ACCIONA, working with consulting firm EY, has developed a methodology for measuring the socio-economic impact of its activities in the markets where it operates. The theory behind the method was developed in parallel with the first two real-world applications, to measure the impact of ACCIONA Energy in the renewable energy business in Mexico and South Africa; this enabled the method to be completed, tested and fine-tuned to ensure its validity.
The project, entitled ACCIONA: a business strategy with social value, which is part of the company’s Sustainability Master Plan, arose out of concerns and the need to reliably quantify the Company’s contribution to economic growth, social progress and environmental balance in the territories where it operates. Having a tool for quantifying the company’s contribution in real terms closes the circle of ACCIONA’s involvement in the communities where it operates.
The methodology is being rolled out gradually, starting with an assessment of the impact of the renewable energy business (wind and photovoltaic) in two strategic countries: Mexico and South Africa. It will be extended progressively to other markets and activities with the ultimate goal of having a complete picture of ACCIONA’s socio-economic impact, broken down by country, division, business and project.
The objective for 2016 is for the Energy business to measure its socioeconomic footprint in two additional countries, and to adapt the methodology to the Infrastructure division by conducting a pilot project.
The methodology provides figures on the direct, indirect and induced impact on GDP and employment per MW of wind or photovoltaic capacity and, by extension, the overall impact of the renewable energy capacity installed by ACCIONA.
It also provides insights into other variables such as the contribution to energy security and independence, the value of community action projects, avoided emissions of CO2 and other gases that are harmful to the environment, avoided water consumption, and land use.
ACCIONA develops methodology for measuring the socio-economic footprint of its activities
MEXICO: EVERY MW CONTRIBUTES 1.19 MILLION EUROS TO GDP
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The survey revealed that the 858 MW of wind capacity (556.5 MW company-owned and 301.5 MW for clients) installed by ACCIONA Energy in Mexico to date represent a contribution of over USD 1.18 billion (1.02 billion euros at current exchange) to GDP and the creation of 1,748 stable jobs over the facilities’ life cycle.
Using a model based on symmetrical input-output tables (a Leontief matrix, named after its creator, Nobel prize-winner Wassily Leontief), the survey concludes that every MW of wind capacity installed by ACCIONA Energy in Mexico contributes USD 1.38 million (1.19 million euros) to the country’s gross domestic product.
That contribution is calculated considering the wind project’s entire life cycle, which includes the manufacture of wind turbines, development and construction lasting 1.5 years (USD 726 thousand of GDP/MW) and the operation and maintenance of the wind farm for 25 years (USD 654 thousand per MW).
Using other parameters, the report reveals that
- every million dollars invested by ACCIONA in a wind farm in Mexico generates USD 560 thousand of GDP,
- every GWh of electricity that a farm produces contributes USD 36,000 to GDP (based on the project’s useful life).
As regards employment, the survey reports that the 858 MW installed in Mexico represent
- 25,740 job-years in the 1.5 years of turbine manufacture and wind farm development and construction
- 20,592 over the 25 years of operation and maintenance, i.e. an average of 1,748 stable jobs throughout the life cycle (1,166 direct, 356 indirect and 226 induced).
The E&Y survey also reveals other social features, such as
- the over USD 837,000 invested in community development programmes, with 16,500 beneficiaries
- and the “Luz en Casa Oaxaca” home electricity programme, which was launched by the ACCIONA Microenergy Foundation in 2012 and has provided a basic photovoltaic installation to 3,600 households in rural areas of Oaxaca.
The survey also assessed the Company’s contribution to reducing CO2 emissions: the 2,174 GWh produced by the company’s own facilities in 2014 (the survey’s benchmark year) saved 1.1 million tons of emissions from fossil fuel combustion, or a saving of USD 43 million in costs deriving from climate change and USD 20.5 million in avoided natural gas imports.
SOUTH AFRICA: A 256-MILLION EURO CONTRIBUTION TO GDP
As for ACCIONA Energy’s activities in South Africa, where it has installed a photovoltaic plant with a rated capacity of 74 MW (94.3 MWp) and a 138 MW wind farm, EY calculate that it contributed USD 295 million (256 million euros) to the country’s GDP and created over 9,500 jobs (direct, indirect and induced) between 2013 and 2015.
Although the contribution to GDP was spread over the period 2013-2015, it peaked in 2014, when plant construction contributed USD 220 million in added value. Of that figure, 85 million were direct (i.e. created by the direct linkage between the Company and its suppliers), 76 million were indirect (within the sectors suppliers) and 59 million were induced consequence of an increase in household purchase power.
The survey reveals that the impact on employment resulted in the creation of over 9,500 jobs between 2013 and 2015, with a peak of 7,112 in 2014.
The model developed by EY concludes that
- every megawatt (MW) of wind generation capacity that the company installs in South Africa represents a contribution of USD 1.5 million to the country’s GDP; photovoltaic capacity contributes USD 1.76 million per MW.
As for employment, every MW of wind capacity installed generates 45 job-years, while every MW of photovoltaic capacity creates 54 job-years (41 prior to commissioning and 13 during operation).
On the social and environmental side, the survey reports on self-employment and child nourishment programmes, and notes that ACCIONA’s renewable output in South Africa last year avoided the emission of 0.4 million tons of CO2, with a saving of USD 15 million in costs derived from climate change, while sparing 800,000 m3 of water.