ADM2Renewables. Exploring opportunities in Scotland s Offshore Renewable Energy Sector. IET Teacher Building Glasgow. In association with:

Transcription

1 ADM2Renewables Exploring opportunities in Scotland s Offshore Renewable Energy Sector In association with: IET Teacher Building Glasgow October 6, 2011

2 Scotland Aerospace, Defence & Marine Scope and Scale No. companies = 850+ Turnover = 5.2 Billion GVA to Scottish Economy = 2.1 billion Employees c. 40,000

3 Agenda Introduction Opportunities for the AD&M industry in offshore renewables Offshore Renewables: A developer s needs from the supply chain Break Diversification Case Study 1: Diversifying into offshore renewables Diversification Case Study 2: Supply chain opportunities & challenges Scottish Enterprise: Offshore Renewables Expert Support Q&A Lunch Ian McMahon Scottish Enterprise Zoe Barnes BVG Associates Finn Teller Statoil Liam Forbes Babcock Marine Alan Chapman MacTaggart Scott Zoe Barnes BVG Associates

4 Opportunities for the Aerospace, Defence and Marine industry in offshore renewables Zoe Barnes 6/10/11

5 About BVG Associates BVG Associates is a technical consultancy with expertise in wind and marine energy technologies. The team has very strong independent knowledge of the supply chain and market for wind turbines in the UK. BVG Associates has over 120 man years experience in the wind industry, many of these being hands on with wind turbine manufacturers, leading RD&D, purchasing and production departments. 4

6 Zoe Barnes Over nine years experience in wind turbine technology, manufacture and development Lead our activities in Scotland, where I am based Specialises in technology development, commercialisation and technology transfer Led Vestas team managing collaborative research, building a strong global network of relationships in the renewables industry and in parallel sectors such as aerospace 5

7 Aim: To give an overview of the UK offshore renewables market and cross-over opportunities for the AD&M markets. 6

8 Contents Introduction to offshore wind/renewables Scale of opportunities: The UK market Location of opportunities: Potentially suitable ports Scottish government support Opportunities for AD&M Barriers to entry Tips for approaching wind turbine manufactures and developers 7

9 Introduction: The structure of a wind turbine Helicopter access Internal crane Nacelle cover Main bearing Hub casting Spinner Main shaft Gearbox Generator Nacelle bedplate Blade bearing Yaw bearing 8

10 Introduction: The structure of a wind farm Helicopters Geophysical survey Ornithological vessels and mammal surveying vessels Met station Construction port Foundation installation vessel Cable-laying vessel Support vessels Subsea installation vessel Cable plough Inspection work class subsea remote operated vehicles (ROV) Offshore substation Turbine installation vessel 9

11 Introduction: Market Structure Projects 10

12 Introduction: The offshore wind farm lifetime costs 11

13 Scale of opportunities: The UK market Source: The Crown Estate 12

14 Scale of opportunities: Predications for UK offshore wind to

15 Wave and tidal forecast AnnualiInstalled capacity (MW) Cumulative installed capacity (MW) UK other Pentland Firth and Orkney waters Cumulative capacity 0 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 Single devices 0-2MW Initial phases 5-10MW Subsequent phases MW 0 Forecast assumes full build of Pentland Firth and Orkney waters by 2020 To 2016 other significant projects include other Scottish leases in Western Isles and Shetland Isles Beyond 2016 it is assumed that new commercial leases begin construction in Scotland, Wales and Ireland 14

16 Scale of opportunities: Estimated timeline for UK projects (Round 3 Phase 1 and STW Phase 1) Zones awarded Planning application and consenting Contracting, procurement & wind farm design Construction & installation Most projects will be phased Some projects may be stalled by developers 15

17 Scale of opportunities: Scottish Market Name Islay Argyll Array Beatrice Inch Cape Neart na Gaoith Firth of Forth Moray Firth Solway Firth Wigtown Bay 690 MW 1800 MW 920 MW 1000 MW 420 MW 3500 MW 1400MW 300 MW 280 MW Kintyre 378 Forth Array 450 MW Source: Crown Estate Total still in process 9.7 GW 16

18 Scale of Opportunities: Scenarios for economic benefit in Scotland by 2020 Scenarios A B C D Energy, economic benefit & export Energy & economic benefit Low delivery energy & economic benefit Low delivery of energy only Economic value 7.1bn bn bn Jobs created Source: Scotland's Offshore Wind Route Map: Developing Scotland's Offshore Wind Industry to

19 Location of opportunities: Potentially suitable ports Offshore wind is likely to cluster around port sites as will act manufacturing, installation and O&M hubs Site Leith Dundee Nigg Energy Park Fife at Methil Aberdeen Hunterston Arnish Campbeltown/ Machrihanish Ardersier Peterhead Kishorn 18

20 Some mechanisms available to support diversification into offshore wind in Scotland Support Mechanism Offshore Wind Expert Support Programme The National Renewables Infrastructure fund International Renewable Energy Zone Scottish Energy Laboratory Scottish Supply Chain Database Low Carbon Skills Fund POWERS Target development area Provides 2 days support to companies to explore opportunities in offshore wind Funding for port and infrastructure development Location where companies can access research and skills needed to commercialise new technologies Network of accessible prototype and test facilities Lists companies with relevant competencies and products Provides sector specific training for companies Support for development of prototyping for offshore wind Regional Selective Assistance Grants for safe guarding or generating jobs in Scotland 19

21 Opportunities for AD&M in offshore wind 20

22 Opportunities for AD&M: Introduction The wind industry is looking to other sectors to provide technology and supply chain solutions Opportunities in consenting, tech transfer, supply, manufacturing and O&M Source: The Boeing Company 21

23 Opportunity: Wind farm development and consenting support Provision of services and products for logistics and transport Site access products Service or products for the transport of large objects Logistic management tools and services Source: The Boeing Company Provision of site assessment services Radar impact Terrain Resource Example: BAE Systems: Radar impact assessment BAE Systems has for a number of years offered a service to wind farm developers whereby they predict the effect of a proposed wind farm on civil marine and military radar. Source: Department of Transport 22

24 Opportunity: Technology transfer and supply: Shared challenges Aerodynamics Composites Smart Grids Energy Storage Reliability Design Tools Lightning Stealth Manufacturing Controls Condition Monitoring Testing 23

25 Opportunity: Technology transfer and supply - Methods Transfer of knowledge from aerospace to offshore wind: Externally funded collaborative projects Technical consultancy IP licensing Component supply Provision on testing facilities and services Provision of design tools Collaborative technology development: Membership of collaboratories (ORETIC) Secondments Co-funded internal R&D projects Co-funding of academic research 24

26 Opportunity: Technology transfer and supply - Examples QinetiQ/Vestas TSB Stealth Turbine Program Boeing/Vestas Strategic Partnership Project applied aerospace stealth materials to wind turbine blades and towers Costs of project split between QinetiQ/TSB/Vestas Collaborative development Patents shared Stealth material patents licensed to Vestas from QinetiQ Signed MOU Range of collaboration: Secondments/workshops Co-support of academics Business development opportunities Sharing test data Co-development of tools Areas include: Manufacturing Aerodynamics Systems integration 25

27 Opportunity: Supply of turbine components and subsystems There is opportunity for supply of a significant number of components and subsystems including: Composites: Materials Subcomponents Components Power electronics Electrical and mechanical control systems Grid integration systems Asset monitoring and protection systems Condition monitoring Radar impact reduction systems Lightning Smart coatings Examples: Moog Insensys Supply condition monitoring systems to the offshore wind industry and have product development projects with some wind turbine manufactures. EADS Developing blade manufacturing factory using internal composite expertise. 26

28 Opportunity: Manufacturing support Challenges in common Speed and volume of production Size of component including composites Quality and reliability 27

29 Opportunity: Manufacturing support Supply of tooling Provision or service for optimisation of manufacturing (e.g. LEAN, factory layout) Supply of quality assurance processes Supply chain development and optimisation Co-support of development skills base Example: M. Torres Composite tooling supply company. Primary market is aerospace but have diversified to become one of the leading suppliers to the wind blade market. Source: M. Torres 28

30 Opportunity: O&M support and asset management Development and provision of asset management products: SCADA systems Data management systems Condition monitoring systems Provision of maintenance tools: Maintenance management software Maintenance engineer tools Access systems Maintenance vessels Example: Lockheed Martin Recently commended for their designs of vessel access systems for offshore wind during the Carbon Trust accelerator program. Provision of maintenance services Maintenance teams Port sites Spare parts logistic support Refurbishment Source: The Carbon Trust 29

31 Barriers to entry Wind industry expects an annual decrease in capital and O&M cost Wind turbine manufacturing philosophy is moving closer to that of the automotive sector Much lower margins Wind industry perception of aerospace & defence sectors Building up a track record Integrating new technologies into road maps 30

32 Tips for approaching wind turbine manufactures and developers Reliability is one of your key selling points, play it up but balance it with an understanding of cost drivers Be able to explain how any proposal or product directly affects cost of energy generated over a wind farm lifetime Collaborate with potential customers to ensure you understand and can meet industry demands If looking to collaborate, bring in external funding Be able to demonstrate a global mindset Have a definite offering or proposal when you approach them Don t underestimate the cultural and cost driver differences between the two industries 31

33 Thank you Note: Zoe Barnes (BVG Associates) Paul Gardener (Garrad Hassan) John Bambrough (Optimat) and Heather Quigley (SE Offshore Renewables Expert Support Programme Manager) will be around at lunch to answer questions. 32

34 See separate presentation

35 Diversifying into offshore renewables BIG International Group Plc 34

36 The leading engineering support services company We take real responsibility for delivering outcomes Managing Assets and Infrastructure and assure those outcomes through process excellence Delivering Projects and Programmes by bringing together leading-edge skills Integrating Engineering Expertise 10/11/

37 High growth organisation Publicly-listed company delivering engineering support services *Order book over 12 billion and sales of 2.9 billion per annum 20010/11 results: Our eighth successive year of significant growth Robust financial position, highly cash generative business model * 2011 annual report 36

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41 Marine and Technology Supporting our customers onshore and at sea Providing innovative solutions worldwide Babcock is the major support partner to the Royal Navy and a key support partner in Canada, Spain and Australia. The division provides services to customers in civil marine and the oil and gas industries 10/11/

42 Babcock Owned Facilities Rosyth Dockyard Naval Re-fits Carrier construction Commercial Construction Civil Marine Devonport Dockyard Appledore Dockyard Commercial Vessel Construction Yachts OSV/PSV Dredgers Naval Re-fits Submarine up-keep Commercial Construction Super yachts RNLI 41

43 Babcock Operated in partnership Facilities Dounreay Nuclear Power plant Faslane Naval Base Coulport Naval Base Devonport Dockyard - Auckland Techport Common User Facility Australia 42

44 Motivation for Babcock Aligns with Babcock continuous growth strategy Aligns with the growth of a wider energy business Maintains / develops capability post Aircraft carrier 43

45 The Process Early 2010 : Conducted a review into the Energy Market in the UK Concluded: Offshore Renewables was a significant growth market suited to the groups capabilities. Simultaneously (as part of our 2020 strategy initiative) conducted a series of reviews via a Renewable Forum constructed of participating parts of the Division. Integrated Technology Systems and Equipment Frazer Nash Included Networks and Dounreay Conclusion: Differentiate the market into Wave/Tidal and Wind and suggested focus on Rd 3 Wind. 44

46 The Process Following this External reviews were conducted by GL Garrad Hassan Market potential Study Fraser Nash Consultancy Internal Capability Study Strategic Description Babcock Activity Lifecycle Purpose Clarified market differentiators and suggested separate focus on 1. Wave / Tidal 2. Wind - Development projects (short medium term) 3. Wind - Operations & Maintenance (Long term) 45

47 The Process Further Capability reviews and market assessments define our areas of activity as: I. FEED - Engineering in support of consent and planning plus Engineering Analysis / governance in support of integrity for device developers II. Product - Development of Vessels and Floating structures (Weather Buoys) III. Support to Developers Port Services, Workshops, Logistics etc IV. Development Manufacture of Complex structures ( Sub Stations) V. O&M Enabling the environment that supports safe operations and maintenance on and offshore 46

48 Client Groups - Insights Generator / Developer Utility company Own turbines and array cables Operate and manage the wind farm Require a high energy yield with minimum OPEX OEM Primarily turbine providers Maintain their equipment under warranty for 2 3 years Require Offshore support and infrastructure along with onshore facilities OFTO Institutional investors Own all transmission (132kV+) assets Defined base revenue with availability incentive Require high asset availability at minimum OPEX 47

49 Current Status I. FEED II. Product III. Support to Developers IV. Development V. O&M Engineering in respect to i) and ii) ongoing Recruitment and execution planning in respect to iii), iv), v) commenced and being accelerated Marketing material being produced Renewable Office is open for business 48

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51 Diversification Case Study 2 Supply Chain Opportunities and Challenges ALL RIGHTS RESERVED The copyright in this document is vested in MacTaggart, Scott & Co. Ltd., and the document is issued in confidence for the purpose only for which it is supplied. It must not be reproduced, in whole, or in part, or used for tendering or manufacturing purposes, except under agreement or with the consent in writing of MacTaggart, Scott & Co. Ltd., and then only on the condition that this notice is included in any such reproduction.

52 Organisation Founded in 1898 Based in Edinburgh Privately owned company employing 250 people Annual turnover of 30 million Specialists in naval engineering Commercial in Confidence 51

53 Company profile Leading contractor to the naval defence and related marine industries Wide range of systems supplied for submarines and surface warships of many types and class Specialising in heavy-duty mechanical handling systems for operation in extreme environments 70% of all systems are exported 60% surface ship work, 40% submarine work Commercial in Confidence 52

54 Naval ship equipment Aircraft & weapons elevators Helicopter handling Towed array handling Replenishment-at-Sea Naval deck machinery - Anchor windlass - Capstans - Davits - Cranes Commercial in Confidence 53

55 Submarine equipment Mast raising equipment Retractable bowplanes Secondary propulsion systems Retractable capstans Anchor windlasses Towed array handling Communication buoy handling Low noise hydraulic motors/pumps Commercial in Confidence 54

56 Renewables Activity - History Wind Turbine Transmission - Replace gearbox transmission in wind turbines with hydraulics - Development venture with Conoco Phillips / Artemis Intelligent Power Carbon Trust - Marine Energy Accelerator (MEA) Strand B - Reactive Hydraulic Modulator (RHM) Device - Universal application to WEC hydraulic PTO systems - Potential for tidal and wind applications Tidal Device Pitch Control system - Proposal for prototype machine Commercial in Confidence 55

57 Why Marine Renewables? General - Reliability - Equipment scale, loads and speeds Marine - Proven record in environment - Supply and knowledge base Industry maturity - Early stage products - Prototype development - Component testing Commercial in Confidence 56

58 Renewables Activity Current Status Have proposed systems in partnership with South Boats - looking to take this further Testing of Wind Turbine Gearboxes - Testing as a service offering - Supply of test rigs and maintenance Continuing development of RHM device - Investigate target devices / partnership opportunities Commercial in Confidence 57

59 Partnering Responsiveness - Preferred supplier arrangements common - Develop concepts ahead of time Market presence - Household names give comfort - Inside information Access to support - Partnership ventures preferred - Spread match funding investment Commercial in Confidence 58

60 Renewables Activity Lessons learned Play to strengths - Massive market focus on key areas Develop a business / market plan - Recognise the size and nature of the market - Plan 3 steps ahead! Know your budget - Might need to prove your offering before adoption - Balance risk with potential rewards Commercial in Confidence 59

61 Scottish Enterprise Offshore Renewables Expert Support Zoe Barnes 6/10/11

62 Objective of support Product is designed to help companies consider and build diversification strategies to enable them to win business in the Offshore Renewables sector Product will provide up to 2 days worth (100% funded) of one-to-one support This support will be delivered by specialist suppliers who have knowledge and experience of the Offshore Renewables sector Focus on identifying and exploring potential profitable revenue steams for the business in the future 61

63 Experience so far 12 very variable companies Companies Small metal working shops, local harbours Large multinational aerospace companies Market readiness Minimal offshore wind knowledge Existing offshore wind revenue stream Requirements from scheme Basic introduction to offshore wind industry Overviews of specific areas of the market Product specific market analysis 62

64 Example: Scottish Aerospace Company Who?: A provider of maintenance, repair and overhaul services Initial Approach: Required an overview of the wind industry and the refurb market for offshore wind Refined requirements: After an initial call, focused it down on gearboxes for the sake of the 2 days support Work: Developed and delivered presentation for internal use on the size of the offshore wind market and the specific opportunities for refurbishment of gearboxes offshore Source: Freeimageslive.co.uk Following on: Review of the refurb market for hydraulic systems by BVG Associates partially supported by Scottish Enterprise 63

65 How to apply Application Form on SE Website Send completed application to For further information contact: Heather Quigley, Project Manager