As the U.K. significantly expands its offshore wind capacity, becoming the first country to legally commit to carbon neutrality by 2050, South Korean companies are swiftly seizing business opportunities. Many are planning or building production facilities in the U.K., and related contracts are increasing as local offshore wind projects grow.
According to industry reports on Dec. 11, the U.K.’s Labour Party government, inaugurated in July, announced plans to quadruple its offshore wind capacity by 2030. Last year, the U.K. ranked second globally in offshore wind capacity with 14.7 gigawatts (GW), behind China (36.8 GW). The government aims to add 7 GW of capacity annually.
The U.K. government plans to establish Great British Energy (GB Energy), a public clean energy investment company, to carry out its policies. It will allocate £8.3 billion (around 15.19 trillion won) to GB Energy over the next five years, with the funding sourced from a 35% windfall tax on fossil fuel companies, which has been in place since 2022.
South Korean companies are rapidly expanding their presence in the growing U.K. offshore wind market. SeAH Steel Holdings established its offshore wind subsidiary, SeAH Wind, in the U.K. in 2021 and is building a monopile factory in Teesside, in northeastern England, with a 400 billion won investment. The factory will have an annual production capacity of 240,000 tons. Monopiles, large cylindrical structures made from welded thick steel plates, are used to anchor offshore wind turbines to the seabed.
SeAH Wind is set to complete the factory by the end of this year and begin commercial production in the first half of next year, having already secured three years’ worth of orders. The company signed a contract in 2021 to supply monopiles worth £360 million (660 billion won) for the Hornsea 3 offshore wind project in the U.K., led by Denmark-based energy company Orsted. Last year, it also secured a contract worth £900 million (1.64 trillion won) to supply monopiles for the world’s largest offshore wind project, the Norfolk Vanguard.
The power cable industry is also expanding in the U.K. LS Cable & System secured a 400 billion won contract in 2022 to supply high-voltage direct current (HVDC) cables for the Vanguard offshore wind farm in the North Sea, marking the largest order ever for a South Korean cable company in Europe.
LS Eco Energy, a subsidiary of LS Cable & System, is actively seeking a local production site. The company signed an agreement in May with U.K.-based energy investment firm Global Interconnection Group (GIG) to establish an HVDC joint plant and has secured first-rights to lease land at the Port of Tyne in northeastern England, with lease terms currently under discussion.
Power equipment manufacturers are likewise increasing local contracts. HD Hyundai Electric signed an 82.1 billion won deal in May to supply nine high-voltage transformers to National Grid, while Hyosung Heavy Industries secured a contract last month to supply 400kV transformers for Orsted’s U.K. wind projects. LS Electric has entered the U.K. energy storage system (ESS) market, winning engineering, procurement, and construction (EPC) contracts for two ESS power plants, along with follow-up support services.
