Two years ago, the Offshore Valuation Group measured the value of the UK’s offshore renewable energy resource and concluded that, by 2050 – by harnessing less than a third of that resource – the UK could generate the electricity equivalent of 1bn barrels of oil a year, reduce its CO2 emissions by 1bn tonnes and create over 145,000 new jobs.
Furthermore, a foreign trade multiplier (FTM) analysis of the impact of increasing levels of offshore wind investments and exports leads Cebr to contend that significant multiplier impacts can be expected to derive from investment in offshore wind.
For instance, while Cebr predicts that by 2020, under its Accelerated Growth scenario, investment in offshore wind will generate GBP8.4 billion of Gross Value Add (GVA) to the UK economy, the application of their FTM model suggests that this contribution could rise to GBP10.5 billion.
These differences are even more marked by 2030, when the estimated difference in impact – between that suggested by the domestic and FTM multipliers – is (for employment) three times the difference estimated for 2020.
Commenting, Eddie O’Connor, CEO of Mainstream Renewable Power said "The "Value of Offshore Wind" to the UK is truly significant. Cebr shows that the net economic benefit to UK plc from investment in offshore wind power is considerable. The foreign trade multiplier effect is of particular interest to a sector which has the potential to supply a global market. By helping the UK reduce fossil fuel imports, and by creating a new industry, offshore wind will create jobs, assist in balancing the trade deficit and boost GDP at a time of economic uncertainty.
"Later this year we will publish a companion paper which will show that offshore wind is a very attractive investment to include in a diversified, low carbon generation resource portfolio. Including a substantial amount of offshore wind will help in the achievement of the government’s long-term goals to decarbonise the UK’s electricity sector by lowering risk and cost to UK consumers.
The Centre for Economics and Business Research (Cebr) is an independent consultancy which advises some of the world’s largest companies. Cebr’s reputation for insightful economic analysis, award-winning forecasting and decisive business advice is based on innovative research by a renowned team of macro- and micro- economists.
Since its foundation in 1993 by former CBI and IBM Chief Economist, Professor Douglas McWilliams, Cebr has been ‘making business sense’ by applying theoretical economics backed by quantitative evidence to real world decisions for private sector firms and public sector organisations. Cebr provides analysis, forecasts and strategic advice to major multinationals, financial institutions, government departments, charities and trade bodies.