Supporting local prosperity with the UK’s next generation of SOVs
By Jim Hey, Group Business Development Director at James Fisher and Sons plc
The UK’s offshore wind industry is growing at an exponential rate – 16 percent year on year according to RenewableUK, which puts the country on track to deliver up to 47GW of installed capacity by 2030. Growth of this rate could treble the number of (direct and indirect) industry jobs, from 31,000 in 2021 to 97,000 in 2030. With many more offshore wind markets emerging, the UK is not unique in this regard, in fact, GWEC estimates that globally, over 3 million jobs could be created by 2025 alone.
With larger turbines being installed further out at sea, vessels and crews will be travelling greater distances and working for longer periods of time in harsher environments. While we have long relied on crew transfer vessels, they become increasingly uneconomic, inefficient, and uncomfortable for sites more than 50km from shore. Building the next generation of service operation vessels (SOVs) is not only vitally important to facilitate the efficient operation of windfarms, it also presents a significant employment opportunity. Leveraging the latest innovations, while offering improved comfort and workability, thousands of jobs are set to be created through the design, fit out, crewing, provisioning and maintenance of the next generation of SOVs.
Based on the projected pipeline, the UK will need at least 28 new SOVs by 2031 to meet demand according to BVG Associates. In a perfect world, we as an industry would have ‘lined all our ducks up in a row’ so that the manufacturing of this new generation of SOVs would have meant UK jobs for UK vessels. However, establishing suitable UK shipbuilding capacity and capability in such a short timeframe is prohibitively onerous and expensive when facilities already exist abroad. Instead, the UK, and possibly many other European countries, will be largely reliant on shipyards in China, Turkey, South Korea and India to build this new fleet of SOVs and there will be a need for UK-based teams to work closely with their colleagues on the ground to supervise shipbuilding to ensure quality execution. Having recently built a fleet of LNG tankers in China, this approach to shipbuilding is something UK companies have extensive expertise in.
Designed with modularity and scalability in mind, many of the latest SOV designs will be able to be built in multiple yards simultaneously or be converted to construction support vessels if required. These new designs also offer significant fuel savings, are package protected for future fuels such as methanol and will typically have options for future conversion to semi or all-electric, or hydrogen fuel cell.
Jobs on land
With most SOVs for the UK offshore wind market being built elsewhere, the UK’s supply chain will need to consider other ways to create local employment and sourcing opportunities. One undeniable opportunity is the creation of new jobs around existing port facilities. Barrow-in-Furness, Grimsby, Lowestoft and Aberdeen are all set to benefit substantially from increased offshore wind activities. As an example, when James Fisher secured the £25 million contract to deliver offshore services to support the construction of the Galloper Offshore Wind Farm 30km off the coast of Suffolk, it created over 100 local jobs around Lowestoft.
Further jobs are also being created as the UK builds new ports in places like the Humber, Nigg and Teesside to accommodate deep-water installation requirements. As well as the actual construction, companies from across the marine sector will benefit including those operating in bunkering provisions, inspection and maintenance, security, cargo delivery and crew transfers.
Then there are port upgrades. As part of the government’s plans for Levelling Up, East Suffolk Council has secured £24.9 million for five major regeneration projects. Its Port Gateway project will see the construction of the Lowestoft Eastern Energy Facility – a purpose-built port to support the offshore wind industry. The new facility will consist of three new deep-water berths spanning over 360m, additional CTV berthing capacity and 8 acres of hinterland. Together with the expected influx of supply chain companies, the new facility will bring hundreds of new jobs and prosperity back to the area.
And at sea
Another local content opportunity is the crewing of SOVs with the UK’s orderbook set to create around 600 jobs. However, to date, all SOVs operating in UK waters are crewed by international mariners. With the right encouragement, this could be rebalanced to create more opportunities for UK workers, too.
Sourcing crews from countries such as Poland, Ukraine and the Philippines is typically more cost effective. So, it must be acknowledged the UK has a challenge when it comes to providing a competitive offering. There is debate about whether introducing maritime cabotage laws to the UK would put companies off from trading here. However, Australia, the US and Taiwan for example, all have local content requirements that ultimately support local jobs, skills and the economy. Of course, these types of requirements do add complexity and so their introduction would need to be carefully balanced with the right incentives to balance the cost. By our estimates, if we wanted to achieve a 50 percent UK crew, for example, a £1.3 million investment per annum per SOV would be required by the charterer (based on a crew of 21).
A higher percentage of UK crewing would create even more opportunities for what is fast becoming a highly skilled workforce. Specialised training programmes are making it quicker and cheaper for experienced offshore workers from adjacent industries to gain the necessary training to work on offshore wind. Pledges made to the Armed Force Covenant see several offshore wind companies benefiting from the expertise of Armed Forces Service leavers, translating their military skills into maritime ones. While school leavers are also finding their place in the industry. James Fisher’s cadet training programme for example, takes 10-12 school leavers a year, to prepare them to be the next generation of tankship mariners. In time, opportunities will open up for these newly qualified officers to crew SOVs too.
The UK’s next generation of SOVs is an exciting opportunity to foster local commitments that make international impact. Their arrival heralds a new dawn in the UK’s offshore wind industry, bringing with it exponential opportunities to create jobs in the UK. In the absence of formal local content requirements, charterers and developers alike can drive local prosperity and growth simply by orientating the way they crew, provision and maintain their new SOVs to the benefit of the local economy.
Published: 13 January 2023