SMEs disadvantaged in offshore energy

The new generation of offshore wind projects could have a far wider set of suppliers if procurement procedures are change, Swedish provider Vattenfall has said.

Feedback from more than 580 companies taking part in events have been compiled into a report: the Norfolk Vanguard and Norfolk Boreas Offshore Wind Supply Chain: Opportunities and Expectations Workshop Report that aims to bring more businesses into the offshore wind supply chain to help the industry achieve 60 per cent of the UK’s energy mix in a decade.

Key issues for businesses wanting to work in the sector included the current project-by-project approach to procurement and construction rather than by portfolio or ‘bundling’ projects. The current system meant “globally active Tier 1 companies are currently better able to manage the peaks and troughs of this system than more locally-based SMEs.” SMEs said they were also disadvantaged in meeting Tier 1 expectations because engagement only happened after developers were awarded Contracts for Difference and final investment decisions had been taken.

More SMEs could win work if a more consistent supply chain workflow was achieved, moving away from the current ‘bid-award-construct’ model with peaks and troughs of activity, the report states.

The 67-page report believes that there is a need for longer term planning for projects, more transparency and a better understanding across the supply chain of how the sector works, and earlier engagement to support businesses prepare for winning tenders.

Key asks to the government in the report include a clear framework and plan for energy transition, encouragement and monitoring of local content, more support for UK companies working overseas, support for and clarity on rules for microbusinesses and SMEs and investment in skills.

The report will now to be shared across government, developers, Tier 1 and 2 companies and the rest of the supply chain.

Rob Lilly, Vattenfall’s supply chain manager, said: “The over-riding message from established and potential supply chain companies is that they would benefit from longer term planning and better understanding of how the sector works as a whole.”

Vattenfall is hoping for consent in June and November to build the Norfolk Vanguard and Norfolk Boreas projects. It has worked extensively with supply chain companies in a series of workshops and ‘meet the buyer’ sessions in Norfolk, and Kent for its Thanet Extension project, since 2018.

    Share Story:

Recent Stories