Stage 2 SIM projects published

SIM projects published highlighting offshore wind sector priorities for supply chain and infrastructure

• On 24^th January 2024, SOWEC’s Strategic Investment Model (SIM) Working Group announced the opening of Stage 2 of the SIM, which will help to deliver transformational offshore wind supply chain growth in Scotland through innovative collaboration between offshore wind developers, the Scottish Government, enterprise agencies and Crown Estate Scotland.
• 38 projects with a potential capital value of £6.5bn have successfully completed Stage One.
  • 32 of these projects are today listed by the SIM Working Group. The remaining six have requested confidentiality at present.
  • Each of these 38 projects has a prospectus, and will receive information back from the SIM group over February 2024 to confirm offshore wind developer interest and next steps.
  • The list of 32 projects is available below.
• An initial first three projects were selected by the SIM and invited to move into Stage 2. All three have accepted this invitation with initial meetings between offshore wind developers and these projects being arranged in February 2024. Further detail on the three projects can also now be shared:
  • Port of Cromarty Firth Expansion (Port of Cromarty Firth)
  • Port of Nigg West Deepwater Quay Expansion (Global Energy Group)
  • A supply chain investment project (for commercial confidentiality reasons its identity is not being disclosed at this time).

• The wider SIM process is ongoing, with projects being assessed and supported to engage with offshore wind projects. The next step for all projects is to receive feedback from the SIM through sight of the expressions of interest submitted by offshore wind developers for further engagement.
• INTOG developers have also been invited to join the SIM and work within this collaborative approach to support infrastructure and supply chain development

The SIM Working Group has today published further information about the initial three projects moving into the SIM Stage 2 process. SIM projects have been assessed in terms of relevance to individual offshore wind project delivery, with multiple developers also expressing interest in taking part in collaborative meetings.

In Stage 2 the focus will be on how to ensure these projects have confidence to make a Final Investment Decision. Offshore wind developers, Enterprise Agencies, Scottish Government and other interested parties, will work collaboratively to help these projects secure the backing they need to move ahead. In testing its approach with the three initial projects, the SIM will be looking to better understand how different means of support can be brought together to help projects reach final investment decision.

Details of the initial two port projects being taken forward are below.

Port of Cromarty Firth Expansion (Port of Cromarty Firth)

The Port of Cromarty Firth (PoCF) is planning to expand its port to support the deployment of floating offshore wind farms (FLOW), by developing an additional 5 Hectares of storage space to enable the construction of circa 1GW of floating offshore wind capacity per year. The facility will be capable of supporting the assembly of floating offshore wind foundations and the integration of floating offshore wind turbines

At its peak of operation, PoCF estimates this facility can support 1,148 direct and 1,060 indirect well-paid jobs per annum, along with investment in local training, and provide much needed capacity to the offshore wind industry to deploy its pipeline of projects. It provides an optimal solution to industry needs, reducing supply chain costs, and lowering the Contract for Difference (CfD) price wedge

This initial 5ha development is part of a wider plan to extend the existing 12ha of open storage capacity adjacent to a 372m quayside, currently being used to marshall the Moray West XL monopiles, by adding 20ha of lay down area and a 413m quay, in four phases. In this first phase, Phase 5A, PoCF will deliver 5ha of land (15t/m2), a 175m quay with a heavy load pad (25t/m2), as well as a deep pocket (16m) next to the quay, delivering 17ha in total with 547m quay ready for 2028. Port of Cromarty Firth is a part of the Inverness and Cromarty Firth Green Freeport.

Port of Nigg West Deepwater Quay Expansion Project (Global Energy Nigg Ltd)

The Port of Nigg West Deepwater Quay Expansion is set to address the increasing demand for larger deep-water facilities in the UK to support the offshore renewables industry. Led by Global Energy Group, the project will expand the existing West Quay at Nigg, creating a new ultra-deep water berth, featuring a 160m quay at a water depth of 22m Lowest Astronomical Tide (LAT). The expansion will create an expansive laydown and storage area totalling 46,860m2, with a ground loading capacity of 50mt/m2.

The Port of Nigg has played a crucial role in supporting five major offshore wind projects in Scotland, totalling 2.6GW. The proposed expansion will enhance Nigg’s capacity to accommodate the next generation offshore wind structures, both fixed and floating, and larger installation vessels.

Central to this development is the creation of an ultra-deep water sea-facing berth, positioning the Port of Nigg as one of the UK’s deepest ports. The expansion will result in a combined addition of 420m of quayside being available at Nigg, taking the facility’s total quayside to an impressive 1,555m. The project will cement the Port of Nigg as a leading location for existing fixed-bottom offshore wind projects and support the industrialisation of floating offshore wind.

The Scottish Government’s Energy Minister Gillian Martin said: “The Scottish Government is determined to maximise the economic opportunities and benefits from our offshore wind potential. We are kick-starting the First Minister’s flagship commitment of up to £500 million over five years to anchor Scotland’s offshore wind supply-chain with investment of £67 million next financial year.

“Moving these three projects – with a combined capital value of around £500 million - to the next stage of the Strategic Investment Model (SIM) is a significant step.

“Around the globe, offshore wind faces challenges in securing the scale of investment needed to unlock its full potential. SIM is a novel, industry-led approach, which supports close collaboration between industry and the public sector.  It is a model being closely watched by other sectors and the investment community.”

Joanne Allday, Strategic Business Development Manager, Port of Cromarty Firth said “Industry and government reports in recent years have all concluded that Scotland needs more port infrastructure to deliver energy security and Net Zero through offshore wind. Its great news that Scotland’s offshore wind projects see the Cromarty Firth as a prime location for the build out of offshore wind. This announcement builds on the region’s location, capabilities and Green Freeport success and should increase local content and jobs. We look forward to the next stage of the process, to ensure we optimise this opportunity for Scotland.”

Iain Sinclair, Executive Director, Global Energy Group said “The vital enabling role that Scotland’s Ports and Harbours will play in supporting national net zero and energy security targets, specifically for offshore wind, is well documented. Being shortlisted to progress to the second stage of the SIM process is welcome confirmation of industry confidence in the Port of Nigg’s strategic role in the industrialisation of offshore wind. We look forward to working collaboratively with SOWEC’s investor stakeholders, and all of our Ports and Harbours partners, to deliver the critical enabling infrastructure required to accelerate the deployment of offshore wind in the UK."

Gillian Morrison, Supply Chain Development Manager at Crown Estate Scotland, and Chair of the SIM Working Group said “Across the last year Crown Estate Scotland has worked alongside government, industry, and a wide range of private and public sector bodies in order to progress the Strategic Investment Model. Today’s details of some of the projects that the SIM is working to support helps make real the scale of the opportunity that we can grasp for Scotland, if we put in place the necessary infrastructure to help grow our supply chain and deliver Scotland’s offshore wind pipeline.”

SOWEC’s Industry Co-Chair Brian McFarlane of SSE Renewables said “The Strategic Investment Model is helping the offshore wind sector work together to prioritise its infrastructure and supply chain needs. ScotWind is a huge opportunity for Scotland, but to land this we need partnership between industry and government to ensure Scottish ports and supply chain are ready to capitalise on future manufacturing, installation and operation contracts.”

Elliot Wishlade, Director at Arup said: “work on the Strategic Investment Model is showing that industry and government is able to collaborate effectively to put shared infrastructure in place. Arup is proud to have been able to facilitate this work as the SIM Programme Manager. “

SIM Stage 1 projects

38 projects have completed Stage 1 of the SIM. Each of these projects has a completed prospectus, and will receive further information on offshore wind developer interest over February 2024. 32 of the 38 projects are listed below. Two of the three initial projects being moved into Stage 2 are highlighted in bold. A further six projects have completed Stage 1 but have asked for details not to be shared outside of SIM discussions.

History of the SIM

In May 2023, the Strategic Investment Model launched a call for proposals for port infrastructure and top tier supply chain projects to be built in Scotland. The SIM came out of sector work to develop a “Collaborative Framework”, and has involved Scottish offshore wind projects, including all ScotWind projects, plus the Scottish Government and its agencies.

By June 2023, 45 proposals were received in the first SIM application process which was launched at All Energy in May 2023. The SIM Working Group and programme manager Arup then worked with these 45 proponents to review eligibility. 38 projects successfully concluded Stage 1. Arup supported each of these infrastructure and supply chain projects to develop a prospectus setting out its offer to the offshore wind market.

Between December 2023 and mid January 2024, offshore wind developers within the SIM reviewed each prospectus. These offshore wind projects have returned expressions of interest to the SIM identifying which of the infrastructure and supply chain projects they wish to meet with collectively to discuss their supply chain needs.

Following an initial review of these expressions of interest, three initial projects identified in this release are being invited for exploratory meetings to look at how best they can be supported through the SIM in its Stage 2 process.

All projects completing Stage 1 will receive information showing what expressions of interest have been received from Scottish offshore wind developers, and the SIM will facilitate initial engagement between projects and offshore wind companies. In addition they now have completed prospectuses to support them in future market engagement.

Notes

• More information on the Strategic Investment Model and the list of the 32 (out of 38) announced projects can be found at: https://www.offshorewindscotland.org.uk/the-scottish-offshore-wind-industry/sowec/sim/
• The SIM Working Group is comprised of offshore wind developers (including all ScotWind developers), the Scottish Government, enterprise agencies and Crown Estate Scotland.
• Port of Cromarty Firth, the statutory harbour authority for the Cromarty Firth and owner of the Invergordon Service Base, is leading the PoCF project. The Port has an established track record and solid experience in managing and delivering such construction projects, having successfully delivered two expansion projects, phase 3 and phase 4 (Quay West), in the past nine years with a combined value of over £50m.
• Global Energy Group (GEG) will lead on developing the Port of Nigg’s West Deepwater Quay Expansion project. GEG is one of the UK’s leading integrated energy supply chain and infrastructure service providers, operating across the renewables, oil and gas and nuclear sectors. GEG has core competencies covering manufacturing, fabrication, assembly, marshalling, crangage, logistics, storage and inspection for offshore energy projects. Since 2011, GEG have invested over £120m into the ongoing redevelopment and expansion of the Port of Nigg. GEG are led by the parent company, GEG Holdings.
• The Scottish Offshore Wind Energy Council (SOWEC) is a collaboration between the Scottish public sector and the offshore wind industry. SOWEC has a clear vision and goals which is focused on growing the sector, ensuring the Scottish offshore wind industry is more sustainable, competitive, and commercially-attractive, both domestically and in the global offshore wind market. SOWEC supports the SIM Working Group in taking forwards the SIM.
• The SIM Programme Manager is sustainable development consultancy Arup. Arup was appointed to this role following a tender process run by Crown Estate Scotland on behalf of SOWEC. Arup is a collective of designers, consultants and experts working globally. Founded to be humane and excellent, we collaborate with our clients and partners, using imagination, technology and rigour to shape a better world.

To follow up on this notice please contact Maf Smith, Lumen Energy & Environment, maf.smith@lumenee.cc / 07768 531501