Ben Houchen is the Mayor of the Tees Valley.
For about a thousand years, Britain’s most important economic highway was not a road or a river, but a sea. The North Sea provided wealth and opportunity for its coastal communities for centuries from the fall of the Roman Empire to the modern era.
Those regions then used coal and steam power to supercharge human productivity and North Sea ports exported the industrial revolution around the world. In the 20th Century, the North Sea offered up more riches and innovation through the oil and gas industry.
At each stage, energy, innovation and trade have combined to enrich Britain and its coastal regions. Yet in recent decades the east coast has faced headwinds that undermined our industries. It even eroded our sense that we had something to offer the world, which cut away at rich traditions and community pride.
A paper released today by the think tank Policy Exchange shows how that downwards trend can be reversed. It points out that new industries connected to the North Sea, focused in a ‘Net Zero Triangle’ between Humberside, Leeds and the North East, as well as key industrial hubs in Scotland, could put these places back at the cutting edge of another global revolution: clean energy. Wind power, hydrogen fuel, and carbon capture and storage are all shovel-ready technologies that could deliver huge rewards in our industrial centres.
The paper also sets out the prize for our coastal communities: an extra 40,000 direct jobs (even accounting for long-term decline in oil and gas employment) and £20 billion of economic activity directly related to the North Sea. Far from Net Zero being a hair shirt that we all have to endure, this is a massive opportunity to deliver new careers. But if we don’t act now to invest in the North Sea, the Government’s levelling up mission will fail – and so will its Net Zero target.
The trick is getting from our current position to a situation where we can take full advantage of this opportunity. Part of this is creating funding pots for projects to help new technologies get off the ground, like the Government’s new Hydrogen Transport Centre in Tees Valley, which will help us to be world leaders in green buses, trains, ships and planes. But we’ll need more than just this welcome new funding.
There are several barriers that stand in the way of developing the North Sea. The biggest barrier is the need to use the North Sea’s finite space efficiently, rather than allowing a free-for-all. One way to help that along is the creation of a new body to promote and coordinate development, and to identify areas that need protecting. Such an agency would help regulators and investors to create new cable networks and pipelines in advance, which will unlock business opportunities for wind energy and clean hydrogen projects.
Another part of the solution is to make sure that the owners of offshore wind farms contribute to local communities. To do this, they should contribute just one per cent of their revenue to the communities where they operate. This will help to reduce opposition to so much new infrastructure.
The other side of the coin is about helping local communities to make the most out of these new industries. That is not entirely straightforward. We often see our most talented students leave for promising careers in London or other urban centres. After industrial decline and the resulting drop in local investment, industrial towns often struggle to attract visitors or new residents, making it harder to capture regenerative investment.
The answers partly lie in training and connectivity – the ‘Net Zero Triangle’ would rival George Osborne’s Northern Powerhouse concept, with transport investments to link up industrial hubs, top universities, and urban centres in Humberside, Teesside, York, Newcastle, Leeds, and Durham. It’s the same thinking that led me to take over Tees Valley’s airport, making it a destination for business visitors. With its own ‘Minister for North Sea Development’ and Metro Mayors with more powers, the area could also secure more focused investment in housing, culture and training.
There is no doubt that the Net Zero agenda offers opportunities for the UK to ‘Level Up’, if we are just willing to grasp them. The North Sea presents the biggest opportunity of them all.