OEUK Says Industrial Strategy Must Harness UK’s Whole Energy Mix

In a release sent to Rigzone this week, industry body Offshore Energies UK (OEUK) said the UK government’s new industrial strategy is welcome “but must harness the UK’s whole energy mix, from oil and gas to wind, hydrogen, and carbon capture technology, and their interlinked supply chains, as a secure and affordable bedrock for long-term industrial success”.

OEUK highlighted in the release that the strategy sets out a ten-year plan for Britain’s industrial sectors. The industry body also pointed out that the strategy includes a Clean Energy Industries Sector Plan and focuses on eight “priority sectors where the UK is already strong and there is potential for faster growth”.

OEUK went on to note in the release that, alongside the industrial strategy, the government published a 10 year plan for renewable energy projects to attract investment of GBP 30 billion a year. OEUK added that the government has also announced a further GBP 700 million in energy supply chains, “taking the total funding for the Great British Energy Supply Chain fund to GBP 1 billion”.

In the release, OEUK CEO David Whitehouse said, “government is right to recognize the role of secure and affordable energy at the heart of industrial strategy – it must also be clear in its backing for the sectors that currently deliver it, including oil and gas alongside renewables”.

“Britain’s future doesn’t start from a blank page – we should build on the shoulders of our world class industries. That means recognizing the critical role of today’s industries on that path,” he added.

“Our sector has a vision of a modern industrial Britain, powered by secure, affordable, homegrown energy. A vision that sees the trend of de-industrialization throughout the UK reversed by the transformation of our energy intensive sectors. The government’s strategy is a positive step – it will come to life through true partnership with our industries and people,” he continued.

“The UK’s offshore energy sector and its closely interlinked supply chains offer opportunities for industrial growth and leadership. Our highly skilled people are working on projects right across this mix and can kickstart economic growth. To build lasting success, it’s critical this new strategy and its supporting funds are inclusive of firms across the whole spectrum of offshore energy,” Whitehouse went on to state.

In a release posted on RenewableUK’s site this week, Jane Cooper, the Deputy Chief Executive of RenewableUK, which describes itself as the “established, influential voice of the UK’s renewable energy industry”, said the industrial strategy “identifies clean energy as one of the sectors with the highest growth opportunity” adding that “we are going to see tens of billions of pounds of new investment in wind energy, grid, and hydrogen in the coming years”.

“With that new infrastructure comes a golden opportunity to secure new jobs, manufacturing, innovation, and exports, in the growing industrial clusters across the UK, in areas like the Humber, Scotland, South Wales, the South West of England, and Teesside,” Cooper noted in the release.

“There are already nearly 2,000 companies in the UK who have benefitted from contracts to deliver work in the wind energy sector. Collectively, wind energy currently employs 55,000 people, a figure which has risen by a quarter from two years ago,” Cooper said.

“By keeping a laser focus, as this industrial strategy does, on unlocking investment, remaining competitive, and supporting UK companies to innovate and grow, the offshore wind supply chain alone could boost the UK economy by GBP 25 billion over the next decade,” Cooper continued.

Cooper went on to state in the release that “the opportunity and vision is there, now government needs to ensure they deliver on the critical aspects of this industrial strategy”.

“Most notably for renewables, that means ensuring the next two Contracts for Difference allocation rounds are as successful as possible, clearing large volumes of projects in a stable market framework to reduce costs,” Cooper added.

“This is essential if we want to attract investment in the UK’s supply chain, skills, and capabilities,” Cooper said.

Rigzone asked the UK Department for Business and Trade (DBT) and the UK Department for Energy Security and Net Zero (DESNZ) for comment on OEUK and RenewableUK’s releases.

In response, a DBT spokesperson highlighted the below comment from Secretary of State for Business and Trade Jonathan Reynolds, which was made in the Commons on Monday.

“We have announced that we will slash electricity costs by between 20 percent and 25 percent through a new British industrial competitiveness scheme. This will bring our prices more closely in line with those in Europe, and it will be a game-changer. We will also put in place the reforms we need for businesses to get the much faster connections to the grid that they need. That means companies in sectors such as car making and chemicals will see their electricity costs cut. The scheme could benefit over 7,000 businesses with high electricity usage in industrial strategy foundational industries and high-growth manufacturing sectors, which collectively employ over 300,000 skilled workers”.

The DBT spokesperson also directed Rigzone to a release posted on the UK government website on Sunday, which stated that “the modern industrial strategy sets out a ten-year plan to boost investment, create good skilled jobs, and make Britain the best place to do business by tackling two of the biggest barriers facing UK industry – high electricity prices and long waits for grid connections”.

That release outlined that the new industrial strategy was set to “unlock billions in investment and support 1.1 million new well-paid jobs over the next decade” and highlighted that the strategy was developed in partnership with business, “marking a new era of collaboration between government and high growth industries”. It also noted that the strategy will make the UK “the best country to invest in and grow a business, delivering on the Plan for Change”.

In that release, UK Prime Minister Keir Starmer said, “this industrial strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past”.

UK Energy Secretary Ed Miliband said in the release, “as part of our modern industrial strategy we’re unlocking the potential of British industry by slashing industrial electricity prices in key sectors”.

“We’re also doubling down on our clean power strengths with increased investment in growth industries from offshore wind to nuclear. This will deliver on our clean power mission and Plan for Change to bring down bills for households and businesses for good,” he added.

DESNZ has not responded to Rigzone at the time of writing.

To contact the author, email andreas.exarheas@rigzone.com