Energy Minister Graham Stuart has underlined his commitment to continue to work closely with the offshore sector to deliver more jobs and investment into the UK.
Speaking at the opening of RenewableUK’s Global Offshore Wind 2023 conference in London on Wednesday, he told delegates how ambitious reforms to the auction market were being considered, acutely aware of challenges on cost.
It comes after Orsted flagged up the huge increase in delivering its next project, Hornsea Three, having set a new low price just before the Russian invasion of Ukraine sent inflation soaring. A new report released has also estimated that jobs in the sector will top 100,000 for the first time by 2030.
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Mr Stuart, who represents Beverley and Holderness - the East Yorkshire constituency off where the project that is set to join the world’s largest wind farms already operational there will emerge, said: “While our flagship Contracts for Difference scheme has been immensely successful to date and much repeated around the world, we aren’t resting on our laurels. We know that prices can go up as well as down, and I’m very aware that we’re in a hugely competitive and challenging economic context. We want to ensure we have resilient and innovative supply chains. That’s why we’re looking at ambitious reforms to the CfD to ensure that it continues to provide sustainable prices for future projects, so that developers have the confidence to invest in infrastructure for the long term.
I welcome the work to produce an Industrial Growth Plan that builds on the UK’s strengths and advantages across the lifecycle to capture the value of combined Government and industry effort. We’re working closely with industry to develop a globally competitive offshore wind supply chain for the long term.”
On the report, which illustrates how 10,000 jobs a year would need to be added, Mr Stuart said: "As has been set out just this morning, the 100,000 jobs in this industry by 2030 is remarkable when you think about the number and opportunities that provides, and the kind of areas typically where these are found, many in the areas where we seek as a government to level up to ensure that economic opportunity is to be found everywhere. We know talent is equally shared around the country but economic opportunity isn’t always and offshore wind can play a part in that as well."
The UK’s existing offshore wind workforce has increased to over 32,000 – up 4 per cent compared to the end of 2021. This includes over 17,000 direct jobs and nearly 15,000 indirect jobs. In the short-to-medium term, a rapid growth in jobs is needed as several offshore wind farms progress to the construction phase – 88,509 jobs are forecast to be required by 2026, which is over 56,000 more than today’s workforce.
In his opening speech at the same conference session, RenewableUK’s chief executive Dan McGrail highlighted the importance of reforming Contracts for Difference to ensure that next year’s clean power auctions bring even wider economic benefits.
He said: “In spite of an oft repeated narrative that the UK has missed out on supply chain opportunities, we are seeing some world-class innovation happening which is positioning the UK as a global leader in many fields. The nine biggest market segments against which the UK has its strongest positioning have a combined addressable GVA potential in the hundreds of billions to 2040. This is real value we can create and capture in the UK and are already doing so, and we are working with Minister Stuart and his team to see how we can do more of this and raise our ambition further.
“Getting CfD design right, from next year’s auction onwards, is absolutely crucial to allow offshore wind to continue to drive the energy transition in the UK - and this value must flow around our industry to boost the health of our supply chains and sustain and grow the jobs and skills upon which our sector depends.”
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