Offshore wind energy - draft updated Sectoral Marine Plan: partial business and regulatory impact assessment

Section 1: Background, aims and options

Background

The responsibility for marine planning including sectoral marine planning is devolved to Scottish Ministers. The licensing and consenting of offshore wind projects in Scottish waters is devolved to the Scottish Ministers.

Sectoral marine planning refers to the strategic approach of managing specific sectors in the marine environment. Sectoral marine planning is one component of Scotland’s marine planning system. The National Marine Plan (2015) (“NMP”) provides the statutory planning framework and strategic policies for the sustainable development of Scotland's marine resources out to 200 nautical miles, and while the SMP is not a statutory plan and instead only establishes a strategic approach to planning, as a matter of policy, the SMP should be in alignment with NMP. This sectoral marine planning process brings together a draft Plan alongside several assessments including, the SEA, HRA, SEIA and NCMPA, as well as a statutory consultation, into one integrated process. The information and consultation feedback gathered during consultation will be used to finalise the updated SMP-OWE.

The current SMP-OWE was published by Scottish Ministers on 28 October 2020. The purpose of this Plan was to identify Plan Options as areas suitable for the sustainable development of commercial-scale (>100 MW) offshore wind projects. This planning process accounted for a maximum generation capacity of 10GW across Scotland’s marine area. Following publication of the SMP-OWE (2020), Crown Estate Scotland undertook the “ScotWind” leasing round, through which Option Agreements were awarded to a total of 20 projects with the potential to generate 27.6GW of energy over a maximum area of 7,903km².

Prior to the publication of the SMP-OWE (2020), offshore wind developers and other stakeholders asked about the electrification of oil and gas infrastructure in Scottish waters. The SMP-OWE (2020) advised that Scottish Ministers may choose to explore the demand for a future leasing round to enable innovative projects and projects aimed at the decarbonisation of the oil and gas sector in Scotland.

With the INTOG planning and leasing being placed on an accelerated timeline, the INTOG planning processes overlapped with CES’ leasing processes, allowing CES to offer applications a form of exclusivity for an area of seabed earlier in the process but still subject to delivery of a final sectoral marine plan for INTOG projects following due consultation. This exclusivity allowed applicants to progress with their development applications and take forward required environmental surveys with reduced risk. The aim of the INTOG leasing was to attract investment in innovative offshore wind projects in Scottish waters, as well as help decarbonise oil and gas operations to help achieve the targets in the North Sea Transition Deal. INTOG consists of two distinct elements; Innovation (“IN”) which consists of small-scale innovation projects of 100MW or less, and Targeted Oil and Gas (“TOG”) which specifically is designed for offshore wind farms which target the electrification of oil and gas installations. On 24 March 2023, the CES announced the results of the INTOG leasing round with 13 projects, five for ‘IN’ and eight for ‘TOG’ were offered Exclusivity Agreements, which proposed capacities of up to 449 MW and 5 GW respectively.

The IPR process aims to update the existing SMP-OWE, taking into consideration new evidence and data which has become available since 2020. This includes the results of the ScotWind leasing round, and subsequent INTOG leasing round. The result will be an updated spatial plan, supported by updated environmental and socio-economic impact assessments (SEA, HRA, NCMPA and SEIA, as well as various internal assessments) and a proposed framework for plan-level mitigation and strategic compensatory measures for environmental impacts.

Marine Directorate - Licensing Operations Team (MD-LOT) is responsible for determining marine licence applications on behalf of the Scottish Ministers in the Scottish inshore region (between 0 and 12 nautical miles (nm)) under the Marine (Scotland) Act 2010, and in the Scottish offshore region (between 12 and 200 nm) under the Marine and Coastal Access Act 2009.

MD-LOT also processes applications for Electricity Act consent for offshore wind farms and makes recommendations to Scottish Ministers. Any proposal to construct, extend or operate a generating station (including offshore wind farms) with a generation capacity in excess of 1 megawatt (MW) situated in the Scottish territorial sea (out to 12 nautical miles (nm) from the shore), or with a generating capacity in excess of 50 MW in the Scottish Offshore Region (12 to 200 nm), will require consent under section 36 of the Electricity Act 1989.

MD-LOT provides potential applicants with advice on the application processes including requirements for information to support applications, such as Environmental Impact Assessment (EIA). This includes providing EIA screening and EIA scoping opinions. Sectoral marine plans are not statutory, but support MD-LOT in the determination of marine licence and s.36 consent applications

Purpose/aim of action and desired effect

The updated SMP-OWE aims to support seabed leasing (managed by CES) and marine licensing and s. 36 consenting processes (administered by MD-LOT) for the proposed ScotWind and INTOG projects. The updated SMP-OWE will also include high-level consideration of additional test and demonstration capacity of up to 1GW divided equally across the five Scottish regions. Though the updated SMP-OWE is not a statutory plan, it will be used alongside any adopted statutory marine plans which may apply at either a national or regional level.

The updated SMP-OWE aims to take into consideration new evidence and data which has become available since the publication of the SMP-OWE (2020) (e.g., the results of the ScotWind leasing round and the introduction of the INTOG leasing round). This includes updating the impact assessments (environmental and socio-economic).

The INTOG planning process was accelerated to support the transition of the Oil and Gas industry to a net zero economy. Whilst some of the Plan Options identified in the updated SMP-OWE are located in areas that may facilitate direct connections to oil and gas infrastructure, the majority of oil and gas platforms lie at distances from shore beyond the extent of the Plan Options. This suggested the need for a sectoral marine planning round with the specific purpose of facilitating offshore wind generation to decarbonise oil and gas infrastructure operations, supporting decommissioning and contributing towards Net Zero targets. The INTOG framework also plans for up to 500MW of “innovation” projects (i.e. not for commercial scale electricity generation) to be developed.

Whilst the SMP-OWE (2020) provided the strategically planned spatial footprint for offshore wind development in Scotland, the updated SMP-OWE will support targeted decarbonisation of North Sea oil and gas and the delivery of offshore wind to enable delivery of the UKG Clean Power Plan, 2030 and the offshore wind contribution to Scottish and UK net zero targets and energy security. Different to the SMP-OWE (2020) plan it will also consider the impacts of supporting infrastructure, such as cables and storage, construction and maintenance of devices at the cumulative level for the first time.

The updated SMP-OWE will engage a range of stakeholders throughout the process to build consensus on the impacts and opportunities of Scotland’s offshore wind ambition. The updated SMP-OWE aims to consider potential effects on other marine users, economic sectors, and the environment resulting from further offshore wind development by assessing the environmental and socio-economic impacts, and considering appropriate plan-level mitigation measures to address these.

If it is concluded that the updated SMP-OWE will have an adverse effect on the integrity (“AEOI”) of a protected site (either alone or in combination with other plans or projects), the derogation process under the Habitats Regulations will be triggered for the plan as a whole. The competent authority has discretion to determine whether to proceed with the derogations process following a negative Appropriate Assessment (“AA”) or refuse adoption of the updated SMP-OWE. The derogations process allows the Competent Authority to authorise the updated Plan only where the ‘derogation tests’ can be satisfied. It is acknowledged that where an AEOI cannot be ruled out, Scottish Ministers may, nevertheless, agree to the adoption of the updated Plan if they are satisfied that (i) there are no feasible alternative solutions to the plan that would be less damaging to the protected site; (ii) there are Imperative Reasons of Overriding Public Interest (“IROPI”) justifying proceeding with the plan or project; and (iii) that all compensatory measures necessary to ensure the overall coherence of the network have been secured. While the final Plan may include a derogation case, this would not remove the requirement for individual projects to go through the project-level HRA process and derogations process if required, although plan-level derogation could create opportunities for streamlining.

The updated SMP-OWE also aims to support de-risking of the consenting and licensing process as an additional evidence source, which will allow project applications to be assessed in the context of a strategic planning framework and support robust consenting decisions. The updated SMP-OWE has been developed to ensure consistency with the objectives and principles set out within Scotland’s statutory NMP and the UK Marine Policy Statement.

Options (considered so far / still open)

As part of the scoping process for conducting the partial focused-BRIA for the updated SMP-OWE, two options have been identified and further details on the considerations for each option are outlined below.

Options 1 – Do nothing

Option 1 is the ‘Do nothing’ option; this is the baseline scenario. Under this option, the current SMP-OWE (2020) would remain in place along with the INTOG Initial Planning Framework (“IPF”)^[1]. Therefore, there would be no consideration or addition of new data and evidence available since the publication of the SMP-OWE (2020). Regardless of there being an updated Plan, developers can continue to submit applications which will be considered by Scottish Ministers on a case-by-case basis in line with the planning, consenting and assessment framework available at the time.

Though the current SMP-OWE is not a statutory plan, it provides a strategic approach to planning for offshore wind development, and assesses the associated impacts as a whole, which can therefore support Scottish Ministers in making marine licensing and s.36 consenting decisions. Following the ScotWind and INTOG leasing round results, the option to not update the SMP-OWE is not viable as Scottish Ministers have previously committed to completing the IPR for the current SMP-OWE and the IPF for INTOG².

Option 2 – Update the Sectoral Marine Plan for Offshore Wind Energy 2020

Option 2 involves updating the SMP-OWE 2020 to account for the outputs of both the ScotWind and INTOG leasing rounds, test and demonstration sites, as well as mitigation and management that will be required to support the increased scale of development. As part of the sectoral marine planning process, the environmental and socio-economic impacts from offshore wind development will be reassessed and potential plan-level and project-level mitigation measures will be developed to address these. This process will incorporate new evidence and updated planning assumptions to inform the approach.

As set out above, the option to not update the SMP-OWE is not considered a viable option. Therefore, and in accordance with both Scottish and UK environmental legislation and Scottish Government policy, it is considered necessary to update the Sustainability Appraisal, which comprises of completing the SEA, SEIA and HRA and other internal assessments, to reflect the new evidence and data available.

Sectors/Groups affected

The updated SMP-OWE is expected to impact on various industries (including, but not limited to, fisheries, shipping and tourism). Potential positive and negative impacts to industries are being assessed as part of a plan-level SEIA – further details can be found in the gap analysis conducted under Annex A. The updated SMP-OWE does not place requirements on the operations of other industries (e.g. in relation to inspection criteria) and there is no funding available to any industry as a result of the Plan. The updated SMP-OWE is intended to support future licensing, consenting and leasing decisions in a manner that provides additional clarity and guidance to regulators (e.g. in relation to compensation of environmental effects) and therefore does not involve any additional commitment of resources post-adoption.