Planning Scotland's Seas: 2013 - The Scottish Marine Protected Area Project – Developing the Evidence Base tor Impact Assessments and the Sustainability Appraisal Final Report

7. Assessment of Combined Impacts

This section provides an assessment of the combined impacts of designation of NC MPA proposals. This takes account both of alternative options for designation (where there are choices concerning which sites could be designated) and the combined impact of designating multiple sites at regional and national scales.

The starting point for each assessment has been to sum the estimated impacts for each NC MPA proposal, taking account of possible alternative sites. For most sectors, the potential cost impacts are minor such that the combined impacts are likely to be additive. However, for sectors for which more substantial cost impacts have been identified, consideration has been given to the extent to which combined impacts may be more or less than the summed estimates and a qualitative description of the potential combined impacts is provided.

Some of the 33 site proposals are science-based alternatives to the features of recommended MPA proposals, whilst other proposals are of equivalent ecological value for the same combinations of features. It will therefore not be necessary to designate all of the sites for which assessments have been prepared and the total costs and benefits of designating the suite of NC MPAs will be less than the sum of the total for all sites. The impact of designating different combinations of site options is therefore also explored.

7.1 Combined Cost Impacts by Site

Table 31 presents a summary of potential quantified cost impacts for non-fisheries activities within inshore sites, together with estimated additional costs for finfish and shellfish aquaculture planning application costs which could only be estimated at national level. The scale of estimated quantified costs is generally very low for all proposed MPAs except for North-west Sea Lochs and Summer Isles under the intermediate and upper scenarios and for South Arran under the upper scenario. For these proposed sites/scenarios, higher levels of cost impact were identified associated with a potential requirement to re-route export power cables from Draft Plan Option Areas currently being considered for possible future offshore energy generation. There is therefore a high level of uncertainty concerning whether such costs might need to be incurred. More detailed information on the combined impact on activities/sectors is presented in section 7.2.

Table 32 presents a summary of potential quantified impacts on direct GVA for commercial fisheries within inshore sites. No cost impacts are estimated for five inshore sites and very low costs are estimated for all sites under the lower scenario. Relatively minor cost impacts are estimated for five sites under the intermediate and upper scenarios. More substantial cost impacts are estimated for Clyde Sea Sill, Loch Sunart to the Sound of Jura, North-west Sea Lochs and Summer Isles, Small Isles and South Arran under the intermediate and upper scenarios. Total cost impacts for the inshore sites under the intermediate and upper scenarios are estimated to be £8.17m and £21.31m (direct GVA, discounted over assessment period) respectively.

Table 31. Present value ( PV) in £ millions for cost impacts to non-fisheries activities for inshore sites (costs discounted over assessment period, 2012 prices)

NC MPA Proposal	Scenarios
	Lower	Intermediate	Upper
Clyde Sea Sill	0.01	0.02	0.03
East Caithness Cliffs	0.02	0.02	0.02
Fetlar to Haroldswick	0.03	0.08	0.08
Loch Creran	0.01	0.01	0.02
Loch Sunart	0	0.01	0.01
Loch Sunart to the Sound of Jura	0.11	0.36	0.36
Loch Sween	0	0	0
Lochs Duich, Long and Aish	0.01	0.02	0.02
Monach Isles	0	0	0
Mousa to Boddam	0.01	0.01	0.04
North-west Sea Lochs & Summer Isles	0.05	2.23	2.36
Noss Head	0.01	0.02	0.02
Papa Westray	0.01	0.01	0.11
Small Isles	0	0	0
South Arran	0.02	0.05	1.76
Upper Loch Fyne & Loch Goil	0.01	0.03	0.03
Wyre & Rousay Sounds	0.01	0.03	0.08
National costs (finfish and shellfish aquaculture planning application costs)	0.44	0.58	0.58
Total	0.76	3.48	5.5

Table 32. Impacts to GVA in £ millions for commercial fisheries for inshore sites (costs discounted over assessment period, 2012 prices)

NC MPA Proposal	Scenarios
	Lower	Intermediate	Upper
Inshore Sites
Clyde Sea Sill	-	1.62	3.23
East Caithness Cliffs	-	-	-
Fetlar to Haroldswick	-	-	0.03
Loch Creran	-	-	<0.01
Loch Sunart	<0.01	0.01	0.03
Loch Sunart to the Sound of Jura	-	1.45	3.44
Loch Sween	0.02	0.05	0.13
Lochs Duich, Long and Aish	-	0.05	0.18
Monach Isles	-	-	-
Mousa to Boddam	-	-	-
North-west Sea Lochs & Summer Isles	-	1.56	3.12
Noss Head	<0.01	<0.01	0.01
Papa Westray	-	-	-
Small Isles	-	1.68	6.15
South Arran	0.01	1.67	4.84
Upper Loch Fyne & Loch Goil	-	0.08	0.12
Wyre & Rousay Sounds	<0.01	<0.01	0.04
Total	0.03	8.17	21.31

Table 33 presents a summary of potential quantified cost impacts for non-fisheries activities within offshore sites, together with estimated quantified costs associated with oil & gas decommissioning and military activities which could only be estimated at national level. The scale of estimated quantified costs in the lower and intermediate scenarios is generally very low for all proposed MPAs except for The Barra Fan & Hebrides Terrace Seamount and Western Fladen in the intermediate scenario where higher estimated costs arise as a result of additional management measures for new oil & gas exploration and development activity. In the upper scenario, a number of additional sites could potentially experience significant additional costs as a result of additional management measures for new oil & gas exploration and development activity. Additional costs could be experienced by the offshore renewables sector associated with management measures for the Firth of Forth Banks Complex proposed MPA. More detailed information on the combined impact on activities/sectors is presented in section 7.2.

Table 33. Present value ( PV) in £ millions for quantified cost impacts to non-fisheries activities for offshore sites (costs discounted over assessment period, 2012 prices)

NC MPA Proposal	Scenarios
	Lower	Intermediate	Upper
Offshore Sites
The Barra Fan & Hebrides Terrace Seamount	0.07	1.56	5.79
Central Fladen	0.03	0.60	2.22
Central Fladen (core)	0.03	0.78	2.90
East of Gannet & Montrose Fields	0.23	0.23	35.02
Faroe-Shetland Sponge Belt	0.49	0.49	27.93
Firth of Forth Banks Complex	0.07	0.07	43.44
Geikie Slide & Hebridean Slope	0.00	0.00	0.00
Hatton-Rockall Basin	0.00	0.00	0.00
North-east Faroe-Shetland Channel	0.44	0.44	37.62
North-west Orkney	0.10	0.13	0.13
Norwegian Boundary Sediment Plain	0.02	0.02	1.15
Rosemary Bank Seamount	0.00	0.00	0.00
South-east Fladen	0.00	0.00	0.00
South-west Sula Sgeir & Hebridean Slope	0.00	0.00	0.00
Turbot Bank	0.01	0.01	0.01 - 0.54*
West Shetland Shelf	0.02	0.02	2.17
Western Fladen	0.06	3.91	7.77
National costs (oil & gas decommissioning)	0.02	0.02	0.02
National costs (military activities)	0.19	0.19	0.19

* depending on whether Turbot Bank is designated for sandeel or also for subtidal sand and gravel habitats

Table 34 presents a summary of potential quantified impacts on direct GVA for commercial fisheries within offshore sites. No or very limited cost impacts are estimated for four offshore sites - Hatton Rockall Basin, Norwegian Boundary Sediment Plain, North West Orkney and West Shetland Shelf under all of the scenarios reflecting the lack of fishing activity in the first two sites and no requirement for additional fisheries management measures for the latter two sites. Very low cost impacts are estimated for all sites under the lower scenario, except Faroe-Shetland Sponge Belt, reflecting the assumed low requirement for management measures in this scenario. For the remaining sites, impacts to direct GVA in the intermediate and upper scenarios range from £0 to £0.6m (Turbot Bank - depending on the features for which the site may be designated) respectively, up to £4.9 to £7.1m (Geikie Slide and Hebridean Slope) (discounted over assessment period) respectively.

Table 34. Impacts to direct GVA in £ millions for quantified impacts to commercial fisheries for offshore sites (costs discounted over assessment period, 2012 prices)

NC MPA Proposal	Scenarios
	Lower	Intermediate	Upper
Offshore Sites
The Barra Fan & Hebrides Terrace Seamount	0.04	2.88	3.68
Central Fladen	-	3.03	6.02
Central Fladen (core)	-	0.67	1.18
East of Gannet & Montrose Fields	-	0.25	1.23
Faroe-Shetland Sponge Belt	0.45	1.73	5.6
Firth of Forth Banks Complex	-	4.17	4.8
Geikie Slide & Hebridean Slope	-	4.94	7.06
Hatton-Rockall Basin	-	-	-
North-east Faroe-Shetland Channel	0.05	1.66	4.3
North-west Orkney	-	-	-
Norwegian Boundary Sediment Plain	-	-	0.01
Rosemary Bank Seamount	0.07	1.42	2.6
South-east Fladen	-	1.91	3.83
South-west Sula Sgeir & Hebridean Slope	-	5.28	6.49
Turbot Bank	-	0 - 0.39	0 - 0.56
West Shetland Shelf	-	-	-
Western Fladen	-	2.43	4.86

Table 35 presents a summary of the potential combined quantified cost impacts for non-fisheries activities within inshore and offshore sites, including costs assessed at national level and taking account of alternative options for some of the offshore sites:

• South-west Sula Sgeir and Hebridean Slope ( SSH) vs. Geikie Slide and Hebridean Slope ( GSH);
• Central ( CFL), Western ( WFL) and South-east Fladen ( SEF) (Central Fladen (core) would be designated under all options - the alternatives relate to the designation of the additional CFL area, which does not incorporate CFL (core) in this assessment); and
• Firth of Forth Banks Complex ( FOF), Turbot Bank ( TBB) (addition of subtidal sands and gravels feature if FOF not designated) and Norwegian Boundary Sediment Plain ( NSP).

In total, based on these alternatives, there are 12 possible combinations of options.

For the lower scenario, the quantified cost estimates for non-fisheries activities are broadly comparable across the 12 options. For the intermediate scenario, the estimated costs for options involving Western Fladen are around 50% higher than for other options, reflecting the potential requirement for micrositing of new oil and gas infrastructure in this proposed MPA. For the upper scenario, options which include the Firth of Forth Banks Complex proposed MPA are significantly more costly, owing to the potential cost impact of mitigation measures for proposed offshore wind energy development. No potential non-fisheries costs have been identified for South-west Sula Sgeir and Hebridean Slope ( SSH) or Geikie Slide and Hebridean Slope ( GSH). Therefore, there is no difference in the cost estimates for these alternatives.

Table 35. Present value ( PV) in £ millions for quantified cost impacts to non-fisheries activities for combinations of sites (costs discounted over assessment period, 2012 prices)

Combination of MPA Options	Scenarios
	Lower	Intermediate	Upper
GSH plus FOF plus CFL	2.45	8.03	162.95
GSH plus FOF plus SEF	2.42	7.43	160.73
GSH plus FOF plus WFL	2.49	11.34	168.5
GSH plus TBB feature and NSP plus CFL	2.4	7.98	121.19
GSH plus TBB feature and NSP plus SEF	2.37	7.38	118.97
GSH plus TBB feature and NSP plus WFL	2.43	11.28	126.74
SSH plus FOF plus CFL	2.45	8.03	162.95
SSH plus FOF plus SEF	2.42	7.43	160.73
SSH plus FOF plus WFL	2.49	11.34	168.5
SSH plus TBB feature and NSP plus CFL	2.4	7.98	121.19
SSH plus TBB feature and NSP plus SEF	2.37	7.38	118.97
SSH plus TBB feature and NSP plus WFL	2.43	11.28	126.74

Table 36 presents a summary of potential impacts to direct GVA for fisheries activities within inshore and offshore sites. The cost impacts range from £0.6m in the lower scenario to around £24m to £29m in the intermediate scenario and £51m to £58m in the upper scenario. The differences are largely accounted for by differences between the impacts associated with the Fladen options (estimated impact to direct GVA ranges between £2-3m and £4-6m under the intermediate and upper scenarios, respectively, with the highest cost impacts relating to CFL) and inclusion of the Firth of Forth Banks Complex (estimated impact around £5m greater than alternative option).

Table 36. Impacts to GVA in £ millions for quantified cost impacts to commercial fisheries for combinations of sites (costs discounted over assessment period, 2012 prices)

Combination of MPA Options	Scenarios
	Lower	Intermediate	Upper
GSH plus FOF plus CFL	0.64	28.93	57.69
GSH plus FOF plus SEF	0.64	27.82	55.5
GSH plus FOF plus WFL	0.64	28.33	56.52
GSH plus TBB feature and NSP plus CFL	0.64	25.14	53.46
GSH plus TBB feature and NSP plus SEF	0.64	24.03	51.26
GSH plus TBB feature and NSP plus WFL	0.64	24.55	52.29
SSH plus FOF plus CFL	0.64	29.27	57.13
SSH plus FOF plus SEF	0.64	28.16	54.93
SSH plus FOF plus WFL	0.64	28.67	55.96
SSH plus TBB feature and NSP plus CFL	0.64	25.49	52.89
SSH plus TBB feature and NSP plus SEF	0.64	24.38	50.7
SSH plus TBB feature and NSP plus WFL	0.64	24.89	51.73

7.2 Combined Cost Impacts by Activity

This section presents information for those human activities for which cost impacts were identified for one or more sites or for which costs were identified at national level. Potential quantified and unquantified costs have been identified for nine activities/sectors ( Table 37). The ranges represent the possible variation in cost impact depending on which options might be selected. The most significant potential costs may be incurred by the oil and gas sector, the commercial fisheries sector (note costs are expressed in terms of impacts to direct GVA, based on the estimated value of landings affected), and the energy generation sector.

For many of the activities and sectors affected - finfish and shellfish aquaculture, military activities, ports and harbours, recreational boating and telecom cables - both the site-level and combined impacts are likely to be very small therefore no significant combined impacts are expected.

For commercial fisheries, significant cost impacts are identified for most of the offshore sites and some inshore sites under the intermediate and upper scenarios, reflecting the impact of the management measures applied. Impacts are expected to be greatest in the North-east region (predominantly on over-15m nephrops and whitefish trawls) and West and North-west inshore regions (predominantly on over-15m and under-15m nephrops trawls, and over-15m dredges and whitefish trawls).

Table 37. Present value ( PV) in £ millions for quantified national cost impacts to human activities (costs discounted over assessment period, 2012 prices) (except for commercial fisheries, expressed as impact to direct GVA).

Human Activity	Scenarios
	Lower	Intermediate	Upper
Aquaculture - finfish	0.36	0.61	0.61
Aquaculture - shellfish	0.14	0.19	0.19
Commercial fisheries (direct GVA)	0.64	24.03 – 38.92	50.70 – 73.53
Energy generation	0.13 – 0.20	2.59 - 2.66	3.90 - 47.34
Military activities	0.19	0.19	0.19
Oil and gas	1.38 – 1.49	3.63 – 8.15	122.67 - 123.20
Port and harbours	0.14	0.14	0.16
Recreational boating	Not quantified	Not quantified	Not quantified
Telecom cables	0.01	0.01	0.75

For the energy generation sector, the majority of cost impact under the upper scenario relates to proposed development within the Firth of Forth R3 Offshore Wind Zone which overlaps with the Firth of Forth Banks Complex proposed MPA. On this basis the combined impact is unlikely to be any greater than the sum of the impacts on individual developments. However, should the additional costs deter some of the investment in the Firth of Forth R3 Offshore Wind Zone, it is possible that this could affect investment decisions in the wider offshore wind supply chain. However, such impacts are unlikely because JNCC's current advice is that the intermediate scenario represents their best view on potential management requirements.

For oil and gas, significant cost impacts are identified under the intermediate and upper scenarios, based on the draft management measures proposed by JNCC. In the intermediate scenario, significant costs could be associated with required management measures to microsite infrastructure to avoid sensitive features for The Barra Fan & Hebrides Terrace Seamount and Western Fladen proposed MPAs. Under the upper scenario, a number of further proposed MPAs could also experience cost impacts, particularly associated with the requirement to microsite new infrastructure and to skip and ship drill cuttings. While the scale of the potential impacts is large, the overall scale of investment in oil and gas projects is also large. The extent to which such additional costs might compromise individual investments under the upper scenario is currently unclear. This is likely to vary on a site by site basis depending on the scale of the potential oil and gas resource and the overall costs of its exploitation. Should a number of potential developments be deferred or cancelled, this could have the potential to give rise to more significant combined impact on the oil and gas sector as a whole. However, such impacts are unlikely because JNCC's current advice is that the intermediate scenario represents their best view on potential management requirements.

7.3 Combined Costs to Public Sector

The estimated costs to the public sector presented in section 4.8 have been derived from a national assessment. The combined costs are therefore estimated to be the same as those presented in Table 19.

7.4 Combined Analysis of Distribution of Economic Costs and Consequent Social Impacts

The main social costs that could potentially be generated by designating the proposed NC MPAs are likely to arise as a consequence of reduced employment generated as a result of lost (or displaced) economic activity (current and future). The combined social impacts that could potentially be generated by designating the suite of proposed NC MPAs are summarised in Table 29 in Section 5.

A distributional analysis of the economic (and hence social) costs that could be generated from designating the entire suite of NC MPAs has also been undertaken for the commercial fisheries sector. This shows how the economic (and hence social) costs generated by designating the entire suite of possible MPAs would be likely to be distributed across different areas of Scotland and specific groups of people and assesses the likely significance of these impacts. The results of the distributional analysis are summarised in Tables 20 and 21 in Section 5.

The key conclusions from the combined analysis of social costs and the distributional analysis are set out in Section 5.3.

7.5 Combined Benefits

Treating marine protected areas as a collection of individual and separate features providing separate ecosystem services potentially ignores any network effects that could occur from a set of continuous set of marine protected areas. The network effect is best described with telephone networks. The additional of one telephone to a network, will privately benefit the owner of that telephone because they are now connected all other users of the network, but it will also have a positive externality on the rest of network because there is now one extra person to call. In marine conservation a number of adjacent marine reserves may demonstrate network effects, i.e. the benefit from the networks may be greater (or less) than the sum of the benefits from the individual MPAs. These effects are potentially of great importance in marine protected areas because of the lack of barriers and mobility of species.

Little literature exist which examines this effect. But care should be taken in using values for ecosystem services which ignore this effect. A collection of protected features, or significant differences in areas of MPAs could exhibit network effects and therefore any valuations undertaken must take into account these potentially synergistic properties. Fletcher et al. (2012), assessed the benefits available from the designation of a network of MCZs. They concluded that the ecological connectivity of the network is likely to have an instrumental role in supporting the delivery of beneficial ecosystem services and their associated socio-economic value at various scales. Benefits may be experienced both within and outside an individual MPA due to connectivity with the wider marine environment, not only other MPAs. The designation of a network is therefore more likely to secure the current and future benefits available from MPAs than would a small number of isolated sites. A precautionary approach to securing the actual and potential benefits available from an MPA network would be to maximise potential connectivity through the designation of an extensive network.

Network effects are considered highly relevant to identifying the benefits of the MPAs, but cannot be quantified. An overview of the ecosystem services provided by the features in the MPAs has been compiled based on recent analysis by the VNN (see Section 3). It is shown in Appendix D, and simply presents the number of features in each site associated with each ecosystem service. It does not considered the level of ecosystem services from different features, or the strength of the scientific evidence identifying these links, both of which are variable.

The table in Appendix D reflects the generally lower numbers of features in offshore sites, with the exception of BHT. For inshore sites, there is more variability in the numbers of features associated with ecosystem services in different sites. The highest numbers of features are associate with supporting services, the numbers of features associated with cultural and regulating services are lower than for supporting services, while the lowest number relate to provisioning services (especially other than fish). There are numerous sites with multiple features associated with supporting services, and this illustrates the potential collective contribution of the MPAs to network values and resilience.

The information in Appendix D has been used to inform the individual site ecosystem services assessment (Table 9 in the Site Reports, Appendix E) and also informs the summary of the cumulative ecosystem services impacts of the proposed sites shown in Table 38.

In addition to these final ecosystem services from the proposed sites, the network of sites could cumulatively have an effect on supporting services. Including the value of the services can in some cases double-count the final services they support. However, they should be considered because they can have additional value through supporting final services from outside the network of sites (and so would not be reflected in Table 38) and through their contribution to the resilience of marine ecosystems and levels of marine ecosystem services.

Table 38. Cumulative view of final ES considered in the assessment

General Ecosystem Service Categorisation	Final Ecosystem Services to be Used	Observations from Site Analysis
Provisioning	Provision of fish and shellfish for human and non-human consumption	High uncertainty in response of fish and shellfish populations to protection of benthic habitats. Changes to primary productivity are complex and interactions between species uncertain. Furthermore, the designation may enhance levels of commercial and non-commercial species, but simultaneously make them less accessible to commercial fishing activities.
Cultural	Recreation	Most inshore sites have some recreational activities ( e.g. angling, diving, boating routes and anchorages), and these are likely to be enhanced if participants can encounter increased levels of biodiversity, and/or if they feel the quality of the marine environment is less likely to be degraded.
	Research and education	The value of individual sites for research is not well understood. Research and education opportunities are enhanced through protection of healthy marine ecosystems, but the value of this is uncertain at individual sites due to the availability of substitutes. The value of the network in this respect is greater, as there is no substitute for the proposed network.
	Non-use	Non-use values are potentially very substantial over the 20 year assessment period, but also uncertain. See discussion in Section 6.
Regulating	Natural hazard protection	No benefits are identified in terms of hazard protection, as the proposed network is assessed not to have any interaction with coastal defences.
	Environmental resilience	This service was not considered for individual sites as it is regarded as something that operates at a larger scale ( i.e. the network level). The MPA network will contribute to increased resilience of marine ecosystems through protection of marine biodiversity. Worm (2006) identified that more ecologically diverse marine ecosystems were more resilient to external pressures and disturbances.
	Gas and climate regulation	Carbon sequestration within marine environments is more significant where there is primary productivity from benthic vegetation. Relevant habitats are present in some proposed MPAs, but they are an extensive feature of the proposed network, and some are already subject to protection. Therefore the additional value of the network in this respect is considered low.
	Regulation of pollution	Waste assimilation services are provided by some sites' protected features ( e.g. Maerl beds), but actions under the Water Framework Directive (WFD) are assumed to be dealing with any significant impacts on coastal water quality, any so benefits of designations in to improve water quality in excess of WFD requirements are assumed to be very low.

The analysis in Appendix D shows that many features in the proposed sites are associated with a wide range of supporting marine ecosystem services. Therefore, it is reasonable to assume that designating the proposed network of sites will make a contribution to the resilience of ecosystem services from the Scottish marine environment. However, currently available evidence does not allow any quantification of this benefit.

7.5.1 Value Transfer for Non-User Benefits of MPA Network

This section details a value transfer to measure the non-use value of designating a network of Marine Protect Areas in Scotland. It aims to present the steps and assumptions leading to a value or a range of plausible values which are reflective of the value placed on Scottish waters by Scottish households.

Value transfer is a process by which readily-available economic valuation evidence is applied in a new context for which valuation is required. It is a quicker and lower cost approach to generating economic valuation evidence compared to commissioning a specifically-designed primary valuation study. This advantage of value transfer makes it a practical tool for analysis given the time and resource constraints that decision-making regularly faces.

The methods and process involved are described in more detail in UK Government guidelines ^[19] . The process of value transfer is rarely perfect: some adjustment of the available evidence (the 'source study') is needed to apply it to another context. This adjustment introduces uncertainties into the valuation evidence produced, and these are reflected in the range of values obtained.

The source study for this value transfer is McVittie and Moran (2008). This is considered a suitable, and the most relevant, study for value transfer due to the similarity of the following factors in this study and in the proposed Scottish MPA designations:

• The good considered: a non-market good based on government action;
• The change: designation of a national scale network of marine protected areas ( MPAs) subject to management measures that protect biodiversity;
• The population: the national population (a Scottish subsample is identified);
• The context: new marine protection legislation; and
• Timing: although economic conditions have changed, the data is relatively recent.

The source study estimates benefits derived from the implementation of the nature conservation measures in the draft Marine Bill, specifically, MCZs in the UK. MCZs are the term used for designating MPAs under the Marine Bill, so MCZs and MPAs are considered to have the same meaning in this context.

It quantifies total economic valuation for the MCZ provisions. However, due to the nature of the MCZ outcomes (being largely to species and seabed habitats not regularly encountered by members of the public), it is suggested that a high proportion of this value will be non-use value ( i.e. associated with benefits derived simply from the knowledge that the natural environment is maintained) even though the data from this study do not allow the study to clearly isolate this component.

The study uses stated preference valuation methods with a sample size of 828 individuals across different regions of the UK (England, Wales, Scotland, and Northern Ireland). Individuals were asked about their willingness to pay ( WTP) for marine conservation through the designation of a network of MCZs. The contingent valuation survey in McVittie and Moran (2008) that generated the unit value used in this analysis stated:

Without the introduction of Marine Conservation Zones it is possible that the deterioration of the marine environment will continue and that some of the damage may be irreversible. The only way of ensuring the conservation of the marine environment would be through an increase in annual tax paid by all households including yours.

The analysis emphasises non-use values of the environmental benefits arising from designations of MCZs. This is a good match for the current policy context in which MPAs are being introduced in Scotland - the policy aims to conserve the condition of the marine environment and is undertaken by Government, funded through annual taxation.

7.5.1.1 Adjusted unit value transfer

Unit value

McVittie and Moran (2008) find a mean WTP per Scottish household for marine conservation (as defined above) in the UK of £14.97 for the year 2008.

Adjustments

Adjustments to transferred values are based on empirical evidence and control for the differences between the study site and the policy site that cause the unit value to differ between the two contexts (eftec, 2010).

Updating the WTP estimate to 2014

The value transferred from McVittie and Moran (2008) and used in this study is for the year 2008. It is therefore updated to 2012 prices using the GDP deflator from The Treasury from 2008 to 2012 ^[20] (a factor of 1.080)). WTP by Scottish households for marine conservation in the UK is then £16.18 per Scottish household in 2014. With 2.37 million households in Scotland, according to the General Register Office for Scotland, this amounts to a non-use value for 2014 of £38.34 million by all Scottish households for marine conservation in the UK.

Size of the marine environment affected

McVittie and Moran (2008) value marine conservation in UK waters. To make the unit value used in their study relevant to Scottish waters only, the total non-use value of marine conservation in UK waters by Scottish households has been scaled down by a factor reflecting the proportion of Scottish sea area in the UK. It is estimated that 60.9% of UK waters are Scottish ^[22] , ^[23] , ^[24] . Therefore the UK value is scaled down by 60.9% to give an estimated value to Scottish households of marine conservation of Scottish waters only of £24.32 million.

Using the Scottish sea area as a proportion of UK sea area is consistent with the way McVittie and Moran (2008) define the good that they value: the McVittie and Moran (2008) study considers the territorial waters (out to 12 nautical miles) of England and the three devolved administrations as well as the UK continental shelf.

Aggregating WTP over time

Discounting

The value transfer detailed in this section includes discounting using the recommended discount rate of 3.5% in The Green Book. The discount rate is employed over the time horizon of 20 years considered in the study. This is done to convert all benefits to 'present values' so that they can be compared to present value costs. This process is based on the principle that people prefer to receive goods and services now rather than later, a concept referred to as 'time preference'.

The discounted total value of marine conservation in UK waters by Scottish households is £583 million in 2012 prices compared to an undiscounted value of £805 million. Adjusted to Scottish water (as above) the total value for marine conservation in Scotland by Scottish households is £355 million over for the period 2014-2034.

Benefits time lag

In aggregating WTP over time, a final adjustment is made to the non-use value of marine conservation of Scottish waters by Scottish households to account for the time lag of benefits. This lag exists because the benefits of MPA designation do not all occur immediately. In reality, it takes many years for habitats to recover from degradation before the flow of ecosystem services ( ES) can resume.

In this context, it is assumed that the benefits for the first year after MPA designation are nil and grow at a rate of 10% over 10 years after which the benefits reach and remain at full value until 2034.

McVittie and Moran (2008) are explicit in stating that they do not make such an adjustment. In effect, the values generated within their research are based on the best ex-ante assessment of the anticipated environmental gains from marine conservation, using a scenario of a hypothetical network of MCZs. One interpretation of this fact is that the benefits of marine conservation in their study represent preferences for implementation of the Marine Bill and arise immediately from policy implementation.

Either assumption is possible as benefits can arise immediately because people know marine biodiversity is being protected, or with a lag after that protection has had a positive effect on the conservation of biodiversity.

7.5.1.2 Results

The value transfer produces a range for the non-use value of the designation of a network of MPAs in Scotland. The ranges are spread across the series of adjustments made to transfer the unit value from the source study to the policy study.

The first part of the range is identified by scaling total non-use value expressed by Scottish households for all UK marine waters down, to only account for Scottish waters. The value over 20 years goes from £583 million to £355 million in 2012 prices. Both values can be thought to represent the non-use value of Scottish waters by Scottish households. The former value assumes that households in Scotland only value marine conservation in Scottish waters whilst the latter assumes that they value marine conservation evenly across UK waters.

A second part of the range of plausible values is then identified by adjusting for the possibility of a lag in the benefits of marine conservation. The value over 20 years goes from £583 million, assuming the benefits are realised immediately, to £392 million in 2014 prices assuming they are realised with a lag. The range of the non-use value of Scottish marine conservation by Scottish households over the 20-year time horizon goes from £355 million, assuming the benefits are realised immediately, to £239 million assuming they are realised with a lag. Both assumptions are plausible.

Table 39 summarises the range ^[25] of values that the adjustments in this value transfer lead to.

Table 39. Range of non-use values of Scottish waters by Scottish households

Adjustment	Estimated Value (2012 prices)
Scottish Households value for UK MPAs	£583 million
Adjusted for size of the Scottish marine environment	£355 million
Adjusted for benefits time lag	£392 million
Adjusted for benefits time lag AND size of the Scottish marine environment	£239 million

It is worth noting that the adjustment to Scottish sea area assumes that Scottish households value MCZs evenly across UK waters. Alternatively, the original value of Scottish households for UK waters could also be used assuming Scottish households only value MCZs in Scotland. This study, however, assumes that the real value of marine conservation in Scottish waters by Scottish households will lie within the range of £239-583 million, underpinned by different plausible assumptions.

The adoption of a range is in line with the argument that, in reality, Scottish households value marine conservation in all UK waters, but value it in Scotland more than at the broader UK level. A wide range also reflects the high level of scientific uncertainty within the area this study is concerned with. The analysis does not take into account any possible effects of economic conditions since 2008, when the McVittie and Moran study was carried out, on Scottish households' willingness to pay for marine conservation.

Discussion and Conclusions

7.6 Cost Impacts to Activities

Based on the assessments undertaken, it is estimated that there will be no significant cost impacts associated with designation of the proposed MPAs under any of the scenarios for the following activities: aviation, carbon capture and storage, coast protection and flood defence, power interconnectors and transmission lines, tourism and water sports.

It is estimated that relatively minor cost impacts will be experienced by the following activities with greater cost impacts under the intermediate and upper scenarios: finfish and shellfish aquaculture, military activities, ports and harbours, recreational boating and telecom cables. However, there is some uncertainty surrounding the potential scale of impacts to finfish and shellfish aquaculture, as it has not been possible to estimate the potential costs of mitigation measures and actual cost impacts could therefore be greater. It has not been possible to derive monetary estimates for the potential impacts to the recreational boating sector, but based on the limited number of anchorages and moorings likely to be affected, the cost impacts are expected to be minor.

Potentially more significant cost impacts could be experienced by the commercial fisheries, energy generation and oil & gas sectors, particularly under the intermediate and/or upper scenarios. For commercial fisheries, potential impacts on GVA (discounted over assessment period) range from £0.6m (lower scenario), £24m to £30m (intermediate scenario) and £52m to £60m (upper scenario) depending on the offshore site options included. The differences are largely accounted for by differences between the impacts associated with the Fladen options (estimated impact to GVA ranges between £3m to £7m) and inclusion of the Firth of Forth Banks Complex (estimated impact around £5m greater than alternative option).

For energy generation potential PV costs range from £0.1m to £0.2m (lower scenario), £2.6 to £2.7m) (intermediate scenario) and £3.9m to £47.3m (upper scenario) depending on the offshore site options included. The costs are particularly affected by the inclusion of the Firth of Forth Banks Complex in the upper scenario owing to the potential requirement to provide graded scour protection around each installation.

For the oil and gas sector potential PV costs range from £1.4m - £1.5m (lower scenario), £3.6m - £7.6m (intermediate scenario) and £111m - £121m (upper scenario) depending on the offshore site options included. In the lower scenario, the costs relate solely to potential additional assessment costs associated with new oil and gas exploration and development. In the intermediate scenario, some additional survey and mitigation measure costs potentially arise in relation to micrositing oil and gas infrastructure to avoid areas of high density for tall sea pens, particularly in Central Fladen (core) and Western Fladen proposed MPAs. In the upper scenario, potentially much larger costs could be incurred associated with more widespread micrositing of infrastrue and skip and ship of drill cuttings.

The combined impact of the designation of proposed MPAs on activities is largely considered to be additive, given the relatively low levels of impact associated with the draft management options assessed within this study. For the energy generation and oil and gas sectors, it is possible that the combined impacts could be more significant in the upper scenario, should some of the planned investment be deterred as a result of the additional costs of development. However, this remains uncertain and JNCC's current advice is that the intermediate scenario represents their best view on management requirements.

For the commercial fisheries sector, certain fleet segments may be significantly affected by the designation of several proposed MPAs in a region under the intermediate and upper scenarios. This is particularly the case for over-15m and under-15m nephrops trawls in the West inshore and North-west inshore regions, and to a lesser extent for over-15m dredges and whitefish trawls. The displacement of these vessels from their fishing grounds may cause conflict among them and with other vessels in the grounds they are displaced to. There may be additional costs associated with moving to new fishing grounds, changing target species or fishing method, and a number of vessels may leave the sector, with resulting employment and social impacts.

It is recognised that accurate quantification of potential cost impacts is very challenging and confidence in the quantified assessments is generally low. It has not been possible to quantify a number of the potential cost impacts, for example mitigation costs for some sectors, or costs of delays in consenting or deterrent to investment. The quantified cost impacts therefore provide only a partial picture of the potential cost impacts of the draft management options. In addition, some cost impacts have only been quantified at national level. The Site Reporting Templates (Appendix E) therefore do not provide a complete picture of all quantified costs and this should be taken into account when considering the estimated costs for each site.

7.7 Costs to the Public Sector

The main public sector costs relate to the costs of biological surveys to assess the condition of features within sites once designated ( PV around £23m to £25m, depending on the offshore site options included in the network). Other public sector costs associated with Marine Management Schemes, Statutory Instruments to implement fisheries management measures, compliance and enforcement activities, proportion of public understanding and regulatory and advisory costs are estimated to be relatively minor ( PV around £0.5m for all options).

There are some uncertainties surrounding the estimates of costs to the public sector, in particular, the requirements for and costs of enforcement of inshore fisheries management measures and the costs associated with securing CFP measures. However, such costs are likely to remain only a minor component of overall public sector costs. The potential for cost impacts to Scottish Water is also uncertain.

7.8 Distribution of Economic Costs and Consequent Social Impacts

7.8.1 Commercial Fishing Sector and Fish Processing Sector

It is difficult to assess the potential socio-economic consequences of designation of proposed MPAs on the commercial fishing sector (and hence the fish processing sector) as, ultimately, this will depend on the extent to which the fleet can access alternative fishing grounds, and that is unknown. The quantitative estimates presented for this sector, therefore, assume there is no redistribution of fishing effort - all affected landings are lost - and hence represent worst-case estimates.

The analysis suggests:

• Designation of ten of the possible MPAs would not require any restrictions on fishing activities and hence would not generate any economic or social costs;
• Under the lower scenario, the economic and social impacts of designation would be minimal;
• While designation of the suite of MPAs would have negative impacts on GVA and employment, the impact at the Scottish economy level would not be significant;
• While designation of the suite of MPAs would have negative impacts on the sector's GVA and employment under the intermediate and upper scenarios, these impacts would be relatively small. Under the worst-case scenario, there would be a 2% reduction in the sector's GVA and employment;
• The North-east, North-west and West regions, however, would bear a disproportionate share of these costs with the most significant employment impacts being felt in Fraseburgh, Peterhead, Mallaig and Ayr. Designation of the suite of MPAs could put jobs at risk in these and other areas (under the intermediate and upper scenarios) and this could generate significant economic and social costs for the individuals affected (and their families) if they do not find alternative employment;
• It is anticipated that designation of the suite of proposed MPAs would have a negative, but fairly minimal impact, on the Scottish fish processing sector as a whole. Affected landings account for a relatively low proportion of total landings at landing ports (typically 0-3%, and 7% worst case at Mallaig) and it is likely that fish processors will react to reductions in local supplies of fish by importing greater quantities of raw material. The impacts could be more significant for smaller-scale processors which are more heavily reliant on locally-caught demersal species and shellfish. Designation is not expected to have any impact on the pelagic sector; and
• If the impact of designation on the Scottish fleet was a displacement of fishing activity, the economic and social costs would be smaller than those estimated. These may, however, be partly offset by other economic and social costs associated with displacement such as increased fuel costs and a loss of social cohesion among fleets, as a result of increased tensions among vessels from having to share fishing grounds. Displacement issues are likely to be most pronounced in the West and North-west inshore regions, particularly for nephrops trawlers (under-15m and over-15m) and dredges.

7.8.2 Energy Generation and Oil and Gas

It has not been possible to quantify the costs associated with all of the possible mitigation measures in the energy generation or oil and gas sectors but these are potentially significant, particularly under the upper scenario. Further, it has not been possible to estimate the costs associated with potential delays or the impact of designation on investment decisions. If designation rendered projects unviable or restricted or deterred investment in development projects (existing, planned or future), this would have potentially very significant socio-economic impacts; not only would it reduce the contribution these sectors make to future levels of GVA and employment but it would have indirect effects on their supply chains and the wider Scottish economy. However, such impacts are unlikely because JNCC's current advice is that the intermediate scenario represents their best view on potential management requirements.

7.9 Benefits

Section 6 reviewed evidence on expected changes in ecosystem services and on the value of those changes. The evidence is extremely limited. It is particularly hampered by the lack of knowledge of the baseline condition of many features in the MPAs, and the impact of management measures on features and ecosystem services from sites.

The available evidence suggests that people do value protection of marine biodiversity and will benefit from increased ecosystem services as a result of MPA designation and management. These changes in ecosystem services are however poorly understood and very difficult to quantify. The conclusion is therefore that the scale of the benefits of designating the MPAs remains unproven, but this should not be interpreted as meaning that these benefits are low.

The same limitations hamper assessment of the cumulative benefits of the proposed MPAs. However, at this scale additional evidence on the network value of MPAs is relevant. The sites can cumulatively contribute to the resilience of marine ecosystem services in a way that is greater than the sum of their parts.

At the network level, economic studies on the value of UK MPAs and halting the loss of marine biodiversity in the UK, discussed in Section 6.3.5, are more relevant. The basis for reliably transferring most of this evidence to the proposed MPAs is uncertain.

A recent UK study of the non-use value of protecting marine biodiversity through site designations (McVittie and Moran, 2008) has been translated to value the proposed MPAs in accordance with UK Government value transfer guidelines. The non-use value of Scottish households, with assumptions made on the scale of Scottish marine waters and a possible time-lag in the benefits from designation, are estimated at between £239 million and £583 million, at 2012 prices discounted over 20 years, from 2014.

7.10 Limitations and Uncertainties

A number of significant limitations and uncertainties have been identified through the course of the study. The development of the scenarios has sought to encompass some of these uncertainties, in particular:

• Where the spatial extent of MPA features for which management measures might be required is uncertain (and thus the spatial area over which management measures might need to be applied (and over which costs and benefits might accrue) is uncertain) the scenarios have used different estimates of the spatial extent of those features;
• Different assumptions have been used concerning the requirements for management measures within the scenarios to take account of uncertainty in the management requirements. This influences the scale of costs and benefits across the scenarios;
• Different assumptions have been used within the scenarios concerning the extent to which management measures might already be necessary to deliver OSPAR/ BAP requirements. This also influences the scale of costs and benefits across the scenarios.

As a result of incorporating these uncertainties within the scenarios, significant variations in the range of potential costs and benefits have been identified, with estimates of costs typically varying by around two orders of magnitude between the lower and upper scenarios. These differences are particularly driven by assumptions on management measure requirements , but in some instances cost estimates are also sensitive to assumptions about whether management measures might already be necessary to meet OSPAR/ BAP requirements.Further refinement of the management options through the consultation process on the MPA proposals could help to reduce this uncertainty.

Uncertainties in the location and nature of future activity in the marine environment also introduce an uncertainty in the estimation of costs and benefits. For example, some of the estimated offshore renewables impacts are based on the location of Draft Plan Options and indicative export cable routes, which will be the subject of separate public consultation. Similar uncertainties relate to future trends in ongoing activities such as commercial fishing (assumed landings values remain constant over the assessment period). Such assessments are therefore based on a significant degree of speculation about future levels of activity and are thus inherently uncertain.

As identified in section 8.1 above, it has not been possible to provide quantified estimates of cost impacts for a number of potential management measures owing to a lack of data on the location of future activity or a lack of information on the costs of management measures. In addition, it has not been possible to estimate the cost of potential consequential impacts associated with designation, for example the costs of delays to consenting processes or costs associated with reduced investor confidence.

For commercial fisheries, the cost impacts have been based on GVA estimates of the value of potential landings foregone. These values will overestimate impacts to the commercial fisheries sector as they assume that all of the displaced effort will be lost, although in practice a proportion of the displaced effort will relocate and continue fishing in other areas. There is also an inherent uncertainty in the multipliers used to estimate GVA, which are not site specific. Further information on displacement effects could usefully be gathered through the consultation process on the MPA proposals.

The main potential social impacts identified within the assessment relate to impacts on the commercial fishing sector. Given the uncertainties relating to commercial fishing impacts identified above, the social consequences of these impacts are also similarly uncertain.

The assessment of benefits has largely been limited to a qualitative assessment owing to the very limited evidence on expected changes in ecosystem services and on the value of those changes. The assessment has also been hampered by the lack of knowledge of the baseline condition of many features in the MPAs, and the impact of management measures on features and ecosystem services within those sites. However, a significant amount of additional research is in progress, for example under the auspices of the National Ecosystem Assessment Follow-on project and it may be possible to incorporate additional informationduring and following the public consultation on the MPA proposals.

The combined assessment poses particular challenges owing to the complexity of such assessments and the limited scientific understanding of impacts. Within this study, combined effects have generally been assessed as the sum of the individual impacts of on individual sites, but the potential for combined cost impacts has been recognised, particularly in relation to commercial fisheries and possibly also for offshore renewables and oil and gas under the upper scenario. The assessment of combined benefits is subject to the same limitations as those identified for the site assessments. However, at this scale, additional evidence on the network value of MPAs is relevant. For example, the sites can cumulatively contribute to the resilience of marine ecosystem services in a way that is greater than the sum of their parts, but there is little if any quantified evidence available to support this.