Europe: Significant opportunities in Southern North Sea wind

“The offshore wind industry knows it has to reduce costs to get continued support,” said Valpy. “This means there are lots of opportunities for innovative companies to sell their ideas.”

Valpy welcomed the shift in industry conversations from “how much subsidy can we get” to “how quickly can we get free of subsidies”.

To achieve “subsidy-free” levels of generation, innovation is vital. The offshore wind industry already has a strong track-record of cost reduction and is always keen to adopt new ideas that increase efficiency. 

Companies such as DONG, RWE, ScottishPower Renewables and Statkraft are all expected to install major off-shore wind farms in the Southern North Sea in the next five years, with more to follow. This should provide a major boost to local economies and especially local companies that make themselves ready to serve the offshore wind industry. The region/UK already has a host of companies with experience of operating in the North Sea, albeit for oil and gas companies. Oil and gas companies have expertise working in the hostile offshore environments that are the next frontiers for offshore wind.  Many of these competencies should be transferable to the offshore wind industry, with a little help.

Developers are also increasingly keen to maximise the local content of their developments to increase local support and comply with planning requirements. “Offshore wind needs the skills of the offshore oil and gas supply chain,” added Valpy. “and oil and gas companies can generate much need new revenue from offshore renewables.”

Valpy was keen to point out that there are some significant differences between offshore wind and offshore oil and gas. In particular, the procurement, working and investment strategies can be very different between the sectors. “Much of our current work with Oil and gas companies,” said Valpy, “is helping them understand the size of the opportunity in offshore wind and how best they can enter the supply chain”.  

Such understanding, analysis and advice can help many UK companies start doing business much quicker than trying to go it alone. There is a significant opportunity in offshore wind for UK companies that can demonstrate their value proposition and long-term commitment to offshore wind customers. They will then help achieve the UK industry’s strategic intention of having over 50% local content by 2020.