The North East flies higher

13th November 2012




Paul Suff reports on the organisations in the North East of England that are helping to shape the UK's future low-carbon economy

Nissan’s decision to manufacture its all-electric car, the Leaf, at its existing Sunderland site and to open a £200 million car battery plant in the North East demonstrates how the region is helping to drive the UK’s transition to a low-carbon economy.

But the North East, which stretches from the Tees Valley in the south to the border town of Berwick-upon-Tweed in the north, is more than just the UK’s first economic area for ultra low-carbon vehicles. It is also the location of the country’s largest trial of smart grid solutions, home to almost 174MW of installed onshore wind capacity and the site of one the country’s first projects to harness geothermal heat.

The region is also a hub for the development of green skills and knowledge. The national renewable energy centre and the skills academy for sustainable manufacturing and innovation are among some of the low-carbon centres of excellence in the North East.

Green-collar jobs

The North East is home to 2.5 million people and its economy is worth about £40 billion a year, more than 3% of the UK’s total economic output. According to data from the business department (BIS), 2,033 companies in the region were classified as being in the low-carbon and environmental goods and services (LCEGS) sector in 2010/11. Overall, these firms employed nearly 40,000 workers.

Three main LCEGS industries have emerged in the North East: alternatively-fuelled vehicles (430 companies), alternative fuels (380) and building technologies (295). BIS figures also reveal that the value of LCEGS sales by companies in the region was £4.8 billion in 2010/11, a 4.5% increase on 2009/10. This compares with average annual growth across the region of 3.6% in the “boom” years between 1993 and 2008.

The North East is, however, ranked only 11 out of the 12 regions covered by the LCEGS data by sales, and by company and employment numbers.

Nonetheless, the region is positioning itself to take advantage of the projected sales growth in the LCEGS sector, which BIS forecasts will be 5.5% in 2014/15.

“The transition to a low-carbon economy is creating a real buzz of opportunity in the North East, which has been badly hit by this and previous recessions,” says Marek Bidwell, at Newcastle-based environmental training firm and consultancy Bidwell Management Systems. Mark Stephenson, a member of the policy team at the North East Chamber of Commerce (NECC), agrees: “The green economy offers the North East enormous potential.”

In 2010, the NECC forecast that the development of low-carbon industries would add around £3 billion to the North East economy over the next few years. Stephenson says that much of the expansion will build on the region’s traditional skills base, such as engineering and fabrication. The NECC also expects 40,000 jobs in the area to be created by 2014 through sustainable energy projects.

In 2009 a report from Arup and Cambridge Econometrics identified some of the potential economic opportunities, notably in offshore wind and biofuels production. “The region’s expertise in offshore and subsea engineering means that North East companies should be in a strong position to work on the next generation of UK offshore wind farms,” it concluded.

The report also highlighted the area’s key assets in manufacturing, science, research and development, technology and attitudes to innovation, and said these would put the region in a good position help deliver the UK’s low-carbon economy.

Fuelling the economy

The North East has a rich history of coal mining, with the region supplying one-quarter of the UK’s coal in 1913 and fuelling local industries such as steel and heavy engineering. The demise of “King Coal” has not eradicated the area’s contribution to the UK’s energy supply, however. The region is now a hub for a myriad of non-fossil-based fuels and energy supply.

Aside from the 24 onshore wind farms across the North East that RenewableUK reports were operational in September 2012, the region is also home to the first near-shore wind project in UK waters, at Blyth harbour, 50km north of Newcastle, which has been generating electricity since 2001.

Furthermore, several offshore wind projects are now in the pipeline. EDF Energy Renewables is constructing an offshore wind farm between the mouth of the River Tees and Redcar. It is located 1.5km from the shore at its closest point and will feature 27 2.3MW turbines, producing more than 60MW of electricity. Also, Dogger Bank, the largest of the nine offshore wind farm zones in the third round of the Crown Estates’ leasing programme, lies approximately 96km offshore and has a capacity target of 9GW, with the potential for 13GW. A 9GW development would reduce UK CO2 emissions by 13.7 million tonnes a year.

Other forms of renewable energy can also be found in the North East. Industrial gases and equipment supplier Air Products is building the world’s largest renewable energy plant using advanced gasification energy-from-waste (EfW) technology on Teesside. With a capacity of 50MW, the plant, which is due to enter commercial operation in 2014, will divert 350,000 tonnes of waste from landfill. It also has the potential to generate a renewable source of hydrogen for commercial use, such as to fuel buses, and is working with partners to demonstrate fuel cell technology at the Tees Valley plant.

Also on Teesside, the Sembcorp biomass power station, commonly known as Wilton 10, came online in 2007 and was the UK’s first large-scale wood-to-energy power facility. The £64 million plant produces 35MW of electricity a year from around 300,000 tonnes of wood from sustainable UK sources – typically, low-value wood from local authority waste disposal sites, sawmill residues and a fast-growing form of willow. The plant saves more than 200,000 tonnes of CO2 each year.

More unusual examples of sustainable energy can also be found in the region. Newcastle University has been instrumental in investigating how best to exploit the area’s geothermal energy sources.

The university was part of a public-private partnership that, between 2004 and 2006, provided evidence of the first deep geothermal resource found in the UK for more than 25 years on the site of a former Lafarge Cement works at Weardale in County Durham.

David Manning, professor of soil science at the university, explains: “A 1km borehole was drilled and at 411m we encountered the highest permeability ever found in granite in the UK. The project demonstrated that there was sufficient hot brine resource to provide a considerable amount of thermal energy.” In 2010, DECC funded a second borehole to act as a potential reinjection well.

The university team has since investigated a second potential geothermal energy site, in Newcastle. The 1.8km borehole was completed in July 2011 at the site of the proposed Science Central development, on the grounds of a former brewery.

Manning says a temperature of 76°C was recorded at the bottom of the borehole, which is significantly higher than 60°C normally found at such depths. “The findings were a complete surprise, but supported the hypothesis that came out of Weardale: that the geological fault that runs through most of Newcastle and an area south of the city [the so-called Ninety Fathom-Stublick Fault Zone] hosts hot groundwater.”

Before a decision can be made on whether to incorporate geothermal energy from the site into the overall energy plan for Science Central, the site is being stabilised. “The signs are very encouraging though,” says Manning.

There are also plans to build on Teesside Europe’s first large-scale tyre pyrolysis plant, which will reclaim valuable materials from waste tyres. Although not primarily an EfW facility, PYReco, the company behind the plant, says the oil and gas recovered will power the operation.

To exploit the area’s remaining coal reserves, several North East companies, including Five Quarter and Clean Coal, are working on commercial-scale underground coal gasification (UCG) schemes.

UCG was first trialled in the North East in 1912 and Newcastle-based Five Quarter has been granted a licence by UK Coal to exploit a 400km2 area of the North Sea with an estimated 2 billion tonnes of coal deposits. It hopes to recover syngas – a combination of hydrogen, carbon monoxide, carbon dioxide and methane – for use in power generation or conversion into liquid fuels.

The region is also rapidly establishing itself as a major hub for the production of transport biofuels. Ensus’ £300 million plant at Wilton, for example, is Europe’s largest cereal grain biorefinery. Bioethanol is produced from locally grown wheat with high starch content and the Teesside plant is expected to meet up to one-third of the UK’s demand under the Renewable Transport Fuels Obligation.

Future transport

The committee on climate change suggests that 1.7 million electric cars and plug-in hybrids need to be on UK roads by 2020 – that is 16% of all new cars and vans sold by the end of the decade. Many of the vehicles will be manufactured in the North East or contain parts produced in the region.

Around 250 companies and 20,000 employees are directly involved in automotive manufacturing in the area, and some of these are pioneering the shift to electric vehicles (EVs). Nissan – which will begin manufacturing the Leaf EV at its Sunderland plant in 2013 and has already started production of lithium-ion batteries at a new 25,000m2 facility at the site – is one such example.

Cramlington-based Avid Vehicles and Smiths Electric Vehicles, in Washington, are two more. Avid manufactures specialist EVs, while Smiths produces two models of commercial electric vehicles as alternatives to traditional diesel trucks. Its UK customers include: Balfour Beatty, Essex County Council, the John Lewis Partnership, BT Openreach and Sainsbury’s.

The North East is also helping to provide the infrastructure to power EVs, and the region will be the first in the UK with comprehensive battery-charging facilities. Earlier this year, EV charging station company DBT, together with Nissan and Gateshead College, agreed to develop a zero-emission centre of excellence in the North East. The centre will act as a business incubator for the EV industry, creating jobs in the region and developing knowledge and technology.

Research and development will focus initially on charging infrastructure and battery second life. This will involve DBT setting up a production facility at the centre to produce up to 1,000 charging units a year for the European market.

The US company’s development manager, Alexandre Borgoltz, comments: “This is a great opportunity for DBT to increase its production capacity and will mean the North East will provide the complete value chain for the EV industry: battery, vehicle and charging stations.”

The support network

Renewable energy generation and EV manufacture are underpinned by the region’s supply chain and its knowledge-sharing support services.

The North East is home to several organisations providing goods and services to the onshore and offshore wind industries, and more suppliers are expected to locate there over the next few years as the offshore wind sector expands.

Tyneside and Teesside, for example, are two of the five CORE areas – centres for offshore renewable engineering – identified by the government for the location of manufacturing for the industry, and both will receive a portion of the £60 million set aside to develop port sites.

Energi Coast is the representative group for the region’s offshore renewables sector. Several of its members were the first to join norstec, a joint industry and government initiative launched in October by energy secretary Ed Davey to maximise the renewable energy potential of the North Sea.

Such firms include TAG Energy Solutions, which operates a factory in Billingham producing foundations for offshore wind turbines, and JDR Cable Systems, which is in Hartlepool and supplies the subsea cables for the first phase of the London Array wind farm, the world’s largest offshore array with planning consent.

The national renewable energy centre in Blyth also, of course, supports the region’s renewables sector. Its turbine blade-testing facility, which opened in August, is the largest in the world and has been designed to analyse longer blades (up to 100m long) for offshore turbines. It also provides expertise in photovoltaics and marine energy.

The region’s academic community is lending its expertise too. Durham University (along with Strathclyde University) leads the SUPERGEN wind energy technology research programme in the UK, which examines wind turbine technology, aerodynamics, hydrodynamics, materials, electrical machinery and control, and reliability and condition monitoring.

The North East is similarly leading the way on training people in the skills needed by the renewables sector. Siemens, for example, has established a wind-energy training school in Newcastle, and all its wind-power technicians will pass through the centre before being deployed on UK wind farms.

Meanwhile, the region’s EV supply chain includes Gateshead-based Sevcon, which manufactures battery chargers, converters and display accessories for electric vehicles. Japanese-owned Nifco UK, which is based in Stockton-on-Tees, is another supplier of EV components. It will supply fully recyclable-plastic injection-moulded components for battery packs on the Nissan Leaf.

In September 2010, the region launched one of the largest trials of EVs in the UK. Switch EV is a Technology Strategy Board project that will trial 44 EVs across the North East over three years to discover whether they are fit for purpose, assess battery performance and examine the public’s perceptions of electric vehicles.

Knowledge-generating organisations supporting the region’s ambition to become the world leader in EV research and development (R&D) include the skills academy for sustainable manufacturing and innovation (SASMI). Based at Gateshead College, SASMI is the UK’s first education centre dedicated to clean vehicles.

And Newcastle University’s institute for research on sustainability is home to Europe’s leading transport technology research centre, which is leading the study of sustainable rail, road and marine transport.

Other R&D facilities in the region include the national anaerobic digestion (AD) development centre in Redcar. The facility is part of the centre for process innovation and is an open-access site designed to help organisations of all sizes to develop AD processes quickly, sustainably and cost effectively.

A greener economy

For a region hit badly by the current and previous economic downturns, the transition to a low-carbon economy provides a chance to reinvent itself and build on its traditional engineering base.

Establishing the industries needed to support the revolution in offshore wind energy and the rollout of EVs is particularly key for the North East.

It is already home to a major automotive manufacturing plant as well as its supply chain, and boasts a growing number of companies and facilities to support the renewable energy sector, including wind, EfW and biofuels.

The decision last year by US company Clipper Windpower to scrap its plans to build a turbine manufacturing plant in the region is a reminder that reinvention will not always be a smooth process. Nonetheless, there is much going on across County Durham, Northumberland, the Tees Valley, and Tyne and Wear to suggest that the region that pioneered rail travel is also on the right track to help develop a new, greener economy.

The North East's smart grid

A £54 million project to test the impact of new low-carbon technologies, such as electric vehicles (EVs) and photovoltaic (PV) solar panels, on the electricity grid is centred in the North East. The three-year initiative, which is the UK’s biggest smart-grid project, involves distribution business Northern Powergrid, energy company British Gas, Durham University and power engineering firm EA Technology, as well as 14,000 households and businesses in cities including Durham and Newcastle.

As well as exploring the impact on electricity demand from customers installing renewable technologies and charging electric vehicles, the project will explore the use of new technology throughout the electricity network and look at commercial solutions, such as different pricing structures.

“It aims to see how well the existing distribution network is capable of meeting the demand challenges from low-carbon technologies and what will need to change when more people are charging EVs or connecting PVs,” says Jon Bird, head of sustainability at Northern Powergrid.

“The system can deal with the odd house connecting a heat pump, but we need to test how the cables cope when each house on a housing estate installs a 3kW pump or when solar energy is fed back to the grid on a large scale.

“Cables tend to get narrower at the connection point to a building and the answer to more demand for electricity has traditionally been to put bigger copper cables in the ground. But that is expensive. We need to find smarter ways of managing demand and the project aims to identify how best to do that,” explains Bird.

A range of technology is being installed as part of the project. These include the roll-out of smart meters by British Gas, the installation of PV panels, ground-source and air-source heat pumps, as well as trials of EVs. “It’s a great opportunity to better understand customer behaviour and electricity consumption patterns,” says Bird.


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