year throughout the operational life of the wind farm, normally expected to be in the region of 25 years. This equates to £1000 per MW per year, or £3600 from each of the 25 3.6MW turbines.
  • The fund is index linked each year in line with the retail price index.
  • The fund supports communities living in Rhyl (£15k) and 13 wards in neighbouring Conwy (£75k).
  • To maximise the benefit for local communities, RWE Innogy UK has worked in partnership with the Welsh Assembly Government to develop an administration arrangement for the Conwy part of the fund that presents local communities with easier access to wider funding options through one simple application form.
  • Local groups can apply for funding packages and the schemes fund capital and / or revenue projects run by charities, community and voluntary groups.

Find out more at: https://www.innogy.com/web/cms/en/3783606/innogy-renewablesuk/in-your-community/fund-list/wales/

8.7 Case Study 7: Existing benefit structures – Fife College and AREVA Wind Pre-apprenticeship programme

Many regional projects support community development across Scotland. There is an opportunity for developers to deliver community benefits by investing in existing programmes and structures, with a focus on employment, training, apprenticeships or any other topic as deemed appropriate by local stakeholders.

For example, the AREVA Wind sponsored Pre-Apprenticeship programme for wind turbine technician training in partnership with Fife College was launched in 2013. This programme is specifically designed to provide the training and skills required for the offshore wind industry and serves as a precursor for further training opportunities to become AREVA Turbine Technicians.

8.8 Examples of Community Benefit Types:

Excerpt from Climate Xchange, 2015, Community Benefits from Offshore Renewables: Good Practice Review

8.8.1 Models considered as 'community benefit' as defined in this document:

Benefit Model Description of Mechanism Examples
Community Funds
  • Developers pay in to a particular fund arranged for an offshore development
  • There are different models of community funds that are either administered by developers, authorities or communities
  • Contributions are made on voluntary basis and provide constant flow of revenues
  • Mechanisms of funds are usually established in consultation with affected and benefiting communities
  • Usually annual payments corresponding with capacity of offshore wind farm
  • Most common in the UK for offshore wind farms
  • Funds for affected communities and regions or funds for communities in which developers operate
  • Access to fund can be regulated
  • Communities and community organisations can usually apply for project-funding from the fund
  • Rhyl Flats Community Fund
  • North Hoyle Wind Farm Fund
  • Burbo Bank Extension Community Benefit Fund
  • Robin Rigg West Cumbria Fund
  • Teeside Offshore Community Benefit Fund
  • Sheringham Shoal Community Fund
  • Gwynt Y Mor Community Benefit Fund
  • Gwynt Y Mor Tourism Fund
  • London Array Community Benefit Fund
  • Dudgeon Community Support Fund
  • Triton Knoll Community Benefit Fund
  • Hornsea Community Fund
  • Eneco Lochterduinen Fonds, NL
Pre-existing funds
  • Developers can also pay into existing funds that were not set up specifically for funds from offshore renewables
  • Such funds comprise regional development funds, nature preservation funds, wildlife trusts
  • Leiston and Sizewell Community Benefit Fund (Greater Gabbard)
  • Kent Wildlife Trust (London Array)
Equal Distribution of Revenues
  • Equal distribution of revenues generated from offshore renewables
  • Distribution is usually centrally managed by one authority
  • In place where offshore renewables generate non-specific revenues through charges by the state or communities
  • These revenues can be applied to benefit the wider society or specific communities
  • Tax income from offshore wind levied by federal states in Germany, as offshore area is not municipalised
  • Highland Council, UK
  • Coastal Community Fund, UK
  • Germany
Direct Investments & Project Funding
  • Developers can also make direct investments in or donations for local projects and sponsor local initiatives
  • Such one-off investments are usually made in addition to establishments of funds in order to boost particular branches of the local economy, e.g. tourism
  • Some developers (e.g. Centrica) also decided to invest in local projects instead of creating specific funds
  • Funding from offshore developers has gone into exhibitions, community & visitor centres, wildlife reserves, local education programmes.
  • Lynn and Inner Downsing
  • Lincs
  • Ormonde
  • Thanet
  • Scroby Sands
  • Sheringham Shoal
  • London Array
Apprenticeships & Studentships
  • There are a few benefit schemes that focus on education as well as skills and training by providing funding
  • Bursary schemes and studentships are regarded as a particular component of the community benefit fund
  • University Bursary Scheme (London Array)
  • Sheringham Shoal Bursary Scheme
  • AREVA pre-apprenticeship programme
  • East Anglia ONE Skills Strategy
  • RWE Gwynt y Mor Apprenticeships
  • Rampian (considered)
Educational Programmes
  • Presentations and workshops in schools and colleges
  • Raising awareness of climate change, sustainability, environment and renewables
  • Encouraging and providing specific skills and knowledge for careers in the renewable energy sector
  • Sheringham Shaol
  • Hornsea
  • Tidal Lagoon Swansea Bay
  • Navitus Bay Offshore renewable wind farm
Electricity Discounts
  • There have been no electricity discount schemes from offshore renewables put in place so far
  • Only in place for onshore wind
  • Idea exists and was raised in context of the Walney Offshore Wind Farm, Tidal Lagoon Swansea Bay and a social acceptance study in Germany
  • Tidal Lagoon Swansea Bay (proposed)
Community Benefit Agreements
  • Binding agreements between developers and local authorities or communities to deliver benefits
  • Can be non-binding policy from council (Highland Council)
  • Highland Council
  • Massachusetts, USA

2.8.2. Further ways in which communities can profit from offshore renewable developments

Benefit Model Description of Mechanism Examples
Community Ownership
  • Co-ownership through coastal communities, co-operatives or non- local energy utilities is very rare
  • Benefits are generated through revenues from partial ownership of wind farm
  • Legal obligation of 20% ownership for nearshore wind farms in Denmark
  • Revenues generated through ownership are also administered by funds and trusts
  • Municipal utilities ownership and citizen participation possible in Germany (community buy-in)
  • Developer of Dutch Westermeerwind Offshore Windpark grants the possibility of community buy-in
  • Denmark: Middelgrunden, Samso, (non-voluntarily)
  • Germany: Global Tech 1, Windreich
  • Netherlands: Westermeerwind
Indirect benefits from supply chain
  • Community benefit-style compensation payments and indirect non-monetary benefits
  • Not necessarily community benefits, but some developers and authorities interpret them as such
  • Creation of jobs through regional supply chain involving local businesses and using local infrastructures
  • Some developers highlight the significance of indirect benefits in addition to community benefit arrangements while others only emphasise the role of indirect benefits
  • Germany
  • UK
Indirect benefits through tourism
  • Offshore renewables are regarded as a novel and innovative technology and as tourist attractions in their own right
  • Facilities as an attraction for tourists and also use for tourist activities (tidal barrages)
  • Tidal Lagoon Swansea Bay
  • Sheringham Shoal
  • Scroby Sands
  • La Rance Tidal Project, France
  • Sihwa Tidal Project, S. Korea
  • Wyre Tidal Energy

Contact

Email: Lorne Frew