Offshore Wind Focus

Introduction

Scotland's wind power is one of our greatest assets. Last year, the First Minister's Investor Panel, which was established to advise the Scottish Government on the investment and infrastructure we need to transition to net zero, identified offshore wind as the single most important opportunity for attracting capital to Scotland and raising Scotland's wider investment profile.

The projected benefits of offshore wind's growth in Scotland are substantial. The offshore wind sector and its supply chain will support high-quality jobs across a range of roles including construction, planning, engineering, manufacturing and fabrication, procurement and supply chain management, and will support a just transition for the existing energy workforce. Based on evidence available across a number of individual studies, Scotland's burgeoning offshore wind sector could support as many as 10,400 – 54,000^[2] jobs.

The outcome of the ScotWind leasing round was a landmark moment for the development of offshore wind in Scotland and for the future of our energy system – with a collective market ambition to deliver 28 GW^[3] of offshore wind power. It is the world's largest commercial leasing round for floating offshore wind and puts us squarely at the forefront of offshore wind development globally. The ScotWind developers' Supply Chain Development Statement (SCDS) commitments could see an average spend of £1.5BN in Scotland across each of the 20 ScotWind offshore wind projects.^[4] The Innovation and Targeted Oil & Gas (INTOG) leasing round could add another 5.4GW^[5] of capacity and will see further commitments from developers to Scotland's supply chain through the SCDS process.

The sector is entering a critical few years as all countries with access to a coastline and offshore wind ambitions around the world seek to establish and maintain domestic capability for offshore wind technology, manufacturing and deployment. Global investors and developers are already heavily invested in Scotland. ScotWind consortia include major global wind developers and global investors, and opportunities for ports and harbours and supply chain have already started to materialise. For Scotland, a key focus is to ensure the infrastructure is in place to enable projects under the ScotWind and the INTOG leasing rounds to flourish and to in turn stimulate supply chain investment and the economic growth and jobs thatflow from that.

To realise this huge opportunity, we need investment, at pace and in the right parts of the offshore wind economy. Facilitating this will require collaboration with the private sector, and strategic and targeted public sector investment.

We have committed to invest up to £500 million over five years to leverage private investment in ports, manufacturing and fabrication. We have listened to offshore wind developers and investors and have designed our investment approach to support sector needs. The programme is unique, taking a cross-public sector, holistic approach to targeting funding at projects that will have a catalytic effect on wider economic growth, with potentially high Benefit Cost Ratios. It also adopts a commercial-first approach, leveraging significant private investment alongside near-term returns and utilising grant funding only where it is required, acknowledging the crucial role that grants can play in de-risking and incentivising investment.