The UK’s offshore wind industry is set to benefit from increased early investment in its supplier companies, thanks to a move by the state organisation managing occupation rights in Britain’s coastal waters.
The Crown Estate is launching its Supply Chain Accelerator, a £50m fund created to strip risk out of early development of projects linked to offshore wind. Making ventures likelier to proceed will, or so the logic runs, spur the growth of the flock of small businesses who sell expertise, components and services to backers of marine wind farms.
With a focus on floating offshore ventures in the Celtic Sea off England’s south west coast, an initial £10m round of funding is now open for businesses looking to register an interest in supplying projects.
Earlier this year the Crown Estate published research, The Celtic Sea Blueprint, putting values to the floating wind industry’s potential for wealth creation. The paper predicts 5,300 jobs and a £1.4bn economic boost could be generated through deploying the first floating offshore wind capacity set to result from the current Leasing Round 5 process.
The study highlighted opportunities to inject confidence in specialist suppliers contemplating contracts with operators of floating turbine parks. Besides non-specialist components, dynamic cables and connections; wet storage infrastructure; infrastructure for operations and management and facilities; and training services and sites were identified.
The Accelerator’s first £10m provides matched funding in amounts capped at £1m spending on early-stage commercial expansion. The Crown Estate will look for the option to participate in the capital investment phase.
Beginning in mid-June, applicants have six weeks to apply. Successful projects will be chosen and announced after September 2024. Consultancy Grant Thornton is advising the Crown Estate.
The Crown Estate’s role is to create long-term value for the British state. It focuses on using the seabed and land it manages to help catalyse Net Zero, restore nature, create thriving communities and drive economic growth. Developing the offshore wind industry’s domestic supply chain through collaboration with industry and government partners forms a vital component of these ambitions.
Once the fund’s first £10m is paid out, another £40m is earmarked to support projects qualifying under the Industrial Growth Plan launched by RenewableUK and partners including the Crown Estate last month. The plan lays out actions needed to triple Britain’s capacity in offshore wind manufacture by the mid-2030s.
Turbines waiting to leap from drawing boards to waves grew by 10GW last year to 93GW, strengthening Britain’s No 1 position. Offshore wind producing 49TWh of electricity last year, according to The Crown Estate’s recently published UK Offshore Wind Report 2023.
The government estimates that 125GW of marine spinners may be needed to meet Net Zero by 2050, an estimate underlying the need for investment in the UK’s supply chain
Will Apps, Offshore Wind Strategy Director at The Crown Estate, said: “I’d encourage businesses with strong development plans and an ambition to support one of the UK’s most future-thinking sectors, to consider submitting proposals to the Accelerator for funding, and play an important part in the UK’s exciting energy transition.”
The Crown Estate’s managing director for marine Gus Jaspert echoed him: “Offshore wind not only plays a key part in our energy transition, it can also be a key part of a local and national regeneration with new jobs, skills and industry. Our world-leading offshore wind industry is already playing a pivotal role in the UK’s energy transition but and demand will only increase as we move towards delivering a net zero economy by 2050. We must move further and faster to invest in and develop the UK’s supply chain to accelerate growth and make our offshore wind sector the most attractive globally.
“The Supply Chain Accelerator will enable investment in priority capabilities and skills to aid the delivery of the opportunities within the Celtic Sea Blueprint, driving economic growth regionally for the benefit of the UK as a whole and ensuring we are driving value onshore through offshore activity.”
