A South Korean steel company will build what it claims will be the world’s largest offshore wind monopile factory, while a European steel company will invest in manufacturing transition pieces in the UK.
Meanwhile, the UK government has announced reforms allowing it to terminate contracts for difference (CfD) – the UK’s support scheme for renewable energy projects, including offshore wind – if generators do not fulfil their supply chain commitments.
Korean firm SeAH Wind and Smulders Projects UK will spend a combined £180 million (€210 million) on their facilities near Grimsby on the Humber and at Wallsend in Newcastle-upon-Tyne, Teesside, both on the north-east coast of England.
They will also receive further support under a £160 million government scheme for their factories, which will together create more than 1,000 direct jobs and a similar number of indirect jobs.
The Korean firm Wind will build a new £117 million monopile foundation factory at Able Marine Energy Park on the Humber. According to South Korean media reports, the company claimed the facility would be the and that it would aim to produce more than 100 monopiles per year from the first quarter of 2023.
The Teesside plant would create up to 750 direct jobs by 2030, the UK government added.
The Able Marine Energy Park is one of two new ports the UK government is investing in to help the offshore wind supply chain.
Meanwhile, Smulders UK will invest £70 million in new equipment and infrastructure to enable the manufacturing of offshore wind turbine transition pieces at its existing site in Wallsend.
This investment will create and safeguard up to 325 direct jobs, the government stated.
Earlier this year, the UK government announced plans to make the Able Marine Energy Park on the Humber and the Teesworks Offshore Manufacturing Centre on Teesside “free ports”. This means they would receive government funding along with “tax reliefs” and “planning freedoms” to encourage private investment.
Turbine manufacturer GE Renewable Energy also announced plans to build a factory to produce blades for its Halaide-X offshore wind turbine platform on Teesside.
Contracts for difference reform
The UK government announced the latest investments in the offshore wind supply chain alongside reforms to its CfD support scheme.
Secretary of State for Business and Energy Kwasi Kwarteng will now have the ability to terminate CfDs if generators fail to meet the supply chain commitments they have made.
Currently, applicants choose which commitments they wish to make. These are then reviewed to test for their “quality and ambition” before project applications are approved and considered for CfDs, the ministry explained.
However, Kwarteng can now scrap these CfDs if developers fail to meet these commitments.
This would likely cause wind farm operators to seek alternative revenue streams for their projects.
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