WP2 Development of value chain
Last updated: 19 December 2016
Lead: General Manager, FPP Ltd, Chris McConville
The main objectives for this work package are:
- Identify value chain for fast following deployment.
- Obtain design requirements for the select site(s) and value chain.
Summary of work performed in WP2
During period 1 the establishment of a site demands/requirement matrix was completed and during the first two periods FPP has had a significant focus on identifying potential deployment sites in the UK by subcontracting IT Power to deliver a site assessment study. The report from the study provided two main findings, firstly it showed the massive potential around the UK for FPP’s technology based on the minimum technical requirements and secondly it adds further, desirable requirements for a first deployment (such as suitable grid infrastructure) which highlights three sites as being particularly suitable for the first UK project.
During period 3 a report on the suggested deployment sites was submitted. The final report outlines the required and desired characteristics for the initial sites and the process used to identify them. A number of suitable sites around the UK are outlined with detail provided for the selected two in Katanes in Scotland and Dyfed in Wales. Special Purpose Vehicles (SPVs) have now been registered to develop these sites, with DP Renewable Energy Ltd and FPP having an equal shareholding in each.
FPP Ltd and FPP A/S have collected additional data for the sites where possible in order to further inform site selection as well as providing relevant data to inform the ongoing design process. During period 4 FPP Ltd will commission an EIA site screening report for each site, an important step in engaging stakeholders and informing many of the licensing and consenting activities.
Manufacturing and potential value chain
Since period 1 FPP Ltd has been working on investigating the supply chain available in the UK and creating a category management procurement system. A database of potential quality suppliers has been created and is continuously expanded. FPP Ltd and FPP A/S have met several potential manufacturers and continues to build and expand these relationships. After identification of the deployment sites the work on identifying the supply chain has been focusing geographically on the suppliers closer to the sites, as local economic impact is a very important factor in the UK project success. FPP are very consciously working on ensuring that there is a geographical coverage while avoiding highly specialist or rare equipment and facilities which would limit competition in contracting for the manufacturing of the system.
In order to support the development of the value chain FPP A/S has produced an internal report which provides a breakdown of the P80 system in terms of its main modules, sub modules, systems and component parts to enable discussion with potential suppliers of facilities for each module and identify particular skills required for each module. The report was submitted during period 3. Initial meetings have been held with the most relvant candidates and as the concept design stage of the P80 is nearing completion and detailed discussions with fabricators will initiated to ensure that relationships are built without requiring excessive rework.
Assembly, deployment, operation and maintenance
Since period 1 FPP A/S has held discussions with companies to support the project development, assembly, deployment and O&M at a high level. After the selection of the sites and more requirements have been identified, the focus has shifted towards specialist facilities and marine contractors. FPP Ltd has particularly made advances in identifying and engaging companies which have the necessary skills and strengths to support the O&M of FPP’s system, both offshore and in port. Engagement with these companies will inform detailed O&M philosophy development, depending on their ability to manage various packages of work. Companies which could provide a wide ranging support service are the main target as this would reduce the number of contracts and relationships to be managed by FPP directly.
During period 2 and 3 FPP A/S has progressed the concept design of the commercial scale device including an adaption which will allow the system to be manufactured in modules capable of being built in standard dry docks and then assembled afloat. Given the fairly remote nature of both of the selected sites, it is likely that some level of facility upgrade must be allowed for. FPP Ltd have therefore gathered relevant information regarding each of the options and made contact with some of the port owners/operators.
FPP Ltd and A/S have also developed initial options and mechanisms for establishing contract structures and providing the warranties and guarantees that will be required by end users.
FPP Ltd and FPP A/S have continued to expand on the efforts made in period 1 to engage a number of key industry stakeholder to raise the general awareness of FPP and FPP’s technology. During period 2 and 3 FPP Ltd, with support from FPP A/S, has also engaged with a number of key stakeholders both related to the site and more generally.
Additional project stakeholders, such as heritage bodies, fisheries associations and wildlife agencies, have also been identified and will be further engaged as part of the site screening and scoping work to be conducted by the project SPVs.
FPP Ltd and A/S continue to participate with relevant industry bodies and have joined Ocean Energy Europe (FPP A/S), Scottish Renewables (FPP Ltd) and Renewable UK (FPP Ltd). FPP Ltd is also a founding member of a new industry group “Friends of Floating Offshore Wind” which was formed in period 2. This group aims to promote the ambition, achievements and support needs of the floating offshore wind industry, focussing initially on the UK as the most developed market.
The establishment of the project companies with DP Energy has provided increased attention to FPP’s projects and resulted in FPP Ltd increasing engagement with the relevant local and national government agencies. The Welsh and Scottish governments in particular have been engaged, at both operational and ministerial level, including meetings with The Scottish Energy minister and Welsh Cabinet Secretary for Economy and Infrastructure. The local governments can provide significant support in ensuring that the projects can be efficiently licenced and consented, as well as providing assistance with establishing a suitable supply chain.
FPP A/S and FPP Ltd have also been able to increase engagement with the EU Commission in the last period to raise awareness of the technology and projects, particularly through involvement in the MARIBE project which focused on the benefits of offshore hybrid technologies.
During period 3 FPP A/S, supported by FPP Ltd, have initiated a capital raise in order to raise the funds required to reach a revenue generating position. This has necessitated a significant increase in engagement with potential investors into the company and this will continue into the next period.