Potential for – and benefits from – local content in Swedish wind power projects

• Main Authors: Edlund, Marcus, Eriksson, Daniel
• Format: Others
• Language: English
• Published: KTH, Hållbarhet och industriell dynamik 2014
• Subjects: wind power; local value creation; local content; local procurement
• Online Access: http://urn.kb.se/resolve?urn=urn:nbn:se:kth:diva-149328

The construction of wind power is strongly associated with negative local externalities in terms of noise, shadows, visual impact and effects on local environment. To compensate for these negative effects, wind developers seek to find methods to create more local value. The purpose of this study has thus been to identify and evaluate potential methods to increase the local value creation from onshore wind power projects, mainly in the Swedish context. Firstly, from the literature review and interviews, four different approaches to create local value has been identified. The four identified methods to create local value are (1) community funds, (2) local ownership, (3) modernization and (4) local content. Of these identified methods, local content is deemed to have most potential in creating local value. The use of local content has generally been strong in the UK, why this study comprises a field study that reveal that British wind developers manage to appoint up to 20-30 % of the total capital expenditure to local companies. Compared to Sweden, the same number is as little asone percent. The explanation to this significant difference could be explained by “three I:s”,, namely, (1) Identification of local companies, (2) Information of opportunities and requirements and (3) Incentive creation for the main contractors. For Swedish developers to overcome the problems associated with the three I:s, the study presents seven activities that are possible to implement directly into the development process of wind power. Together these activities create a comprehensive way of enhancing the possibility for local companies to be involved in the construction phase, and by doing so, increasing the local value creation.