How the Humber's two biggest names in offshore wind see the Sector Deal
Benj Sykes, top and Clark MacFarlane, on the Offshore Wind Sector Deal, and what has got us there.
By Grimsby Telegraph | Posted: 6 Mar 2019
THE Humber’s role in making the Offshore Wind Sector Deal work for Britain – at home and abroad – has been championed by two leading industry figureheads with significant stakes either side of the Energy Estuary. David Laister sat down with Orsted’s Benj Sykes and Siemens Gamesa’s Clark MacFarlane, who have played a key role in sealing the momentous commitment with Government.
“This refreshes parts of the country other industries cannot reach... this is not hosted by London, it is in coastal areas of the UK, it is in the Humber.”
Benj Sykes, as co-chair of the Offshore Wind Industry Council has led on securing a deal for his sector that puts it on a pedestal as a key part of the Government’s Industrial Strategy.
Intimately familiar with the area, as Orsted’s UK country manager, he works for Grimsby’s biggest inward investor for decades with £24 million ploughed into the port alone. It is the company that is developing and then operating the world’s biggest offshore wind farms, and putting the blade orders in at Greenport Hull.
Referencing this, and the cluster that has been established over a decade - with the likes of Centrica and E.on also contributing strongly, and Innogy next to come - Mr Sykes said: “For the Humber, it is more of the above. The Humber was first out of the blocks in terms of project delivery, skills and innovation and academic and supply chain links.
“We are already seeing a capability of skills developing. We have been exporting them in oil and gas, and we can see it in offshore wind. Wherever offshore wind is built in the world you will hear Humber accents.
“The industry is going global. It is taking off in the US, in Taiwan, we are seeing action in Japan, Korea and other markets. “Now, with this deal, investing in skills becomes very important, as we go on to create more green collar jobs that are going to transform this region, creating an exciting future for those coming out of school in the next decade.”
Known projects are already there, with more to come.
In rooms neighbouring the Humberside Airport get-together, work on Hornsea Project Two is gathering pace, as technicians installing the first dozen or so turbines on Hornsea One land and take-off out of the briefing room window. “Hornsea Three is going through planning, the consent, we hope that will happen in due course later this year, then Hornsea Four is in the very early stages, and we don’t know how big that will be,” Mr Sykes said. “By the time we are in 2030, and have built out these projects, the sector will deliver a third of our electricity demand from offshore wind. It is transformational, affordable and reliable.”
Currently the UK, with a world-leading amount of offshore wind, is at 7 per cent, providing 8GW of the 45GW required to keep Britain switched on.
Huge steps in scale, reliability and accuracy of delivery have been taken, bringing cost down dramatically over a five year period, while attracting outside investment.
Explaining how detailed weather forecasting and analysis of operations is bringing a new level of knowledge to the sector, Mr Sykes said: “Offshore wind is now very predictable. If you are National Grid, managing the system, we as an industry are great, as you can predict output over the next 72 hours, and it is much more distributed than other sources (should one big generator go down). “It is a good example of the transformation too, as there were not many of these jobs in Grimsby prior to offshore wind.”
Between the operations sites in Grimsby and a Siemens Gamesa base in Newcastle, data from turbines is crunched to deliver increasing availability, while innovation in scale ensures more energy is harnessed from the wind.
Hornsea Four could see 20MW turbines, Mr Sykes said. “That’s three times what we have now. They don’t exist, but on the back of what we have seen they could soon.”
North Sea conditions are ideal, with an average wind speed at the optimum level for such generation, of 10 to 11 metres per second. Turbines can operate from three metres per second to 27, any more and the blades are feathered - levelled to reduce drag - to protect the huge installations, but too little or too much is a tiny percentage of time. “It is the best location for this natural resource. We could generate enough electricity out of UK waters to power the whole of Europe, but we need to do it in a responsible way,” Mr MacFarlane, managing director of Siemens Gamesa Renewable Energy adds.
In such changing political times, patience has been a virtue, with six energy ministers sharing the OWIC helm with Mr Sykes. He smiles as he reflects how more members of the Government are better informed because of it, from Health Secretary to Leader of the House of Commons.
“We have been working as an industry council for two years now, it has been a long journey, but a very good one and where we have got to is that we have a Sector Deal that delivers for both parties. Fo the Government, there is growth, skills, an invigorating od the economy across the UK, in the Humber and clusters from the North of Scotland to the South of England, and it is coastal communities that will benefit.
“As a sector, we have a deepening relationship with Government and clarity around future auctions for Contracts for Difference, which is absolutely key for encouraging investment in the supply chain. If we want to see businesses invest, and do business here, it is vital they can see a pipeline of projects coming through.”
Orsted wowed the world when it brought Hornsea Two in at £57.50 in the last auction, halving the cost of its previous subsidy win just two years earlier. And now The Crown Estate is opening up more of the North Sea in areas favourable to the Humber once more.
The next CfD round will open in May and will be repeated every two years in the next decade. Depending on the price achieved, these auctions will deliver between 1GW to 2GW of offshore wind each year in the 2020s.
“We’ll have to wait and see where the next generation of wind farms go, but the Humber is well established,” Mr Sykes said. “There are other ports up and down the coast, the Sector Deal will be important for other clusters, in Scotland, the North East and East Anglia too. It is going to be important for all, and the Humber will be a big part of that.
“There is every reason to think there will be a supply chain that grows around the existing infrastructure. I feel very confident, not only in expansion of what we do - Orsted and Siemens Gamesa - but new companies who come and grow, and that’s the whole principle behind clusters; they create a centre of gravity that will encourage businesses looking to set up, to come and locate in the Humber to do that.”
And progress, like the deal, has been a steady build with full-pace development and lulls between projects. “It has taken a while, but it has got real momentum now. We have had a footprint in the Humber since Westermost Rough (built from 2012), we have been here for a long time. What we have in this area, in Grimsby in particular, with our new East Coast Hub, is ultimately over 400 people working there, which is really transformational, and very exciting.
“You only need to talk to people working there about the good quality of what we have in Grimsby, it is a town really benefitting now.”
Cost, in particular has been the driver, with Orsted proud to have brought it below coal and nuclear, and on a par with new-build gas.
“It is like flat screen televisions,” Mr Sykes summised. “My first was 19in and upwards of £500. Now you get a 40in for a fraction of the price. It is what we are seeing in the offshore wind industry. It is an extraordinary story, and no-one, not even us, believed it would happen as quick as it has.
“That’s why now is a fantastic time to say we are world leaders in the UK, with more offshore wind than anywhere else in the world. Let’s now harvest the benefit of that by creating a strong supply chain across the UK.”
As supply chain partners already there, few rival Siemens Gamesa. While the nacelle is still built in the Danish motherland, blades, towers, transition pieces and foundations are all emerging in the UK, with the above-water packages sailing out of the Humber.
Mr McFarlane said: “It has been two years in the making but this Sector Deal has been a positive journey for the industry.
“For Siemens Gamesa it is great to have a home market in the UK that has certainty through regular auctions and an ambitious deployment level. We have already been looking at the future because we have invested in the facility constantly. Since we built the facility we have built a training centre, and that’s trained 6,000 people over the last year, and 40 per cent are external, so that’s industry training.
“This summer we will be implementing a new blade type, 81m, and that is significant investment. These are exciting times, we don’t know our 2030 plans, but we expect this type of progress.
“There will be a natural limit, but it is over 100m. We have larger turbines generating far more energy, 10 times what they were before, and we have also got the volume. Now we have dedicated vessels, dedicated manufacturing, the skills and ever-evolving designs, while everything is lasting longer.”
There has been huge progress on the physical setting out of the incredible engineering feats that are the arrays too.
“When we built London Array it took 30 days to install a turbine.” Mr McFarlane said. “It was built offshore completely, with cabling, all the mechanical and electrical commissioning works carried out, from 2010 to 2012. Today we do that in 24 hours.”
Working has got smarter. Onshore where chartering vessels for tens of thousands of pounds a day isn’t required, is where much of that work now happens. Making it an almost plug-and-play concept at a scale barely believable. It is aiming to get smarter again, with automation and artificial intelligence reducing risk, and cost, further.
“We are working with Orsted and Hull University on a cluster initiative, Project Aura that is trying to encourage and support companies to come in to the Humber with new innovation, drive, skills sets to deliver a network,Mr McFarlane enthused. “In the sector deal there is a fund for companies to apply for that supports them to become real.
“We have had a number of companies that have come into offshore wind that have been in other industries, as well as new companies developing technologies. One of the great facts is that we have created 1,000 jobs, which is actually now 1,100 jobs, but there was a study done that showed it had created 2,000 jobs across the supply chain.
“There is still scope to develop the facility and we have had to take additional storage from ABP as part of Hornsea One. It isn’t endless development, but our minds are open to how we develop our site in the future. It is not only the UK but exporting. Part of the Sector Deal is to help people export, and we will certainly be an example of that with international wind farms.”
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