People’s Power – Labour announces plan for offshore windfarms with public stake
Rebecca Long Bailey MP, Labour’s Shadow Business and Energy Secretary, will announce Labour’s plans to build 37 new offshore wind farms with a 51 per cent publicly owned stake.
Offshore wind prices fell by 30 per cent last week and there are more offshore wind farms installed in the UK than any other country. But deployment is still too slow, and all sites are owned by private and foreign public firms, taking jobs and revenue out of the UK. This is despite wind being a common resource.
Under the ‘People’s Power Plan’, Labour will deploy clean power at the scale and pace needed to deal with the climate emergency. This means delivering 52GW of offshore wind by 2030, equivalent to 38 coal power stations. Labour’s new wind farms will be enough to provide electricity for 57 million households.
A ‘People’s Power Fund’ will be created from 20 per cent of all profits from the publicly owned stake, investing between £600 – £1,020 million each year into ‘bricks and mortar’ infrastructure in held-back coastal communities such as harbour fronts, leisure centres, libraries and parks.
The remaining 80 per cent of public profits will be reinvested into new renewables generation, improvements to the wider energy system and climate transition.
Labour’s Regional Energy Agencies will be responsible for owning, developing and operating a 51% public stake in new offshore wind farms – similar to the role of public energy companies in Belgium, Germany and Denmark. Labour’s plans will lead to a total of £83bn of government and private sector funding being invested along the UK coastline, in partnership with private and foreign public companies.
The People’s Power Plan will create at least 67,000 new unionised high-skilled jobs in the offshore wind sector, with particular concentrations in Scotland, Yorkshire & Humber, East Anglia and North-East England.
Commenting on Labour’s ‘People’s Power’ plan, Rebecca Long Bailey MP, Labour’s Shadow Business and Energy Secretary, said:
“Britain has long benefited from its windy shores, with the wind playing an essential role in our history as a seafaring nation. Our wind will soon become our largest energy source.
“While UK’s offshore wind industry is still young, the UK has the opportunity to avoid replicating Britain’s experience with North Sea Oil and instead to learn from countries such as Norway and Sweden by owning what is already ours.
“By taking a stake in offshore wind, we can collectively benefit from the profits, investing them back into our held back coastal communities. That wind will turn into harbour fronts and libraries. Instead of jackets for wind farms located in Scotland being made in Indonesia, we’ll bring those jobs back to Fife.
“As part of our Green Industrial Revolution – we can tackle the climate emergency and create a better economy for us all.”
Notes to Editors
- Today, the UK already has significant offshore wind farms – more than any other country https://www.weforum.org/agenda/2019/04/these-3-countries-are-global-offshore-wind-powerhouses/
- The development and operation of offshore wind farms is entirely run by foreign publicly-owned entities alongside international and domestic private companies.
- Of around ~10GW of offshore wind under construction or operational:
o 51 per cent is owned by foreign public entities like Ørsted from Denmark, Vattenfall from Sweden and Masdar from UAE.
o 42 per cent is owned by foreign private companies like Iberdrola-ScottishPower from Spain, Innogy from Germany and Maquarie from Australia
o 7 per cent is owned by UK private companies like SSE and Centrica.
o And there is a single offshore turbine owned by the Offshore Renewable Energy Catapult.
- This has led to frustration that new offshore wind farms create limited benefits for local communities and too few jobs. Migrant workers on the Beatrice wind farm in Scotland were paid below the minimum wage.
- The ‘Fife – Ready for Renewal’ campaign run by the Scottish TUC, GMB and Unite has challenged EDF’s decision to build the enormous foundations for its new Neart Na Gaoithe wind farm not in manufacturing yards in Fife in view of the wind farm, but in Indonesia 7,000 miles away.
- Sweden, Norway and Denmark have each developed successful publicly-owned national industrial champions to take advantage of the offshore wind boom.
- Denmark’s Ørsted (previously DONG) owns over 30 per cent of the UK’s offshore wind, and is the largest offshore developer in the world.
- Norway’s Equinor (formerly Statoil) is at the forefront of developing new technology such as floating wind and building an industrial future for Norway beyond oil.
- Norway’s Oil Fund also demonstrated the importance of taking a public stake in offshore energy resources, rather than privatising the assets and losing control over future revenue stream.
- Municipal energy companies in German cities like Munich and Darmstadt have become large-scale offshore wind developers, returning revenues to local services in their home cities. Stadtwerke München owns 30 per cent of the Gwynt y Môr windfarm off the Welsh coast.
- People’s Power will be financed through joint venture partnerships between Regional Energy Agencies and existing offshore wind developers. A total of £83 billion will be invested between 2020 and 2030, with £6.2 billion from NTF-provided equity capital, a further £6.2 billion in equity capital invested by the REAs, £12.5 billion invested by private sector partners in equity capital, and £58 billion in limited-recourse project finance from the private sector.
- 37 new wind farms is based on an average 1.1GW per wind farm.
- Generation equivalent to the consumption of 57 million homes is based on 41GW of new offshore wind generating 208.9 TWh per year, and 3,600 kWh annual consumption per household.
- Added to existing 11GW from offshore wind this will total 52GW by 2030.
- 52GW is equivalent to 38 coal plants is based on 1.37 GW per coal plant.
- Labour will make the Regional Energy Agencies powerful industrial actors – learning from the success of public companies across Europe. As well as offshore wind, the REAs will own and run our electricity and gas distribution networks, install solar on 1.75 million homes, and deliver a mammoth electric charging expansion for electric vehicles.