The UK Government published its Offshore Wind Industrial Strategy on 1st August. This is one of eleven sector strategies that comprise the UK’s overall Industrial Strategy, developing long term relationships between Government and industry to deliver economic growth in the UK.
The Offshore Wind Industrial Strategy was developed in partnership with industry through the newly created Offshore Wind Industry Council (which will also be responsible for implementation of the Strategy. The Strategy was produced alongside the draft delivery plan for Electricity Market Reform (EMR). It builds upon the announcement of draft ‘strike’ prices for renewable technologies, including offshore wind, published on 27 June, giving industry clarity about the prices that might be offered under the new Contract for Difference (CfD) in EMR.
The UK is one of the most attractive locations in the world to invest in the offshore wind sector – in part due to the huge development pipeline, which is the largest in the world, as well as due to long-term price stability. With EMR, the UK is the first country in the world to give funding clarity through to 2021, visibility of prices to 2018/19 and price certainty to projects awarded a CfD (subject to Royal Assent of the Energy Bill), as well as a legally binding emissions target.
The UK is now, and predicted to remain, the largest offshore wind market in Europe. This provides a real opportunity to build and develop a UK-based supply chain. The Offshore Wind Industrial Strategy aims to deliver this potential by promoting innovation, investment and economic growth in the UK supply chain. It identifies practical measures to develop and grow a competitive UK supply chain and attract inward investment from the top tier of the supply chain which will open up opportunities more widely.
Measures set out in the Offshore Wind Industrial Strategy include:
- A new Offshore Wind Investment Organisation to attract inward investment to the UK;
- £20m from the Regional Growth Fund for GROW: Offshore Wind, a new Manufacturing Advisory Service programme to support the UK supply chain to become more competitive;
- £46m funding over five years for the Offshore Renewable Energy Catapult Centre to join up innovation between industry, Government and academia and enable innovative companies to bring their products to market;
- Industry-led initiatives to share information with the supply chain about their procurement timelines and contracting decision points, including via new ‘Share Fairs’ drawing on the successful model used in the oil & gas industry;
- A proposal, to be developed, requiring developers of offshore wind farms above a certain size to produce a supply chain plan before they can apply for a CfD, setting out how the project and procurement approaches will encourage a wider, more diverse supply chain and support innovation and skills; and
- Expansion of the scope of the DECC Offshore Wind Manufacturing funding scheme to support port and coastal infrastructure development in assisted areas of England. Any grants offered will be conditional on sites securing manufacturing investment.
Full details of the new strategy can be found at here.