Washington Watch

UK shipyards and offshore wind farms

Flying back from London earlier this week, I settled into my seat and opened up the day’s edition of the Financial Times. A photo of workers at a shipyard caught my eye. I read with interest the accompanying article about how development of offshore wind farms is benefiting shipyards in the United Kingdom.

Cammell Laird, one of the oldest British shipyards, has delivered more than 1,300 vessels during its 200 years of production, ranging from a U.S. Confederate ship to the steamer used for Dr. Livingstone’s Africa explorations. The yard is now moving aggressively into the burgeoning business of offshore wind farms, which are flapping their turbines off much of Britain’s shores these days.

In fact the company is so bullish on wind power that it is positioning itself to take a leading role in this renewable energy sector, investing heavily in facilities to support the assembly, storage and movement of components needed to build and maintain offshore wind turbines.

Like U.S. yards, Cammell Laird saw its order books clipped back by hard economic times. Things got so bad that it had to close in the early 1990s, reopened in 1997, but then went bankrupt in 2001. It reemerged as a privately held company and today employs 750 workers.

Business has picked up over the past year due to offshore wind work. The company expects to post its highest earnings in more than a decade. Renewable energy work now accounts for almost 15 percent of total revenues, and the company thinks revenue from this source could double in the next few years.

The yard is fortunate to be located near the Gwynt y Mor turbine site, which when completed will be one of the largest offshore wind farms in the world. A new generation jackup vessel has just arrived at its yard, where it will be outfitted with specific equipment before being put to work installing wind turbine foundations at the Gwynt y Mor site in the Irish Sea. More such vessel work is expected.

It made me wonder whether the situation in Britain could be a good barometer for what U.S. yards might expect as the offshore wind industry gets going here. There have been promising signs that the first and subsequent projects will begin producing energy within the next year or so. Hopefully U.S. yards are positioning themselves for the opportunities, just as Cammell Laird has across the pond.