Major energy projects are taking shape in Tees Valley, with CCS and SeAH Wind’s monopile factory leading development
The region offers unique advantages: extensive industrial land, existing infrastructure, and devolved powers through the Tees Valley Combined Authority
Success depends on tying together Tees Valley’s existing industrial capacity with its potential for new growth and investment

Tees Valley stands at a crossroads. It has an extraordinary industrial past and a potentially transformative future in new energy technologies.

The region is on the cusp. But can it leap? Mining, chemicals, steel and shipbuilding have shaped the region, bringing wealth and environmental challenges.

Today, the region is emerging as a leader in the UK’s energy transition. Tees Valley is positioning itself at the core of Britain’s green industrial revolution, from carbon capture to offshore wind, from sustainable aviation fuel (SAF) to nuclear power.

These industries have done more than just provide economic activity. They have helped create the infrastructure and expertise for new energy plans.

Secure your place at E-FWD’s Momentum Morning in Tees Valley, on March 4, now.

Firm foundations

Tees Valley has hosted energy operations for decades. Decommissioning has played a significant role, as seen with Able UK’s work on Brent Alpha and Brent Charlie.

Nuclear power at Heysham has long driven the local economy.

The Teesside Gas Processing Plant can meet up to 10% of the UK’s demand, processing gas from the Central and Southern North Sea. Late last year, Ineos announced new compression facilities at the site to improve flows from the Breagh field.

New opportunities are emerging, building on past successes. For instance, Hartlepool hosts services for the nuclear power facility and for wind farms.

Steel River Quay, backed by the UK Infrastructure Bank, showed some of these new opportunities with its commissioning in 2024.

The next step change will be the start of operations at SeAH Wind’s monopile factory at Teesworks Freeport. This may start up as early as March. It will use the new quay to ship equipment to wind farm sites.

These industrial foundations have been crucial. Effective governance is required to turn potential into reality. Tees Valley has become a testing ground for the UK’s devolution agenda.

Devolution plans

Tees Valley seems to meet the government’s criteria: green energy, devolution and growth.

A recent government whitepaper said Tees Valley had broad industrial strengths alongside R&D and vibrant businesses.

The government has designated the North East, and Tees Valley in particular, for an investment zone focusing on advanced manufacturing. The previous government planned to provide £160 million of funding – through tax incentives and cash – for each zone.

Tees Valley was an early devolution test case. The plan launched in 2015 and began in 2017 with Mayor Ben Houchen’s election. The Tees Valley Combined Authority (TVCA) has a £356 million budget and a mandate for long-term economic growth.

*Mayor Ben Houchen and the then PM Rishi Sunak visit SeAH’s factory in Tees Valley. Source: The Conservative Party via Flickr*

The authority has highlighted the region’s potential. In evidence to Parliament, the TVCA said it had local expertise “to develop strategies, vision and policies” to “deliver high-skilled, well-paid jobs to the Tees Valley whilst leading the nation in clean energy, carbon capture and industrial digitisation”.

However, it complained of the challenges of implementation. “Without the funding necessary to put these plans into action, devolution can at time feel like it is occurring with the handbrake on, at a time when we want – and need – [to] put our foot on the accelerator.”

The TVCA cited a shortfall in government support compared to London and the South East. It argued that the region should have more power to make decisions and deploy cash.

One project stands out for its dramatic impact on the local landscape among the emerging opportunities from the industrial foundations and devolved powers.

Carbon capture

The biggest recent development for Tees Valley is the announcement of government support for carbon capture and storage (CCS).

The East Coast Cluster is due to begin construction in mid-2025 and operations in 2028. This follows the government setting out a £21.7 billion package for projects in the northeast and northwest.

In December, the commercial partners took final investment decision (FID) on the Northern Endurance Partnership (NEP) and Net Zero Teesside Power (NZT Power). It is the world’s first project-financed CCS project.

NEP handles infrastructure and storage. It consists of BP, Equinor and TotalEnergies.

Initially, it will store 4 million tonnes per year of CO2. By the mid-2030s, NEP could store up to 23mn tpy of CO2.

NEP will capture up to 2mn tpy of emissions from NZT Power. This is an 860 MW CCGT, the world’s first gas-fired power station with carbon capture, backed by BP and Equinor.

The presence of these major companies is a point of pride and a demonstration of the region’s long-term hopes.

*Source: Northern Endurance Partnership*

The government design is instrumental. The UK’s green industrial plans rely on clusters, bringing together resources in concentrated areas. Carbon capture is central to these clusters and the NEP project underpins the regional aspirations.

Putting industry and jobs at the heart of the cluster plan is critical. The government said CCS investment aimed to “reignite industrial heartlands and drive investment in industrial communities such as Teesside”. The decision to start work triggered £4bn in contracts and should create 2,000 direct jobs, with more to come.

Success at CCS depends on people. Tees Valley must draw on its existing workers and find new talent.

Employment uptake

More jobs are crucial given the government’s need to grow the economy and drive prosperity. ECITB head of strategic engagement in the region Kenneth Fleming said estimates suggest Teesworks could support “upward of 10,000 jobs”.

In the past, there has been scepticism of CCS from government and the public. For instance, problems at Gorgon in Australia have undermined confidence in the technology.

Fleming noted that work at the cluster could “give verifiable data that shows how successful, on a technological level, CCS could be. It would be great to see in five or 10 years really strong data showing we can make CCS work. If you can get it right in Teesside, it could be a brilliant vision of addressing many of the deindustrialisation and net zero challenges that we have right across the UK.”

Mayor Houchen’s 10-year vision aims to create 16,000 jobs between 2019 and 2029. As of last year, the TVCA reported direct new jobs at just over 10,000.

“We’ve got a huge task ahead of us to get the skills needed into thousands upon thousands of our people”, Houchen said. “We’re serious about getting as many people as possible access to the thousands of jobs we’re creating.”

The Institute for Government cited the TVCA’s “Gateway to Construction” programme as evidence of how local powers can focus on education to tackle unemployment.

To navigate this workforce change, a balance between existing skills and new capabilities is needed.

Continuity and disruption

Fleming said the industry needed to talk to both existing workers with legacy skills and new ones.

“It’s easy to talk about the newness of clean energy, but there’s something important around recognising that a lot of the technical skills are the same,” he said. Welders will have the core skills to move into CCS or hydrogen, despite different safety issues.

“Trying to emphasise things being new and exciting isn’t always the message that resonates with someone who is, say, a craft-based technical person.” Fleming noted the “significant numbers of workers in their 60s” in the region.

The ECITB official said it was important to engage with communities and “produce new individuals that have the skills and the values and the attitudes that can be successful in these industries”.

He said that the sense of newness – and tackling carbon emissions – can attract young people to the sector.

“There are new approaches. For example, there are opportunities around things like virtual reality and augmented reality welding. That’s a really good way of training welders.”

In addition to new training methods, these new industries can attract new entrants. “It can help attract more women, people from different backgrounds that are under represented in the energy sector.”

Fleming said that if the industry can find new ways to tap into diversity as a strength, “so it’s not just white men, but across gender lines and underrepresented groups, that could be a shining example. It could show how to get it right across the country – and even internationally.”

Bringing together new and existing workers and technologies is required to diversify economic plans in Tees Valley.

The next page

New areas and ways of working underpin the region’s and government’s hopes. Tees Valley can leverage local knowledge and networks to develop its energy sector and capture growth.

There are ambitious projects ahead. In October 2024, Teesworks announced plans for a £100mn investment in the UK’s largest private wire network to support site activity.

SAF has potential in the region. The government aims for SAF to meet 10% of the country’s needs by 2030, up from 2% in 2025.

The Department of Transport backed five local companies in 2023. Progress has been slow, but there are positive signs, such as Willis Lease Finance Corp. reaching a deal with McDermott in November.

High stakes

Tees Valley is positioned to secure its place in the UK’s energy industry future. The region offers available industrial land, technical expertise, established infrastructure, and a growth-focused administration.

Major companies like BP and Equinor have bet on the region’s success through NEP.

There are challenges. TVCA’s capacity is an issue raised in a recent EY audit, amid various reporting burdens. The supply chain requires investment, while the workforce transition requires management.

Perhaps the biggest challenge is psychological. Can a region shaped by industrial decline embrace a new identity as a clean energy pioneer? The infrastructure from the industrial past provides a foundation for growth, but has also left a legacy of scepticism about grand transformative visions.

The only solution is success. Completing the SeAH plant and starting the CCS project will demonstrate real change. This high-level success and political support will help smaller companies advance other innovative plans, like SAF.

If Tees Valley gets this right, it can provide a blueprint for traditional industrial regions to navigate uncertainty and change. It can demonstrate how a region can maintain industrial heritage while pioneering new technologies.

The stakes could hardly be higher for Tees Valley and the UK.

Find out more about E-FWD’s upcoming Momentum Morning in Tees Valley, on March 4.

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