Freeport extension and carbon capture call top Humber’s Autumn …

An extension for vital freeport tools and a desire for carbon capture to be realised on the Humber are huge opportunities being sought from next week’s Autumn Statement[1].

Urgent but considered pleas came as it emerged the new status further empowering economic development in Hull, Goole and Immingham has seen the region take a leading UK position. Proof that the freeport policy works - with Prime Minister Rishi Sunak the early architect - will now be central to the ask to allow for further time to deliver on jobs and investment promises, as the decarbonisation agenda aims to get back on track too.

A collaborative event uniting Humber Energy Board and the Humber Freeport - two driving forces for the estuary’s industrial and commercial might - heard the reasoning, days before the reckoning, as The Waterline Summit closed. Investment worth £1 billion, with job creation at 500 to 600, has already been announced in the first few months, with much more in the pipeline.

Net Zero Humber urgency and steel's 'wrong transition' highlighted[2]

North's praise for Energy Estuary stance on the route to Net Zero[3]

And it was Harry Jones, freeports programme director at the Department for Levelling Up, Housing and Communities, who gave the ranking, and inspired confidence in the required policy direction, having joined the summit from a fact-finding tour.

He said: “Freeports have made a good start, with success in attracting investment in the Humber and also around the country. The Humber is up there in terms of investment, either first or second depending on the figures, and that start is making the policy model work.

“There have been challenging economic headwinds over the past couple of years, and what that means for the investment environment, we all recognise. We have been trying to improve policy, and the Autumn Statement next week should see efforts to build on success so far and go further. Freeports are about the government supporting a cluster supporting investment in a place, and hopefully there will be stronger support across government.

“In the very near term the Autumn Statement can bring further strings to the bow of freeport policy, then it is about delivering. We have had a good start, it is about making sure that continues and accelerates.”

The panel for Innovation and Collaboration: Shaping a Sustainable Humber, from Humber Energy Board and Humber Freeport. Pictured from left, Richard Gwilliam, Humber Energy Board chair; Jo Barnes, managing director of Sewell Estates; Chris Gilbert, Humber decarbonisation project manager for Phillips 66; Katie Hedges, head of membersip and low carbon strategy at Catch; Harry Jones, freeports programme director, Department for Levelling Up, Housing and Communities and Simon Green, interim CEO of Humber Freeport. The panel for Innovation and Collaboration: Shaping a Sustainable Humber, from Humber Energy Board and Humber Freeport. Pictured from left, Richard Gwilliam, Humber Energy Board chair; Jo Barnes, managing director of Sewell Estates; Chris Gilbert, Humber decarbonisation project manager for Phillips 66; Katie Hedges, head of membersip and low carbon strategy at Catch; Harry Jones, freeports programme director, Department for Levelling Up, Housing and Communities and Simon Green, interim CEO of Humber Freeport.

Hopes to realise the ambitious 7,000 jobs figure, with many more Pensana[4], Meld Energy[5] and Metsa Tissue[6] level announcements required, depend on a timeframe extension for vital allowances, with a further five years hoped for beyond the current 2026 deadline. It is particularly prudent for the Humber, having only got going officially this summer[7].

Simon Green, Humber Freeport interim chief executive, said: “Success has been very tangible. Investment announced - not just in the pipeline - is around £1 billion, and around 500 to 600 jobs, spread between Hull East and Goole sites.

"We’re also noticing types of investment, innovation-led investment is coming in, because it has got a feedstock, an offtake and customers, and there are new ways of doing it. It is excellent news. It is also reinforcing the decision to position the Humber Freeport as a major catalyst that is so closely aligned with the Humber being the pre-eminent energy cluster in north western Europe.

“We are hoping for certainty on tax site extensions in terms of timescales and additional incentives to help create and develop the companies.”

Jo Barnes, managing director of Sewell Estates, a lead partner in Yorkshire Energy Park east of Hull, stressed the need for extending the timeframes.

She said: “Development does not happen in five year terms. We have been working on Yorkshire Energy Park for seven years and we have probably got another 10 years to go. We are seeing an uptick in enquiries. The quality of enquiries has gone up in the last year, down to the freeport foundation, which gives us a different platform. Now the freeport's powers need extensions. Most enquiries that were to benefit from freeport status will be timed out. An enquiry today will be two to three years before build, and that would likely be beyond the current period.

“This is a big, once in a lifetime chance, for us. The difference for the Humber could be exponential if we really work hard on this.”

Skills were also touched upon, with Katie Hedges underlining grand plans for Catch's expansion[8] under the Net Zero banner. Initial aims are to double appentices in key trades at the beacon industrial training complex, leading to an eventual 10-fold increase to 1,000.

Carbon capture 'time critical' to keep investment appetite

Humber Energy Board chair Richard Gwilliam said an indication, at least, for Humber progress on carbon capture would we hugely welcomed.

International competition for global companies’ investment was stressed, with fears previously voiced for the £15 billion of projects that make up the Humber 2030 Vision - all linked to the hydrogen and carbon capture proposals.

March’s forerunner window was missed, and while Viking - the South Bank option - was included in a second tranche, negotiations continued on Zero Carbon Humber.

Mr Gwilliam, who is a director at Drax, said: “We have the biggest concentration of capture projects in the Humber and the biggest concentration of viable storage sites off the Lincolnshire and Yorkshire coast. The path to decarbonisation goes through the Humber, it has to.

“I was nervous about the appetite for investment (back in March). Multinational companies have a portfolio of developments. Boards may make decisions without the emotional attachment like we have in the region. We have moved heaven and earth to rebuild the case for the Humber. The Minister’s visit a month back to come and listen[9], to learn about the freeport, decarbonisation, was very important. Lord Callanan coming[10] really galvanised us to build a stronger case going forward. “It feels to me we have built a very strong and collaborative case for the region. We need to make sure we are successful in taking that case to government.

Humber Zero's project leaders have made a policy push plea to Westminster as a project update was given to key stakeholders in northern Lincolnshire. Could the Autumn Statement help progress carbon caputure and storage plans?

“An announcement on carbon capture use and storage feels time critical - it may be too challenging in the time available - but reference to it would help create appetite for investment.”

Phillips 66’s lead figure on decarbonisation, Chris Gilbert, firmly underlined that collaboration - with opening comments stressing the importance of the unified stance, having not always been the case across both banks. But the transition from fishing nets to Net Zero calls for a helicopter view, the audience heard.

Mr Gilbert said: “We have had our disappointment in the Humber. A lot of hard work went in, real collaboration. Traditionally we are a company that doesn’t want to work with others we may see as competitors, but on this Net Zero agenda we have really worked together, whether it is Humber Energy Board or Humber Industrial Cluster Plan. We are collaborating under Humber Zero, with VPI next door.”

Mr Gilbert is also keen to see a cohesive, agile permitting environment emerge “so we can get spades in the ground, create jobs and get things moving”.

And on the international race, he added: “We are a global company, and it is a real game-changer in the US with the Inflation Reduction Act. A very simple tax credit mechanism, very simple to understand, and we are seeing a lot of opportunity; carbon capture, hydrogen, renewable fuels - so many opportunities. It is becoming more difficult, and the sooner we get clarity on what is happening in this region the better.

“It will happen. It is enshrined in law to get to Net Zero by 2050. When you look at where the emissions are, the largest emissions are here. This area will have to decarbonise. We have to play the long game, keep collaborating, whether it is Track One, Track One expansion, Track Two, there is room for us all. If we keep working with government we will get there.”

Never mind the Autumn Statement, what about a general election?

The panel was encouraged to look beyond the Autumn Statement, the looming date in the Westminster calendar, prompted by a question from the Aura Innovation Centre audience on impacts a general election could have

Mr Gwilliam said: “The last thing business wants is disruption. We need long-term clarity and certainty, but it is an opportunity to engage. We engage extensively with existing government and opposition parties to make sure our messages are heard.

“We have a unique opportunity here. I think it is an opportunity and platform to push the message from around the region home and hope it gravitates with those people seeking a platform at the election.

“I hope it transcends party politics. The message we are trying to get out, the longevity requirement of Net Zero, means this will continue through, irrespective of whatever party of whatever colour is in power.

Mr Jones picked up on freeports, explaining how while relatively new, it was deep-rooted. He said: “Will freeports survive a general election? It is something on many people's minds. Freeport benefits are enshrined in law and that's difficult to reverse. It has also been set up as independent local-led companies, out of government, to move forward.

“The energy transition and levelling up agendas are not going to go away, if anything there will be a greater focus. I am confident it will be part of future plans should Labour get in. It may become a branding thing, we don't look like a freeport elsewhere in the world, it is trade and customs elsewhere, whereas we have pretty aligned to industrial policy.”

Mr Jones also revealed Sue Gray to be “a fan” of freeports. The former senior civil servant, who became a household name when she led the Downing Street ‘Partygate’ investigation into lockdown gatherings, recently became Labour’s chief of staff.

Back to next week, and potential county deals - the latest devolution steps for Hull and East Riding and Greater Lincolnshire - will also be awaited, as they could bring substantial investment funds, which twinned with freeport’s abilities to retain rates, are seen as transformative.

Mr Green said: “There is an enormous opportunity to make sure all strategies and plans, the vision and collaboration are all aligned, and that’s when the Humber as a collective, starts to make a real step forward and repositions the economy to what we are aspiring to”

References

  1. ^ Autumn Statement (www.business-live.co.uk)
  2. ^ Net Zero Humber urgency and steel's 'wrong transition' highlighted (www.business-live.co.uk)
  3. ^ North's praise for Energy Estuary stance on the route to Net Zero (www.business-live.co.uk)
  4. ^ Pensana (www.business-live.co.uk)
  5. ^ Meld Energy (www.business-live.co.uk)
  6. ^ Metsa Tissue (www.business-live.co.uk)
  7. ^ only got going officially this summer (www.business-live.co.uk)
  8. ^ grand plans for Catch's expansion (www.business-live.co.uk)
  9. ^ The Minister’s visit a month back to come and listen (www.business-live.co.uk)
  10. ^ Lord Callanan coming (www.business-live.co.uk)