The cost of new offshore wind in the UK fell by 65% between 2015 and 2019 (to less than £40/MWh) at which point an ambitious Offshore Wind Sector Deal was agreed between Government and Industry. This deal highlighted key opportunities, challenges, and commitments which the Offshore Wind Industry Council (OWIC) has been working with Government and key stakeholders to address.
A shared vision and effective collaboration have allowed our industry to progress towards our goal, supported by recent Government announcements.
Offshore wind is a clean, low-cost source of energy which is supporting thousands of high-wage, high- value jobs in the UK, transforming our coastal communities. Our in-depth research shows that 26,000 people work in our sector and this is set to rise to 69,000 over the next 5 years. Our UK-based supply chain is growing rapidly; for example, major investment announcements in new factory facilities totalling over £900 million have been made this year, creating and securing more than 2,500 new jobs in our manufacturing sector alone.
Ever since the UK’s first offshore wind farm began generating in 2000, we have been able to accelerate innovation and reduce costs to deploy over 10 gigawatts (GW) of offshore wind in UK waters – with an ambition to reach 40GW by 2030, including 1GW of floating wind.
Offshore wind forms the backbone of the UK’s commitment to net zero carbon emissions by 2050 and the UK Prime Minister’s vision for a Green Industrial Revolution. The technology is also at the heart of a green economic recovery post COVID-19 and a Just Transition from fossil fuels to clean power which brings economic and environmental benefits to all those working in our modern energy sector.
Initially shaped by the key pillars under the UK Industrial Strategy (Ideas, People, Infrastructure, Business Environment, Places), OWIC established several key strategic workstreams to help address some of these key challenges in large scale deployment of offshore wind, whilst also looking to identify opportunities for synergies and collaboration with other parties and sectors.
Each workstream drives key deliverables under the Sector Deal, overseen by the Council Board, and supported by the OWIC Delivery Coordinator and a Stakeholder and Communications group.
OWIC Delivery Coordinator
The workstreams listed below illustrate the effort and progress the sector is making in all parts of the industry – from supply chain growth and jobs, to consenting challenges around grid connection, aviation, and environmental factors, to innovation, the transition from traditional energy industries and understanding how wind operates as a key part of the wider UK power system.
Aviation & Radar: Co-existence of air defence radar systems with offshore wind - more information here
Solving the Integration Challenge: System integration of offshore wind and hydrogen - workstream closed, see case studies below
The Solving the Integration Challenge workstream has now closed following the publication of two reports. OWIC commissioned Energy Systems Catapult and the Offshore Renewable Energy Catapult to deliver a project to address the integration challenge in two workstreams.
The two workstreams provide complementary perspectives on different aspects of the potential role and integration of offshore wind and hydrogen into the energy system – case studies can be read below:
The Energy Systems Catapult was commissioned to:
• Consider the impact of very high levels of offshore wind on the energy system, and how these impacts could be mitigated; and
• Identify opportunities to strengthen offshore wind’s role in delivering innovative solutions to system integration.
The analysis, published in October 2021, found that:
i. Credible systems are possible at significantly higher levels, with up to 150GW systems modelled.
ii. Hydrogen plays an important role in decarbonising certain sectors, particularly industry and some transport and heating.
iii. Future systems with a diverse generation mix, including clean thermal and nuclear power, have advantages over a system dominated by a single technology.
iv. Reform of electricity markets is essential to unlock the potential of offshore wind and ensure a more flexible demand side is established to match higher penetrations of wind.
Offshore Wind & Hydrogen: Solving the Integration Challenge Report
The Offshore Renewable Energy Catapult3 explored the opportunities for hydrogen generation and use coupled with offshore wind generation, including the potential for export of both hydrogen and electricity, a potential development roadmap, and the likely economic benefits to the UK.
The study, published in July 2020, considered the viability, and economic opportunities, of combining offshore wind with hydrogen, via electrolysis. The analysis found that:
i. Offshore wind with green hydrogen is a major UK opportunity. The UK has outstanding offshore wind resource, with the potential for over 600GW in UK waters, and potentially up to 1000GW, well above the figure of 75-100GW likely to be needed for UK electricity generation by 2050.
ii. The industrial base is strong. UK has an established industry base to build on.
iii. Our universities provide the underpinning science and engineering for electrolysers, fuel cells, and hydrogen, and are home to world-leading capability in these areas.
iv. By 2050 green hydrogen can be cheaper than blue hydrogen. With accelerated deployment, green hydrogen costs can be competitive with blue hydrogen by the early 2030s.
v. Action is urgent: developing green hydrogen in the next 5 years will be critical to achieving cost reduction and growing a significant manufacturing and export industry, based on UK technology.
vi. This can create a major new manufacturing sector for the UK. The overall demand for hydrogen by 2050 in the UK is predicted to be between 100- 300TWh. It is estimated to be 25% of Europe’s energy supply, with much more needed globally. The combination of additional OSW deployment and electrolyser manufacture alone could generate over 120,000 new jobs, replacing those lost in conventional oil and gas and other high carbon industries.
vii. And generate significant economic impact: the study estimates a cumulative GVA of £320bn between now and 2050.
viii. Production needs a market, investment needs both. Government intervention across multiple Departments is needed to support the concurrent creation of supply and demand in this new industry.