5. Economic Impact of PDE Option 2 (Commitment)
5.1. Construction
5.1.1. Ossian Impact
- Based on the estimated expenditure for Ossian as a whole, the technical expert’s model of costs and the information provided in the SCDS it was assumed that under PDE Option 2 the total construction phase spend in Scotland could be £3.8 billion (36% of total expenditure) and total spend in the UK could be £4.9 billion (46%), as shown in Table 5.1. The largest expenditure is associated with the manufacture of floating foundations.
Table 5.1: PDE Option 2: Ossian Construction Spending by Category, Scotland and the UK
Parameters | Scotland | UK (Inc. Scotland) | Total (Scotland, rUK and rWorld) |
|---|---|---|---|
Wind Turbine | £819 m | £1,260 m | £3,663 m |
Floating Foundation Manufacturing | £1,833 m | £1,833 m | £2,235 m |
Cables Supply | £0 m | £155 m | £1,280 m |
Offshore Cable Installation | £187 m | £262 m | £1,249 m |
Floating Foundations Installation | £366 m | £366 m | £532 m |
OSP | £180 m | £215 m | £505 m |
Development and Consenting Services | £339 m | £433 m | £471 m |
Floating Mooring Systems | £81 m | £162 m | £405 m |
Onshore Substation | £0 m | £129 m | £280 m |
Onshore Cable Installation | £0 m | £34 m | £34 m |
Operation and Maintenance Base | £7 m | £7 m | £7 m |
Total | £3,813 m | £4,857 m | £10,660 m |
Total (%) | 36% | 46% | 100% |
- Applying turnover per employee and turnover/GVA ratios for the relevant sectors it was estimated that the direct economic impact of Ossian could be £1.5 billion and 22,670 years of employment in Scotland and £1.9 billion GVA and 28,350 years of employment in the UK (Table 5.2).
Table 5.2: PDE Option 2: Ossian Construction Direct Economic Impact, Scotland and the UK
Parameters | Scotland | UK | ||
|---|---|---|---|---|
| GVA | Years of Employment | GVA | Years of Employment |
Wind Turbine | £327 m | 4,880 | £500 m | 7,450 |
Floating Foundation Manufacturing | £724 m | 10,430 | £724 m | 10,430 |
Cables Supply | £0 m | 0 | £57 m | 790 |
Offshore Cable Installation | £48 m | 590 | £67 m | 820 |
Floating Foundations Installation | £130 m | 2,020 | £130 m | 2,020 |
OSP | £74 m | 1,290 | £86 m | 1,450 |
Development and Consenting Services | £185 m | 2,890 | £236 m | 3,690 |
Floating Mooring Systems | £36 m | 550 | £73 m | 1,090 |
Onshore Substation | £0 m | 0 | £41 m | 470 |
Onshore Cable Installation | £0 m | 0 | £11 m | 120 |
Operation and Maintenance Base | £2 m | 30 | £2 m | 30 |
Total | £1,526 m | 22,670 | £1,926 m | 28,350 |
- Applying GVA and employment multipliers it was therefore estimated that the total economic impact could be £2.6 billion GVA and 38,030 years of employment in Scotland, and £5.0 billion GVA and 71,780 years of employment in the UK (Table 5.3) (Table 5.4).
Table 5.3: PDE Option 2: Ossian Construction GVA impact, Scotland and the UK
Parameters | Scotland | UK |
|---|---|---|
Direct GVA | £1,526 m | £1,926 m |
Indirect GVA | £577 m | £1,571 m |
Induced GVA | £472 m | £1,537 m |
Total GVA | £2,575 m | £5,034 m |
Table 5.4: PDE Option 2: Ossian Construction Employment impact, Scotland and the UK
Parameters | Scotland | UK |
|---|---|---|
Direct Years of Employment | 22,670 | 28,350 |
Indirect Years of Employment | 9,180 | 21,560 |
Induced Years of Employment | 6,180 | 21,870 |
Total Years of Employment | 38,030 | 71,780 |
5.1.2. Array Impact
- For the Array it was estimated that the total spend could be £8.1 billion, of which £3.5 billion (44%) could be secured in Scotland and £4.3 billion (53%) could be secured in the UK (Table 5.5).
Table 5.5: PDE Option 2: Array Construction Spending by Category, Scotland and the UK
Parameters | Scotland | UK (Inc. Scotland) | Total (Scotland, rUK and rWorld) |
|---|---|---|---|
Wind Turbine | £819 m | £1,260 m | £3,663 m |
Floating Foundation Manufacturing | £1,833 m | £1,833 m | £2,235 m |
Offshore Cable Installation | £47 m | £66 m | £312 m |
Cables Supply | £0 m | £95 m | £190 m |
OSP | £180 m | £215 m | £505 m |
Development and Consenting Services | £214 m | £273 m | £297 m |
Floating Mooring Systems | £81 m | £162 m | £405 m |
Floating Foundations Installation | £366 m | £366 m | £532 m |
Operation and Maintenance Base | £7 m | £7 m | £7 m |
Total | £3,547 m | £4,278 m | £8,145 m |
Total (%) | 44% | 53% | 100% |
- Applying turnover per employee and turnover/GVA ratios for the relevant sectors it was estimated that the direct economic impact of the Array could be £1.4 billion and 21,160 years of employment in Scotland and £1.7 billion GVA and 25,460 years of employment in the UK (Table 5.6).
Table 5.6: PDE Option 2: Array Construction Direct Economic Impact, Scotland and the UK
Parameters | Scotland | UK | ||
|---|---|---|---|---|
| GVA | Years of Employment | GVA | Years of Employment |
Wind Turbine | £327 m | 4,880 | £500 m | 7,450 |
Floating Foundation Manufacturing | £724 m | 10,430 | £724 m | 10,430 |
Offshore Cable Installation | £12 m | 150 | £17 m | 200 |
Cables Supply | £0 m | 0 | £35 m | 470 |
OSP | £74 m | 1,290 | £86 m | 1,450 |
Development and Consenting Services | £116 m | 1,820 | £149 m | 2,320 |
Floating Mooring Systems | £36 m | 550 | £73 m | 1,090 |
Floating Foundations Installation | £130 m | 2,020 | £130 m | 2,020 |
Operation and Maintenance Base | £2 m | 30 | £2 m | 30 |
Total | £1,422 m | 21,160 | £1,715 m | 25,460 |
- Applying GVA and employment multipliers it was therefore estimated that the Array’s economic impact could be £2.4 billion GVA and 35,600 years of employment in Scotland, and £4.5 billion GVA and 64,110 years of employment in the UK (Table 5.7; Table 5.8).
Table 5.7: PDE Option 2: Array Construction Total GVA impact, Scotland and the UK
Parameters | Scotland | UK |
|---|---|---|
Direct GVA | £1,422 m | £1,715 m |
Indirect GVA | £543 m | £1,383 m |
Induced GVA | £442 m | £1,369 m |
Total GVA | £2,406 m | £4,466 m |
Table 5.8: PDE Option 2: Array Construction Total Employment impact, Scotland and the UK
Parameters | Scotland | UK |
|---|---|---|
Direct Years of Employment | 21,160 | 25,460 |
Indirect Years of Employment | 8,650 | 19,070 |
Induced Years of Employment | 5,790 | 19,580 |
Total Years of Employment | 35,600 | 64,110 |
- The spend at the primary construction port(s) is expected to be around £252 million, of which the largest contract is expected to be associated with marshalling harbour (£189 million). This would require a significant workforce, with an estimated peak direct employment of 400 jobs (Table 5.9).
Table 5.9: PDE Option 2: Array Construction Port Impact by Category
Parameters | Total Investment | Port Spend | Employment | Peak Employment |
|---|---|---|---|---|
Wind Turbine Assembly | £135 m | £19 m | 90 | 20 |
Marshalling Harbour | £189 m | £189 m | 1,530 | 340 |
Offshore Logistics | £11 m | £11 m | 100 | 20 |
Anchor Installation | £166 m | £33 m | 80 | 20 |
Total | £501 m | £252 m | 1,800 | 400 |