5. Statement by the Minister for Economy: Offshore Marine Energy

Part of the debate – in the Senedd at 3:47 pm on 17 May 2022.

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Photo of Vaughan Gething Vaughan Gething Labour 3:47, 17 May 2022

I thank the Member for his series of questions. I'll do my best to answer the points as briefly as I can. I'll start with the point of difference and the innovation strategy. We're going to go out to consultation on that, hopefully shortly, so you'll see the draft strategy, and we'll then need to take account of the comments made before we then indicate the sort of funding choices we'll need to make around that. But, as we've indicated before in this Chamber, our innovation strategy previously has been supported by European funds, structural funds, that are no longer available to us, and they haven't been replaced like for like. What we'll need to do, though, is we'll need to be more successful at getting funds out of the UK research, development and innovation funding pot that is available. More than £20 billion is supposed to be available over a period of years, and in previous times that has largely gone around the south-east of England, around the golden triangle, and also to literally a couple of institutions in Scotland. That's an issue for us, where we will need to gain more out of those UK funding pots to replace the money that has not been replaced on a like-for-like basis following our departure from the EU.

On the rest of your points and questions, I think there is a much more constructive engagement to be had that doesn't involve direct criticism of the UK Government. So, I think when you look at the investment choices, there'll be a need for private investment, for the Welsh Government to support some investment choices as well, but also for the UK Government too. For example, your question about the grid: well, the reason why we're going through the future grid Wales process is to understand where and why to make strategic investment choices, and, without those, that will hamper our ability to actually lever not just the power itself but the economic opportunity as well. We don't want all of the landing source for the Celtic sea, for example, to be on the Devon or Somerset coast, so we're going to need to have grid infrastructure that is fit for purpose for what we're doing in the future, and that means proactive investment. It's the point that my colleague Julie James has regularly made, not just in internal meetings but with counterparts in the UK Government. Without that sort of choice being made, it will hold us back.

However, in addition to that, we'll need to see some of those investment choices and the line of sight that I talked about in the statement for how long the future supply line is, for how much licences are going to be made available. That will then mean that investors will have enough confidence to make significant investments in port infrastructure, because you're right, other ports are in a different place in terms of the size and the scale of what they're going to need to handle. Now, that's a real opportunity for Welsh ports, to have that investment made and then to make sure that deepwater ports that are nearer to the opportunities in the Celtic sea and the North sea can actually take advantage of those, and I definitely want to see that happen—so, a clearer line of sight with a longer term that will allow both private investment choices to be made and also the case for public sector investment where needed. And when it comes to us putting our money where our mouth is on that, of course, the announcement I referred to for the European programmes money that we have to agree—the £31 million going to Morlais to make sure the infrastructure is there so they can land the energy—well, that really does show we've been prepared to make significant investments with money that we control to make sure that those opportunities are realised.

The further point that I made and that you asked about, about skills for the sector as well, that will be really important. So, that's both work with providers, it's both work with the sector, and then understanding how we then have a pipeline for skills acquisition. Now, the difficulty there is, without a clearer sight on the pipeline of where the work's going to go, we're going to need to understand how and where we try to give people new skills to ensure that they're ready to undertake the jobs as and when they come. So, being able to plan that successfully together will be really important, and I do think that the net-zero skills plan that we'll provide later this year will be helpful in doing that, but the conversations with the sector will be even more important in advance on it.

On the marine planning landscape, you'll be aware that the responsible Minister is in the Chamber as well—I'm looking forward to her second statement of the day—but we have recently published the first marine plan for Wales, setting out planning policy. But I do know, as well as the advantage of certainty, that the Minister for Climate Change is always ready to look at whether we can have a better system that will deliver on the economic opportunities that are available and the impact we can have on climate change, and at the same time the balance with the natural environment as well.

On what we have done to help the supply chain, I indicated in my statement that we've invested about £0.5 million in supporting the supply chain. That's money we've given to Marine Energy Wales that I've signed off, together with moneys for the Offshore Energy Alliance, dealing with the supply chain across north Wales and north-west England. So, again, there's active conversation between our officials on making sure that those opportunities are real, and the supply chain locally, including many small and medium-sized enterprises, are able to take advantage of that, and us helping to ensure that businesses are ready and able to take advantage of the opportunity.

And I'll finish with two points, quickly, Deputy Llywydd. That is, on the port infrastructure fund, it is a welcome step forward, but the eligibility criteria aren't yet available. So, I'm not able to talk to you much about the criteria, which have yet to be published, but we are hopeful they will be published in the near future this summer to allow people to then think about bidding, and we're very keen that Welsh ports get a proper share of that money that is going to be made available.

And on free ports, it's a good thing that we've reached agreement on terms that are acceptable to both Governments. We'll be joint decision makers, there'll be an equity of funding with free ports in England, and the prospectus for bids will be coming up over the summer. And I do think it'll be important to see bids that help us to achieve our ambitions and are aligned with Welsh Government policy frameworks, including, of course, the opportunities in marine energy as well as fair work. But I'll have more to say on that when we actually are able to provide the joint prospectus.