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Tees Valley Newsletter – Winter 2021

Message from the Mayor

Many people will have been winding down as the nights have been drawing in and we’re approaching Christmas, but it couldn’t be further from the truth here.   

As you’ll read, over the past three months, we’ve had some landmark moments for the region, including throwing the doors open to the world as we launched the Teesside Freeport. After four years in the making, our region was finally confirmed as the UK’s first and largest freeport, bringing with it thousands upon thousands of job opportunities that will touch every part of Teesside, Darlington and Hartlepool. 

We’ve made even more headway on the Teesworks site too, continuing our demolition programme while welcoming VIPs such as as Secretary of State for Levelling Up, Housing and Communities Michael Gove MP, bp’s global CEO Bernard Looney and its chairman Helge Lund. They all visited to see the progress we’re making to clear the site and get it ready for the likes of Net Zero Teesside and GE Renewable Energy’s offshore wind  turbine manufacturing facility. 

The summer season may now be over, but that’s not stopped things happening at the airport, as we move into the next phase of growth and take advantage of the land and property assets there. There are hundreds of acres for business and commercial development as part of the Teesside Freeport and we’re now putting plans into action to maximise this.  

We also had the Autumn Budget, delivering nearly half a billion pounds of new money for our region. Ahead of the budget, we secured £107million to help make South Bank Quay a reality, and also £310million to invest in our transport priorities including rail, road, bus and cycling. In the Budget, Yarm and Eaglescliffe received £20million from the Levelling Up fund too.  

There’s also been a raft of hydrogen news from bp and Sabic, and we’re continuing to shout about our clean energy credentials – this time taking a delegation to COP26 in Glasgow, which I also attended. Read more about them below. 

It just remains for me to thank all of our LEP members, cabinet members, local councils, brilliant businesses, and stakeholders of all types for their support over the past 12 months. You can see just how much progress we’ve made in the video below:

Merry Christmas, happy new year and here’s to a bright 2022! 

Ben 

Teesside Freeport Opens for Business 

Teesside Freeport

The Teesside Freeport, the UK’s first and largest freeport, began its operations in mid-November, just three weeks after it was officially launched. 

At sites all across the Tees Valley, including Teesside Airport and Wilton International and with its heart at Teesworks, the freeport will help businesses benefit from a wide package of tax reliefs, simplified customs procedures, streamlined planning processes to boost redevelopment and government support to promote regeneration and innovation. 

The Teesside Freeport will create more than 18,000 new highly skilled jobs and generate billions of pounds for the local economy over five years, with work well under way on the first scheme at Teesworks. 

GE Renewable Energy’s mammoth offshore wind turbine blade manufacturing facility will be based on the site to supply Dogger Bank, the world’s biggest wind farm, and chose the region to invest because of its freeport status. 

Teesworks’ Quay Secures £107million as Land Preparation Work Continues 

Teesworks’ South Bank heavy-lift quay has been awarded £107million from the UK Infrastructure Bank’s first ever funding commitment. 

The funds will see part of the site along the River Tees, completely transformed, creating a 450-metre quay to service the offshore wind sector – including GE Renewable Energy’s facility coming to the site – providing opportunities for manufacturing, storage and mobilisation of wind technology. 

The investment came following news that the Net Zero Teesside carbon capture, utilisation and storage power plant, as part of the East Coast Cluster, has been selected as the premier net zero project to lead the UK’s low-carbon ambitions. It will now receive a share of the £1billion Carbon Capture and Storage Infrastructure Fund to create the country’s first decarbonised industrial cluster in the region. 

Plans have now been submitted to clear and remediate the 150 acres of land at the proposed site of Net Zero Teesside Power and two consortiums of engineering companies have been awarded the first design and development contracts for the facility. This will determine which group of firms take the lead in delivering the power plant and its associated carbon capture and export infrastructure.  

Elsewhere on site, plans have also been lodged for Teesworks Skills Academy’s new building in the Dorman Point area, which will be used to help connect local people with the jobs and opportunities being created on the site now, and those in the future. The majority of the construction on the £2.1million development is expected to take place early next year, ahead of its opening in March 2022. 

 

Teesside Airport Makes Property Its Next Phase as More Flights Go On Sale 

Teesside Airport has revealed how it aims to capitalise on its land and property assets and enter the next phase of its business plan, following the terminal’s multimillion-pound redevelopment. 

Images of the new 1,360sq m office space which will be created as part of the proposals has been released, replacing the current ageing landside offices which are being remodelled into a new Sky Bar and viewing platform. 

Work has also begun on a new road linking the A67 to the southside of the airport, opening up access for a new business park. The airport is also expanding its cargo handling capabilities with the creation of a new freight facility. 

Inside the terminal, the new duty-free store has now opened for business, operated by World Duty Free in a 12-year partnership. A new deal has also been signed with the Bannatyne Group, which is making a £100,000 investment to create a luxury spa in the departures lounge, offering a range of express treatments. 

In airline news, Loganair has launched a new one-stop service to Esbjerg, Denmark, particularly useful for oil and gas workers, while Ryanair’s summer holiday flights for 2022 to Alicante, Corfu, Faro and Majorca are now on sale after strong sales in 2021. It’ll be a bumper year of summer holiday flights to look forward to with the return of TUI jetting passengers off to Majorca and Turkey in 2022 and now on sale for 2023. KLM has also brought forward the time of its service to Amsterdam Schiphol, making it even more convenient, and it has pledged to go even further next year, with the introduction of morning flights allowing for increased ease in making global onward connections from Schiphol.  

 

Three New Major Hydrogen Projects Set for the Region 

Hot on the heels of the announcement earlier in the year that bp will establish a “blue” hydrogen facility in the region – H2Teesside – three new hydrogen projects have been earmarked for the area. 

A second blue hydrogen scheme – which sees natural gas split into hydrogen and CO2 which is then stored – has been announced by electrical infrastructure firm Kellas Midstream. It will explore the production of 1GW of low-carbon hydrogen using gas already imported through its terminal at Seal Sands. 

On top of this, bp announced plans for a large-scale green hydrogen facility for the region, HyGreen Teesside. This is targeting 60Mwe of hydrogen produced from renewable energy by 2025, potentially rising to up to 500Mwe by 2030. 

Petrochemical firm Sabic has also pledged to invest £850million into a new green energy project at its site on Wilton. Sabic, a subsidiary of oil titan Saudi Aramco, has agreed funding to restart its hydrocarbon cracker at Wilton and convert it to run on hydrogen, a greener source of energy. The conversion would also aid the Government’s green energy ambitions, as hydrogen is a natural by-product of the cracking process. 

The cracker, known as the Olefins 6 plant, breaks down hydrocarbons into chemicals such as ethylene which are then used in a host of further processes, and has been shut down for over a year.  

All of these projects will help to create more good-quality jobs in the clean energy sector as well as supporting more in the supply chain, upskill our workforce and further mark the region out as the place to be for innovative hydrogen technologies.  

 

Tees Valley Heads to Cop26 Climate Change Conference 

The Tees Valley is the UK’s leading export-focused and energy-intensive industrial cluster with ambitions to create the world’s first Net Zero industrial cluster by 2040. So with COP26 being held in Glasgow in October, it was the perfect opportunity to showcase everything we have to offer. 

In order to show not just the region’s net zero credentials but also our capabilities in innovation, we teamed up with local company, Animmersion to create a unique 3D hologram that highlighted the whole Tees Valley offer, from the UK’s most developed CCUS project – Net Zero Teesside Power – to two huge hydrogen projects, H2Teesside and H2NorthEast.  

A new mini-site was also set up, and we worked with local businesses and organisations who are also doing their bit to help climate change to showcase their efforts with a dedicated case study section. You can check out the web page here: https://teesvalley-ca.gov.uk/net-zero/ 

 

Transport Funding Helps Drive Forward Key Schemes 

Government has confirmed that funding for the region’s transport initiatives would total over £310million over the next five years. 

This will help finance revolutionary projects across all modes of travel, including rail, road, bus and cycling. It also includes cash for Darlington, Hartlepool, South Bank and Redcar stations, plus Eaglescliffe station, which recently had £1.6million signed off to kick-start major improvements including a new western access point to the station.  

LNER’s Middlesbrough toLondon service also began this month, with its first Azuma train leaving the station on Monday, 13 December bound for the capital. The service, the first in more than 30 years, came after work to extend the station’s platform two by 75 metres was completed earlier this year, as part of an ongoing £34million transformation supported by £22.5million from the Tees Valley Mayor and Combined Authority. 

A total of 145 electric vehicle charging points are set to be rolled out across the region’s public car parks too, in a drive to encourage the take-up of lower-carbon electric vehicles and make it easier for those who own one to get about.  

The first phase will include 38 car parks, with 32 currently identified, and rising to a potential 45 in further phases of the scheme. Installation is due to begin early in the new year, with the first 21 sites expected to be up and running by the summer. 

 

Policy Update  

Autumn Budget and Spending Review 2021 briefing 

The Chancellor of the Exchequer presented his Autumn Budget and Spending Review to Parliament on Wednesday 27 October 2021 which set out the government’s plans to build back better for the rest of the Parliament.  

Headlines for the Tees Valley:  

  • Teesside Freeport will be one of the first Freeport tax sites (along with Humber and Thames) and will be able to begin initial operations from November 2021. Teesside Freeport became operational on 19 November 2021 
  • £310m public transport funding.
  • £310m indicative funding allocation for improving public transport from 2022/23 to 2026/27. TVCA will submit a final delivery proposal to DfT in January 2022.
  •  investment – a £107m loan to Tees Valley Combined Authority Group to develop a new heavy-lift quay at the South Bank area of Teesworks to support the offshore wind sector. This will create around 800 high quality jobs directly, with the potential to unlock thousands of jobs in total across the Teesworks site  
  • Levelling Up Fund: £20million for Yarm and Eaglescliffe for town centre regeneration 
  • Almost £690,000 will be allocated towards the regeneration of Church Lane North estate in Redcar and Cleveland from the £14million estates regeneration share of the Brownfield Land Release Fund 2 
  • Up to £50,000 through the Restoring Your Railway ‘Ideas Fund’ to develop an early-stage proposal to reinstate passenger rail links between Darlington and Weardale 
  • Selecting East Coast Cluster (combining Teesside and Humberside) as one of two Carbon Capture Utilisation and Storage clusters to be deployed by the mid 2020s 
  • The reduction of Air Passenger Duty for domestic flights from April 2023 (50% cut) 

 

Clean Growth Update 

COP26, the United Nations climate change conference took place in Glasgow in November. Announcements made at COP26 included: 

  • Plans to phase out coal power in major economies in the 2030s 
  • A pledge to end deforestation by 2030 
  • A declaration to accelerate the transition to 100% zero emission cars and vans – including ending non-zero emission vehicle sales by 2035 in major economies.  

The government published the National Net Zero Strategy in October, setting out how the UK will deliver its target of net zero emissions by 2050. There is strong strategic alignment between the strategy and the Tees Valley’s ambitions in the areas of hydrogen power and carbon capture – including the government’s announcement in October that Net Zero Teesside Power has been selected as the UK’s first major carbon capture utilisation and storage project.  

Alongside the strategy the government published a regional assessment which stated that our region could “potentially benefit from the transition to net zero over and above the benefits which may accrue at a national level” with analysis forecasting an additional £1.9billion could be added to annual direct GVA in the region, leading to 27,000 more direct jobs by 2050, compared to 2020 levels.