Draft Sectoral Marine Plans for Offshore Renewable Energy in Scottish Waters: Socio - Economic Assesment

The study reported here provides a high level socio-economic appraisal of the potential costs and benefits to activities that may arise as a result of offshore wind, wave or tidal development within the Draft Plan Options as part of possible future Scotti


The methodology to inform the assessment has built on previous work to assess the socio-economic impacts of offshore renewables including ABPmer et al, 2011; ABPmer & RPA, 2012a; ABPmer & RPA, 2012b and previous EIAs for offshore renewables, and has followed wider guidance on impact assessment (Scottish Government Guidance on Business and Regulatory Impact Assessment [2] , Better Regulation Executive guidance on impact assessment [3] and the Green Book methodology ( HM Treasury, 2003).

Development of Scenarios

The Draft Plan Option areas for offshore wind, wave and tidal development identify potential broad locations within which future arrays might be located. However, in order to provide a sufficient basis to carry out a quantitative socio-economic assessment, it was necessary to make assumptions about the potential scale (potential installed capacity), nature (the types of technologies) and timing of possible development within these Draft Plan Option areas and the location of power export cable routes. Given the inherent uncertainty in seeking to predict the scale and timing of development, a number of scenarios were developed, primarily relating to different possible scales of development within the Draft Plan Option areas, so that these uncertainties could be explored. The impacts of these scenarios were then compared against the 'do nothing' option in seeking to estimate the costs and benefits associated with offshore wind, wave and tidal development within the Draft Plan Option areas.

Three scenarios (termed 'Low Case', 'Central Case' and 'High Case') have been applied within the study relating to different scales of possible future offshore wind, wave and tidal development within the Draft Plan Option areas in the period 2020 to 2030 as follows (in terms of additional capacity beyond existing lease agreements):

  • Offshore wind
    • Low Case: 3 GW installed capacity
    • Central Case: 7 GW installed capacity
    • High Case: 15 GW installed capacity
  • Wave
    • Low Case: 0.5 GW installed capacity
    • Central Case: 1.25 GW installed capacity
    • High Case: 2.5 GW installed capacity
  • Tidal
    • Low Case: 0.5 GW installed capacity
    • Central Case: 1.25 GW installed capacity
    • High Case: 2.5 GW installed capacity

The potential installed capacities were then broadly assigned to individual Draft Plan Option areas pro rata to the size of each area.

The timing of possible development within individual Draft Plan Option areas is particularly uncertain. For the purposes of this study, the assumption was made that the draft Plans will look to enable development within the period 2020 to 2030. Given the uncertainty surrounding the precise timing of development, it was further assumed that all construction will commence in 2023 and that all developments will become operational in 2025. While this is a simplification, for impact assessment purposes it is likely to provide a broadly similar assessment of costs and benefits to an assumption that evenly distributes development over the period 2020 to 2030. A sensitivity test was also carried out to explore how costs and benefits might vary with different assumptions on the phasing of development.

Establishing a Baseline

The following socio-economic activities have been considered within the assessment:

  • Aquaculture (finfish and shellfish);
  • Aviation;
  • Carbon Capture and Storage;
  • Coast Protection and Flood Defence;
  • Commercial Fisheries (including salmon and sea trout);
  • Energy Generation (this will need to cover interactions between different offshore energy devices);
  • Military Interests;
  • Oil and Gas (including exploration, production, interconnectors, gas storage);
  • Ports and Harbours;
  • Power Interconnectors (including offshore transmission networks);
  • Recreational Boating;
  • Shipping;
  • Social Impacts;
  • Telecom Cables;
  • Tourism (including heritage assets);
  • Waste Disposal (dredge material); and
  • Water Sports (including sea angling, surfing and windsurfing, sea kayaking, small sail boat activities and scuba diving and).

Baseline information for the study has largely been drawn from ABPmer & RPA (2012a) which collated baseline information on a wide range of marine activities that may potentially interact with offshore renewables development in Scottish Waters. Some additional baseline information was also obtained, including:

  • Additional fisheries data provided by Marine Scotland including provisional outputs from the Scotmap project for inshore fisheries (vessels <15m);
  • Information on shipping density around the Scottish coast for 2008 (provided by the Maritime & Coastguard Agency); and
  • Information on helicopter main routes (from National Air Traffic Services)

Baseline information has been presented for a consistent base year (2012) and projected forward for the period of the assessment, taking account of available information on current and future trends.

Approach to Quantification of Economic and Social Impacts

The potential for offshore wind, wave and tidal development arrays and export cables to give rise to socio-economic impacts on other activities depends on the nature and scale of interactions between them. The approach adopted therefore sought to define the potential interactions and to identify those interactions which have the potential to give rise to significant socio-economic impacts drawing on relevant previous studies and taking account of specific factors relevant to each Draft Plan Option area. Where potentially significant socio-economic impacts were identified, more detailed methods for quantifying these impacts were applied taking account of information availability (see Appendix B). Where it was not possible to prepare quantitative assessments, relevant impacts were described qualitatively.

Social impacts have primarily been identified based on a distributional analysis. Based on the quantification of economic impacts and baseline data, the study has determined which of these impacts of the sets of plan options will fall on different groups in Scotland. This has included consideration of impacts on specific locations (including individual settlements, where data availability allows) and on specific groups within Scotland's population (including, for example, different age groups, genders, minority groups, and parts of Scotland's income distribution). The approach adopted has been consistent with that put forward by the GES / GSR Social Impacts Taskforce, which is based on the 'capitals approach' of ensuring that stocks of social capital are maintained over time. The key areas of social impact identified by the Task Force include:

  • Access to services;
  • Crime;
  • Culture and Heritage;
  • Education;
  • Employment;
  • Environment; and
  • Health.

For the purpose of this study, the combined impact of potential offshore wind, wave and tidal development within the Draft Plan Option areas has also been considered at both regional and national levels. The study has generally adopted an additive approach to assessing combined impacts associated with multiple offshore renewables development locations and multiple offshore renewables technologies within a region and nationally, unless the impacts were predicted to be particularly concentrated and intense at a local or regional level, in which case specific consultation with the relevant sectoral interests was undertaken to seek to evaluate the combined effect using expert judgement.

Estimation of Costs and Benefits

The costs and benefits associated with the impacts identified under Section 2.4.6 have been estimated for the three scenarios compared to the 'do nothing' option. This includes:

  • The potential costs (negative impacts) associated with the plan options on other activities;
  • The potential benefits associated with the impacts of the plan options on other activities; and
  • The potential distribution of costs and benefits between activities, between different locations and regions and between different social groups.

The assessment period used within the study ran from 2014 (the base year) until 10 years after all development became operational ( i.e. 2035), a period of 22 years. In line with the indicative programme, construction was assumed to start in 2022 and economic impacts were therefore assumed to ramp up between 2023 and 2025 (one-third of full impact in 2023, two-thirds in 2024 and full impacts from 2025).

Where it was possible to develop quantified estimates for impacts, these were converted to Present Values using a 3.5% discount rate in line with Treasury Green Book guidance, summing the discounted values over the assessment period. In addition, impacts on Gross Value Added ( GVA) and employment were estimated for the commercial fisheries sector.

Assessment Outcomes

Assessments for Offshore Wind, Wave and Tidal Energy Development

Table S1 to S3 present quantified estimates of impacts (Present Value ( PV) costs and GVA (fisheries)) for activities potentially affected by offshore wind, wave and tidal development within Draft Plan Option areas for each Scottish Offshore Renewable Energy Region ( SORER) and nationally.

Table S1. National PV Costs (and GVA impacts for fisheries) in £millions for Offshore Wind (costs discounted over assessment period, 2012 prices, numbers rounded to nearest £0.01m))

Activity Region Scenarios
Low Central High
Carbon Capture & Storage NE 1.85 4.32 9.27
Total PV 1.85 4.32 9.27
Commercial Fisheries SW 0.05 0.06 0.13
W 0.13 0.31 0.67
NW 0.11 0.27 0.58
N 0.74 1.8 3.9
NE 0.18 0.43 0.92
Total ( GVA) 1.21 2.87 6.2
Recreational boating SW 0.5 0.06 0.10
NE - 0.66 0.81
Total PV 0.5 0.72 0.91
Shipping SW 4.87 5.08 5.98
W - 3.80 7.88
NW - 1.45 2.90
N - 7.11 14.22
NE - 48.57 98.61
Total PV 4.87 66.01 129.59
Tourism SW - 0.03 0.33
W - 0.01 0.06
N - 0.22 0.59
Total PV - 0.26 0.98
Water Sports - Sea Angling N - - 0.47
Total PV - - 0.47
Total PV Costs 6.77 71.31 141.22
Total GVA Impacts (Commercial Fisheries) 1.21 2.87 6.20

Table S2. National PV Costs (and GVA impacts for fisheries) in £millions for Wave Energy (costs discounted over assessment period, 2012 prices, numbers rounded to nearest £0.01m))

Activity Region Scenarios
Low Central High
Commercial Fisheries W 0.01 0.01 0.03
NW 0.03 0.09 0.18
N 0.03 0.08 0.17
Total ( GVA) 0.07 0.18 0.38
Water Sports - Sea Angling N - - 0.10
Total PV - - 0.10
Total PV Costs - - 0.10
Total GVA Impacts (Commercial Fisheries) 0.07 0.18 0.38

Table S3. National PV Costs (and GVA impacts for fisheries) in £millions for Tidal Energy (costs discounted over assessment period, 2012 prices, numbers rounded to nearest £0.01m))

Activity Region Scenarios
Low Central High
Commercial Fisheries SW 0.01 0.03 0.06
W 0.02 0.05 0.1
N 0.06 0.13 0.25
Total ( GVA) 0.09 0.21 0.41
Recreational boating SW - - 0.06
Total PV - - 0.06
Shipping SW - - 1.07
W - - 1.89
N - - 9.33
Total PV - - 12.29
Sea Angling (Water sports) N - - 0.35
Total PV - - 0.35
Total PV Costs - - 12.70
Total GVA Impacts (Commercial Fisheries) 0.09 0.21 0.41

For all offshore renewables technologies, the estimated cost impacts increase with increasing scale of development. The impact of offshore wind development is estimated to impose much greater cost impacts on other activities compared to wave or tidal development. This is largely on account of the potentially much larger footprint for offshore wind development compared to the other technologies. Overall offshore wind accounts for up to 93% of total estimated costs across the scenarios.

The main contributing factor to these cost impacts relates to impacts on the shipping sector (assessed as around £130m PV out of a total of £141m PV under the high scenario for offshore wind). Approximately £98m PV of this cost arises in NE SORER - OWNE1 and OWNE2 - with a further £14m PV cost associated with potential development in North SORER - OWN1 and OWN2.

Significant impacts are identified for the commercial fishing sector, as a result of the potential for loss of landings from within offshore renewables arrays, particularly in relation to offshore wind Draft Plan Option areas, for which impacts range from £1.21m to £6.20m PV ( GVA) across the scenarios. Around 80-90% of the assessed impacts to the commercial fisheries sector relate to potential offshore wind development depending on the scenario. Potential impacts in the North SORER Draft Plan Option areas for offshore wind OWN1 and OWN2 account for around 55% of the total estimated costs. There is also potential for arrays within the Draft Plan Option areas, particularly offshore wind arrays, to disrupt steaming routes to fishing grounds, primarily for areas in the West, North-West, North and North-East SORERs. Some export cable routes may also affect fishing opportunities in some SORERs but it has not been possible to quantify these impacts.

Some potential impacts on recreational boating have been identified associated with additional fuel costs linked to increased steaming distances to navigate around offshore wind and tidal arrays. The largest estimated impacts occur for potential development in offshore wind Draft Plan Option areas in the North SORER ( OWN1 and OWN2) and North East SORER ( OWNE1 and OWNE2). Stakeholders have expressed concerns about the potential impact of cumulative offshore renewables development along the east and west coasts in deterring sailors from sailing along these coasts. This has the potential to affect revenues for the recreational boating supply chain (for example reduced revenue from berthing fees for marina operators) but it has not been possible to quantify these impacts.

The assessment identifies relatively minor potential cost impacts to recreational angling and tourism. Potential costs to the CCS sector arise based on possible future development of a CCS pipeline from the Firth of Forth up to St Fergus and relate to additional costs that would be incurred to construct cable crossings over offshore wind export cables from OWNE1 in NE SORER. Given the uncertainties surrounding possible future CCS development, these cost estimates should be considered speculative at this stage.

Although there are possibly some negative impacts on some social groups (particularly special interest groups, such as recreational boaters, sea kayakers and sea anglers), these will be most noticeable at the local level. Tourism impacts may also occur due to changes in the landscape and seascape, but again these will be at a very localised scale. At the national scale, there are numerous alternative locations for these activities to take place, such that the overall impacts are negligible.

Impacts on employment due to reduced turnover are again only likely to be noticeable at the local level, and are mainly associated with commercial fisheries. The maximum impact is in North region, with 9 to 10 direct and indirect jobs potentially affected per year with much lower estimated impacts on employment in other SORERs. This is against a national total of 4,996 fishermen in 2011 [4] . At the national scale, the number of jobs affected (including both direct and indirect) is, therefore, negligible. As a result, knock-on effects due to downturns in local economies are unlikely. Therefore, at the national scale impacts would not be noticeable, although the impact at local level for communities that are heavily dependent on fisheries ( e.g. Orkney and the Shetland Islands) will be greater. At the national scale, therefore, the number of jobs affected (including both direct and indirect) is expected to be negligible.


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