UK offshore wind manufacturers secure government funding

4C Offshore | Tom Russell
By: 07/07/2021 BEIS

The UK government's Department for Business, Energy & Industrial Strategy (BEIS) has announced that offshore wind production is set to boom following more than £180 million of private investment. Offshore wind manufacturers SeAH Wind Ltd and Smulders Projects UK will each receive grant funding from the £160 million Offshore Wind Manufacturing Investment Support Scheme.

Business & Energy Secretary Kwasi Kwarteng expects more than 1,000 jobs to be created and safeguarded across the North-East of England and the Humber. The funding is part of the Offshore Wind Manufacturing Investment Support scheme which was announced by the Prime Minister last year as part of his Ten Point Plan to build factories that will develop components for next-generation wind turbines.

The Offshore Wind Manufacturing Investment Support Scheme is designed to support the delivery of manufacturing investment in the offshore wind supply chain. It provides grant funding for major investments in the manufacture of strategically important offshore wind components, from turbine blades to sea cables.

SeAH Wind Ltd will receive funding towards a new £117 million monopile foundation factory at the Able Marine Energy Park on the Humber. This is expected to lead to the creation up to 750 direct jobs by 2030.

Smulders Projects UK will receive funding towards a £70 million investment in new equipment and infrastructure to enable the manufacture of offshore wind turbine transition pieces at their existing site in Wallsend, Newcastle. It is anticipated that this would safeguard up to 325 direct jobs.

Kwarteng said: "Wind is one of the UK’s greatest natural assets and we’re a world-leader in offshore wind energy. With the largest installed capacity of offshore wind in the world, we are determined to grow and nurture a strong, world-class manufacturing base so British businesses and our workforce can fully seize the economic benefits being a windy island nation brings.

"Today’s investments will not only put the wind in the sails of the UK’s industrial heartlands, creating and supporting thousands of good quality jobs, they will also benefit the whole of Britain as we work to onshore more manufacturers, attract inward investment and ramp up export opportunities."

Minister for Investment Gerry Grimstone said: "The UK is well-established as having the largest offshore wind capacity of any country on the planet. These investments highlight how we are building a manufacturing base that reflects our position as a world leader in this key technology and the attractiveness of the UK’s clean energy sector to international investors.

"UK workers will be building the next generation of wind turbines that will not only help us meet our own climate change commitments but will be exported and can power countries all over the globe in a cleaner greener future.

Joosung Lee, COO of SeAH Steel Holdings Corporation, said: "Based on the active support and trust from the UK government, it is meaningful for SeAH that investment toward the monopile factory is in full swing."

The funding announcement follows news in March this year when the government announced up to £95 million investment to establish two new ports on the Humber and on Teesside to enable manufacturers to build the next generation of offshore wind projects.

These new ports are expected to have the capacity to house up to seven manufacturers to support the development of the next-generation offshore wind projects.

In addition, US energy giant GE Renewable Energy has plans for the investment in a major new offshore wind turbine blade manufacturing plant, the first investment on Teesside. This manufacturing facility will directly create around 750 jobs in the area to supply the Dogger Bank Wind Farm project.

Business & Energy Secretary Kwasi Kwarteng also announced changes to the UK’s renewable energy support scheme, Contracts for Difference (CfD) today (& July 2021). Secretary Kwarteng outlined that the main tool to ensure CfDs grow are Supply Chain Plans. This is to be assessed in a questionnaire before a project can compete in a CfD auction.

Changes include simplifying and reducing the amount of questions in the questionnaire to improve clarity for the Supply Chain Plan process for projects of 300MW or above wishing entering a CfD allocation round. It also sets out the more rigorous and intensive monitoring process for Supply Chain Plan implementation. Furthermore, BEIS restored the requirement to submit a Post Build Report once the project has been fully commissioned.

The changes followed a consultation which was held between January and March, the results of which have been published alongside the revised versions of the
Supply Chain Plan guidance and questionnaire.

Under the reforms announced today it was outlined that the Secretary of State for Business and Energy, Kwasi Kwarteng, has the ability to terminate a contract as a last resort if generators do not fulfil the Supply Chain Plan commitments they have made.

For more information on offshore wind farms worldwide, click here.