UK Supply chain vital to realise green ambitions

Posted on 7 Oct 2020 by Tom Lane

UK manufacturers react to the PM's Build Back Greener announcement and call on the government to back onshore supply chains to realise the plans.

Yesterday the UK government announced £160m will be available to upgrade ports and infrastructure across communities like in Teesside and Humber in Northern England, Scotland and Wales to hugely increase our offshore wind capacity.

The plans will see the creation of 60,000 jobs, both directly and indirectly, supporting the Build Back Greener project.

Aiming to place the UK as a world leader in renewable energy. Currently the UK produces 10 per cent of its electricity through its offshore wind capacity, the largest in the world.

The announcement is part of the government’s commitment towards net zero emissions by 2050.

Although the announcement has been welcomed in large by the manufacturing community in the UK, it has come with a warning. The UK must look to develop its own supply chains to service these projects and turn to British manufacturing and engineering expertise to realise these ambitions.

UK Steel Director General, Gareth Stace, said: “virtually none of the steel comes from the UK today, for the simple reason that the UK still lacks the majority of the offshore wind manufacturing supply chain.  It is vital that in massively expanding the offshore wind capacity of the UK that the Government focuses on building a domestic supply chain that will support UK manufacturing jobs, including those in the steel sector.

He continued: “In the short term – we want to see the UK Government place the same requirements on offshore wind developers as it does on other public projects when it comes to the procurement of steel. Let’s have a target for UK content, let’s make sure we know where the steel is made, and let’s make sure UK companies have the best opportunities possible to supply it.

“Energy consumers ultimately pay for these wind farms, through power bills and subsidies – and it is only right that the Government focusses its attention on getting as much economic value for the UK as possible out of them. The UK is by far the largest market for offshore wind in the world, one-third of the total, and it is mad that we continue to import most of the equipment needed for it.”

The capacity of offshore wind farms nearly doubled over 2018. One new wind farm, the Walney Extension, is the largest offshore wind farm in the world.
The Walney Extension, is the largest offshore wind farm in the world.

Sanjeev Gupta, GFG Alliance Executive Chairman said: “To deliver the prize of a new generation of green jobs it is critical that the commitment to offshore wind is accompanied by a wider green, targeted procurement strategy that backs British foundation industries.”

He concluded “By directing investment appropriately and lowering uncompetitive UK energy costs, the Government can encourage inward investment and stimulate a market for UK steel products that will generate tens of thousands of jobs and launch a green infrastructure-led recovery from the damage caused by the Covid-19 pandemic.”

Kevin Brundish, CEO at British battery cell company AMTE Power: “A green recovery depends on the realisation of the Government’s Industrial Strategy, which outlines its ambitions on battery technologies and on-shore battery supply chains. To sustain the wider renewable energy industries, the Government must prioritise the creation of an onshore, full-cycle, supply chain for the scalable production of high quality lithium ion cells.”

Luke Hamm, CEO at GovGrant: “£160m investment into offshore wind infrastructure is a promising move from the Government to boost opportunities in manufacturing.  This is a key sector in our economic recovery post Covid-19 and an industry where the UK should be a global leader. State support for the sector is paramount, as manufacturers are naturally rich producers of valuable intellectual property (IP) and innovation which will create sustainable growth and more jobs for the future.

“For manufacturers, at a time when historically stable sectors such as automotive and aerospace are in turmoil, it should provide confidence that they can adapt their skillsets to new markets. That said, it’s fair to raise the question as to whether £160m is enough – given the significant role manufacturing offers to the economy, it feels like a drop in the ocean when you consider the prize on offer.”