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The Economic Impact of Scotland’s Renewable Energy Sector – 2023 Update

  • This report presents estimates of the economic impact of Scotland’s renewable energy
    industry.
  • Using a model of the Scottish economy that describes inter-industry economic relationships,
    we were able to estimate how much output, gross value added (GVA) and employment
    renewable activities support in Scotland’s economy as a whole.
  • There is no renewables sector defined in the national accounts, so we constructed the
    sector using data published by the Office for National Statistics (ONS).
  • We estimate that the renewable energy industry had a turnover of £6.1 billion and 13,600
    full-time equivalent (FTE) employment in 2021.
  • However, the economic activity supported by renewables sector is far greater than its
    own turnover and employment. The renewable energy sector supports economic activity
    throughout its supply chains and this economic activity supports wage spending across
    Scotland.
  • Including these spill-over effects, we estimate that the renewable energy industry supports
    over £10.1 billion of output, over £4.7 billion of GVA and over 42,000 FTE employment across
    the Scottish economy.
  • The technologies that individually support the most FTE employment are offshore wind
    (15,005), onshore wind (12,030), renewable heat (7,220) and hydropower (5,605).
  • However, there is significant uncertainty in the underlying ONS survey of renewable
    activities, particularly at the individual technology level. Our results are therefore
    accompanied by a moderately large margin of error. More robust and timely production of
    renewables data by the UK and/or Scottish Government would allow for more meaningful
    between-year and between-technology comparisons of these estimates.

Authors

Mairi is the Director of the Fraser of Allander Institute. Previously, she was the Deputy Chief Executive of the Scottish Fiscal Commission and the Head of National Accounts at the Scottish Government and has over a decade of experience working in different areas of statistics and analysis.

James is a Fellow at the Fraser of Allander Institute. He specialises in economic policy, modelling, trade and climate change. His work includes the production of economic statistics to improve our understanding of the economy, economic modelling and analysis to enhance the use of these statistics for policymaking, data visualisation to communicate results impactfully, and economic policy to understand how data can be used to drive decisions in Government.

Brodie is a Knowledge Exchange Assistant at the Fraser of Allander Institute. She has recently completed an MSc in Applied Economics at the University of Strathclyde and has a first-class Honour’s degree in Economics and Politics from the University of Glasgow