As SSE commits to invest £15m in the UK’s largest turbine tower manufacturing facility in the Scottish Highlands, CEO Alistair Phillips-Davies says the scale of the company’s ambition and pipeline in offshore wind is behind its decision to inject the funds needed to make Nigg Offshore Wind happen.
For all the admirable talk and far-off commitments at COP26, the last week has really seen the rubber hit the road on net zero here in the UK.
Last Thursday we announced that financial close had been reached on Dogger Bank C – the third phase of the world’s largest offshore wind farm, which we’re constructing off the northeast coast of England.
Each one of Dogger Bank’s turbines will be almost as tall as the Shard and one turn of its giant blades will be enough to power a home with clean electricity for more than two days. When fully operational it will be able to power 6 million UK homes with green energy, equivalent to 5 per cent of UK annual energy demand.
But it will generate so much more than electricity. For the UK economy, nationally and regionally, and for our workforce, its impact will be huge. The sheer scale of the project is driving significant economic benefit into regional economies in the north east of England and into the UK supply chain more broadly.
Already it is supporting over 3,000 skilled, green jobs in the UK. This includes plans by GE to build a new offshore wind turbine blade manufacturing facility in Teesside off the back of the surety of the massive orders from Dogger Bank.
And now in Scotland, Global Energy Group and Haizea Wind Group have announced plans to build a new state-of-the-art offshore wind turbine tower factory at the Port of Nigg in the Highlands, backed by £15m in debt funding from SSE Renewables to make it happen.
Nigg Offshore Wind, or NOW as it will be called, is the most significant localisation of offshore wind supply chain manufacturing ever seen in Scotland and the UK.
It will be built at an investment cost of over £110 million and will be a giant, 450-meter-long, 38,000 m2 factory, capable of rolling steel plate to supply towers which will weigh in excess of 1,000 tonnes each, as well as other offshore products. This will make it the UK’s largest offshore wind tower manufacturing facility, producing components out of the Scottish Highlands for projects in the UK and abroad, and ready to compete in a global marketplace.
It’s difficult to overstate the importance of this announcement. Once operational in 2023, NOW will employ 400 people on a full-time direct basis manufacturing up to 135 towers each year for the next generation of fixed and floating offshore wind turbines. Its activities will support another 1000 indirect jobs in the Scottish and UK supply chain – helping transform thousands of lives in the region and providing real opportunities for workers to transition from oil and gas to renewables. For us, this is an integral part of the Just Transition.
“We’re bringing more than just £15m in debt funding to Nigg Offshore Wind. We’ll be a strategic backer, placing orders with the factory in the near future to meet our growing offshore wind pipeline.”
I’m incredibly proud of the central role which SSE has played in securing this development. Our substantial, multi-million-pound backing for this tower manufacturing plant makes us the largest single UK backer behind these exciting plans in the Scottish Highlands. And it shows that at SSE, we’re willing to put our money where our mouth is to support the development of a competitive Scottish manufacturing supply chain and create local jobs.
Getting to this point has been two years in the making and it has required immense effort and commitment from everyone involved to ensure we were able to turn a vision into a commercial reality. We’ve worked night and day with Global Energy Group and with other partners and stakeholders, including the Scottish and UK governments, to get this world-class tower factory at Nigg over the line.
Because we believe that if the UK is truly to be the world leader in offshore wind development, we need to ensure the economic benefits in terms of jobs and investments are felt here at home.
That’s why we’re committed to bringing more than just £15m of our own debt funding to this project. We intend to fulfil our role as a strategic backer for the facility, placing orders with the factory to meet our growing offshore wind pipeline in the near future.
Because at SSE we’re in a unique position to be able to create sustainable long-term supply chain opportunities for the UK’s next generation of offshore supply chain hubs, whether that’s at Nigg or at GE’s new turbine blade factory in Teesside.
We have the pipeline of offshore wind construction and development projects of scale, such as Dogger Bank and our new super-sized project Berwick Bank, that can create a stronger, greener and more successful UK. Combining that pipeline of scale with our ambition and our clear commitment to power the drive to net zero allows us to commit the investment needed to make an infrastructure project such as Nigg Offshore Wind happen.
“We have an offshore wind construction and development pipeline of scale that can create a stronger, greener and more successful Scotland and UK.”
And it shows how much can be achieved when developers, governments and supply chains work together with a common purpose.
The UK’s plan to quadruple its offshore wind capacity to 40GW by 2030 is bold and ambitious, but with developments like this it is achievable. And we are aiming to enable delivery of over a quarter of this target.
Last month, when we announced our Interim Financial Results for the first six months of our current financial year, I was delighted to be able to unveil an ambitious £12.5bn Net Zero Acceleration Programme that underlines our status as the UK’s clean energy champion.
Offshore wind is a key component of the plan and SSE is building more offshore wind right now than any other company in the world. Our own ambition shows the scale of the offshore wind opportunity for Scotland. With Seagreen and Dogger Bank already in construction, with Berwick Bank on the horizon and, we hope, with success in the ScotWind seabed leasing round where, together with our consortium partners, we’re committing a further £100m to build the Scottish supply chain, we’re powering the next generation of Scottish and UK offshore wind farms.
Which is why we’re confident that the strength and scale of our UK offshore wind pipeline means we can enable the delivery of 25% of the UK’s 40GW offshore wind target. All of this provides a long-term pipeline of projects, so vital to building confidence in the Scottish and UK supply chain. And all of this is only made possible by the strength of the SSE group.
There’s been plenty of time for talking about climate action in recent months but we are now truly in delivery mode. As the UK’s national clean energy champion, SSE has a vital role to play right across the energy system. And ultimately that delivers for society and shareholders alike through the creation of jobs, levelling up communities and addressing the climate crisis head on.
The announcement of a new world-class offshore wind manufacturing factory, producing turbine towers out of the Scottish Highlands for a global marketplace, shows what can be achieved when government and businesses work together.
Now is the time for Scotland and the UK to capitalise on this successful collaboration. Now is the time for all of us to seize upon the scale of our ambition and to deliver a sustainable Scottish and UK supply chain that creates jobs, reskills our workforce for a low carbon future, and maximises the economic benefits both regionally and nationally.
Because we can see what happens when we work together to power change.