The Energy Transition | Government announces public-private investment to drive UK offshore-wind job creation

This week, we look at public-private investment to drive offshore wind job creation, the Crown Estate's selection of new development partners for Celtic Sea floating wind, and the government's publication of a 10-year UK infrastructure strategy.

Public-private investment secures £1bn funding for offshore wind sector

The government and Great British Energy (GBE) have announced a major public-private deal that brings together funding from GBE, the Crown Estate, and industry to invest a total of £1 billion to support domestic supply-chain development for offshore wind projects.

GBE's initial investment of £300 million was announced in April and provided upfront public investment to encourage funding from the private sector. This deal now adds £400 million from The Crown Estate and a £300 million pipeline from the offshore wind industry. It follows last week's Spending Review, which confirmed the biggest programme of investment in homegrown energy so far.

The £1 billion investment aims to stimulate the full offshore-wind supply chain in the UK, including investment into the manufacturing of turbines, floating platforms, and high-voltage direct current cables, as well as the upgrade of important port infrastructure. The funding also aims to create thousands of additional jobs across the supply chain, and it is hoped that the industrial hotspots of Teesside, Scotland, South Wales and East Anglia will benefit in particular.

This funding is in addition to the £544 million from its Clean Industry Bonus, which, as we previously reported, is designed to provide funding to incentivise offshore wind developers to prioritise investment into deprived communities.

GBE's chief executive, Dan McGrail, said: "By providing state-backed, catalytic investment, we can deliver on our remit to crowd-in investment, giving much-needed certainty to developers and investors in the clean energy sector."

New development partners selected by the Crown Estate for Celtic Sea floating wind farms

The Crown Estate has announced that it will partner with Equinor and Gwynt Glas (EDF Renewables and ESB joint venture) as the preferred bidder to deliver new floating wind farms off the coasts of Wales and South West England. The two sites will deliver a capacity of up to 1.5GW each. 

The announcement also confirmed that the Crown Estate was looking into a third site (to be accompanied by a third preferred bidder) which would be confirmed by September this year, and that a total of 4-10GW of floating offshore capacity could be brought to market by the end of the decade – through the Crown Estate's offshore-wind leasing rounds.

As part of its planning for the new sites, the Crown Estate announced that they have established a new strategy with the National Energy System Operator to ensure that the windfarms have an agreed connection plan before development begins. 

Floating turbines, while more expensive than their fixed-bed counterparts, enable expansion into the Celtic Sea, as they can be located in areas of deeper water where fixing the turbines would be impractical or difficult to achieve. The UK energy secretary, Ed Miliband, said: "The Celtic Sea has huge untapped potential to support our mission to become a clean energy superpower, so we can get energy bills down for good through our Plan for Change."

The announcement follows a number of other significant announcements by the Crown Estate in relation to offshore wind. In May, it announced a 4.7gigawatt (GW) expansion of existing offshore wind lease agreements across seven fixed-bottom wind farms on the estate's property. It was also reported this week that the Crown Estate would invest up to £400 million in new ports, supply chains and early-stage projects to support offshore-wind expansion.  

UK government reveals boost to renewables infrastructure projects

The government has published its strategy paper outlining key renewables infrastructure projects that will be financially supported across the next decade. Backed by £725 billion of government funding across various forms of infrastructure, the publication outlines the need to invest in "home-grown energy".

Reiterating its mission of "delivering clean power by 2030 and accelerating to net zero", the government set out a number of goals, including:

• Delivering a flexible, low-carbon electricity system to secure 43-50GW offshore wind, 27- 29GW onshore wind, and 45-47GW solar generation by 2030, with a view that unabated gas processes shrink to less than 5% of generation;
• Continuing to invest in carbon capture, usage and storage and low-carbon hydrogen by allocating £9.4bn to the deployment of these technologies and over £500m specifically set aside for hydrogen infrastructure, including regional hydrogen transport and storage; and
• Decarbonising heat and buildings by funding the Warm Homes Plan with £13.2bn over the  Parliament, with the intention that this will help to cut bills, tackle fuel poverty, and accelerate the UK's path to net zero. This investment will be allocated across schemes that support the roll-out of heat pumps, alongside energy efficiency measures and other low-carbon technologies, such as solar generation and battery storage.

The strategy paper will be reviewed and updated every two years to ensure that it remains relevant and achievable, and to reflect on the progress that's been made.

Alongside the publication of the strategy paper, the government has launched the National Infrastructure and Service Transformation Authority (NISTA), which will play a key role in advising ministers on the above goals. Specifically, NISTA will aid decision-makers in efficiently developing key stages of projects, such as relevant design, supply chain, budget, and financing considerations.

This article was written with the assistance of trainee solicitors Adam Budd, Ellie Smyk, Imogen Drummond, and Tomi Agbonifo, paralegal.