Value of Offshore Wind: A Case Study of the UK with German Comparator

This report outlines the value of offshore wind to the UK across the lifecycle of offshore wind projects and using a series of different value lenses: financial, innovation, energy & environmental, and community & wellbeing. To do so, we utilised secondary data, both quantitative and qualitative to build insights into where the UK shows strengths. We compared UK data against data available for Germany as a comparator. We outline data availability issues around the availability and non-standardised reporting of data.  

We find that the UK’s offshore wind sector shows potential for addressing regional economic inequalities, and the industry set local value capture allows UK supply chains to benefit from offshore wind investment. Circular economy principles are strongly advocated for by industry bodies such as the Offshore Renewable Energy Catapult, and early innovations are qualitatively captured in the report. Compared to Germany, the UK is generating more offshore wind energy and increasing capacity at a quicker rate.  

Our key insights include: 

• CAPEX capture: While CAPEX is the point of highest expenditure it remains the lowest point of local capture. Interventions in upstream supply for development of offshore wind sites could provide a source of local economic value for the UK.  

• Supporting offshore specific technologies: Offshore wind technologies are likely to start evolving away from the more mature technologies available in onshore wind, particularly around the materials and construction of components to withstand corrosive environments at sea, and where floating structures differ from onshore wind components.  

• Circular economy as an opportunity: The sector is already embracing principles of circular economy, and innovations around circular economy are emergent, but opportunity has yet to be fully grasped, as pioneering in the repowering, reuse and recycling of offshore wind materials offers opportunities in the UK and on a global scale.  

• Supporting offshore wind is a regional rebalancing opportunity: Current patenting evidence suggests that offshore wind activity happens outside of London and the ‘golden triangle’ where the majority of patenting would typically occur suggesting that offshore wind can be a means of providing innovation value to those areas. Understanding how offshore wind can rebalance regional economic inequality in the UK is an area future research interest.   

• Potential to pioneer in community offshore energy: While local content industry standards are high meaning local supply chains benefit from offshore wind in the UK, Offshore wind’s requirements for capital make community ownership more challenging, and offshore wind is behind onshore wind in making community funding available. There is an opportunity to pioneer new ways (such as those proposed by Project Collette) of structuring offshore wind projects so that community ownership is more feasible. 

We also provide the underlying lifecycle and values framework, which can support horizon scanning in other industries as a downloadable template.  

The values framework was created to support Innovate UK to understand the value of Offshore Wind to the UK across the life cycle of offshore wind, and according to different ideas of value.    

The framework is particularly useful to energy technologies as this is what it was designed for, but could be used for other industries with some adaptation  

This document provides a guide written by the research team on how a similar exercise could be replicated with reflections on sources, tools and challenges  

Its primary audience is internal to Innovate UK but can also be used with external researchers/consultants 

Download full report using the button on the right

To see our related report that aims to answer the question of ‘what is the UK good at, in terms of Net Zero technologies?’, please click here.