New opportunities in Offshore Renewable Energy
As the government looks to industries capable of strengthening the UK’s economic growth after Brexit, one sector in which the UK is already a world-leader has fallen under the spotlight.
Offshore Renewable Energy is helping to spearhead the new low carbon economy.
Bloomberg New Energy Finance predicts that of the $11.5 trillion of investment expected to be invested in new power generation assets globally out to 2050, 86% is expected to be in low carbon, and 73% of that from wind and solar.
Claire Perry, Energy and Clean Growth Minister, said this created enormous economic opportunities for the UK.
She said: “We want the UK to continue to be a leader in this global transition, and a leading destination for clean investment. Since 1990 the UK has cut emissions by more than 40%, while growing our economy by more than two-thirds, the best performance in the G7.
“But cutting carbon and capturing clean growth is an ongoing challenge. Government policies have already led to rapid growth in the deployment of renewables. This has led to substantial investment by offshore wind suppliers into UK-based services and manufacturing, creating thousands of skilled jobs and delivering hundreds of millions of pounds worth of investment.
“Offshore wind is a success story for the UK – and we’re the world leader with over 7 gigawatts installed and operational. The scale and breadth of our ambition has driven innovation and evolution through initiatives like (the Offshore Renewable Energy) Catapult; in partnership with industry.”
The benefits were already considerable, she added, with the advances leading to sharply decreased costs.
“The UK has helped to realise this extraordinary coming of age for the global sector, and are poised to reap the reward in new export markets. And we want to continue to build on our successes at home,” she said.
The government has already announced the next Contract for Differences Auction will open by May next year – the parameters of which will be published later this year.
“But we understand that to make meaningful long-term investments, industry needs clarity over years, not months,” said the MInister.
“That is why we are also announcing the intention to run subsequent auctions around every two years after that, using the £557m that we have already announced.”
Depending on the auction prices, this could see 1-2 gigawatts of new offshore wind every year in the 2020s – powering millions more homes a year.
Ms Perry said that in return, the government expected the offshore wind sector to continue cutting costs and reducing household bills whilst growing UK manufacturing.
“In giving companies long-term visibility, we should rightly expect long term commitments from them, and I look forward to working with the sector in the coming months to explore their ambitious plans to invest in the UK supply chain,” she said.
“In recent years total UK content in the offshore wind sector has increased to 48%. And I am committed to upping the scrutiny of developers and their supply chains and ensure this number keeps growing.
“For the last decade the offshore wind industry has been a great British success story: increasing productivity, raising earnings and improving lives in communities across the UK.”
The new measures give the sector the certainty it needs to build on this success through the next decade, she added.