East of England’s OW Industry Awaits Policy Clarity

Investment, jobs and skills generated by the East of England’s position as a leading centre for developing offshore wind farms are at stake as the industry awaits clarity in policy, an industry leader has warned.

The UK is being left behind by the rest of Europe as the industry waits for a sign from the government, which has yet to announce the next round of subsidies for future offshore wind farms. Six months after the General Election, the industry is still waiting for government policy and news on the next Contracts for Difference rounds, which had been scheduled for this autumn but postponed after the election in May. This delay could have a serious impact on the projected UK market in the southern North Sea within reach of ports at Great Yarmouth and Lowestoft and the predicted economic spin-off as developers and investors look over to Continental Europe, experts are warning. This frustration – already voiced by East of England energy leaders – was aired on the stage of the RenewablesUK conference in Liverpool.

Giles Dickson, chief executive of the European Wind Energy Association, told conference delegates: “It is crucial that the government as a matter of urgency clarifies what the arrangement will be for the second round of Contracts for Difference and beyond for offshore wind.”

“Investment in offshore wind in the UK has fallen this year. Germany has overtaken the UK in terms of new installations for offshore wind.

“Germany delivered a good degree of certainty in the form of its renewables law last summer. That set a clear framework for the period up to 2020 and investors have responded appropriately. That clarity does not exist in the UK.”

James Gray, director of the East of England Energy Zone, whose role is to attract investors to the East of England, was in the audience and had called for government clarity earlier this year.

“Pressure needs to be applied to the government to offer guidance with policy. We are working hard with potential investors, showing them the land and facilities we have.

“Our ports are prime for offshore wind development but we need our work backed up by a Government position.”

Dickson echoed these concerns to the conference: “The key issue is investor certainty. Any government that is serious about attracting investment needs to make sure that it is not doing things that undermine certainty because these investors can and will go elsewhere.”

Gray met with companies based in Spain, Denmark, Germany and France at the event. “They all agreed that the UK is the primary market with the greatest potential for offshore wind. The East of England has the greatest concentration and the most potential for growth.”

The offshore wind industry was also confident it could drive down costs and the need for subsidy to make offshore wind the most cost effective and clean energy source for the UK, he said.

“Industry leaders like Scottish Power Renewables and Statkraft have been very bullish about prices and therefore the need for subsidies falling.

“Other European countries are pushing on with their developments, including the Netherlands, which had sanctioned the development of a 2.5GW wind farm in the North Sea in five phases.

“All of these could be supported from Great Yarmouth and Lowestoft.”

“This is all further evidence that the future of the offshore wind sector in Europe is in the SNS with our ports ideally located.”

“Logistics are important with our ports ideally located for East Anglia Array, Galloper, Dudgeon with Race Bank and Triton Knoll within easy reach.

“But we should expand our scope to look at other SNS developments in UK waters and off the Northern coast of Belgium and Holland.”

The conference was told that renewable energy was “key to tackling the huge risk posed by climate change” by the Foreign Secretary’s Special Representative for Climate Change, Professor Sir David King, one of the most respected figures in his field n internationally.

Mr Gray said Prof King’s point that the renewables sector was “a leading industry” and “a big part of the British economy which will continue to grow” was encouraging but needs to be backed up with clarity on Government policy.
“We will allow European countries to overtake us. We are positioned to service wind farms further across the SNS but off our shores is where they should be developed.”

“The East of England has so much potential – for our economy, jobs, skills for the future but we risk losing that.”