Interpretation of findings

Introduction

Having provided a direct summary of the findings from the literature review within Chapter 3, this chapter seeks to interpret the findings within the context of potential zero emission and decarbonisation mobility innovation projects. This focuses around three core elements:

1. The development of an overall logic map that provides an understanding of the potential direct and indirect consequences of investment in R&D, or innovation.
2. Consideration of the individual economy, societal, governmental, and international impacts that may arise
3. How the literature review evidence can be used to develop a framework for estimating the potential returns on investment from bespoke zero emission and decarbonisation mobility innovation projects.

Development of an overarching logic map of impacts

Section 3.2 provided an overview of the key outputs, outcomes and wider impacts of research and innovation projects that were identified across the literature review. These can be used to produce an overarching logic map that sets out how a financial investment in research / innovation translates through direct outputs into outcomes and wider impacts across economies and societies.

Direct elements delivered from investment

Public sector funding in research / innovation projects provides the investment to cover the capital and revenue costs associated with the research activities. Whilst this investment will be bespoke to each individual zero emission or decarbonisation mobility project, there are a core range of elements that are identified within the literature review relating to capital and people.

• Buildings & infrastructure: in which to conduct research or that forms part of the research project (e.g., hydrogen hub)
• Machinery & equipment: required to conduct research or forms part of research project (e.g., battery storage, demonstrator projects of emerging zero emission vehicles)
• Hardware and software: required to conduct research or forms part of research project (e.g., mobile apps, battery innovation, charging infrastructure e.g., wireless charging and v2g technology)
• Research staff: directly involved in research and innovation
• Management & support staff: wider organisational staff co-ordinating set-up or role out of research

Outputs from the completed research / innovation

The research investments in capital and people enable a series of research innovation activities to be undertaken that result in a set of immediate outputs. Section 3.2.1 provides an overview of the range of outputs described across the literature reviewed and these have been used to identify the main immediate outputs. These can be broadly categorised into four areas:

1. Knowledge: the production of disclosures, research papers, citations or delivery of open data that shares knowledge to other parties. Much of the literature also focuses on how this leads to specific patents or Intellectual Property Rights (IPR), although this is less common for public sector investment, or at least until the point of private sector involvement and investment. Within the context of zero emission / decarbonisation mobility projects, this increase in knowledge could relate to demonstrator projects and trials that disseminate knowledge on the performance of emerging vehicle types and technologies.
2. New concepts: the delivery of new products, software, process, or services within a specific area, or, potentially, new market areas. Within the context of zero emission / decarbonisation mobility projects, new concepts could relate to new vehicle types (e.g., zero emission heavy vehicles or specialist vehicles), innovations in battery technology, or catenary systems and new charging solutions (e.g., Charging as a Service, smart metering).
3. Upskilling: new leant skills, both in terms of research and innovation process, as well as within specific technical areas. Within the context of Zero emission / decarbonisation mobility projects, this increase in skills could relate to installing and maintaining infrastructure (e.g., hydrogen production plants and refuelling stations), or servicing and maintaining zero emission vehicles.
4. Collaboration: involvement in other parties, including local communities, to become aware and help shape new innovations to make them relevant to society and the local economies. Within the context of zero emission / decarbonisation mobility projects, this collaboration could relate to working with communities to raise awareness of certain technologies (e.g., hydrogen to remove negative public perceptions).

Direct outcomes of the research / innovation

The literature review identifies how the diffusion of knowledge, new concepts, upskilling and collaboration translate into tangible outcomes that can be observed within the economy or society. Section 0 provided an overview of the main identified elements, with much of the literature focuses upon potential commercial implications within the following broad areas:

• Revenues / sales / costs: the ability to generate new revenues (either through licensing arrangements or direct products / processes), increase existing sales through enhanced offers to the market, or generate cost reductions through greater efficiency in product or processes. The literature refers to these outcomes primarily in the context of private sector firms. Therefore, in relation to zero emission / decarbonisation mobility innovation, they are primarily likely to occur where projects involve private sector partners, either in terms of collaborations, or where public sector grants have helped private firms to innovate. Examples could include where the private sector look to roll out new electric vehicle charging infrastructure developed in collaboration and generate new revenue streams, or vehicle manufactures that are able to commercialise new battery technology.
• Productivity: improve underlying levels of productivity through efficiencies delivered by innovation. The literature identifies these productivity benefits across public and private sector operators. Within the context of zero emission / decarbonisation mobility projects, this increase in productivity could relate to more efficient production of battery technologies that becomes feasible through new research in production techniques.
• Skill levels: improve underlying levels of researcher skills within a local economy, both in terms of generic skills, as well as individual technical areas of excellence. Within the context of zero emission / decarbonisation mobility projects, this will obviously relate to specific skills relating to zero emission / decarbonisation that could be applied both within the transport sector but also, potentially across other sectors.
• Spin-offs: facilitate the generation of new enterprises to promote and market research outputs and innovations, as well as enable the provision of new consultancy services. Within the context of zero emission / decarbonisation mobility projects, spin-offs could relate to new charge point operators that are established to commercialise development of new charging technologies.

Impacts and wider impacts

Across the range of literature reviewed, the classification of outcomes, primary impacts and secondary / tertiary impacts is not always consistent, reflecting both context within different sectors and countries, as well as the interpretations of individual authors. The summary provided within Section 3.2.3 is a general reflection of the literature, seeking to demonstrate the impacts of the outcomes throughout the economy and society that can be measured, or observed, either within individual firms / market or at a regional / national level.

In developing the logic mapping process, we have sought to consider direct (primary) impacts that result more directly from research and innovation for firms and in markets, and then wider (secondary / tertiary) impacts as benefits flow through the economy and society.

The direct (primary) impacts can broadly be classified as:

• Commercial value: the literature presents a range of generic and bespoke measurements of commercial value, from measures of market share, profitability, and share price / stock values, as well as measures of Total Factor Productivity (how much output can be produced from a defined amount of input) and Realised Imputed Commercial Value (a representation of actual recurrent commercial revenue from intellectual property rights).
• Employee benefits: enhanced working conditions for researchers and salaries that result through research investment and upskilling. Within the context of zero emission / decarbonisation mobility projects, employee benefits could relate to improved facilities and wages for researchers within academic organisations specialising in transport technologies and/or climate change.
• Supply chain benefits: multiplier effects through the economy from increase outputs requiring additional inputs from supply chains. Within the context of zero emission / decarbonisation mobility projects, there might be many forms of supply chains but an indicative example could be consumable materials utilised within day-to-day research activities.

The reviewed literature highlights a range of economic, societal, and governmental impacts that may arise at regional / national level, through research and innovation. In addition, there is a broad discussion around the potential global impacts that may occur beyond the reach of the country of origin of the research.

The reviewed literature focuses primarily upon each of these wider impacts as the key economic and societal benefits of research and innovation. Section 0 examines each individual element in detail.

Summary

Developing a generic logic map for research and innovation projects is challenging, reflecting the fact that research and innovation can be across all sectors of the economy, focus upon a wide range of technical areas, and require different types of inputs to achieve aspired outputs and outcomes.

Our interpretation of the collective view presented by the literature review, of linkages between inputs, outputs, outcomes, impacts and wider impacts. These linkages were often presented in short form within individual papers, or indeed not discussed at all, and so this should be seen as an indicative mapping process that helps to highlights key elements and linkages.

A consideration for further investigation would be to utilise case study evidence from individual zero emission / decarbonisation mobility projects to refine this logic mapping process to become more bespoke. This is discussed further within Sections 4.4 and 5.2.

Consideration of economy, societal, governmental, and international impacts

As discussed in Section 4.2.4, the evidence from the literature review identifies a range of impacts and wider impacts that can be classified in terms of economy, societal, governmental, and international. The mechanisms by which these impacts occur, and any evidence of the scale of each impact reported within the literature, is set out within the following sections.

Mechanisms for delivering economy impacts

The literature identifies a range of impacts of research and innovation investment upon regional / national economic metrics, including levels of Gross Domestic Product (GDP), employment, private sector investment, and tax revenues, as well as international competitiveness. The mechanisms for realising these impacts, and any individual metrics and quantification identified within the literature, is considered for impact below.

GDP

As highlighted previously within Section 3.4, research and innovation projects are reported to impact upon GDP either in terms of a permanent uplift or an uplift in the growth rate over time. The previously reported extent of potential change in economic output, with a core estimate suggested across the literature of between 20% and 40% return on investment.

It is clear from the literature that GDP impacts from research and innovation investment are highly variable and are dependent upon a wide range of factors, as outlined within Section 3.5 on benefits realisation. By its nature, research and innovation is unpredictable in terms of outcomes and, hence, how this might feed through to regional / national economies in terms of medium or long-term GDP. However, the potential magnitude of benefits can be better understood through consideration of generic regional / national context and by consideration of key factors relating to specific research or innovation investment.

In terms of regional / national context, recognising how policy and institutional structures will facilitate research outcomes being able to filter through into the wider economy is a key aspect. For example, are there incentives to encourage risk taking or, alternatively, might legal structures hinder entrepreneurship? 

At an individual research or innovation project, by considering key factors outlined within Section 3.5 (e.g., the type of research, potential lags, existing research linkages and talent, as well as the status of markets for absorption), a better understanding can be made as to whether an investment is likely to deliver GDP benefits at the higher range of estimates or the lower.

How this might be applied within the context of zero emission / decarbonisation mobility projects is discussed further within Section 4.4.

Employment

The logic mapping process demonstrates a range of employment impacts, from direct employment upon the research and innovation projects, to longer-term employment generated from the outcomes from the research. The economic value of these changes in employment is reported within the literature in terms of both the quantity and quality of employment opportunities. 

In terms of the quantity of jobs, the literature reviews identifies three areas of influence of research and innovation investment, in term of potential jobs safeguarded that would otherwise have been lost, new jobs created, but also the potential for jobs to be displaced.

As with GDP, the scale of medium / long-term job safeguarding or creation is recognised to be influenced by a wide range of factors that are bespoke to individual research and innovation investment (as discussed previously within Section 3.5).

The literature recognises that there can also be a disruptive nature from research and innovation outputs upon how specific markets operate and the potential for obsolescence of products or, indeed, entire markets. This relates to the concept of ‘Just Transition’ and how economies can transition from different market structures and/or technologies without disadvantaging those within established markets / sectors / industries. The reviewed literature is sparse in terms of attempting to quantify the employment impacts of such disruption, again recognising the bespoke nature of impacts. However, these impacts can be mapped out in terms of the risks of who and when specific employment groups could be impacted.

Measures can also be implemented to manage such transition periods but it needs to be recognised that this inevitably comes with some level of associated resource/cost requirement that may dampen the positive impacts from other economic benefits of a research and innovation project.

The issue of Just Transition and job displacement has a particular relevant to zero emission / decarbonisation mobility projects, recognising the influence upon the established fossil fuel industry and is discussed further within Section 4.4.

Private sector investment and tax revenues

The focus of this study is to consider the impacts of publicly funded research and development. The literature recognises that this is often required to de-risk projects for the private sector and reduce barriers to progress and development. Having initial public funding can ‘pump-prime’ subsequent private sector investment, in terms of additional research and innovation, or capital investment to develop products and commercial operations. These are mostly reported as positive outcomes within the literature, helping to multiple the benefits of an initial public sector investment across the economy.

In economic terms, this private sector investment must still be treated as a negative private sector impact, but still help to reduce the financial burden on the public sector of fully realising the benefits of new research and innovation outputs. The scale of these impacts is not captured within the reviewed literature and is, again, recognised as being bespoke to individual research and innovation.

How this might be considered within the context of zero emission / decarbonisation mobility projects is discussed further within Section 4.4.

Some of the reviewed papers also recognise the potential long-term public sector tax revenue impacts that may occur through the increased output within the economy. This, potentially, acts as a mechanism for the public sector to reclaim some of the value from investments over the longer-term. No specific evidence is presented around the potential scale of these returns.

 

International competitiveness

Much of the literature focuses upon economic benefits for individual countries investing in research and innovation, as captured within the metrics of GDP, employment etc. There is recognition, however, that research outcomes can deliver a competitive advantage to sectors / industries within international markets. No specific evidence is presented about the potential scale of benefits, which will be dependent upon individual outcomes.

Mechanisms for delivering societal impacts

The literature suggests a range of societal impacts of research and innovation investment within the context of social, health, educational and environmental outcomes. The mechanisms for these impacts, as outlined within the literature, are each considered below.

Social outcomes

The literature often refers to a range of potential positive social outcomes as being key impacts from public sector investment in research and innovation. The individual elements referenced often vary in language and focus, but can be broadly summarised in terms of three areas:

• Equality, Diversity and Inclusion (EDI)
• Social cohesion
• Quality of life

Promoting EDI through research and innovation is outlined both as part of the research and innovation process itself, as well as an impact derived from the outcomes of research and innovation projects. The literature reviewed provides a narrative on how to capture these impacts, rather than presenting much evidence of the likely scale of impacts.

In terms of equality, the limited narrative available suggest that, whilst mechanisms should be available to promote equality, in practice this link is weak, perhaps suggesting that it has not been an active priority outcome from investment.

The literature refers to social cohesion in terms of involvement of the general public (citizens) within the process of shaping research and innovation outcomes, as well as benefiting more broadly from the actual outcomes. There is reference to building social capital (shared values or resources that enable society to function more effectively) through research and innovation processes, as ensuring that society shapes how innovation and advancement is applied within communities. The literature reviewed tends to present these processes in broad terms, with limited description of how to capture the benefit within appraisal.

Similarly, there is wide-ranging references throughout the literature related to the ability for innovation and knowledge to improve the quality of life, in terms of standards of livings, as well as democratic processes. This is, again, presented as a positive impact from research and innovation but not quantified.

Health

There are references across the literature reviewed that highlight the potential health benefits from research and innovation; however, these broadly tend to relate directly to research within a health industry context, as opposed to more general health benefits that may arise from cross-sector research and innovation.

The exception relates to a discussion within some areas of the literature around the how involving communities within research and innovation process can have positive influence of health and wellbeing, either through community-based activities or engendering a sense of belonging within a community that is actively involved in making positive change. This is, again, very much a theoretical discussion, with no reference to quantification.

Educational

Unsurprisingly, the literature highlights a wide range of potential educational areas where research and innovation can deliver wider impacts. This tends to focus upon three areas: i) establishing, or re-enforcing educational networks; ii) training; and iii) community-based activities.

The ability to generate new networks between organisations and community groups, or to re-enforce existing networks, is referenced throughout the reviewed literature as universal positive outcomes from research and innovation. This helps to diffuse knowledge, and accelerate the development of ideas and concepts, helping to bring applied outcomes. The scale of impacts if recognised to relate to the type of research / innovation area.

Most research and innovation is also considered to further training and development of others through a variety of formal and informal mechanisms. Clearly different research and innovation projects will approach this in different ways, and so outcomes will also differ, but the literature recognises the potential for significant positive outcomes across educational institutions, as well as individual market sectors.

Some of the reviewed literature also references the specific role of community learning that can flow from research and innovation projects. Again, this will be bespoke to individual projects, but a range of positive outcomes are identified through public exhibitions of ideas, schools projects, and community lectures.

Environmental

As with health, the majority of references to positive environmental outcomes relate to specific research and innovation projects that are designed to directly deliver positive change in this area. Clearly this will be the case for the zero emission and decarbonisation mobility projects, but the literature does not identify more generically any positive environmental impacts that are encompassed by all research and innovation projects.

Mechanisms for delivering governmental impacts

Some of the literature reviewed makes reference to the potential impacts that research and innovation can have upon governmental outcomes, in terms of the establishment of policy and setting of regulations. Research and innovation outcomes can provide the knowledge to better inform government decision-making, and provide the evidence to justify specific policy interventions or the requirement for new regulation.

The extent to which this occurs, and the value to society, is not specifically referenced within the literature, only the inference of a positive impact.

A few of the papers reviewed also specifically highlight the potential role of research and innovation in delivering productivity enhancements for the public sector. This refers the opportunities for more efficient delivery of public sector services through implementation of new products or processes developed through research and innovation. Again, the extent to which this occurs, and the value to society, is not specifically referenced within the literature but a positive relationship is identified.

Mechanisms for delivering international impacts

The final area of potential wider impacts identified within the literature review relates to international impacts. These focus upon two area: i) international cooperation (working collectively for advancement), and ii) international spillover (benefits derived within countries beyond the county of origin of the research or innovation).

The literature recognising the range of additional benefits that can be derived by being able to cooperate with other countries in area of research. This can not only pool overall resources and strengthen networks, by may strengthen wider relationships between those countries involved. The scale of benefits will be dependent upon individual research and innovation projects and the extent to which cooperation occurs across the project, but the literature recognises the net impacts can be greater than the sum of completing individual research projects in isolation.

The concept of international spillovers recognises, over time, benefits from research and innovation in one country are likely to extend to other countries (either by design or naturally). While some countries may attempt to limit these spillovers (to maintain competitive advantage for the economy of the country of origin of the research), the literature suggests that overall benefits are increased through these spillovers. This may include for the country of origin through enhanced international reputation.

 

A framework for estimating returns from research and innovation into zero emission / decarbonisation mobility projects

The review of the literature has indicated that there is a wide scale of potential returns from research and innovation (Section 3.4) and that there are a significant number of factors that affects the outcomes and impacts (Section 3.5). There are a range of potential logic chains by which bespoke investment in research and innovation can feed through from outputs into outcomes and impacts (Section 4.2) and the mechanisms for achieving wider economy, societal, governmental, and international impacts are complex, reliant upon individual context, and have not readily quantified (Section 4.3).

This section seeks to examine how these findings from the literature review can be best utilised to provide the basis for a framework with which to assess the potential impact of public sector investment in research and innovation into zero emission / decarbonisation mobility projects. This is done by considering:

1. What are the main factors that are likely to determine the benefits that can be derived from zero emission / decarbonisation mobility research and innovation?
2. What are the implications for forecasting the scale of potential impacts?

The framework seeks to identify a check list of elements that would be used to evaluate each individual zero emission / decarbonisation mobility project to flag the likely areas where impacts may be derived. These can subsequently then be assessed to consider the potential scale of impacts (e.g., low, medium, high). Based upon the overall number of areas likely to derive benefits, and the potential scale of those benefits, then the likely overall rate of return from a research and innovation project could be estimated.

Chapter 4.4 then considers what further evidence would help Transport Scotland to develop this framework into a formalised process for assessing the potential impacts of individual investment in research and innovation for zero emission / decarbonisation mobility projects.

Key considerations in determining impacts from zero emission / decarbonisation mobility research and innovation

Section 3.5 provides a discussion of a range of key factors that the reviewed literature indicates can impact upon the achievement of benefits from research and innovation. These range from the detailed aspects of research through to the characteristics of industries, regions, and nations in which the research is taking place. Six broad categorises have been identified:

1. The type of research and innovation being undertaken
2. The component element of the research approach and development process
3. The precise technical nature of the research and innovation
4. The area of research and the networks and talent available to support the delivery of projects and maximise the outcomes.
5. The context and conditions of the sectors / industry in which the outcomes from the research and innovation may be applied
6. The context and conditions of the country of origin of the research and innovation, in this case being Scotland.

The sections below consider each of these impacts within the context of zero emission / decarbonisation mobility research and innovation to help identify how much influence they may have in the derivation of outcomes and impacts.

The type of research and innovation

The literature review indicates that the achievement of benefits is likely to directly corelate with a number of factors that relate to the type of research and innovation being undertaken.

Each individual zero emission and decarbonisation mobility project will be formed of specific aspects and will be anticipated to deliver targeted outputs, within defined timeframes. These factors will all combine to influence when wider impacts will be derived and the overall potential rate of return from investment. An impact framework, therefore, needs to incorporate a check list of the type of research encapsulated by an individual project. This could include:

• Applied or basic research
  • Is the research applied, targeted to develop a practical solution to an existing problem? Or is it basic research into an area to improve understanding of general principles?
• Targeted research outputs (ideas / patents / new services)
  • Is the aspiration of the research or innovation to develop at specific output and what type of output is that to be? A new product or process that can potentially be taken to market? Or less tangible ideas to further insight within a specific research area?
• Timescales
  • What is the proposed programme for the research? Are there staged outputs over time? If products or processes are being developed, when are they targeted to be ready for implementation?
• Additional development costs
  • Will the direct outputs from the research or innovation project still require additional investment to develop products or processes? Additional research investment or capital investment in product delivery? If so, what is the likely source of the funding required?

By understanding what an individual project is likely to deliver, the timescales involved and the need for additional supporting investment, this will affect when economic returns will occur and what the ratio of overall investment (costs) and benefits for the project might be.

The component elements of the research approach and development process

The literature review indicates that the component elements of any individual research or innovation project have a direct impact upon specific output metrics, as well as potentially longer terms influence over outcomes and impacts.

Each individual zero emission / decarbonisation mobility project will include a range of standardised input elements, to varying quantities. The scale and combination of these elements will influence overall outcomes. An impact framework, therefore, needs to incorporate a check list of component elements in which an individual project could have influence. This could include:

• Employment
  • How many individuals will be employed within the internal operation of the research project? How long for? What types of roles will be created? What types of opportunity will there be for technical career development?
  • Are the outcomes of the research anticipated to generate further employment? Permanent or temporary? What types of roles?
• Training
  • Does the project include specific training and development proposals, either directly within the project or as part of wider dissemination of knowledge?
  • This could include employee training, student placements, enterprise education (capabilities and skills that enhance employment opportunities), advisory roles, etc.
• Community learning
  • Does the project specifically incorporate community-based activities to enhance understanding and spread understanding?
  • This could include public exhibitions, community lectures, schools projects, etc.
• Social capital
  • Does the project seek to involve local communities in the development of the research or innovation outputs or outcomes?
  • Are the research or innovation outputs or outcomes specifically targeted to improve community cohesion or engagement?
• Equality, Diversity and Inclusion
  • Will the internal operation of the research project positively promote equality, diversity and inclusions?
  • Which social groups are the outcomes of the research anticipated to benefits and is the project set up to positive influence inequalities?

By understanding the component elements involved within an individual zero emission and decarbonisation mobility in terms of how it will affect employment, skills, community engagement, and EDI, this will affect both economic and social rates of return.

The technical nature of the research and innovation

The derivation of benefits will, inevitably, be affected by the precise nature of the research and innovation that is being sought. Many of the papers that were reviewed have considered research and innovation across all sectors, or generically at a national level. There is, however, reference to how certain technical areas of research and innovation will result in specific types of impacts, most notably health and environmental, but also potentially across other impact areas.

Clearly research and innovation within the technical area of zero emission / decarbonisation mobility will be expected to deliver environmental benefits, in relation to emissions. There may also be the potential for other health and societal benefits, depending upon the precise nature of individual projects.

An impact framework, therefore, needs to incorporate a check list of technical nature of an individual project, or the technical areas in which it could have influence. This could include:

• Quality of life
  • Does the project include targeted outcomes that will impact upon individual standards of living? This could include improved travel options, the affordability of travel, etc.
  • Does the project include targeted outcomes that will progress democratic and open society? This could include approaches that enhance inclusiveness or accountability of organisations, etc.
• Public health
  • Does the project include targeted outcomes that could result in improvements to public health outcomes?
  • This could include encouraging greater levels of physical activity, reducing harmful emissions, reducing stress, etc.
• Safety
  • Does the project include targeted outcomes that will reduce the risk of accidents or improve personal safety?
  • This could include improved safety provision for vulnerable people whilst travelling, etc.
• Environment
  • Does the project include targeted outcomes that will improve environmental outcomes?
  • This could include reduced emissions, improved air quality, reduced embodies carbon, etc.

By understanding the technical nature of the individual zero emission / decarbonisation mobility projects in terms of what they may deliver for quality of life, health, safety, and environment will affect social rates of return.

Research area - networks and talent

The literature review highlights the role of existing, or emerging, research networks, as well as the available pool of talent available within a technical / market area, in influencing benefits realisation.

The existing context of zero emission / decarbonisation mobility research area will be an influencing factor within the derivation of benefits. An impact framework, therefore, needs to consider the status of this area of research in terms of:

• Existing research linkages
  • Is there an established research network relating to overall zero emission and decarbonisation mobility projects? If so, does the focus area of an individual research project fit within this established network, or does it extend into alternative research specialities? How easy will it be to connect with wider networks where there are overlaps with the specifics of the individual zero emission and decarbonisation mobility project?
• Talent
  • Is there an established pool of talent that can successfully deliver the individual project?
  • Is there a wider pool of talent that can maximise the outcomes from the project and ensure it can be scaled up over a regional and/or national economy?

By understanding the context of research networks and available talent, the potential implications upon economic rates of return can be projected.

Sectors and industry

The literature review identifies a range of factors relating to the sector or industry in which research and innovation projects are undertaken that can impact upon the scale of benefits derived. The zero emission / decarbonisation mobility projects will sit primarily within the transport sector but may encompass additional elements that are more general to decarbonisation. An impact framework, therefore, needs to consider the how established these sectors / industries are in terms of:

• Status of market / industry and potential for ‘crowding-in’ / ‘crowding-out’
  • How much existing research and innovation is undertaken within the sector / industry? Would additional public sector investment stimulate additional innovation or substitute / duplicate private sector research?
  • What is the technology base of the industry? Are there likely to be early adopters for new research and innovation? Is there an entrepreneurial ‘spirt’ within the sector?
  • Is the sector / industry set-up for replication and expansion of ideas to ensure outputs and outcomes of research and innovation are widely adopted?
  • Is there private sector capital available to develop ideas and concepts further?
  • Is there a risk of making previous research and investments obsolete and can the sector / industry respond positively to change?
• Absorption
  • What is the existing capacity of the sector / industry to adopt ideas, products, processes that arise out for the research and innovation project?
  • Are structures and processes in place that will enable organisations to readily adopt new ways of working or integrate new technologies into their products?
• Supply chains
  • What is the capacity of the supply chain to support the delivery of new concepts, product, or processes?
  • Can supply chains readily scale-up in areas of expansion or can new supply chains from other sectors be brought in?

By understanding the context of the sector / industry in which the zero emission / decarbonisation mobility research outputs will relate to, the potential implications upon economic rates of return can be projected.

Scottish context

Much of the literature review focuses upon national impacts and the extent to which different countries benefits the most from research and innovation investment. Much of this focuses upon the maturing of individual economies and the support policy and regulatory framework in which the public and private sectors operate.

As set out in Section 1.1.1, it is recognised that the area of zero emission / decarbonisation mobility is seen as policy priority within Scotland. A range of structures are already in place to support this project work and the economy, as a whole, has the maturity to maximise the benefits of research and innovation investment. On this basis, the majority the factors listed within the reviewed literature relating to the influence of national context should be viewed positively within the context of Scotland. These factors relating to the country of origin should be captured within the impact framework in terms of:

• Maturity of economy
  • What are the underlying conditions and structures of the economy to support the implementation of research and innovation outcomes.
• Policy
  • How do national and regional level policies and strategies support research and innovation in general, as well as within the specific area of zero emissions and decarbonisation mobility?
• Institutions
  • How do the financial and legal structures and institutions support the ability to raise funding for development of innovation outputs and provide sufficient protection for taking ideas and new products to market?

By understanding the context of the Scottish economy, policies, and institutions in relation to specific zero emission / decarbonisation mobility projects, the potential implications upon economic rates of return can be projected.

Implications for forecasting impacts

Section 4.4.1 has presented 21 component factors, across six categories, that the literature review has indicated will impact upon the scale of returns from zero emission / decarbonisation mobility research and innovation projects. Alongside the evidence of quantified economic rates of return, presented within Section 3.4, these can be used to forecast the potential impacts of public sector investment within individual research and innovation projects.

The central case forecasts of economic and social rates of return of between 20% to 40% offer a generic starting point for implied research and development impacts. By then considering the extent to which an individual zero emission / decarbonisation mobility project is likely to perform against the 21 identified component factors, it would then be feasible to make a judgement as to whether the rates of return for that project are likely to be greater or lower than core estimates.

A potential approach would be to establish a proforma of questions relating to each of the 21 component elements. The responses to each component would provide an indication as to whether benefits are likely to be higher or lower than average. Summing this cumulatively would provide a basis upon which to conclude whether, overall, a project is likely to deliver higher, lower, or comparative rates of return to the core estimates.

It is recommended that forecast estimates remain a range so, for example, a project that is anticipated to perform better than average may have a project rate of return between 30% to 50%, whilst a project anticipated to perform lower may have a project rate of return between 10% to 30%.

Table 4.2 provides an indicative check list that could form the basis of the assessment of how an individual zero emission / decarbonisation mobility projects will perform against the 21 component factors. The cumulative scoring could be used to determine the extent to which the rate of return for a project should be adjusted from the core.

Table 4.2: Indicative ‘check list’ of component factors affecting performance of research and innovation investment

Categories	Components	Implications of research and innovation project	Impact upon economic and social returns	Indicative types of scoring
1. Type of research	a. Applied or basic research	● Is the project targeted at producing a practical solution or more general research in an area?	● Applied research more likely to generate immediate economic and social returns	● +1 applied ● 0 mix of applied and basic ● -1 basic
1. Type of research	b. Targeted research outputs	● Is the project anticipated to produce tangible products / process that can be immediately deployed within markets / society? ● Is it more likely to produce evidence / knowledge that will then require further development?	● Tangible products more likely to generate immediate economic and social returns	● +1 clear tangible products ● 0 unknown ● -1 ideas / concepts only
1. Type of research	c. Timescales	● What is the length of the project? ● What are the anticipated timeframes to produce / take tangible products / process into markets / society? ● Is there a single market / social application or could innovations be applied across multiple markets or areas of society? Are benefits likely to grow over time? ● Are products / processes likely to have limited lifespans? If so, what might they be?	● Longer lags between initial public sector investment and realisation of products / processes will reduce value for money ● Research outcomes with potential multiple applications will increase potential for economic and social returns ● Defined useful lifespans of research outcomes will constrain benefits streams	● +1 short lags ● 0 medium lags ● -1 long lags ● +1 multiple applications ● 0 single application ● +1 long lifespan ● 0 medium lifespan ● -1 short lifespan
1. Type of research	d. Development costs	● Are there likely to be additional research or development costs beyond the initial public sector investment?	● Additional future costs will reduce overall value for money from public sector investment.	● 0 no additional costs ● -1 additional costs
2. Component elements	e. Employment	● What level of direct employment is there on the project? Does it include opportunities for upskilling? ● Is the likelihood of on-going employment requirements post-project high? What type of roles might be required?	● The higher the level of direct employment, and the greater the potential for upskilling, the greater the economic returns. ● The higher the potential for on-going employment, and the higher the value of that employment, the greater economic returns	● +1 high employment ● 0 standard employment ● -1 low employment
2. Component elements	f. Training	● Does the project incorporate specific training requirements for employees? Does the project include apprenticeships, student placements, enterprise education?	● Involvement of training opportunities on projects will increase the economic and social returns	● +1 training opportunities ● 0 none
2. Component elements	g. Community learning	● Are there plans for disseminating research findings to local communities or schools?	● Dissemination of findings to local communities within projects will enhance social returns	● +1 community learning ● 0 none
2. Component elements	h. Social capital	● Does the project involve any collaborations with local communities around research outcomes? ● Will the outcomes of the research have the potential to change social behaviours?	● Collaboration with local communities within projects will enhance social returns	● +1 citizen collaborations ● 0 none
2. Component elements	i. EDI	● Will the project positively promote equality, diversity, and inclusion? ● How are the research outcomes anticipated to affect different social groups? Will they contribute positively to reducing deprivation and social inclusion?	● Projects that can demonstrate they will have a positive outcome in relation to equality, diversity and includes will enhance social returns	● +1 positive EDI activities ● 0 none
3. Technical nature	j. Quality of life	● Does the project have targeted outcomes that will improve the standard of livings?	● Projects that can demonstrate they will have a positive uplift in relation to quality of life will enhance social returns	● +1 targeted standard of living improvements ● 0 none
3. Technical nature	k. Public health	● Does the project have targeted outcomes that will improve public health?	● Projects that can demonstrate they will have a positive uplift in relation to public health will enhance social returns	● +1 ● 0 none
3. Technical nature	l. Safety	● Does the project have targeted outcomes that will improve safety?	● Projects that can demonstrate they will have a positive uplift in relation to safety will enhance social returns	● +1 ● 0 none
3. Technical nature	m. Environment	● Does the project have targeted outcomes that will improve aspects of the environment?	● Projects that can demonstrate they will have a positive uplift in relation to the environment will enhance social returns	● +1 ● 0 none
4. Area of research	n. Research linkages	● Is there an established research network relating to zero emission / decarbonisation mobility or specific elements of the individual research project? ● How easy will it be to connect into wider research networks?	● Projects that can demonstrate existing linkages with wider research networks, or a strong ability to develop these linkages, will have a positive uplift in economic returns	● +1 strong research networks ● 0 standard research networks ● -1 no / weak research networks
4. Area of research	o. Talent	● Is there an established pool of talent that can successfully deliver the project? ● Is there a wider pool of talent that can maximise the outcomes from the project?	● Projects that can demonstrate an existing pool of talent within the specific research area will have a positive uplift in economic returns	● +1 large established talent pool ● 0 small established talent pool ● -1 no established talent pool
5. Sectors / industry	p. Status of market	● Is there a track-record of innovation and or a strong technology base within the sector / industry? ● Is there private sector capital available to develop new products / concepts? ● Are the direct outputs / outcomes of the research likely to generate obsolescence of existing products / processes?	● Project that can demonstrate they are operating within a sector / industry with a strong record of innovation and technology base will have a positive uplift in economic returns ● Project that can demonstrate they are operating within a sector / industry a strong record of private sector investment will have a positive uplift in economic returns ● Projects that are likely to create obsolescence will reduce overall rates of economic returns	● +1 strong record on innovation and technology base ● 0 standard record on innovation and technology base ● -1 poor record on innovation and technology base ● +1 strong record of investment ● 0 standard record of investment ● 0 standard risk of obsolescence ● -1 increased risk of obsolescence
5. Sectors / industry	q. Absorption	● Does the sector / industry have a good track record of absorption of new ideas / products and the capacity to respond to change?	● Project that can demonstrate they are operating within a sector / industry a strong record of absorption will have a positive uplift in economic returns	● +1 strong record of absorption ● 0 standard record of absorption
5. Sectors / industry	r. Supply chains	● Can the project demonstrate that there is an existing supply chain that can support commercial delivery of outcomes from the research or that the supply chain can be developed?	● Projects developing outcomes where there are no existing supply chains will reduce overall rates of economic returns	● 0 good existing supply chains ● -1 no existing supply chains
6. Country of origin	s. Maturity of economy	● Do the underlying conditions and structures of the economy to support the implementation of research and innovation outcomes?	● Demonstrating the conditions and structure of the Scottish economy support the specific targeted outcomes of the research will have a positive uplift in economic returns	● 0 conditions supportive ● -1 conditions not supportive
6. Country of origin	t. Policy	● Do national and regional level policies and strategies support research and innovation within the area of zero emissions and decarbonisation mobility?	● Demonstrating UK, Scottish, and local authority policies and strategies support zero emission / decarbonisation mobility will have a positive uplift in economic returns	● +1 project fully support policies ● 0 project mainly supports policies ● -1 project in conflict with some policies
6. Country of origin	u. Institutions	● Do the financial structures and institutions support the ability to raise funding for development of innovation outputs ● Do the legal structures and institutions provide sufficient protection for taking ideas and new products.	● Demonstrating how the financial and legal structures and institution will support delivery of zero emission / decarbonisation outcome will have a positive uplift in economic returns	● 0 structures and institutions supportive ● -1 structures and institutions not supportive