18.8. Key Parameters for Assessment

18.8.1. Maximum Design Scenario

  1. The maximum design scenarios identified in Table 18.12   Open ▸ are those expected to have the potential to result in the greatest adverse effect on an identified receptor or receptor group. Many of the economic effects assessed in the socio-economic EIA chapter are expected to be beneficial. Therefore, this chapter assesses the Project Design Envelope (PDE) Option (volume 1, chapter 3) that could generate the lowest beneficial impacts.
  2. These scenarios have been selected from the details provided in volume 1, chapter 3 of the Array EIA Report. Effects of greater adverse significance or, where appropriate, lesser beneficial significance are not predicted to arise should any other development scenario, based on details within the Project Description (volume 1, chapter 3) (e.g. different infrastructure layout), to that assessed here, be taken forward in the final design scheme. 
  3. The Applicant’s SCDS (Ossian OWFL, 2023), provides estimates of expenditure in Scotland, rUK, the EU and elsewhere across two scenarios (commitment and ambition) associated with four categories of expenditure: development, manufacturing and fabrication, installation, and operation and maintenance (the first six years).
  4. The SCDS was submitted in July 2021 and updated in April 2023 (Ossian OWFL, 2023), based on the initial 2,610 MW capacity. As discussed in more detail in volume 3, appendix 18.1, this was used as the basis of estimating expected expenditure in each of the socio-economic study areas for each of the PDE Options. The PDE Option with the lowest beneficial economic impacts was assessed as the maximum design scenario for the economic impacts, and this was identified as PDE Option 4 under the commitment scenario.

 

Table 18.12:
Maximum Design Scenario Considered for Each Potential Impact as Part of the Assessment of LSE1 on Socio-Economics

Table 18.12: Maximum Design Scenario Considered for Each Potential Impact as Part of the Assessment of LSE1 on Socio-Economics

  1. Under the maximum design scenario for economic impacts, the construction cost for the Array would be £7.7 billion ( Table 18.13   Open ▸ ), of which the largest expenditure would be manufacturing and fabrication (£6.3 billion). The annual operation and maintenance spend would be £223 million.

 

Table 18.13:
Maximum Design Scenario for Economic Impacts (PDE Option 4, commitment): Scotland, rUK and Total Array Spending (£m)

Table 18.13: Maximum Design Scenario for Economic Impacts (PDE Option 4, commitment): Scotland, rUK and Total Array Spending (£m)

 

  1. For the social impacts the main driver of the magnitude of impacts will be population and demographic changes arising from labour market demand associated with the employment opportunities created. PDE Option 1 was assessed as the maximum design scenario for the social impact assessment as this is associated with the highest port-related employment impacts.

18.8.2. Impacts Scoped Out of the Assessment

  1. On the basis of the baseline environment and the Project Description outlined in volume 1, chapter 3 of the Array EIA Report, no impacts have been scoped out of the assessment.

18.9. Methodology for Assessment of Effects

18.9.1. Overview

                        Economic impact assessment

  1. The socio-economic assessment of effects has followed the methodology set out in volume 1, chapter 6 of the Array EIA Report. Specific to the socio-economic effects related to the offshore elements, the following guidance documents have also been considered:
  • General Advice for Offshore Socio-economic Impact Assessments, (Marine Analytical Unit, 2022);
  • Defining ‘local area’ for assessing impact of offshore renewables and other marine developments: guidance principles (Marine Scotland, 2022);
  • UK Offshore Wind Sector Deal (UK Government, 2020); and
  • The Green Book: Appraisal and Evaluation in Central Government (HM Treasury, 2022).
  1. The economic impacts considered for each socio-economic study area and are reported in terms of:
  • GVA: this is a measure of economic output, the economic value added by an organisation, industry or region and is typically estimated by subtracting the non-staff operational costs from the turnover of an organisation.
  • Years of Employment: this is a measure of employment which is equivalent to one person being employed for a year and is typically used when considering short-term employment impacts, such as those associated with the construction employment.
  • Employment (Jobs): a measure of employment which considers the headcount employment in an organisation or industry.
  1. The focus of the economic impact assessment has been on the direct and indirect (supply chain) effects, in line with the UK Offshore Wind Sector Deal (UK Government, 2020). In addition to this, the assessment also considers the effects of staff spending and the economic impact that this subsequent increase in demand stimulates (the induced effect).
  2. Deadweight (what would have happened without the Array), leakage (economic impacts occurring outside of study areas considered) and displacement (economic activity that is being displaced by the Array) have been taken into account and are discussed in volume 3, appendix 18.1.
  3. The Array will include the construction and installation of floating foundations and wind turbines, the Offshore Substation Platforms (OSPs), and the construction and installation of inter-array and interconnector cabling. The analysis for the Array covers three phases:
  • construction (including development, manufacturing and fabrication, and installation);
  • operation and maintenance; and
  • decommissioning.
  1. The impacts during the construction phase have been based on the planned expenditure associated with this phase, as discussed in volume 3, appendix 18.1. In addition to the total impact over the period, the assessment also considers the timings of impacts during this phase to understand the peaks and troughs of this activity.
  2. The impacts during the operation and maintenance phase for the Array have been based on projected operation and maintenance expenditure, as discussed in volume 3, appendix 18.1. 
  3. The impacts during the decommissioning phase for the Array have been based on industry estimates, as discussed in the volume 3, appendix 18.1. These impacts are expected to be less than for the construction phase.

                        Social impact assessment

  1. As well as generating economic impacts in each of the socio-economic study areas considered, the Array may have social impacts on the communities where economic activity takes place. The magnitude of these social impacts is expected to result from the level of economic impact associated with the Array.
  2. Therefore, the social impact assessment aims to outline the primary pathways through which the development of offshore wind projects, such as the Array, could lead to social impacts. It focuses on the following key areas:
  • demographic changes;
  • housing demand and availability;
  • impacts on other local services; and
  • socio-cultural alterations.
  1. As the construction and operation and maintenance port(s) are not yet known, the social impact assessment has been based on the population and workforce of the local areas surrounding a long list of potential construction and operation and maintenance port(s).
  2. The social impact assessment has focused on how communities could be affected by economic changes, and how different characteristics (such as the size of the settlement, its economic characteristics and social dynamics) will inform the types of social impacts that are experienced as well as their sensitivity to change. This is expected to vary depending on the different phases considered, e.g. a temporary increase in workers during the construction phase will have different effects compared to a long term increase in employment in a given area.

18.9.2. Criteria for Assessment of Effects

  1. When determining the significance of effects, a two-stage process is used which involves defining the magnitude of the potential impacts and the sensitivity of the receptors. This section describes the criteria applied in this chapter to assign values to the magnitude of potential impacts and the sensitivity of the receptors. The terms used to define magnitude and sensitivity are based on those which are described in further detail in volume 1, chapter 6 of the Array EIA Report.
  2. The socio-economics impacts have been considered over distinct study areas to capture the spatial extent of any impact. The magnitude and significance of any impact are then considered in relation to the baseline conditions within those socio-economic study areas.

                        Magnitude of economic impacts

  1. Between 2000 and 2019, the average level of Gross Domestic Product (GDP) per capita growth in the UK was 1% per annum (International Monetary Fund, 2022). Similarly, between 2000 and 2019 the number of jobs increased by 1% per annum (ONS, 2023d). The magnitude of any change in an economy should be considered within this context and in relation to changes in the levels of economic activity.
  2. In addition to the change in the overall impact in the GVA or employment of an area, consideration can also be made for the sectors of the economy which are considered to contribute to the potential for the local area to secure contracts. For example, in the context of offshore wind, the construction, manufacturing and professional services sectors present in an area are likely to contribute towards it securing contracts, since the presence of potential suppliers is likely to increase the value of contracts secured in the study area.
  3. The definitions of the magnitude of economic impacts are provided in Table 18.14   Open ▸ .
Table 18.14:
Definition of Terms Relating to the Magnitude of an Economic Impact

Table 18.14: Definition of Terms Relating to the Magnitude of an Economic Impact

 

                        Magnitude of social impacts

  1. The magnitude of impacts on the social or community assets will be dependent on the scale of the economic and demographic changes that occur in each of the socio-economic study areas and how these affect demand for services, such as housing, education and health. The definitions of the magnitude of social impacts are provided in Table 18.15   Open ▸ , consistent with the magnitude of change definitions for the economic impacts.

 

Table 18.15:
Definition of Terms Relating to the Magnitude of a Social Impact

Table 18.15: Definition of Terms Relating to the Magnitude of a Social Impact

 

Sensitivity of receptors – economic impacts

  1. The sensitivity of an economy is linked to how it absorbs change. To consider the sensitivity of an economy, or a sector within that economy, it is necessary to consider both the resilience and agility of the economy. There are several factors that contribute to an assessment of resilience and agility; these include:
  • the scale of the economy;
  • the diversity of sectors in the economy;
  • the level of economic activity;
  • the level of skills and education; and
  • the level of economic potential from utilising capital (natural, human, social, economic).
  1. The criteria for defining sensitivity for economic receptors in this chapter are outlined in Table 18.16   Open ▸ .

 

Table 18.16:
Definition of Terms Relating to the Sensitivity of Economic Receptors

Table 18.16: Definition of Terms Relating to the Sensitivity of Economic Receptors

 

                        Sensitivity of the tourism economy

  1. Considering the significance of effect on the tourism economy in a particular study area requires an assessment of the sensitivity of the tourism sector in the study area. For example, a tourism sector will be sensitive if there are only a few drivers of tourism or if there is a particular reliance on a particular type of visitor.
  2. As the construction and operation and maintenance ports are not known, it is not possible to assesses how sensitive their local tourism economies are to change. However, to some extent, sensitivity of tourism economies can be considered generically by taking account of how port operators manage their facilities to avoid conflict between customer types (including customers from the offshore wind sector and from the tourism sector).  

                        Sensitivity of community and social assets

  1. The sensitivity of community and social assets will depend on their relative capacity to adapt to change and meet increased demand without affecting existing services, e.g. whether there is additional capacity in the housing market, schools, etc.
  2. As the construction and operation and maintenance ports are not yet known, it is not possible at this stage to assess sensitivity at the community level. However, a long list of potential ports has been identified as have associated local study areas. By assessing the magnitude of the most beneficial and most adverse scenarios for the local study areas with the lowest and the highest populations, the range of possible assessments that could be made on the significance of the local social impacts can be identified. This means that a qualitative assessment can be made of the circumstances in which the sensitivity of a local study area could result in an impact considered to be significant.

                        Assessment of significance

  1. The magnitude of the impact and the sensitivity of the receptor are combined when determining the significance of the effect upon socio-economics. The particular method employed for this assessment is presented in Table 18.17   Open ▸ .
  2. Where a range is suggested for the significance of effect, for example, minor to moderate, it is possible that this may span the significance threshold. The technical specialist’s professional judgement has been applied to determine which outcome defines the most likely effect, which takes in to account the sensitivity of the receptor and the magnitude of impact. Where professional judgement has been applied to quantify final significance from a range, the assessment sets out the factors that result in the final assessment of significance. These factors may include the likelihood that an effect will occur, data certainty and relevant information about the wider environmental context.
  3. For the purposes of this assessment:
  • a level of residual effect of moderate or more will be considered a ‘significant’ effect in terms of the EIA Regulations; and
  • a level of residual effect of minor or less will be considered ‘not significant’ in terms of the EIA Regulations.
  1. Effects of moderate significance or above are therefore considered important in the decision-making process, whilst effects of minor significance or less warrant little, if any, weight in the decision-making process.

 

Table 18.17:
Matrix Used for the Assessment of the Significance of the Effect

Table 18.17: Matrix Used for the Assessment of the Significance of the Effect