Report on cross border supply chain collaboration. Task of WP5 from the MERiFIC Project

Transcription

1 Report on cross border supply chain collaboration Task of WP5 from the MERiFIC Project A report prepared as part of the MERiFIC Project "Marine Energy in Far Peripheral and Island Communities" August 2014 Compiled by Nicolas Wallet (Cornwall Council)

2 Skills Cooperation Funding Ports Industrial and economic development Energy & planning The similarity of the available resources Complementarity in Marine renewable Energy The complexity of the supply chain Importance of the supply chain maturity V. MERiFIC economic development strategy... 8 VI. Supply chain for MRE Brittany... 6 Complementarity... 7 IV. Background... 6 Cornwall and South West... 6 Key findings... 4 III. The MERiFIC Project... 5 Highly competitive sector... 3 Importance of dedicated support group... 3 I. Contents... 2 II. Executive summary... 3 MERiFIC I. 2

3 5.4.1 SEEM Study p 83 & 84 by MERiFIC Adopt a Regional marine renewable energy plan a planning document defining regional objectives for 2020/2030 between Cornwall/South West and Brittany. MERiFIC recommended some actions published in the SEEM Study 1 : Général du Finistère and Cornwall Council. However, further steps are required to establish a stronger supply chain collaboration The collaboration between these two regions on marine renewables is also established through a protocol of co-operation signed between the two local authorities: Conseil Iroise, Pôle Mer Bretagne Atlantique and Bretagne Développement Innovation also shape the strategy and the supply chain for the local MRE market. In Brittany, France Energies Marines is a collaborative public-private network that supports the development of the MRE sector, but some other structures such as Technopôle Brest Network and Marine Offshore Renewable Group also gather supply chain stakeholders in preparation to answer the developing needs of the MRE market. Offshore Renewables Delivery Group programme have the objective to shape the supply chain to the needs of the MRE sector; some private initiatives, such as Cornwall Marine very important to have a dedicated local support group. In Cornwall, some public private groups such as the South West Marine Energy Park or the Importance of dedicated support group To allow the supply chain to diversify into or successfully engage with the MRE market, it is on collaboration now between Cornwall/South West and Brittany to keep the international lead on MRE development. logical and pragmatic step. The competition will be increasingly high as the MRE sector matures, so it is urgent to focus Due to the complexity of the development of these offshore marine renewables technologies and the high investment cost and economy of scale, strong collaboration is a almost guaranteed a huge development market, collaboration within the sector is not the easiest to implement. energy offshore are really high, as are the deployment and maintenance costs. Keeping in mind that the potential of a technological breakthrough in the offshore marine renewable is The Marine Renewable Energy (MRE) market is not yet mature, however it is already experiencing harsh competition as the costs for developing the right technology to generate both Cornwall/South West and Brittany and then tries to highlight the grounds for collaboration. Highly competitive sector This report compiles the findings of the MERiFIC project on the supply chain research in MERiFIC II. 3

4 2. Produce a technical and economic study on the sites with potential identifying attractive sites in connection with the road map resulting from action 1 3. Set up a jobs observatory specific to the MRE sector 4. Set up a regional Call for Expressions of Interest (CEI) for innovative systems, alternative technologies and islands 5. Arrange meetings between enterprises in Brittany and Cornwall and develop a joint upstream service offering 6. Share R&D efforts in strategic segments promote cooperation and combine research teams, particularly around test sites 7. Carry out lobbying activities to have the MRE segments included in national policy Key findings The collaboration between Cornwall/South West and Brittany has to be encouraged and supported through key actions and programmes (such as MERiFIC 2 ). The analysis of the competitive advantage of each region shows some key areas that will create a win/win collaboration. Brittany is building strong capacity in industrial construction for the MRE sector, notably though the development of the POLDER Brest 3. Cornwall has strong assets in Research and Development and testing facilities, such as the COAST Lab (University of Plymouth), FaB Test (University of Exeter) and Wave Hub in Hayle. 2 MERiFIC is a cross border project (INTERREG IV A) funded by European Regional Development Funds 3 Brest port 4

5 III. 5

6 5.1.3.UK p5 6 supply chain; Brittany; BDI; 2014; Link N/A; Report not published yet - report Regional Brittany 5 19/06/2014 Cornwall Regional report - supply chain; Cornwall; CMN; 2014; PDF report link; Published UK 4 around EUR 33 million for supported by ADEME [French Environment and Energy Management Agency] at a level of is transition energy and ecological The this. for fund TEN-T the to access priority to refers implementation of its work. Moreover, the development project for the port of Brest must be accelerated, particularly with a view to housing the new MRE industrial sector: the Pact economic and social difficulties in the region. Regarding MREs, the government undertakes to do all it can to support France Energies Marines and its components in the Recently, the Brittany Future Pact, established in December 2013 in consultation with economic, political and social players, established certain measures to respond to the services required that local supply chain companies can provide. 6 Brittany wind and tidal sector. Regardless of technology or location there are and will be a diverse range of skills and advantages. Cornwall and Plymouth are well placed to support the wave & floating wind sector, while Devon (and specifically North Devon) is well placed to support the offshore the South West a unique and significant offer to the MRE sector. However due to the location of the marine energy resources, each region will have different types: Offshore Wind, Floating Wind, Tidal and Wave (PMSS, 2010). Combining the diverse skills, services and facilities with the extensive natural resource gives reported that the South West of England had an abundance of natural marine energy resources with a capacity to deliver 9.2 GW of power by 2030, using the four key technology In 2010 the then South West Regional Development Agency (SWRDA) commissioned the Offshore Renewables Resource Assessment and Development (ORRAD) report which institutes, testing facilities (from tank testing to full scale array testing) and supply chain businesses. The South West Marine Energy Park (SWMEP) covers the entirety of the South West stretching from Bristol to Cornwall and the Isles of Scilly. The SWMEP includes academic In January 2012 the South West of England was officially designated as the UK s first Marine Energy Park (DECC, 2012), marking the significance of the MRE sector for the region. Regional report - supply chain; Cornwall (CMN, 2014) 5 Cornwall and South West Based on the reports: Regional report - supply chain; Brittany (BDI, 2014) 4 MERiFIC IV. 6

7 The Breton Electricity Pact 2010 therefore aims to bring marine renewable energy production to 1,250 MW by The draft SRCAE approved in November 2013, while confirming these objectives for 2020, projects an MRE potential of between 2,440 and 3,840 MW including tidal energy as early as 2050, i.e. 1,100 MW of additional MREs by 2020 and 2,200 to 3,600 MW by Complementarity Brittany and Cornwall have two different, complementary strategic visions for the development of MREs by The resources of these two areas are comparable: Fixed and floating wind turbines Large-scale marine current turbines: powerful currents in some spots Small-scale current turbines: low power scattered across the area Wave energy: significant potential across much of the area SWAC: the entire coast In spite of these similarities, Cornwall s objectives are primarily supported by wind and wave power, whereas Brittany s are primarily supported by wind and marine current power. Brittany has carried out significant planning work in consultation with the various players in the region, notably through the Breton Energy Conference and the Regional Sea and Coast Conference. Cornwall has produced quantified estimates of the potential accessible by 2020 and Sharing these plans and visions/skills could be beneficial for the two regions to implement joint actions to tackle the shared issues identified here. 8 The supply chains in both Brittany and South West of England are in development and much more investment is needed in order to respond to the future needs of the development of Marine Renewable Energy. This requires that the local supply chain successfully build up their capacity step-by-step, following closely the pace and scale of development of the market as it grows SEEM Study by MERiFIC SEEM Study p48 by MERiFIC 7

8 two regions for floating wind turbines and large-scale marine current turbines, and potentially the foundations for fixed wind turbines. On this path, offshore wind turbines and wave energy are MERiFIC s main strategic MRE segments, with the port of Brest as the organising industrial base for industrialisation of the and industrial development potential available to Brittany and Cornwall. parallel, taking into account the extent of the marine resources and socio-economic in MREs several of development controlled around policy segment assured An mobility. electric regional of development the with energy renewable breakthrough models, such as coupling the sale of locally produced marine to implement in a coordinated way (test resources, CEIs, etc.) to the search for items natural most the from funding, innovative and planning multi-mre activation: immediate for levers two around policy energy regional shared ambitious An The five strategic recommendations produced at the end of the project are based on two complementary types of strategic decision-making: This is due to the similarities between the regions. MERiFIC identified for both Cornwall/South West and Brittany a strategic pathway for the development of MRE with a collaborative base. MERiFIC V. 8

9 In addition, the potential offered in Brittany and Cornwall by alternative segments (SWAC, small-scale tidal energy, low power marine and river current turbines, etc.) and the storage segment justifies the implementation in the short term of a strategy defined around islands and energy autonomy, with a subsequent ambition based on the implementation of overall solutions tried and tested locally then focused on export, in view of future opportunities at global scale SEEM Study p76 by MERiFIC 9

10 The complexity of the supply chain Marine Renewable Energy requires a diverse and robust supply chain if it is to reach the commercial stage. 10 Importance of the supply chain maturity The maturity of the supply chain will affect complementarity and collaboration UK p7 MERiFIC VI. Marine Renewable Energy Supply Chain Engineering Legal & Finance Manufacturing Installation Environmental O & M Consultancy Consenting Steel structures Port Facilities EIA s Vessels & Helicopters CAD Design Certification Composite structures Vessels Subsea Surveys Vessels & Helicopters Maintenance CFD Modelling PPA & ROC Components Vessel Maintenance & Modification Environmental Monitoring Maintenance Crew Marine engineering Insurance Cables Diver s & ROV s Resource Assessment Diagnostic Equipment Electrical engineering Finance Mooring, Anchor & Foundations Heavy Lifting Maintenance Tools & Supplies Mechanical engineering Funding access & Bid writing Paints & Marine Coatings Quayside Access Civil engineering Navigation Equipment Resource Assessment Equipment Hydraulic Equipment 10

11 The SEEM study 11 carry out by MERiFIC recommends: Carry out demonstration and pilot farm tests on a coordinated basis for the two main strategic segments in Brittany and Cornwall in order to prepare and consolidate local industrial structuring and associated services as from upstream of the projects. In the short term, build up the industrialisation of floating wind turbines for both Brittany and Cornwall around the port of Brest and in the medium term identify French and English port sites compatible with the industrial development of wave energy. Coordinate and share operational service offerings during the installation, cooperation and maintenance phases of the farms to be built in the MERiFIC area (service ships in particular). Anticipate more long-term questions connected to the opportunities offered by park dismantling and systems recycling activities. The industrial, social and economic potential generated by MREs in Brittany and Cornwall include: Near-term opportunities, especially in the most mature sectors, although it is important to control the risk of dispersion in order to concentrate sufficiently on developing strategic sectors. Fixed offshore wind turbine and major marine current turbine vs. Floating offshore wind turbine and wave roller. Sustainable solutions that are directly operational to meet the challenges of energy decentralisation and greater energy independence for both regions with insular and peninsular characteristics. Storage and alternative MREs: ocean thermal energy conversion, small marine current turbine and small tidal power plant SEEM Study p70 onwards by MERiFIC 11

12 The similarity of the available resources 12

13 Complementarity in Marine renewable Energy Industrial and economic development The industrial infrastructure in Brittany has the capability to provide all the links in the MRE value chain. Complementarity between industries and major infrastructure in Brittany and Cornwall. Potential to harness synergies in the two regions, in both upstream and downstream services. Energy & planning Similarities between peninsular and insular electrical infrastructures o relevance of alternative MRE technologies and other energy segments (storage notably) o Issue of energy decentralisation and energy independence for regions. Converging goals: floating offshore wind farms a strategic sector. Diverging goals: focus on wave in Cornwall. Funding In the context of the review of support systems in Europe; Financing for R&D is critical (for example, the British Wave Hub test site, the French AMI, etc.) and connection and storage is a challenge; Need for innovation at local level in finding sources of funding: upstream (CAPEX) and downstream ( /MWh) o Crowdfunding and innovative economic models. Ports 15 to 30 ports with the capacity to develop O&M services and activities, provided adaptations are undertaken; Brest Port has the ability to participate in the installation of offshore wind farms; With adaptations to their infrastructure, five ports in Brittany and one or two in Cornwall are suitable for works for marine current and wave roller installations; MRE business park being developed in Hayle (Wave Hub). Skills Cornwall and Brittany are both well-positioned to operate in the emerging market, with existing expertise and training that will stand them in good stead for the future. The addition of business, project management and language skills alongside cross-border exchanges between institutions will increase the employability of graduates and impact positively on regional growth. The sector builds on the expertise of the oil and gas industries and the relatively mature offshore fixed wind industry, but while there are similarities with these industries, there will still be areas of disparity with the marine renewable energy sector which make it difficult to gauge skills needs and employment prospects with any accuracy. The sector is still subject to rapid change as new technologies are developed and the policy landscape changes. 13

14 However, sustainable development is central to policy development at regional, national and EU level and the prospects for the growth of the sector into a viable, investable industry are optimistic. It is an exciting time for the marine renewable energy sector as the technology is on the verge of commercialisation. Brittany and Cornwall have the maritime expertise, the experience in MRE development and the training resources necessary to see the sector bring growth to their regions. Cooperation Existing academic, professional and inter-regional cooperation bodies, governance by well-known participants in the field (hubs, clusters, support from economic development agencies and local authorities); Sector's key representation role internationally with companies outside the region and political structures. 14

15 Find all our reports on 12 healthy competition. The developer won t feel tied down to a region and it is important that the market stays open. example the far peripheral and island communities that are found in Brittany and Cornwall. The collaboration between regional supply chains will work if there is complementarity and MERiFIC has challenged this idea. One of the main findings of the MERiFIC project is that collaboration has a stronger base for success if the regions involved have similarities, for be able to identify non-commercially sensitive areas where collaboration will help for both parties. The natural instinct of countries is to establish national MRE support groups. But if this collaboration sounds logical, it is not a natural economical move, either for the public or the private sector. This is why we advocate the need for support networks that will and supply chain to develop locally. It is in this very idea of win/win collaboration that the MERiFIC project was established. represents huge investment. This is why it makes sense to have inter-regional collaboration within the sector, pulling together key resources to reduce the risks and allow the sector sector pass through the local regional supply chain and thus the local regional economy. This being said, the development of the MRE sector will not happen overnight and its cost economic benefits and the jobs creation. This is why it is important to develop the whole scope of the regional local supply chain to ensure that all the economic benefits of the the short term. However to maximise the benefits of Marine Renewable Energy development regionally in the long term, local stakeholders need to get a grip on the As we understand from the findings of MERiFIC project 12 the supply chain for the MRE sector is large and complex, which means that reducing it only to a region is not realistic in MERiFIC VII. 15