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The local ownership model used in the proposed Viking Energy windfarm offers the greatest economic benefits for local communities "by a substantial margin", according to a study by academics at Strathclyde University.

"The Importance of Revenue Sharing for the Local Economic Impacts of a Renewable Energy Project: A Social Accounting Matrix approach" by Grant Allan, Peter McGregor and Kim Swales, of the Fraser of Allander Institute, University of Strathclyde, will be published in Regional Studies, the leading international journal in theoretical development, empirical analysis and policy debate.

The study, which outlines the local economic impacts of renewable energy projects, considers two different economic models currently used to analyse economic benefits; local ownership and community benefit payments. The research shows that in Shetland's case local ownership confers the greatest economic benefits for the local community.

However, should the proposal get the go-ahead the local community in Shetland stands to benefit two-fold, as the project will not only be developed with local ownership but will additionally receive community benefit payments as well.

Project Manager, Aaron Priest, said, "In 2003, Shetland Islands Council made it clear that no large-scale renewables development should take place in Shetland without the community having the opportunity to obtain a stake. This study validates what we inherently understood those many years ago. The unique structure of the Viking Energy project gives Shetland control over how the project might come forward and will keep the greatest benefits locally."

Professor McGregor, said, "If you can secure local ownership or even part ownership of a major wind energy project such as the proposed Viking Energy development the income flows into the local economy can be substantial. Traditionally onshore wind energy projects tend not to have strong backward linkages into the local economy since turbines are mainly imported, although local contractors will be involved during the construction phase and other jobs created thereafter. However, the social and economic benefits of local ownership combined with community benefit should not be underestimated and can bring very significant benefits to rural communities like Shetland."

According to the research three times as many jobs are likely to be created by a wind farm with community ownership than one without.

The paper has been accepted by Regional Studies and will be published in due course. A copy is available to read here.

Grant Allan is a Research Fellow and Professor Peter McGregor is Director of the Fraser of Allander Institute, Department of Economics, University of Strathclyde. Professor Kim Swales is Head of Department of Economics and a Senior Research Associate of the Fraser of Allander Institute.

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