Defining 'local area' for assessing impact of offshore renewables and other marine developments: guidance principles

2. Outline of the Principles

The analysis of the current approaches taken to defining local areas for socio-economic assessment of offshore developments and the stakeholder consultations have highlighted the need for a defined set of principles to be used to guide the geographies used in these assessments. This section discusses these principles.

2.1 Development of the Principles

The principles have been developed based on the key themes that have emerged from a literature review, current practice and the stakeholder consultations that formed the basis of the wider study. More details on this research are available in the full report which accompanies this guidance document. The key points from this research and the implications for the development of the principles are described below.

The supply chain and investment impacts were viewed separately from the wider socio-economic impacts across the literature, current policy and industry consultations. The supply chain and investment impacts are typically benefits that arise from direct project spending. The wider socio-economic impacts are typically impacts that arise from externalities of the project. This is evident in the differences between areas of defined benefit and supply chain engagement programmes. The industry stakeholders also highlighted that considering all socio-economic impacts at the same geographic level would decrease value of assessments in the formal Environmental Impact Assessment process. Therefore, the definition of local area should be different for supply chain and investment impacts and wider socio-economic impacts.

The case studies and the industry consultations also highlighted the range of potential impacts for consideration and the implications for the selection of local areas. Impacts that are included in any assessment need to be appropriate for the level of assessment that is being undertaken and the scale of the project that is being assessed.

The stakeholder consultations and literature review identified multiple geographic locations that impacts can radiate from, which have been referred to as epicentres of impact in this report. These epicentres can be specific to individual impacts and can include the visibility of the offshore and onshore infrastructure, the main ports of activity associated with the offshore development. These epicentres drive community perceptions of a development being local and therefore all epicentres of impact should be included within any defined local area.

The stakeholder consultations also highlighted the need for there to be meaningful engagement with communities in any local area. Industry engagement has been most effective in areas where it has been possible to work with pre-existing economic and political organisations to facilitate conversations and promote accountability. Similarly, when any impacts in a defined local area are discussed it is beneficial if the area described is understandable to all stakeholders. This allows impacts to be communicated in a clear and concise manner.

All case studies used collections of neighbouring Local Authorities to define local areas for supply chain and investment impacts. This resulted in the local areas used in the assessments being a single entity, which was easier to understand and allowed for the inclusion of economic multiplier impacts. The other principles defined in this chapter may result in geographies being selected that are discontinuous, particularly if potential epicentres are far apart. This would make the defined local areas less comprehensible and would hinder the inclusion of economic multiplier impacts.

Therefore, the principles that are outlined in this section have been developed within the framework of Dual Geographies, Local Areas and Epicentres.

• Dual Geographies - This means that the definition of local area is different for supply chain or investment impacts and wider socio-economic impacts. The split between these two is maintained throughout;
• Local Areas – This means that the geographies are clearly defined. Together these give the framework a clear structure and a clear definition of a unit of analysis; and
• Epicentres – This is a way of organising information about impacts and areas that is very flexible.

The combination of these three means that the framework has a clear structure but is still flexible enough to accommodate specific project needs.

2.2 Outline of Principles

The consultations and the spatial analysis have led to the identification of the following principles. These principles were first circulated in a draft version to members of the Steering Group for comment on 2nd May 2019 and have been updated to reflect comments received. The principles were further updated after the conclusion of the consultation programme. A summary of these principles is provided below and more details and justifications are provided in section 2.3. The principles are:

• Principle 1 (Dual Geographies) - The local area for the Supply Chain and Investment Impacts should be separate from the local area(s) for Wider Socio-Economic Impacts;
• Principle 2 (Appropriate Impacts) - The appropriate impacts for assessments should be identified prior to defining the local areas;
• Principle 3 (Epicentres) - The local areas should include all the epicentres of the appropriate impacts;
• Principle 4 (Accountability) - The local areas used in the assessment should comprise of pre-existing economic or political geographies (community councils, local authorities, development agencies) to enhance accountability;
• Principle 5 (Understandable) - The local areas should be defined in such a way that they are understandable to the communities they describe; and
• Principle 6 (Connected Geography) - The local area for the Supply Chain and Investment Impacts should consist of connected (including coastal) pre-existing economic or political geographies.

2.3 Details of Principles

Below each of the six principles identified is outlined in detail. The process for applying these principles to define areas is described in Section 3.

2.3.1 Principle 1 – Dual Geographies

The process for defining local areas of socio-economic assessment will vary depending on the impacts that are considered^[1]. In particular, the Supply Chain and Investment Impacts should be considered separately from the Wider Socio-Economic Impacts and using different local areas.

The Supply Chain and Investment Impacts will cover those associated with the developer spending money and include impacts that can be quantified in economic terms such as employment supported or Gross Value Added. Examples of these are listed in the description of Principle 2.

The Wider Socio-Economic Impacts will include other social or economic impacts that have been scoped into a particular assessment. These are more likely to be qualitative in nature, closer to the epicentres of impact and can be related to perceptions as well as observable actions. Examples of these are listed in the description of Principle 2.

This will allow the separation of the analysis and ensure that the scale of impacted areas is appropriate for magnitude and effect assessments undertaken in Environmental Impact Assessments.

2.3.2 Principle 2 – Appropriate Impacts

The local areas used for assessment shall be dependent on the particular Supply Chain and Investment Impacts or Wider Socio-Economic Impacts that are considered appropriate as part of the assessment. The range of potential impacts will vary between projects and the impacts identified as part of the Sciencewise study^[2] and others^[3], which are outlined in Section 3 of the accompanying report, represent a guide, rather than an exhaustive list.

The impacts should be identified prior to the selection of the local area used in the assessment. This will ensure that the local areas selected are decided by the appropriate impacts, rather than vice versa.

• For example, the Supply Chain and Investment Impacts could include:
  • Direct Jobs & Gross Value Added (GVA);
  • Multiplier Jobs and GVA;
  • Inward Investment;
  • Supply Chain Development and Sustainability; and
  • Fragile Economies.
• The Wider Socio-Economic impacts could include:
  • Tourism Assets;
  • Recreation Assets;
  • Cultural Assets;
  • Community Assets;
  • Local Trust and Role in Decision Making Systems;
  • Traffic;
  • Demographic Changes/Vulnerabilities
  • Fragile Economies; and
  • Fishing and Marine Economy.

The scope of this study is to consider the impacts that an offshore development will have onshore and to define geographies for considering these impacts in such a way that the assessment is consistent, comparable and practical. In particular, the study considers the approaches taken to socio-economic impact assessments for projects, which are normally considered as part of the Environmental Impact Assessment or as an addendum to a planning application. As a result, some of the impacts listed above, in particular the Wider Socio-Economic impacts, may not be considered by assessors.

The selection of appropriate impacts is the most subjective principle and as a result, the same offshore development may have different local areas assessed depending on which impacts are selected by an assessor.

2.3.3 Principle 3 – Epicentres

The particular aspects which are considered in the assessment will have different epicentres of impact, places from where the impacts radiate. For example, the main operational port for an offshore wind farm will be an epicentre as the port would experience a visible change in levels of activity and this would be noticeable to the community and a direct result of the offshore wind development. Similarly, the area in which a fish farm is visible would be an epicentre of impact because the vista would experience a visible change, which could be the noticeable to the community and a direct result of the fish farm development.

The geographic points which are the epicentres of impact should all be considered as part of the local areas for assessment in both the Supply Chain and Investment Impacts and the Wider Socio-Economic Impacts. For example,

• the Supply Chain and Investment Impacts could be geographically linked to:
  • the offshore site;
  • the landing site of the main cable (if applicable);
  • the substations;
  • the construction base and ports; and
  • the operational base and ports.
• the Wider Socio-Economic Impacts could be geographically linked to:
  • the visibility of the offshore site;
  • the visibility of the onshore infrastructure;
  • the offshore site itself;
  • the onshore infrastructure itself;
  • the construction base and ports;
  • the operational base and ports; or
  • worker accommodation facilities.

The above list of potential epicentres is not exhaustive and other epicentres may be considered depending on the specifics of the project assessed.

The socio-economic impact assessments that contribute to the planning process are typically undertaken in advance of decisions being made regarding the actual locations of key project sites, such as ports or substations. Therefore, the assessor should consider likely options (either from a developer generated shortlist or desk-based assessment) and all potential epicentres should be included in the defined local area.

This principle to delineation of impacts is also applied to assessments of other local markets in areas such as labour and housing^{[4] [5]}.

2.3.4 Principle 4 – Accountability

The local areas should be defined in terms of active political and economic authorities such as community councils, electoral wards, local authorities or skills and enterprise agencies. Socio-economic data is reported in these defined geographies and therefore this approach will enable a reliable baseline to be described. Using existing economic or political geographies will also ensure that the community is able to be engaged and democratically represented in discussions with the developer and the developer will be able to be held accountable for local impacts by these bodies^[6].

2.3.5 Principle 5 – Understandable

The communities should be able to understand the geographies described in the local impact assessments because this will encourage engagement^[7].

2.3.6 Principle 6 – Connected Geography

Assessing the Supply Chain and Investment Impact in a single connected geography (for example of multiple local authorities that share a border, or local authorities that surround an area of water) will facilitate the inclusion of multiplier economic impacts^[8]. This approach is also applied to other geographically focussed impact studies in market such as housing^{[9] [10]}. There is no requirement for the Wider Socio-Economic Impact local areas to be joined up and these can be assessed more locally in multiple local areas around the epicentres of impact.