Economic and Environmental Impacts of UK Offshore Wind Development to 2029: the Importance of Local Content

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Abstract

The continuing development of the offshore wind sector is an important element of UK energy and industrial policy since it holds the potential of substantial emissions reductions while simultaneously boosting economic activity. A central idea here is that the economic impact of the offshore wind sector can be enhanced by increasing the local content of its inputs. We explore, through simulation of a purpose-built Input-Output model of the UK, the economic and emissions impacts of the likely future development of the UK’s offshore wind sector, with a particular emphasis on the importance of local content. We explore six scenarios all of which embed the capacity expansion anticipated by the Sector Deal, but differ in terms of local content – including a set of illustrative simulations considering the possible impact of Brexit on local content. We find that future offshore wind development does indeed generate a “double dividend” in the form of simultaneous and substantial reductions in emissions and improvements in economic activity. It is also the case that, as anticipated, the scale of the economic stimulus arising from offshore wind development is directly and strongly related to the extent of local content.
Original languageEnglish
Place of PublicationGlasgow
PublisherUniversity of Strathclyde
Pages1-31
Number of pages31
Volume19
Publication statusPublished - 1 Aug 2019

Publication series

NameStrathclyde Discussion Papers in Economics
PublisherUniversity of Strathclyde
No.5
Volume19

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Keywords

  • low carbon economy
  • industrial strategy
  • supply chain
  • offshore wind
  • economic impact
  • input-output analysis
  • Brexit

Cite this

Allan, G., Comerford, D., Connolly, K., McGregor, P., & Ross, A. G. (2019). Economic and Environmental Impacts of UK Offshore Wind Development to 2029: the Importance of Local Content. (10 ed.) (pp. 1-31). (Strathclyde Discussion Papers in Economics; Vol. 19, No. 5). Glasgow: University of Strathclyde.