Carbon Reduction and Economic Growth in the North East. Gillian Roll NELEP Economic Strategy Manager

Transcription

1 Carbon Reduction and Economic Growth in the North East Gillian Roll NELEP Economic Strategy Manager

2 Content of Presentation Background to NELEP NELEP s Energy Activities The Green Economy in the NE, including key assets Opportunities Challenges Conclusions

3 North East LEP 32 billion economy 2 million population 43,000 businesses 800,000 employees City/Rural/Coastal geography 4 HEIs/10 FE Colleges. 18 Board members chaired by Paul Woolston, Senior Partner at PWC Business, Local Authorities, Further Education, Higher Education represented 10 members of executive team

4 NELEP areas of work Main goal of all LEPs: job creation, attracting investment and creating the conditions for economic growth to flourish Scope of LEP activity grown since Heseltine Review reflected in recent Spending Review Lord Andrew Adonis-led Independent Economic Review of the North East Enterprise Zone management Developing the European Investment Strategy (2014 to 2021) and new Single Local Growth Plan bids Skills Action Plan meeting employers needs

5 NELEP areas of work continued Managing the North East Investment Fund ( 55m capital) Attracting inward investment Involvement in trade missions Lobbying, joining up, adding value Rural Growth Network pilot area (Defra initiative) High growth sector/ supply chain development Innovation Strategy

6 Energy priorities for NELEP Energy security and affordability Long term: climate change mitigation and achieving a balanced energy future Driving forward the offshore renewables agenda and low carbon/electric vehicles Growing the marine and offshore sector Oil and gas Offshore wind Potential for decommissioning rigs in the North Sea

7 Enterprise Zone Agreed by NELEP Board to: build on our regional success in low carbon manufacturing, electric vehicles, offshore wind and science and innovation, and to help the North East become a world leader in the emerging market for low carbon R&D, manufacturing, installation and maintenance of low carbon technologies EZ three sites in the North East: Port of Blyth (offshore renewables) North Bank of the Tyne (subsea - oil & gas and offshore renewables sectors) Sunderland (A19 Ultra Low Carbon Vehicles Corridor)

8 CORE (Centres for Offshore Renewable Engineering) North East part of CORE Network Brings together Central Govt and the six major offshore wind investment hubs in England. Promote foreign direct investment. Provides link between industry, ports, LEPs, local and national Govt. Strong strategic alliances collaboration for competitiveness. Supporting existing businesses to become more successful in the global market.

9 Green Economy in the NE Subsea sector now employs more than 10,000 people and has annual revenues of over 1bn. Creation of the Neptune National Centre for Subsea and Offshore Engineering. Energi Coast members have invested 400m in the offshore renewable energy market in the North East since 2010, employing 6000 people. Hitachi building its new generation of intercity trains in County Durham - 70m factory will create 900 jobs directly. Production of the Nissan Note, alongside the Leaf at Nissan s Sunderland Plant. In 2012, the NE became the most connected area for electric cars in the country.

10 NaREC the National Renewable Energy Centre Full scale open access and independent blade testing facilities (50m and 100m blades). Proposed 99.9MW 15 turbine offshore wind demonstration site, aiming to encourage collaborative R&D, increase market competition and support SMEs to grow the sector further. UK wide brief, but location within the NE a significant asset in terms of investment and R&D capabilities.

11 Low Carbon Vehicles/ Electric Vehicles Strong supply chain: Nissan, Original Equipment Manufacturers (OEMs) and smaller low carbon vehicle companies. NE England has the potential to become the low carbon demonstration region for all elements of LCVs and associated technologies: Mass manufacture of Nissan Leaf and batteries (starting 2013); Already developed charging network, pioneering research, product and service devt, training, testing and trialling of all aspects of LCVs; and Ultra low carbon vehicle focused Enterprise Zone.

12 LCV/EV continued Strong workforce skills and supply chain. LCV performance test track Strategic transport assets that enable us to export to and be accessed by a world market. Currently developing a new Sustainable Manufacturing and Renewable Technology Park (SMART) in Sunderland goal of becoming a Centre of Excellence for EV and LCV technology. Piloting fleet services with North East Ambulance Service

13 Opportunities for NE Renewables and LCV/EV Sectors The formation of a North East Combined Authority cohesive and strategic Strike price announcement incentive confirmed Strong and united sub-sea and offshore sectors Oil and gas companies evolving/diversifying into offshore renewables Neptune Centre serious competitor to Aberdeen? Location of Dogger Bank Focus of Enterprise Zone and significant interest from investors rationale for EZ expansion?

14 Opportunities (cont) Global recognition of leading role in LCV/EV Test facilities LCV test track and NaREC blade testing European funding programme smart specialisation Green Investment Bank Growth in exports hit record levels in 2012 and NE still the only region with a Balance of Trade surplus Highly skilled and committed workforce in marine and offshore and automotive sectors (but significant challenges too )

15 Challenges - NE Renewables and LCV/EV Sectors Due to fast growing demand, there is a shortage of technical skills and engineering graduates. Situation will be exacerbated by an ageing workforce. Alternative energy sources and developments, e.g. Fracking, Nuclear Costs developing infrastructure (including grid architecture) and subsidies Accessing finance and taking risks - global economic downturn Local planning issues, e.g. onshore wind farms New innovations devaluing existing investment must remain at the forefront Significant level of FDI - extent of R&D in the NE and sustainability of investment?

16 Conclusions Potential economic benefits of Renewables and EV sectors are substantial for the North East, but there is a limited window of opportunity to capture and maximise these benefits. NELEP interface with the sector tends to focus on offshore renewables and low carbon vehicles. Strike rate announced degree of certainty, so chance to pursue investment with more clarity No longer a trade off between low carbon and economic growth can be a win:win as part of a Balanced Energy Future.

17 Sources Analysis of opportunities and barriers to growth in key manufacturing sectors in the North East region - University of Sunderland, Building Offshore Wind in England CORE, DECC

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