£100bn programme to build thousands of offshore wind farms.
Friday 8 January 2010 8:58 AM
Bids for tenders for nine zones around territorial waters and the Continental Shelf were submitted to the Crown Estate, which owns the seabed to a distance of 22.2km off the UK coast.
The opportunity has attracted some of the big energy players: Southern Energy, E.On and Scottish Power, as well as Norway's Statoil, Germany's RWE and Sweden's Vattenfall.
It will create one of the biggest infrastructure projects for wind energy in the world, with construction beginning in 2014 at the earliest.
"It's easy not to grasp the scale of challenge," says Benj Sykes, senior technology acceleration manager with the Carbon Trust.
Taller than the Gherkin
This is the third round of tenders for the construction of wind farm zones around the UK.
But this time the project is huge.
The turbines will be erected in water depths of up to 60m, compared with 25m for previous rounds.
They will be positioned up to 205km off the coast, compared with 25km now.
About a third of the country's energy will be provided by these new wind farm zones by 2020, experts hope.
The areas put up for grabs this time are the Moray Firth, Firth of Forth, Dogger Bank, Bristol Channel, Irish Sea, Hornsea in East Yorkshire, Norfolk, Hastings in East Sussex and western Isle of Wight.
The biggest site will be at the Dogger Bank zone, located about 100km off the East coast.
In total, the farms will generate 25 gigawatts of electricity.
Huge potential
According to the British Wind Energy Association, the UK has potentially the largest offshore wind resource in the world, with relatively shallow waters and a strong wind resource extending far into the North Sea.
Offshore turbines are difficult to maintain in bad weather
The UK has been estimated to have more than 33% of the total European potential offshore wind resource, which is enough to power the country nearly three times over.
Each of the new zones will each have a range of energy-producing capacity.
The two smallest will be able to produce 500 megawatts each, two will have 5,000 megawatt capabilities and one, based at the Dogger bank zone, will have a capacity of 10,000 megawatts.
To put this into context, an average coal or gas powered station produces between 1,000 and 1,500 megawatts.
But offshore farms are more expensive to run.
Per megawatt of stored energy capacity, a gas powered station costs £1m, a nuclear power station costs £3m and a wind farm costs £3m.
However, a nuclear power station operates all the time, as opposed to only when the wind is blowing, so the offshore option works out as more expensive.
If one of these turbines goes down, it could be out of action for the whole of the winter period
Andy Cox, KPMG
Offshore wind farms are arguably less of an eyesore than a power station or, indeed, an onshore wind farm.
The benefits are clear. No-one can see the turbines out at sea, they do not make as much noise as their onshore cousins and they can be bigger, which means they can produce more energy.
But they are far trickier to look after.
"One of the biggest challenges to offshore wind farms is ongoing maintenance," says Andy Cox, energy partner at KPMG.
"If one of these turbines goes down or experiences a technical failure in November, it could be out of action for the whole of the winter period, because they are difficult to get to."
Job creation
Overwhelmingly, wind turbines are manufactured in Europe, with very little activity in Britain.
But this could change, as many see great possibilities for developing the industry and creating thousands of jobs off the back of the zone tenders.
"It's a massive opportunity, if you look at what's happened with onshore manufacturing in Europe," says Charles Anglin from the British Wind Energy Association.
Manufacturers are not going to invest millions of pounds if they think the market is risky
Charles Anglin, British Wind Energy Association.
"It's created 20,000 jobs in Denmark, 30,000 jobs in Spain and 80,000 in Germany. We have 6,000. If we build only 20 gigawatts of offshore wind farm capacity by 2020, and two-thirds of that is built in the UK, that could create 45,000 jobs," he says.
Some ask why manufacturers would now be tempted to build turbines in the UK when they have been reluctant before.
"We can get the government to put together an attractive enough package for manufacturers to invest in turbine factories in the UK, but these factories need to be based in ports. But many ports have been modified for the container industry and not manufacturing," says Charles Anglin from the British Wind Energy Association.
But he says the government is taking this opportunity very seriously.
"It's low-profile publicly, but there is a government taskforce talking to manufacturers. We anticipate a couple of manufacturers making decisions in the next few months to say where they are going to make the turbines."
So how do you go about creating an environment in which people will readily invest?
"We need a policy of stability, so manufacturers know that this market can take place. Manufacturers are not going to invest millions of pounds if they think
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