Offshore wind subsidies are essential to efforts to hold supply chains together, encourage innovation and enable Britain to lead on the development of wind farm technology a leading wind farms developer has told MPs.
Giving evidence to the Commons business, energy and industrial strategy committee on the potential for a new sector deal, Ørsted vice president and co-chair of the Offshore Wind Council Benj Sykes called for an offshore wind sector deal to unite the ‘‘fiercely competitive market’’.
The Offshore Wind Councils 2030 Vision calls for government subsidies of £48bn over the next 12 years to help developers pay for essential energy infrastructure for offshore wind farms.
Sykes said that the current climate is making collaboration between contractors and suppliers increasing difficult.
“We are the global leader for wind farms but things are starting to change and our first mover advantage won’t last forever,” Sykes said. “The areas we can work together are shrinking, collaboration is becoming more challenging. The future is going to be built around a sector deal.”
He said that a sector deal involving subsidies would help with the development of a UK supply chain. About 50% of wind farm components are currently built in the UK, and it is hoped that this figure will increase to 60%.
“We are looking to come together as an industry to support the development of the UK supply chain in response to agreeing a sector deal – those things won’t happen without a sector deal,” Skykes added.
“As a developer I need to know I’m working in partnership with government and my colleagues in industry otherwise I will chase the lowest cost possible way to build my windfarms otherwise I won’t win contracts.”
ORE Catapult chief executive Andrew Jamieson said that competition in the off-shore marketplace had driven down costs, but now threatened progress on technical issues.
“We have benefited enormously from competition in the marketplace, we have seen that with the costs that come down and are projected to keep going down, but what we have is industry going into different corners and not speaking with each other,” Jamieson said.
“My view of the sector deal is that we create some central ground for industry to come together with government to help assess and tackle the technical issues this industry faces.”
RenewableUK executive director Emma Pinchbeck added that the investment in a sector deal would have far reaching effects on the UK outside of the sector.
“There are other benefits to the UK that can be invested in by UK government for this supply chain and productivity, like making sure the work force is diverse and from all regions of the UK, and assisting the oil and gas industry in transitioning into renewables and ensuring high skilled jobs and training are offered in the supply chain.”
The industry estimates that the export value of British offshore wind could grow five-fold by 2030 with the investment and support of a sector deal.
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