As the current 50 percent target is close to being met by some wind farm developers, Sir Michael now wants the higher target to be set for the remaining £550 million spend to 2025.
Within the 60 percent target, which will include operating expenditure, he recommends at least 50 percent of capital expenditure to be sourced within the UK.
Sir Michael also says that expenditure on each wind farm development should be reported in a more transparent way that includes added value in both jobs and local skills.
His new ‘Winning Locally, Going Global’ report also recommends the UK offshore wind industry should agree a ‘sector deal’, placing it at the heart of the government’s industrial strategy and giving it equal status with sectors such as pharmaceuticals, defence and aerospace.
To support this proposal, the report highlights the need for a supply chain accelerator programme, as recommended by the Offshore Wind Council, which would encourage greater collaboration, innovation and support new entrants to the market with exporting technology and services.
This would build upon the Government’s new Supply Chain Competitiveness Programme, which should be used to target areas like the North East, which should become the leading centre for new offshore wind technology.
Sir Michael also highlights the challenge facing the supply chain in terms of business planning and investment, due to uncertainty surrounding dates of future licences and Contracts for Difference (CfD) auction rounds.
Given that public spending is already allocated up to 2025, Sir Michael recommends the Government set out the full timetable for each future auction, helping the sector to plan, invest and recruit.
He recommends the Government should confirm the quarter in which the 2019 auction will take place and that the next auction will be held in a specific quarter no more than 18 months later, combining these announcements with fixed dates for further leasing rounds from the Scottish and English Crown Estates.
A spokesman for the Offshore Wind Industry Council, commented: “We welcome the ambition expressed in Sir Michael Fallon’s report to grow the UK’s offshore wind supply chain.
“British firms are already exporting goods and services to offshore wind projects around the world, as well as supplying UK projects. The case for Ministerial support is clear, and we are working with Government on a Sector Deal which would unlock even greater investment in our industry.”
23 Apr 2018