Sunday, 21 February 2010

A green future for Teesside

With proper levels of investment and government support, offshore windfarms could fill economic gaps in the north-east

Ed Cox, Thursday 18 February 2010 17.00 GMT
In October 1346, English forces from across the north of England rode into Durham to take up positions against the Scottish army of King David II. They arrived just in time to take up the better ground and in the ensuing Battle of Neville's Cross they saw off the invaders and captured their king. This week the cabinet is meeting close by the scene of the battle, but it remains to be seen whether the arrival of the cavalry will see off the economic forces currently hammering the north-east.
The cabinet meeting in Durham is certainly timely, for just down the road the final steel will be poured at Teesside Cast Products bringing to a close 150 years of steelmaking. The process – known as chasing the salamander – involves emptying the last dregs from the smelt before mothballing the plant and any remaining hopes of a last-minute takeover.
The perceived need for this cabinet meeting is symbolic of a parliamentary system that has so distanced the executive from the day-to-day life of steelworkers that such gestures count for a great deal. (Roll-on powers for local authorities to drive their own economic development). Ministers will seize upon the opportunity to beat their breasts about the Corus closure and reiterate promises of a £60m investment package to bring new jobs to the area: new, green jobs in offshore wind-farming.
The argument for green jobs is persuasive. As unemployment continues to rise and the economy stumbles out of recession, the need to create new jobs and new markets is pressing. At the same time, the imperative to drastically reduce emissions of greenhouse gases means that we need to rethink how the UK economy will be structured. But three issues must be addressed if the "green new deal" is to become a reality.
First, the UK must seize some competitive advantage. Taking offshore wind-farming alone, a recent Institute for Public Policy report argues that anything between 20,000 and 70,000 jobs could be created in the sector. But with the significant majority of job growth predicted to be in turbine and component manufacture, unless the UK can attract a turbine manufacturer to its shores it is likely to lose out to Denmark, Spain or Germany with their better-developed wind markets. Not only do we need to secure the domestic market through reforms to the renewables obligation and investment in the national grid infrastructure, but a combination of tax incentives and loan guarantees might also be required.
Second, we need to do the maths. Even the best estimates suggest that for every four jobs lost at Corus, only one will be created in offshore wind locally. Analysis for the Department for Business, Innovation and Skills found that in 2007-08 there were only 445,000 UK jobs in the entire green sector (including the low-carbon support and supply chain), and with growth projected at just 5% per annum we have to look more widely not just at new green jobs but at the greening of existing industry.
Third, we need to build up our skills base. We simply don't have enough engineers and skilled technicians to fill emerging opportunities. Offshore wind industries will look to attract offshore oil and gas talent before they turn to retraining Corus workers. A demand-led skills strategy is going to be too little, too late; a more proactive, long-term plan is needed urgently.
Records have it that despite being outnumbered as a result of fighting wars on many fronts, the English army prevailed in 1346 by pooling the best forces from across the northern regions and seeking the better ground. The cabinet should dwell on this lesson, for victory at the Battle of Neville's Cross led to many decades of peace and prosperity in England's north-east.