1. Renewable Energy Technology Centre (Offshore Marine) A cost/quality comparison (Based on information from the Financial Times fDi Benchmark tool – April 2012)

2. Competitiveness of Scottish Central Belt Value for Money Overall Attractiveness Quality of the Location Annual Operating Costs Quality Competitiveness General Business Environment Labour Availability and Quality Presence of an Industrial Cluster Infrastructure and Accessibility Living Environment Contents

3. The following analysis is based on fDi Benchmark, an online location benchmarking tool provided by the Financial Times (FT) fDi Benchmark compared the Scottish Central Belt with the leading locations globally for establishing a Renewable Energy Technology Centre (offshore) based on an analysis of over 55 quality factors and 10 cost factors A key emphasis was placed on: - Presence of industrial cluster – the size of the industry, track record and R&D capabilities; and - Labour availability and quality – experience of industry-specific staff, number of top 500 universities and flexibility of labour regulations Other factors including general business environment, infrastructure and accessibility and the living environment were also assessed Benchmarking Study

4. Project Profile Overview Cost FactorUsage Amount Property Total Occupancy cost (in town office rent)1,200 m² Weighting Model OverviewWeight Presence of an Industrial Cluster45 Labour Availability and Quality30 General Business Environment10 Infrastructure and Accessibility10 Living Environment5 Employee TypeProfile Head count Information Technology Software Development Engineer3 Technology Engineering Specialist2 R&D / Engineering Assistant Engineer4 Chief Engineer/Technical Mgr1 Engineer10 Head of Research and Development1 R&D Team Leader2 Senior Engineer3 Senior Technical Drawer1 Technical Drawer2 Trainee/Apprentice Engineer1

5. fDi Benchmark Matrix The fDi Benchmark Matrix shows the trade off between cost and quality across the 6 selected locations for the Renewable energy technology centre (Offshore Wind, Wave and Tidal) profile. The average cost and quality score is 100 for the selected locations. the Scottish Central Belt is in the ideal top left quadrant. Source: fDi Intelligence, from the Financial Times Ltd The ‘ideal’ quadrant is the top left (high quality/lower operating costs)

6. fDi Benchmark Matrix The matrix is based on the weighting and cost model for the Renewable Energy Technology Centre, April 2012, profile. The weighting model identifies the key location criteria for the project and the cost model shows the primary cost inputs for the operation. The cost and quality scores are calculated using real data on all the location requirements and cost inputs. The results indicate the different location solutions for the investor as follows:  the Scottish Central Belt offers higher quality at a lower cost than the average of all the selected locations  Oslo offers high quality but at higher cost  Lille, Newcastle, Porto and Bilbao offer lower cost, but at lower quality The Operating Cost value is in GBP – United Kingdom Pounds Location Qualitative Score Operating Cost Index Operating Cost Value Bilbao78.999.11,737,897 Bremerhaven87.2119.22,090,289 Lille67.590.31,584,569 Newcastle75.190.01,579,048 Oslo138.5137.42,410,066 Porto63.272.81,276,015 Scottish Central Belt189.691.21,599,844 Source: fDi Intelligence, from the Financial Times Ltd

7. Location Attractiveness Index The location attractiveness index shows the overall attractiveness of the 7 selected locations for the Renewable Energy Technology Centre, April 2012, profile. The ratio of quality to cost is 50:50 Source: fDi Intelligence, from the Financial Times Ltd

8. Cost Quality Competitiveness The cost quality competitiveness uses the results of the fDi Benchmark Matrix to show the value for money of each location option. The graph shows that:  The top locations offering the highest quality for a given level of cost are the Scottish Central Belt and Oslo  the Scottish Central Belt offers an above average level of quality and good value for money as there relative quality is higher than its relative cost Source: fDi Intelligence, from the Financial Times Ltd

9. Cost Competitiveness The annual operating cost calculation for Renewable Energy Technology Centre, April 2012 is based on the following primary input costs: Labour Cost  The average cost across the selected locations for Renewable Energy Technology Centre, April 2012 is GBP 1,753,961  The greatest cost saving between the selected locations is GBP 1,134,052 per annum  The values in the chart below are in GBP – United Kingdom Pounds Source: fDi Intelligence, from the Financial Times Ltd

10. Cost Competitiveness LocationLabour CostProperty Bilbao1,450,810287,086 Bremerhaven1,907,767182,522 Lille1,329,400255,169 Newcastle1,155,464423,583 Oslo1,895,735514,331 Porto1,061,945214,069 Scottish Central Belt1,104,636495,207 10 The locations with the lowest operating costs are Porto and Newcastle In terms of the individual cost factors, the locations with the lowest costs are:  Labour Cost: the Scottish Central Belt and Porto  Property: Porto and Bremerhaven The values in the table below are in GBP – United Kingdom Pounds Source: fDi Intelligence, from the Financial Times Ltd

11. Quality Competitiveness The quality competitiveness assessment is based on the weight model for the Renewable Energy Technology Centre, April 2012 profile which assesses each location across the following location factors: General Business Environment, Labour Availability and Quality, Presence of an Industrial Cluster, Infrastructure and Accessibility and Living Environment. The average score for the selected locations is 100. The locations with the highest quality scores are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

12. Quality Competitiveness Location General Business Environment Labour Availability and Quality Presence of an Industrial Cluster Infrastructure and Accessibility Living Environment Bilbao8204074 Bremerhaven81550104 Lille8212685 Newcastle12203085 Oslo124659156 Porto82219105 Scottish Central Belt136692126 In terms of the individual quality factors, the locations with the highest scores are:  General Business Environment: the Scottish Central Belt and Oslo  Labour Availability and Quality: the Scottish Central Belt and Oslo  Presence of an Industrial Cluster: the Scottish Central Belt and Oslo  Infrastructure and Accessibility: the Scottish Central Belt and Oslo  Living Environment: the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

13. General Business Environment The quality competitiveness breakdown for General Business Environment for the Renewable Energy Technology Centre, April 2012 profile is shown below The locations with the highest overall scores for General Business Environment are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

14. General Business Environment Location Economic growth and stability Operating risk Taxation and incentives Access to finance Regulatory environment Bilbao 1.701.341.442.101.76 Bremerhaven 0.821.491.362.412.31 Lille 0.831.480.942.342.76 Newcastle 1.203.421.852.632.62 Oslo 2.671.691.673.332.88 Porto 1.131.171.392.052.54 Scottish Central Belt 2.153.421.852.632.62 In terms of the individual quality criteria within General Business Environment, the locations with the highest scores are:  Economic growth and stability: the Scottish Central Belt and Oslo  Operating risk: the Scottish Central Belt and Newcastle  Taxation and incentives: the Scottish Central Belt and Newcastle  Access to finance: Oslo and the Scottish Central Belt  Regulatory environment: Oslo and Lille Source: fDi Intelligence, from the Financial Times Ltd

15. Labour Availability and Quality The quality competitiveness breakdown for Labour Availability and Quality for the Renewable Energy Technology Centre, April 2012, profile is shown below The locations with the highest overall scores for Labour Availability and Quality are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

16. Labour Availability and Quality Location Overall size of labour market Tightness and competition for labour Experience d industry- specific staff Non- experienced staff Flexibility of labour regulations Bilbao 3.441.616.397.520.99 Bremerhaven 4.661.752.264.871.23 Lille 3.651.888.625.701.06 Newcastle 4.601.502.569.192.53 Oslo 3.440.5330.2510.681.21 Porto 3.981.875.239.560.95 Scottish Central Belt 7.731.3639.1815.492.53 In terms of the individual quality criteria within Labour Availability and Quality, the locations with the highest scores are:  Overall size of labour market: the Scottish Central Belt and Bremerhaven  Tightness and competition for labour: Lille and Porto  Experienced industry-specific staff: the Scottish Central Belt and Oslo  Non-experienced staff: the Scottish Central Belt and Oslo  Flexibility of labour regulations: Newcastle and the Scottish Central Belt Source: fDi Intelligence, from the Financial Times Ltd

17. Presence of an Industrial Cluster The quality competitiveness breakdown for Presence of an Industrial Cluster for the Renewable Energy Technology Centre, April 2012 profile is shown below The locations with the highest overall scores for Presence of an Industrial Cluster are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

18. Presence of an Industrial Cluster LocationSize of industryTrack record Research and Development Capabilities Export competitiveness Industry Specialisation Bilbao 27.133.173.471.764.00 Bremerhaven 30.212.277.033.436.96 Lille 9.364.545.582.983.05 Newcastle 6.842.8713.662.434.10 Oslo 14.784.0736.271.472.75 Porto 4.972.272.021.258.26 Scottish Central Belt 16.9643.8226.472.432.38 In terms of the individual quality criteria within Presence of an Industrial Cluster, the locations with the highest scores are:  Industry Specialisation: Bremerhaven and Porto  Size of industry: Bremerhaven and Bilbao  Track record: the Scottish Central Belt and Lille  Research and Development Capabilities: Oslo and the Scottish Central Belt  Export Competitiveness: Bremerhaven and Lille Source: fDi Intelligence, from the Financial Times Ltd

19. Infrastructure and Accessibility The quality competitiveness breakdown for Infrastructure and Accessibility for the Renewable Energy Technology Centre, April 2012 profile is shown below The locations with the highest overall scores for Infrastructure and Accessibility are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

20. Infrastructure and Accessibility Location Access to major overseas markets Quality of local infrastructure Quality of utilities Quality of ICT infrastructure Bilbao 3.751.470.641.26 Bremerhaven 4.711.920.592.53 Lille 3.112.180.492.03 Newcastle 4.831.540.461.58 Oslo 10.450.810.443.21 Porto 6.251.040.421.91 Scottish Central Belt 8.901.540.461.47 20 In terms of the individual quality criteria within Infrastructure and Accessibility, the locations with the highest scores are:  Access to major overseas markets: the Scottish Central Belt and Oslo  Quality of local infrastructure: Lille and Bremerhaven  Quality of utilities: Bremerhaven and Bilbao  Quality of ICT infrastructure: Oslo and Bremerhaven Source: fDi Intelligence, from the Financial Times Ltd

21. Living Environment The quality competitiveness breakdown for Living Environment for the Renewable Energy Technology Centre, April 2012 profile is shown below The locations with the highest overall scores for Living Environment are the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

22. Living Environment Location Cost of living Attractiveness for international staff Bilbao 1.362.64 Bremerhaven 1.592.78 Lille 1.593.33 Newcastle 1.463.23 Oslo 1.114.75 Porto 1.793.21 Scottish Central Belt 1.604.56 In terms of the individual quality criteria within Living Environment, the locations with the highest scores are:  Cost of living: the Scottish Central Belt and Porto  Attractiveness for international staff: the Scottish Central Belt and Oslo Source: fDi Intelligence, from the Financial Times Ltd

23. To realise the potential, please contact: Scottish Development International 150 Broomielaw, Atlantic Quay Glasgow G2 8LU Scotland, UK T +44 141 228 2828 F +44 141 228 2089 www.sdi.co.uk Worldwide offices in: Americas, Europe, Middle East, Africa and Asia Pacific