Feature

UK ports: ready for Round 3?


George Marsh

Part 1: As the UK gears up its offshore ambitions, George Marsh asks whether critical parts of the infrastructure – namely the ports – are ready.

TOO MANY structures destined for the UK's extensive Round 3 wind farms could be built and installed without touching UK soil. That would be a lamentable waste of what is likely to be the country's biggest maritime industrial opportunity since North Sea oil. As well as sidelining assets of great potential for the offshore wind sector as a whole.

Consultancy BVG Associates estimates that by 2020 up to £800 million could accrue to UK ports from the offshore revolution now in train – based on the statistic that port-related expenses account, on average, for about 1% of the total installed cost of an offshore wind farm. Round 3 turbine and foundation manufacture, in particular, will require facilities at ports since these structures will be too large for transporting other than by river and sea.

At one level, the UK will certainly succeed. Given that it has some 120 ports within its extensive coastline, it can readily provide bases for the numerous workboats needed to convey personnel and material to and from offshore installations. Several locations are already well established in this role as a result of Rounds 1 and 2.

A lower number are active at the next level, supporting operations to assemble turbines from components received from outlying suppliers and loading the results onto installation vessels ready for shipping to the required sites. Fewer ports still, a couple of dozen according to BVG Associates, can potentially cope with the more stringent requirements of Round 3, which brings increased scale – in terms both of activity and of the offshore structures themselves.

At the highest capability level are the so-called super-hub ports needed for constructing, assembling, testing and shipping giant turbines of up to 10 MW, along with their enormous foundations, that will be future offshore workhorses. Such premier ports must be able to offer many hectares of land on which to place factories and storage areas, long strong quays with high, heavy-lift cranes, and sufficient alongside space to accommodate the third-generation installation vessels now being built.

These latter are marine leviathans; for example, the Wärtsilä designed Innovation, in progress in Poland, is 135 m long, 42 m wide and has a carrying capacity of 8000 tonnes. Samsung Heavy Industries in Korea is building a turbine installation vessel (TIV) which, at 151 m long by 50 m wide, is even larger. Manoeuvring such TIVs, particularly with turbines aboard, is facilitated by approach channels that are clear and direct, plus an absence of fast cross currents (tide) and strong local winds. Deep water and adequate height clearance under power lines etc are other prime requirements.

The British Isles have ports that are potentially in the super-hub league, but there are obstacles to realising that potential. One is the issue of shoreside space. Overseas developers tend to see Britain as a ‘tight little island’ with little spare land – and that available only at high cost. Ports stand ready to free up land areas currently used for other purposes, but that takes time, and timescales are a real issue for turbine makers and wind farm developers intent on Round 3 (and Rounds 1 and 2) business.

The fraught process of obtaining planning consents exacerbates the delay. Then there is the fact that many otherwise desirable UK ports are successfully plying existing trades – Felixstowe with its container traffic and Southampton with its cruise trade are examples – to the extent that they may have insufficient reserve capacity to satisfy large-scale wind energy needs.

Ownership

Moreover, the port ownership situation can be a mixed blessing. Unlike in mainland Europe where most ports are in the public sector, many of Britain's ports are privately owned. Associated British Ports (ABP), for instance, has 21 of them, including such examples as Barrow, Cardiff, Fleetwood, Lowestoft and Southampton. While private enterprises tend to be leaner and meaner than their public counterparts, market forces alone sometimes prove inadequate. In theory at least, public ownership make it easier to implement strategic plans that require multi-agency coordination; to rationalise investment programmes and to channel for wider benefit energies that might otherwise be dissipated in competition between individual ports.

One really pressing challenge in terms of Round 3 developments off the UK's south and east coasts, is competition from other European ports, especially those that are already active in wind energy. Leading wind turbine manufacturers in Germany, Denmark and France – hardly any are yet up and running in Britain – have access to ports such as Bremerhaven, Emden and Cuxhaven (Germany), Cherbourg and St. Nazaire (France), Esbjerg (Denmark), Antwerp (Belgium), Rotterdam (the Netherlands) and others.

Bremerhaven provides a useful example of what a port must have (and must do) to attract wind energy players. Faced with a decline in its major shipbuilding activity, the north German port decided in the early noughties to focus on renewable energy, exploiting its advantages of strategic location, a deep water harbour (albeit with lock access) and adjacent river, a strong maritime technology base and a skilled engineering workforce.

The city council decided to create a 250 hectares Offshore Wind Port featuring a new greenfield manufacturing and supplier park. Pre-assembly of offshore structures directly on the quayside ready for shipping is allowed for. Much of this infrastructure is now in place and in 2014 construction is due to start on a new offshore terminal on the Weser River just outside the existing port. A new heliport, complementing an existing airport, is to be built.

The city offers proactive support, including capital injection, help in locating sites for facilities, accelerated permitting processes and subsidised loans for incoming companies. This level of commitment, along with a cohesive overall plan, has proved successful. Today, REpower Systems and Areva Wind are building their 5 MW offshore machines at the port while rotor blades are produced there by PowerBlades GmbH. Other enterprises in an extensive supply chain include foundation manufacturer WeserWind GmbH, two rotor blade testing organisations and a host of smaller firms. A continuing supply of technicians, engineers and managers is delivered by local educational establishments, including the University of Bremerhaven, with training being subsidised by the state of Bremen.

This example illustrates what east and south facing UK ports are up against – European mainland ports that already up and running with wind, have strategies in place for further wind energy growth and benefit from regional and city backing. Although Round 3 demand, coupled with the head of steam already built up by Rounds 1 and 2, is undoubtedly creating a desire among leading players to be in Britain, ports on the mainland are keen to compete for this business. Ports on the western side of the UK are better placed because they may have more of the field to themselves in serving developments in the Celtic and Irish seas.

A chicken and egg situation

To an extent ports and developers alike are victims of a ‘chicken and egg’ situation where regional, city and port authorities are reluctant to invest strongly in port development unless they have good indications that wind energy business will result, whereas wind turbine manufacturers will not commit to a port unless timely infrastructure development is almost certain. This impasse could worsen as the economic situation reduces the availability of funds and credit. Consequently, while there is no shortage of glossy prospectuses trumpeting ports’ physical attributes, actual earth shifting and building activities are harder to find.

In truth, some agreements have been signed, but most of these are provisional. Focus of one of these ‘provisionals’ is Hull, a major port and city on the river Humber in north east England. In January 2011, Siemens announced the signing of a memorandum of understanding (MoU) with Associated British Ports to develop Green Port, Hull, as the site for an £80m manufacturing facility. Siemens, which has also invested in training and other competence centres in several towns in northern England, said it hoped to have its new factory serving Round 3 needs by 2014. Regeneration of an existing 56 hectares port complex next to a natural deep water channel will, it is expected, include the development not only of the wind turbine equipment factory but also component storage areas, offices and a helipad. A new 600 m riverside berth will be constructed and nearby docks will be able to receive blades and towers arriving from construction sites elsewhere by ship.

Clearly, Hull would like to see this provisional plan become reality on the ground. As Karl Turner, MP for Hull East, has put it: “We are well placed to be the renewables capital of the UK. This exciting opportunity guarantees jobs, helps the environment and will boost Hull's economy for future generations.”

Aspirational words abound, but nothing is yet certain. The original agreement expired in July, and Siemens is unlikely to go ahead if it felt that UK market prospects were faltering or that it would not gain significantly from Round 3. The company will have been reassured by the Government's reversal of an earlier decision to cut the £60m funding it had earmarked for UK port development, and the announcement that nearly 210 hectares of Hull's port area have been granted Enterprise Zone status which, with the favourable capital allowances and other inducements that this entails, will help in attracting a renewable energy supply chain cluster.

Hull City has pitched in with a pledge of £5m towards the new development. Local hopes were boosted by a Siemens statement in September that ‘we are continuing to work with our preferred bidder (ABP) for the construction of a wind turbine factory in Hull and negotiations are on-going and on track’. Local MPs feel that further backing from the UK Government could help clinch the deal in the face of competition from Danish ports.

Hull's trump card is its proximity to several major wind farm projects including the Humber Gateway (E.ON Climate and Renewables), the Hornsea Offshore Wind Farm Scheme (SMart Wind, a joint venture between Siemens and Mainstream Renewable Power) and, further offshore, farms on the Dogger Bank. Siemens certainly needs a site able to serve the massive Hornsea scheme which alone, with its planned 4 GW capacity, will require hundreds of turbines.

Moreover, the Humber estuary, with its flat, stable sea bed and favourable wind and wave conditions, is a tempting operational location – the more so given that it has four ports of potential wind energy use. Ed Moss, Marketing Manager for the Humber Local Enterprise Partnership says that Hull, Goole, Immingham and Grimsby have much to offer as an integrated nexus. Grimsby, at the mouth of the estuary, can serve as a quick access O&M base with Grimsby Port East, a proposed redevelopment of a previous fishing port, being within 80 miles of 10 actual and proposed wind farms. Goole, inland from Hull, has potential as a manufacturing and shipping base for supply chain elements while Immingham near the mouth of the river is a noted deep water port that could berth large TIVs.

Additionally, work has reportedly started at Killingholme Marsh, on the south bank of the Humber, on the Able Marine Energy Park, an intended £430m transformation of a 327 hectare site into a facility for manufacturing, commissioning, installing and recycling offshore wind turbines. The plan includes a deep water terminal and Able UK hopes to have the first quay operational by 2014. Activities in other renewables, including biomass and wave technology, are also part of the scheme. Local residents welcome the plan because it could create more than 4000 much needed jobs, adding to the 10,000 or so that Siemens would eventually employ in Hull. Some £50m has been spent on preparing for construction and marketers for the development are targeting producers of nacelles, blades, towers and foundations as well as the wind turbines themselves.

Richard Cram, Able UK's Design Director for this new all-embracing ‘Humber Port’, says: “The Humber can become the European centre for offshore wind turbines.”

Already the Humber Estuary is the busiest trading estuary in the UK and, taken as a whole, ranks fourth among north European ports, surpassed only by Rotterdam, Antwerp and Hamburg. This has ensured that the Humber ports and their hinterland are rich in skills, maritime expertise and have good road and rail connections.
Vestas’ choice

Meanwhile, Vestas Wind Systems has provisionally chosen Sheerness in Kent for the production of its 7 MW offshore turbine, the V164. An option agreement signed last spring with Peel Ports, operators of the Port of Sheerness, gives Vestas provisional rights to a 70 hectare plot of land on which to manufacture and store blades, assemble nacelles, store turbine towers and load installation vessels at an adjacent quay. ‘Provisional’ because, as Vestas stated when releasing the news last May, full follow-up on the agreement is contingent on it receiving a satisfactory order intake for the new turbine.

Anders Søe-Jensen, the then-President of Vestas Offshore, declared at the time: “We have shown our intention to make major investments and create jobs, but we don't just jump head first into an investment of this size. We first need to be sure it makes business sense. Before our customers can provide us with the needed order pipeline, they need to see stability in the market and a long-term political and regulatory certainty that secures their business case. Making that happen is in the hands of the policy makers, so we look forward to seeing the UK Government provide the best possible terms for the offshore wind industry to take-off and for the potential jobs to become a reality.”

The company chose Sheerness at the mouth of the River Medway because 15 GW of planned offshore wind development lies within 140 miles of the port. This includes the Norfolk and Hastings Round 3 zones plus the Rounds 1 and 2 Thanet, Kentish Flats and London Array developments off the Thames Estuary. The turbine maker also has developments in French, Belgian and Dutch waters in mind. But Vestas is clear that public funding support is needed to de-risk and reduce the large investment that such infrastructure development requires.

Sheerness, one of five Centres for Offshore Engineering (CORE) areas identified by the British Government as preferred wind energy hubs (the others are Teeside, Tyneside, the Humber, plus Great Yarmouth and Lowestoft together) believes it is playing its part. The port has marshalled a significant incentive package and has undertaken to vacate an existing fresh produce terminal and import car terminal to accommodate the new facility. If plans go ahead, Vestas could start serial production on this site in 2015.

Part 2 of this series –  will look at ports in the South and West of the UK, and those that look set to lose out.

About the author: George Marsh: Engineering roles in high-vacuum physics, electronics, flight testing and radar led George Marsh, via technology PR, to technology journalism. He is a regular contributor to Renewable Energy Focus.

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