Member Article

Offshore wind policy will benefit North East

The Government’s new offshore wind strategy should benefit the North East, regional industry bodies have said.

The long-term strategy for offshore wind in the UK was launched by Nick Clegg and includes £56m of investment.

The Deputy Prime Minister was joined be Energy Secretary Ed Davey at a visit to open Lincs wind farm, off the Lincolnshire coast.

Low carbon Enterprise Zones in the Tees Valley and the wider North East are namechecked within the full strategy as areas that could provide thousands of new jobs and support supply chain activity.

Firms such as Hartlepool’s JDR Cables Systems Ltd and Tees Valley’s TAG Energy Solutions Ltd are credited as driving port development for manufacturing forward.

Tees Valley Unlimited LEP worked with BIS to draft the strategy that aims to “unlock” £7bn for the economy by 2020.

It includes a £20m investment pot from the Regional Growth Fund for GROW: Offshore Wind, a supply chain support programme; £46m funding over five years for the Offshore Renewable Energy Catapult Centre to join up industry, government and academia; and a new Offshore Wind Investment Organisation, established by UKTI.

Tees Valley Unlimited’s managing director, Stephen Catchpole, said: “The capability of the sector within Tees Valley is reflected by the number of companies that have been name-checked in this vital industrial strategy.

“The Strategy references our Tees Valley Catalyst Fund, which the Business Bank is looking to learn from. The Fund was initiated by TVU as a response to companies telling us a barrier to their growth was an inability to finance performance and warranty bond schemes often needed when bidding on large contracts. We can now address this.”

“It also looks at the need to develop skills and training within the industry and again Tees Valley Unlimited is ahead of the game having secured Regional Growth Fund monies to support a local skills hub.”

“This Offshore Wind Industrial Strategy demonstrates how important the Government regards this sector for the economic wellbeing and future prosperity of the UK and it is also a framework that we, and our partners, can follow to ensure that Tees Valley attracts as much investment, work and jobs as possible.”

Alex Dawson, chairman of Energi Coast and Chief Executive of TAG Energy Solutions, said: “We welcome the offshore wind strategy as it is an important next step towards securing the future of this industry.

“Clarity of direction and confidence in the market is crucial if the industry is to attract further investment. Anything that can be done to bring projects forward against a history of market delay and slippage will be beneficial and this strategy sets out some clear objectives to get the sector on track.

“While considerable investment has already been made in the region’s supply chain capabilities, which is recognised in the strategy document, increased confidence in the industry will encourage further developments that will allow companies to industrialise manufacturing processes and increase volume. This is crucial if offshore wind demand and cost reduction is to be met.”

Paul Livingstone, business development manager at NOF Energy, added: “This strategy will help bring long term sustainable business to UK companies and job creation for the benefit of the UK economy.

“The delays caused of a lack of clarity in the sector have been felt by companies in the supply chain, however this strategy, along with other developments such as the recently published draft strike prices, will encourage investment and allow the sector to come of age and play a significant role in the UK’s balanced energy future.”

Left-leaning think tank, IPPR, suggested the strategy did not go far enough and that Lib Dems should “stand up” to Tories on the outline.

IPPR associate director, Will Straw, said: “These micro announcements are broadly sensible but the government’s offshore wind strategy risks failing without a macro statement about the level of ambition beyond 2020.

“This is what business in the supply chain have been calling for and Britain risks a “high cost, low jobs” pathway without it. In particular, Vince Cable’s desire to see 70% of the supply chain coming from Britain looks extremely unrealistic without a clearer long-term signal.

“The Lib Dems are right to support this sector but they must stand up to those Tories who want to scupper the industry before it gets going.”

A proposal incorporated in the strategy would require developers of offshore wind farms above a certain size to produce a supply chain plan before they can apply for a Contract for Difference.

There is also plans for expansion of the DECC offshore wind manufacturing funding scheme to support port and coastal infrastructure development in assisted areas of England.

This was posted in Bdaily's Members' News section by Tom Keighley .