Norman Broadbent Insights

Growth. Collaboration. Safety. Globalisation. People. Profitability. Ambition.

These were the key themes which were reinforced time and time again during the 2022 Global Offshore Wind conference in Manchester in June.

Firstly, a huge credit goes to Renewable UK and their partners for hosting such a fantastic event. Having attended this conference several times in the past, this year was notable for a palpable excitement and optimism across the entire supply chain. It was also a pleasure after several years of virtual events to be able to meet and share ideas in person once more.

Each nation has set their own ambitious targets for success over the coming decade. Whether it’s 50GW by 2030 in the UK, or 30GW in the US, there is no doubt that the sector has significant challenges ahead. Despite the ongoing debate about how achievable these targets might be, and acknowledging the many obstacles and challenges ahead, it was reassuring to hear the consistent level of optimism and commitment from industry leaders to these goals. There was an incredibly strong sense of pragmatism running throughout each discussion. Not one attendee claimed that any of this would be easy, but there was a general consensus that we can and we will achieve these goals - as long as governments, developers, OEMS and others throughout the supply chain are willing to come together, share knowledge, help one another and focus on long-term sustainable investments and outcomes.

A key topic which was keenly discussed was of course floating wind. If our long-term growth targets are to be met, then floating wind is absolutely crucial. There were some clear takeaways from these debates:

Firstly, from a technology perspective, the concept of floating wind has already been proven; we know that a WTG can be taken offshore, connected to the grid and operated. But there are several hurdles. Commercialising and reducing cost go without saying, but if we continuously try to over-engineer radical new designs, the industry will sit on repeat - going round in circles trying to reinvent the wheel. This will only waste time and money - two things that the industry simply cannot spare at this critical juncture. Instead, developers and suppliers need to focus on a small handful of appropriate designs and come together as an industry to modularise, drive down costs and improve the speed of supply (particularly in relation to foundations) to accelerate the ability to deliver larger volumes of platforms for GW-scale floating wind farms.

Secondly, there are the huge logistical hurdles of physically supplying, assembling, towing out and energising 30, 40, 50 or even 100+ floating platforms and turbines in extremely deep and hostile waters. There is a severe lack of suitable coastal locations (and importantly, space) available to provide the necessary ports, yards and storage facilities to serve projects of this size and scale; yet our global development goals will fundamentally rely on it. Delivering a small pilot with 3 or 4 floating turbines is one thing, but no one has come anywhere near close to resolving this critical issue.

There are isolated examples of solutions being developed; Andy Reay from Associated British Ports offered a clear and honest summary of what will be required from government, investors and the supply chain to convert their existing facility here in the UK and ensure that their investments are fit for purpose for decades to come. There was talk of utilising large naval facilities in the US and expanding the supply chain into new markets in APAC to utilise existing infrastructure. However, 2030 is only 8 years away and there a realistic approach is needed - we all know how long an OfW project takes to develop and execute! ?Add in additional complications such as the Jones Act in the US which, as it stands today, will prevent purpose-built European vessels from serving the US market, and you start to realise how far away the industry is from having a scalable, sustainable solution for floating offshore wind.

The US market is currently attracting great attention and investment and had a strong representation on the panels, paired with European industry executives who are leading the transfer of knowledge and capability through strategic partnerships and direct investments. With Biden setting the tone and several States driving their local markets, there is obvious intent and momentum building, particularly on the East coast and in California.

However, to accelerate growth, it is clear that individual States cannot achieve their goals on their own. Rather, they must come together, to share knowledge and leverage their existing strengths to develop a nation-wide industry.?Jennifer Mundt from the North Carolina Department of Commerce delivered a clear presentation of the capacity, opportunity and future outlook in the US. For example, North Carolina has the best manufacturing capacity on the East Coast which should be utilised to its full potential. In addition, Ragnhild Katteland explained how Nexans has already established a factory in South Carolina which has huge potential to serve the US market more broadly. Stephen Boyle from Atlantic Power Transmission explained the complexities of installing new transmission lines through multiple States with their own approval processes and regulations. And we already know that the North-East hub around Massachusetts, New York, New Jersey and Maine has developed a strong centre of industry-specific competence, which continues to grow and mature.

It simply isn’t commercially or logistically viable to build an end-to-end supply chain locally in each State. And to achieve 30GW by 2030, there is little time to deliberate. The States must work with investors, developers and suppliers at all levels and across the nation to develop constructive partnerships and consider a phased long-term approach, if their short-term ambitions are to become a reality.

Reassuringly, during the past week since the GOW conference, the US has been making strides! The Biden administration has launched a new Federal-State partnership to drive collaboration. And the US Department of Transportation has just announced the intent to declare offshore wind vessels as “vessels of national interest” to accelerate and improve the process of supplying purpose-built vessels into the industry.

Of course, the comments above do not only apply to the US; the whole industry – whether established in Europe or across global emerging markets, needs to apply a much more collaborative mindset; a theme which echoed around the conference and all of the panel discussions.

It is widely recognised that in order to achieve the forecasted growth, the industry will have to invest heavily in new recruits at all levels and in all types of organisations. The UK is a prime example - even as a world-leading, established player in the sector, we will need to more than triple our workforce to achieve our long-term requirements. ?Norman Broadbent will continue to challenge clients to consider where their leadership talent might come from, with a focus on attracting new people into the industry, rather than simply taking a leader from one offshore wind company to satisfy the demands of another. Identifying and attracting diverse talent is, of course, on the agenda, but we can do a lot more. Gender diversity is still an issue in the offshore wind sector, and we need to be more proactive on hiring out-of-sector talent across all levels of the organisation; candidates who may take a little time to adapt and get up to speed but who could bring broader strategic thinking to accelerate growth and advocate change. Ultimately, this is about growth and development on an international scale.

There is no doubt that the industry faces huge challenges going forward but they are not insurmountable. There is an unmistakeable desire to rise to the occasion, and we look forward to future events to measure progress!

Chris Smith, Partner – Global Power, Renewables & Utilities Norman Broadbent? [email protected]m