Could the UK be the supplier of choice for the global offshore wind market?

• 6 years ago (2018-02-08)
• Junior Isles

Offshore wind 121

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By James Young, Chief Technology Officer at JDR Cable Systems, Part of the TFKable Group

Since 2008, the UK has been the world leader in offshore wind, with more installed capacity than any other country. Could it translate that domestic achievement into export success and become the supplier of choice for the global offshore wind market?

The UK has an established track record in exporting physical manufactured products as well as world-renowned sector expertise. But how can it build on that position? It depends on investment in innovation and workforce, as well as one of the UK’s other key exports: a collaborative approach and way of working that supports and makes the best of local workforces and supply chains around the world.

A position of strength

The UK already had a globally-renowned manufacturing and knowledge base for the offshore energy industry, thanks to its North Sea heritage.

Over decades, the oil and gas industry has had first-class engineering talent, much of it well versed in the difficulties of working offshore. With it came the manufacturing capability and infrastructure, already well placed to serve the offshore sector.

While this was useful when manufacturing new technology, many technologies were actually translatable into the new sector. For example, at JDR we first entered the offshore wind market by working on the 2005 Beatrice demonstrator project. We used existing technology to supply the array cables for the project, which connected two wind turbines back to the Beatrice oil platform. The technology, expertise, factory and supply chain were all already in place.

The UK also enjoys a unique geographic advantage. As an island nation with a shallow continental shelf that extends far offshore, and some of the windiest conditions in Europe, it’s extremely beneficial to use fixed-base offshore wind turbines.

Coupled with the historically robust subsidy support for the sector deployed by the UK Government, the UK seized opportunity to take the lead on offshore wind.

Maintain and gain

However, this position of strength isn’t without threats, especially with the uncertainty surrounding Brexit trade negotiations, which could make exporting to the EU more difficult for UK industry. That said, I’m confident Europe will want to continue trading with the UK.

Until now, the UK approach to subsidising renewable energy has been incredibly successful for offshore wind. In 2014, the first contract for difference (CfD) round saw 15-year CfDs awarded for £140-150/MWh for five wind farms. In 2017, there were two successful bids at £57.50, meaning the cost of the technology has fallen so far that offshore wind is close to the point of competing without subsidy.

However, we still have £557m of CfDs to be allocated to renewables through to 2020. In the Autumn Budget, the Chancellor revealed that there would be no new money after this until at least 2025 and the impact of subsidies on energy bills had been reduced. With near future offshore projects in Europe likely to be subsidy free, we can expect these changes to the have an impact on the developers and the supply-chains that support them.

Finally, we can foresee an emerging skills gap in the UK as with the rest of the rapidly growing global offshore renewables sector. In the offshore wind sector alone, studies have shown our current workforce is expected to double over the coming decade. We need to increase the level of our STEM educated workforce and encourage more people to consider careers in offshore energy.

So, how can the UK best prepare for the future?

In terms of subsidies, the big-ticket CfD auctions have been instrumental. However, many of the cost reductions and efficiency improvements will be from smaller-scale innovation across the supply chain for offshore wind. This calls for a different type of subsidy support, smaller scale and focused at R&D.

The government has indicated continued support for this type of activity, but I would encourage these schemes to continue and increase carry on in a post-Brexit world. The return on investment from innovation projects can clearly be seen with the rate at which the offshore wind industry has been able to drive down its costs.

Then to address the skill gap. At JDR, we have an active programme encouraging students to be excited about a career in energy and an apprenticeship programme providing the next generation of our workforce.

It’s important for the industry to collaborate. Over the past decade, JDR and Poland's TFKable have achieved success doing just that.

Opportunity in the air

Global nations are now actively pursuing offshore wind in deeper waters and for UK businesses such as JDR with deepwater oil and gas experience this will open up extensive international markets. Continued investment and innovation is key. At JDR we were recently announced as the cable supplier of choice for the Windfloat project in Portugal, largely based on our 66Kv subsea cable transmitting greater volumes of power, making larger turbines viable.

UK Businesses have a great opportunity to lead the way in the supply of products and services for the growing offshore wind sector but the projects are pieces of major critical infrastructure, requiring a fully engaged, reliable and skilled supply chain to ensure projects are successful.

If the UK exports its way of working, it would become the supplier and the partner of choice to ensure each emerging market can deliver on their low carbon economy commitments.