Analysis: Neart Na Gaoithe Offshore Wind Farm to Have GBP 827 Million Impact on Scottish GDP
The 450MW Neart Na Gaoithe offshore wind project is estimated to contribute to Scotland’s GDP with GBP 827.4 million during its CAPEX and OPEX phase, according to an analysis carried out by the Fraser of Allander Institute (FAI) at the University of Strathclyde.
The CAPEX for this project could be up to GBP 2 billion, according to the analysis commissioned by Mainstream Renewable Power, with around GBP 510 million expected to be spent in Scotland.
For OPEX, it is estimated that this will total around GBP 1.7 bilion over the 25-year operational life of the development, with around GBP 610 million of this spent in Scotland.
The analysis suggests that the Neart Na Gaoithe project will support around 8,000 person-years of employment in the CAPEX phase and a further 5,900 person-years of employment in the OPEX phase.
On the CAPEX side, this is driven in large part by Mainstream’s expectation that the majority of the jackets and piles will be procured within Scotland.
On the OPEX side, this figure is predicated on around half of the maintenance on the site being procured within Scotland.
In terms of a contribution to Scottish GDP, this is estimated to generate an additional GBP 475m to the Scottish economy during the CAPEX phase of this project, with a further GBP 352m being contributed to Scottish GDP over the OPEX period of 25 years.
In total, around half of the total impact on Scottish GDP (GBP 410.2m) is driven by direct spend with the other half (GBP 417.2m) coming through the supply chain and, as a result of additional household wage income, through supporting household consumption.
The economic impact of the project impact is equivalent to 0.6% of total Scottish onshore GDP in 2016, with half of this impact occurring during the CAPEX phase of the project, according to the analysis.
Mainstream expects the Neart Na Gaoithe offshore wind project to achieve financial close in 2018 with construction starting in 2019 and first commercial supply of electricity occurring in 2021.
The 450MW project is scheduled to be delivered in 2021 at a strike price of GBP 114.39/MWh.