The Crown Estate is launching its Supply Chain Accelerator, a £50m fund created to strip risk out of early development of projects linked to offshore wind.  Making ventures likelier to proceed will, or so the logic runs, spur the growth of the flock of small businesses who sell expertise, components and services to backers of marine wind farms.

With a focus on floating offshore ventures in the Celtic Sea off England’s south west coast, an initial £10m round of funding is now open for businesses looking to register an interest in supplying projects.

Earlier this year the Crown Estate published research, The Celtic Sea Blueprint, putting values to the floating wind industry’s potential for wealth creation. The paper predicts 5,300 jobs and a £1.4bn economic boost could be generated through deploying the first floating offshore wind capacity set to result from the current Leasing Round 5 process.

The study highlighted opportunities to inject confidence in specialist suppliers contemplating contracts with operators of floating turbine parks.  Besides non-specialist components, dynamic cables and connections; wet storage infrastructure; infrastructure for operations and management and facilities; and training services and sites were identified.

The Accelerator’s first £10m provides matched funding in amounts capped at £1m spending on early-stage commercial expansion. The Crown Estate will look for the option to participate in the capital investment phase.

Beginning in mid-June, applicants have six weeks to apply.  Successful projects will be chosen and announced after September 2024. Consultancy Grant Thornton is advising the Crown Estate.

The Crown Estate’s role is to create long-term value for the British state. It focuses on using the seabed and land it manages to help catalyse Net Zero, restore nature, create thriving communities and drive economic growth. Developing the offshore wind industry’s domestic supply chain through collaboration with industry and government partners forms a vital component of these ambitions.

Once the fund’s first £10m is paid out, another £40m is earmarked to support projects qualifying under the Industrial Growth Plan launched by RenewableUK and partners including the Crown Estate last month. The plan lays out actions needed to triple Britain’s capacity in offshore wind manufacture  by the mid-2030s.

Turbines waiting to leap from drawing boards to waves grew by 10GW last year to 93GW, strengthening Britain’s No  1 position.   Offshore wind producing 49TWh of electricity last year, according to The Crown Estate’s recently published UK Offshore Wind Report 2023.

The government estimates that 125GW of marine spinners may be needed to meet Net Zero by 2050, an estimate underlying the need for investment in the UK’s supply chain

Will Apps, Offshore Wind Strategy Director at The Crown Estate, said: “I’d encourage businesses with strong development plans and an ambition to support one of the UK’s most future-thinking sectors, to consider submitting proposals to the Accelerator for funding, and play an important part in the UK’s exciting energy transition.”

The Crown Estate’s managing director for marine Gus Jaspert echoed him: “Offshore wind not only plays a key part in our energy transition, it can also be a key part of a local and national regeneration with new jobs, skills and industry.   Our world-leading offshore wind industry is already playing a pivotal role in the UK’s energy transition but and demand will only increase as we move towards delivering a net zero economy by 2050. We must move further and faster to invest in and develop the UK’s supply chain to accelerate growth and make our offshore wind sector the most attractive globally.

“The Supply Chain Accelerator will enable investment in priority capabilities and skills to aid the delivery of the opportunities within the Celtic Sea Blueprint, driving economic growth regionally for the benefit of the UK as a whole and ensuring we are driving value onshore through offshore activity.”

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Eickholt will step down on 31 July and leave the company on 30 September, the parent company Siemens Energy announced this morning. He was appointed the turbine maker’s head only in April 2022, with a brief to reverse cost over-runs and to repair fractured supply chains.

Replacing the 62 year old will be Vinod Philip, 50, head of global functions at Siemens Energy. Philip currently oversees a palette of functions including IT, purchasing, innovation, logistics and project management.

Today’s announcement by the parent makes no mention of Tim Dawidowsky, appointed as Siemens-Gamesa’s chief operating officer in 2022, within two months of Eickholt’s arrival.

Under the pair’s tenure, Siemens Gamesa has continued to struggle with quality issues and sustained financial losses.  Siemens Energy CEO Christian Bruch today absolved Eickholt from blame for the former, declaring that “the causes of the quality problems did not fall under his tenure”.

Bruch said that Eickholt’s departure was part of the company’s multi-year restructuring plan as “the time has now come for a generational change at Siemens Gamesa”.

Continuing losses at the turbines division dictates the sharpening of strategy identified in today’s overhaul. While continuing to make larger maritime structures, it will now target developers and generators operating onshore farms in stable regulatory environments, chiefly in Europe and the US. Break-even by 2026 is the financial goal, to be followed by profit margins topping 10% at an unspecified date.

Although its plan meentions unspecified job cuts, the parent Siemens Energy reaffirmed its commitment to both maritime and onshore turbines, allaying concerns of potential divestment or closure of wind business segments.

The parent confirmed that coastal factories making maritime – and thus bigger – turbines in Cuxhaven, Aalborg and Le Havre will continue to ramp up their capacities, a move the parent sees as essential.

Continuing disruptions to production and resulting flaws led to financial setbacks for Siemens Gamesa in 2023, including a loss of €4.6bn (£3.94bn). At the time, Bruch said: “The strong performance of our other business areas gives me confidence in our company’s ability to put businesses back on a strong footing.”

Siemens Energy’s shares surged 13% on today’s announcement.  At group level, it declared expectations of better profit margins, and adjusting its 2024 projections for sales to rise as much 12% during the year.

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Investee company Ocergy is disrupting the floating offshore wind market with an innovative approach to designing and manufacturing floating foundations, drastically reducing their build cost and deployment time.

Headquartered in the US and with operations in France, Ocergy pioneers a hyper-local supply chain approach, working with local manufacturers and creating green jobs in the areas where the turbines are installed.

Further efficiencies are unlocked, says Octopus, through Ocergy’s lighter designs which make the turbine foundations easy to transport and assemble.

The green tech disruptor already works with over a dozen developers. Its first floating foundations are scheduled for installation from next year.

Octopus’ investment today, of undisclosed value, will help fuel the rapid expansion of Ocergy’s tech into new markets.  Also benefiting is the US firm’s cutting-edge system for monitoring biodiversity and collecting environmental data related to floating turbines when in operation.

Vector, Octopus Energy’s £3 billion offshore wind fund launched late last year in partnership with Tokyo Gas, is making today’s investment.

It marks the latest milestone in the company’s plans to turbocharge the rollout of offshore wind globally to reduce the globe’s reliance on fossil fuels.

Floating foundations are used in areas where the seabed is too deep for conventional turbines to be fixed.  Around 80% of global offshore wind resources are located in deep waters, according to the Global Wind Energy Council, thus underscoring this technology’s vast potential.

Governments across the globe have set ambitious targets for floating offshore wind. Britain alone is targeting 5GW of floating offshore capacity by 2030.

Octopus Energy Generation CEO Zoisa North-Bond said: “Tech and innovation are fuelling the energy revolution globally, and Octopus is always on the hunt for game-changing solutions.

“Ocergy’s ground-breaking approach has the power to slash the costs of floating offshore wind. With our investment, they will get there faster, paving the way for cleaner, greener energy systems across the globe.”

Ocergy CEO Dominique Roddier said: “We are incredibly enthusiastic about this collaboration.

“It will empower us to scale up our operations and concentrate on delivering both pre-commercial and large-scale floating offshore wind projects. There are lots of synergies between Octopus’ forward-thinking efforts in offshore wind and Ocergy’s accomplishments.”

The world’s biggest floating wind farm off Aberdeenshire was this week announced to have secured its final planning consent. The 560MW Green Volt venture, co-owned by Japanese-owned Flotation Energy and Norwegian energy company Vårgrønn is scheduled to be fully commissioned in 2029.

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