Making renewables happen: green shoots in the South West

The South West of England is one of several parts of the UK which is hoping to reap economic benefits from getting a head start in renewables development – particularly in wave, tidal and biomass. Considerable effort is going in to develop local industries and to persuade mainstream renewables developers to tap into local supply chains. The potential contribution to the region’s economy may depend on how successful a new emphasis on regional and county renewables targets are in stimulating development in the region.

The debate over the strengths and weaknesses of high-level policy support mechanisms for renewables is well-rehearsed. But on the ground, the planning system remains a major barrier to developing a greener energy system. In the past, local authorities have often placed greater weight on the local environmental impacts than on the wider benefits of moving to a low-carbon energy system.

In November, the Government sought to shift the balance in favour of developers with revised planning guidance (PPS22) (see pp 48-49 ). This introduced a new driver in the shape of beefed-up regional targets for renewables which, the Government hopes, will encourage local authorities to take a more positive approach towards delivering their share of national targets. There are also increasing efforts by the Government and industry to highlight the other side of the coin – the potential for renewables to boost regional economies and stimulate employment.

But are regional targets having any effect? And is there a real prospect of developing new green industries on the back of the growth in renewables, or will the main beneficiaries be established suppliers such as the Danish and German wind turbine industry?

Looking to the South West
The South West provides an interesting test bed for the two approaches. The region is windy, and has a long coastline with one of Europe’s best wave resources. The climate favours the growing of energy crops, and high rainfall in several upland areas also makes it attractive for hydro schemes.

A number of technologies have been pioneered in the region, including the UK’s first commercial windfarm at Delabole in Cornwall; the UK’s first centralised anaerobic digester in North Devon (ENDS Report 329, pp 7-8 ); and the world’s first tidal stream turbine which was installed off Lynmouth in April (ENDS Report 332, pp 28-31 ).

There are signs that the region is now recognising the economic potential of renewables. The Regional Development Agency wants to encourage environmental technology as an emerging sector – with renewable energy being singled out as needing a dedicated independent agency. This agency, Regen SW, was created in October 2002 with ongoing funding from the RDA. Headed by former Greenpeace energy campaigner Matthew Spencer, Regen does not campaign in favour of individual projects. Instead, it aims to tackle the barriers to renewables development and help the industry to grow in the region.

“Without some organisation with a specific remit to champion the renewables sector it would be hard to make progress,” said the RDA’s head of policy Simon Hooton. “Regen SW was established to help the region meet its renewables targets, to develop skills in the sector, and to build the renewables industry to a point where South West companies can benefit from opportunities in the global market, particularly in wave, tidal and biomass technologies.”

Taking a regional lead
Renewables could be big business for the South West – no small consideration in a region with surprising levels of poverty and only a small manufacturing base. The RDA predicts that meeting the region’s renewables targets (see below) could add 12,000 jobs and £260 million to the region’s economy between 2000-2010.

However, such benefits cannot be taken for granted. A major stumbling block to local acceptance of renewables is that many economic benefits tend to flow out of the region. One of Regen’s tasks is to maximise the economic benefit for the South West.

Regen aims to build a “first mover” advantage on some renewables technologies, and to develop an enduring centre of expertise in the region.

The South West has already benefited from early involvement in onshore wind, Mr Spencer says. Companies offering legal, financial or monitoring services for the Delabole windfarm in 1991 have gone on to become leaders in the field while retaining a regional presence, he points out. The lawyers for the project, Bond Pearce, are now prominent in the wind sector, while Ernst & Young’s 12-strong renewables finance team is still based in Exeter.

Trying to recreate this effect with wave and tidal power is one of Regen’s priorities. It has asked the RDA to fund a wave power “hub” off north Cornwall. This would not duplicate the wave test centre in Orkney, which provides facilities for testing and monitoring of prototypes of up to 2MW. Instead the hub – costing £5-8 million – would cater for devices between the prototype stage and full commercial arrays of 50-100MW.

The hub would connect several wave devices floating 7-15 kilometres offshore to an onshore substation – reducing developers’ risks of finding a suitable site and establishing a grid connection.

The RDA has commissioned a study of wave and tidal stream resources and is backing Regen’s call for a strategic environmental impact assessment for the region to be brought forward (see box ). A decision on the hub is expected by spring 2004.

Businesses look at diversification
Regen also believes there is a great potential for existing businesses in the region to diversify into marine renewables. The South West has a large leisure boat industry with many composite manufacturers, offering possible synergies with wind blade or turbine manufacturing. It also has a strong marine sector, and some companies have already diversified into servicing the renewables industry.

Seacore, the Cornwall-based marine engineering firm, has become a leading player in offshore renewables construction, utilising its experience with large-diameter drilling and jack-up platforms.

The company laid foundations for two Swedish offshore windfarms, the offshore turbines at Blyth in Northumberland, and the North Hoyle project which has just started generating off North Wales (see p 8 ). Seacore is also a major shareholder in Marine Current Turbines, and helped to install the prototype turbine off Lynmouth.

“Offshore renewables is now a significant part of the work that we do, and it has the potential to grow – it’s definitely a big opportunity,” construction director Peter Clutterbuck told ENDS. Seacore hopes to install more offshore windfarms in Germany and Holland, and is interested in installing wave power devices. Mr Clutterbuck also sees “potential markets” for Seacore in plant maintenance and marine survey work.

Seastructures, a rival marine engineering firm based in Plymouth, is developing a specialist offshore wind installation vessel. However, it does not see immediate opportunities in wave and tidal technologies.

Another company with a presence in the region is Renewable Technology Ventures, a £10 million joint venture set up this year between Weir Group and Scottish and Southern Energy. RTV hopes to work with more than one wave or tidal stream developer to take prototypes to commercial operation utilising Weir’s experience with hydropower, according to principal engineer Angela Robotham.

Ms Robotham sees little room for new players in developing wind power, which is already technologically mature. But wave and tidal stream designs are still at the R&D stage, and RTV is currently screening wave and tidal developers for potential partners.

Supply chain opportunities?
Seacore, Seastructures and Weir Group offer specialist skills to the renewables industry, but Mr Spencer believes there are wider opportunities for manufacturers.

“The challenge is to bring existing component manufacturers into renewables supply chains,” he said. “In the wind turbine sector you aren’t going to change the fact that most manufacturers are going to be Danish, German or possibly American. But you can ensure that 60-70% of the components come from British companies, bringing greater employment and economic benefit to Britain or to particular regions.”

Renewables UK, an Aberdeen-based body set up recently by the Department of Trade and Industry, is trying to get more firms into renewables supply chains at a national level. Regen hopes to do the same thing in the South West.

When the Danish developers of the Wave Dragon prototype expressed an interest in deploying a full-scale device in the region, Regen produced a list of dozens of companies – including dockyards, assembly sites, engineering and electrical companies – which were interested in collaborating.

However, one of the larger companies listed, Devonport Management Limited, is cautious about moving into renewables from its work on submarines, surface ships, yachts, rail and composites.

“As renewables is outside our core market then we would have to look at it carefully before getting involved,” said environment manager Peter Jones. But he added that renewables will be an increasing market and DML would consider working with the right developer. It is clearly early days in the bid to develop a renewables supply chain in the South West. Regen is hoping that a major wind turbine manufacturer will locate a factory in one of the region’s many ports – but as yet there are no firm plans. Moreover, the mass manufacture of wave and tidal technologies is still many years away.

Devolving down the targets
“The South West has a good potential for renewables and the industry could make a meaningful contribution to the regional economy,” says Amanda Wilkinson, regional director of the CBI. “But as things stand, obtaining planning permission for renewables can be difficult and this might limit the industry’s importance.”

Although some councillors may be swayed by arguments about the local benefits of renewables, there is little doubt that the top-down push from central Government remains the main driver.

In 2000, the Government asked the English regions to assess their renewable energy potential and establish regional targets. The initiative encountered several problems – and an official review later found that the targets did not add up to the Government’s 2010 target (ENDS Report 326, pp 10-11 ).

The assessment for the South West, produced early in 2001, proposed a target of 597MW by 2010 – a substantial increase from the 94MW installed at that time. The target corresponded to 14.6% of the region’s generating capacity, though this would fall to 10.9% if a proposed large combined cycle gas turbine went ahead.

An indicative breakdown of the South West’s target suggested that onshore wind might contribute more than half of total capacity by 2010. Biomass accounts for perhaps a quarter, with smaller contributions from wave, tidal stream, landfill gas, hydro and energy-from-waste. The assessment recommended that the regional target should be broken down into “minimum county renewable energy targets”. This would help to counteract the patchy reception for renewables development – for instance Cornwall now has seven windfarms whereas neighbouring Devon has none.

Tentative county targets were drawn up in discussion with planning officers and councillors. The counties are currently consulting on incorporating the targets either into structure plans or sustainable energy plans.

Remarkably, a scenario used to inform the target-setting process envisaged that by 2010 Devon might have a wind capacity of 73-103MW – the highest contribution from any county, despite its strong historic opposition to wind.

There are some signs of progress. In August, a planning inspector overturned Torridge District Council’s refusal of a windfarm near Bradworthy in north Devon. She accepted that West Coast Energy’s plan for three 1MW turbines would make a “negligible” contribution towards reducing national greenhouse gas emissions – but noted that it would make a “positive contribution” towards Devon’s share of the regional renewables target.

Matthew Spencer thinks the decision shows that regional and county targets make a difference. “It’s striking how remote and abstract the national targets feel when you’re working in a region,” he said. “If we just had national targets then I suspect that the project wouldn’t have been approved.”

Paul Baker from the Devon Association for Renewable Energy thinks that local authorities may now be “a little bit nervous” about rejecting projects because of local opposition. Even so, he says, “there are a number of district councils in Devon that don’t want to see any commercial wind development at all in their area”. He warns of a likely tussle over carving up responsibility for the county target, which is likely to require one or two sizeable wind or biomass schemes.

Peninsula Power’s 23MW biomass gasification project at Winkleigh, North Devon – which received a £11.5 million capital grant from the DTI in April – has already run into local opposition. “There’s a great need for targets at the planning level – not just set as a fraction of the Devon target, but based on the potential in each district,” Mr Baker said. “I think drawing up county targets has really increased peoples’ understanding of what the choices actually are rather than what they might want them to be,” said Regen’s Matthew Spencer. “You cannot say, ‘I’ll have tidal instead of wind’. You have to look at not just the resource but also at the economics and whether projects are likely to come forward.” The picture is complicated further if the employment benefits are considered. Biomass is generally considered to have the largest potential to create local jobs, particularly if energy crops are used. But this pushes up the cost of the technology, making it less attractive to developers.

In contrast, onshore wind is a relatively cheap, mature technology with little need for ongoing maintenance once installed – but it offers smaller local economic advantages. Even so, Mr Spencer points out, National Wind Power used local electrical contractors for its Bears Down farm in Cornwall, and farmers receive around £3,000 per year for every turbine on their land. The next few years will be crucial in determining whether a sustainable industry can be nurtured in the South West on the back of a growing local generation capacity. If renewables is to become fully recognised as a major contributor to the regional economy, some major success stories, such the establishment of a manufacturing facility for wave, tidal or wind devices, will be needed. Perhaps then, renewable energy may start to be viewed as an important economic sector rather than a green gesture

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