Building Industries at Sea: ‘Blue Growth’ and the New Maritime Economy

This publication, Building Industries at Sea: ‘Blue Growth’ and the New Maritime Economy, looks at all aspects from innovation and market to structure and working conditions within several blue growth industries. 

Aquaculture

More than 1 billion e investment in aquaculture is planned in the Baltic/North Sea region (according to the adopted OPs). There is also a high need for Blue Energy investments providing good base for combinations.

Predictions of aquaculture development in the period 2016–2025

  • Developing countries will consolidate their position as lead aquaculture producers, with a share of almost 95% of global aquaculture production
  • The latest trends and forecast studies also justify the 28% increase until 2025 in Europe (majority expected from the salmon aquaculture of Norway)
  • Numerous studies indicate a considerable increase of aquaculture production in the European Union

The main constraints of aquaculture

  • Fierce and often unequal competition with third countries that brings market prices down
  • High labour and capital costs and administrative burdens slow down investments in the sector
  • Lack of understanding of the spatial needs and infrastructure for the industry among the planning authorities

Driving forces

  • Overfished and decreasing wild fish stocks, while the demand for fish is growing
  • Aquaculture is more efficient in terms of freshwater use and energy than other animal production sectors
  • The availability of marine space for aquaculture is larger than availability of agricultural land
  • Technology development makes aquaculture more and more profitable.

Blue Biotechnology

Potential applications of biotechnology in marine environments may include the following: PUFAs, Microbiomes, and Coatings

Blue biotechnology still needs to deliver a huge amount of basic research, given that marine biotechnology is a relatively new area and considering the current low level of knowledge on marine biodiversity.

Seabed Mining

The challenge is to find those spots where concentrations and availabilities of ores are high enough to have commercially viable exploitation despite the low TRLs and resulting high costs of equipment and techniques. This results in a strong competition for suitable concessions.

Ore prices are the major incentive for market-driven development. When especially nickel and cobalt prices will rise structurally, offshore mining on nodules can be achievable. Further development of the technologies used for mining can strengthen the sector.

Market driven technological development is hampered by the large uncertainties and ample availability of land-based ores and recycling.

In view of high investment, technological challenges and economic considerations, private-public cooperation could be an effective means to make offshore mining a success.

Ocean Energy – Wave and Tide

Six essential priority areas to be addressed to improve ocean energy technology and decrease its risk profile:

  1. Testing sub-system components and devices in real sea conditions
  2. Increasing the reliability and performance of ocean energy devices allowing for future design improvements
  3. Stimulating a dedicated installation and operation and maintenance value chain, to reduce costs
  4. Delivering power to the grid, with hubs to collect cables from ocean energy farms and bring power to shore
  5. Devising standards and certification, to facilitate access to commercial financing
  6. Reducing costs and increasing performance through innovation and testing

There are potentially enormous exploitable energy resources available in the world’s oceans. This would suggest significant potential markets for the sale of ocean energy as well as opportunities for supporting industries and services involved in the development, manufacturing, construction, installation and operation. However, uncertainty in future costs makes it difficult to estimate the scale of the opportunity and the size of the long term potential market.

The technically exploitable energy of wave energy devices is estimated to be 5,500 TWh/yr, which is approximately 30% of world electricity demand. Whilst currently under development, the Ocean Energy Forum goal is to install 100GW of wave and tidal by 2050. This equates to 350 TWh of exploitable electricity and opens up a global market for investment, jobs and growth. This would meet 10% of the power demands of the EU, a significant component in the transition to a low carbon clean economy.

Offshore Wind Energy

Offshore wind is a significant industry within the Atlantic and Baltic basins, and there is high confidence these basins will continue to be a focus for future activity. These markets have relatively low electricity prices so output from offshore wind farms are currently explicitly subsidised. This level of price support has substantially reduced in 2016 and 2017 and grid parity with combined-cycle gas turbines for the better wind projects is likely to occur at some point in 2023 to 2025 assuming current views of likely future carbon pricing.

Offshore wind is the world’s most commercially and technologically developed marine renewable energy subsector and is changing fast from being a niche technology into a mainstream supplier of electricity.

The strong focus is to reduce cost of energy for the sector to become more costcomparative with other renewable and fossil fuel energy generation

Key technology and trends includes:

  • Innovations in larger rated turbines
  • Innovations in foundation design
  • Alternative foundation
  • Floating foundations
  • Innovations in high voltage alternating current (HVAC) subsea cables

Offshore wind is considered as a high technical innovation sector and funding into technology advancement is still significant.

Fisheries

The demand for fish and fish product is strong and continuing to rise but the growth is entirely with farmed fish and the World Bank forecast zero growth in the catch industry up to 2030

Everything points to an industry which is mature or even post-mature in its lifecycle but with a lot of potential life left in it, but only if it can meet the challenges through innovation and change. These challenges fall to three main headings:

1. Innovation in sustainability

2. Innovation to meet technical and operational demands including cost reduction

3. Innovation in the market and marketing.

Offshore oil and gas

Driven by low selling prices, high production costs and the development of new onshore exploitation techniques, offshore oil and gas activities are experiencing a significant decline. The European sector is mainly composed of private companies that operate mostly at the global scale. However, the production from its territorial waters accounts for 9% and 13% respectively of the total oil and gas consumption in Europe, respectively. Thus, this decline can undermine the energy interests of the EU and especially, the economic activity of the North Sea countries (responsible for the production of virtually all of the oil and more than 80% of the gas). Despite this negative outlook, the development of new and more efficient subsea exploitation systems can provide an important boost to the sector. However, in a Blue Growth context, the main importance of this industry relies on its important legacy of infrastructure, knowledge and experience (skills, business models, concepts of permanent occupation of the marine environment, etc.). With this in mind, this chapter describes the main features of the offshore oil and gas industry along with the opportunities and barriers that it presents for the development of Blue Growth and Multiple-Use-ofSpace /Multi use platform concepts.

Shipping: shipbuilding and Maritime Transportation

Shipbuilding and maritime transportation are the main sectors around which the shipping industry is built. Despite their great differences, both sectors are closely related, showing a strong and direct dependency on the performance of international markets. Clearly dominated by Asian countries, the industry is highly competitive and globalised. To face this competition, the European shipbuilding industry has adopted a specialisation strategy and focused its activities to the construction of high value-added vessels. Largely thanks to its location along major trade routes the European maritime transportation companies have a leading position in the global industry. The European shipping industry, and more specifically the shipbuilding sector, offers a number of important opportunities for the development of Blue Growth sectors. The need for highly-specialised new vessels is in line with the technological requirements of many of the Blue Growth sectors (e.g., development of renewables, seabed mining or biotechnologies).

Multi use platforms

As maritime activity increases, so does the competition for space as coastal areas become overcrowded. This led the European Commission to publish a call in 2014 asking researchers to prepare for the ‘future innovative offshore economy’ (BG5 2014). Expecting economic activities to move further offshore as competition for space increased, this call was designed to promote smarter and more sustainable use of our seas. It was in response to this call that the project Maribe was initiated to promote smarter and more sustainable use of the sea through the sharing of space. It investigated the potential of combining maritime sectors in the same place (Multiple-Use-ofSpace (MUS)) or on a specifically built platform (Multi Use Platform (MUP)) in order to make more efficient use of space and resources

Currently the only technology that is successfully exploring MUP is Floating Power Plant. The Business plan fitted perfectly within the Maribe ranking criteria, of an Atlantic deployment and TRL 5 or higher having been already achieved.

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