First Minister intervention plea as jobs go at CS Wind

Unite raised concerns that 22 had already lost their jobs this week.

The factory, bought over by the South Korea-based firm in 2016, has announced it will cut up to three-quarters of its workforce, despite recording pre-tax profits of £7.1 million last year.

The update - signed off by the managing director Yun-Cheol Kim - confirmed that a major project to deliver towers for the Beinn an Tuirc wind farm would “no longer” be manufactured at CS Wind’s UK factory.

READ MORE: Scotland left with 'scraps off table' in £2bn wind farm boom

It has prompted the union Unite to write to Nicola Sturgeon to make a last ditch appeal to rescue the company and appeal to her to help breathe new life into Scotland’s wind farm industry.

In 2010, a Scottish Government report stated the offshore wind sector alone offered the potential for 28,000 direct jobs and a further 20,000 jobs in related industries, as well as £7.1bn investment in Scotland by 2020.

But Unite says this turns out to be “yet another fantasy in the so-called green jobs revolution”, claiming the current offshore wind direct jobs figure is at 1,900.

In a report last month, RenewablesUK estimated floating wind farms can support 17,000 UK jobs by 2050, and £33.6bn of economic activity.

CS Wind were involved in the Beinn an Tuirc wind farm project on the Kintyre peninsula believed to consist of 18 turbines.

Last month, ScottishPower Renewables, announced that it had begun work on the Amazon backed project which was to see 50MW of green energy, enough each year to power the equivalent of 46,000 homes.

ScottishPower had then stated the project would be powered by turbines supplied by Danish-owned Vestas, with the towers for the wind turbines being supplied by CS Wind.

Up to a hundred new jobs were expected to be created at the site over the lifetime of the project and it was announced CS Wind were on board.

Unite believe CS Wind lost the Beinn an Tuirc contract due to the uncertainty surrounding the factory. It was believed the contract would have provided the factory with a two months of work until other contracts could be secured.

Staff at CS Wind have now been told that many meetings with Government officials, Highlands and Islands Enterprise, and union leaders have “not given us any positive outcomes so far”.

Mr Kim said in a circular seen by the Herald: “Despite all efforts to date, there remains a significant high risk of redundancies of around 80% of the workforce at all levels. Currently it is expected that approximately 20% of employees will be retained to complete our contractual obligations.”

It is understood that would mean up to 73 jobs would go at the factory, which has a total workforce of 94.

Pat Rafferty, Unite Scottish Secretary, “Unite is extremely concerned about the future of CW Wind. It’s the UK’s only facility which manufactures onshore and offshore wind towers, however, 120 workers face redundancy in the coming weeks.

“This is due to contract gaps but the position has been exacerbated by CS Wind’s decision to announce redundancies at precisely the same time as they are awaiting news on bids for contracts.

“If CS Wind is successful it would keep the workforce employed for a further year but the contract could be on the brink of being lost unless the factory receives concrete support from the Scottish Government.”

Unions are already angry over what they see as “the scraps off the table” that Scotland has received in the work on the £2 billion Neart Na Gaoithe (NnG) wind farm off the Fife coast, awarded by EDF, the French state energy giant.

READ MORE: Scotland left with 'scraps off table' in £2bn wind farm boom

It is understood that in a key contract – it is proposed a minimum of eight of 54 steel foundation jackets which anchor the turbines to the seabed will be built in Scotland with the rest being constructed in south east Asia.

Scotland has lost further important project work, worth hundreds of millions of pounds to England, Germany, Finland and France as part of the deal.

“It will be unforgiveable and disgraceful if the factory is left to wither on the vine, particularly, in the aftermath of the abject job creation arising from EDF’s announcement on the Neart na Gaoithe project,” added Mr Rafferty.

“The Scottish Government are hiding behind the headlines of multi-billion pound contracts when the reality is that there is no renewables jobs bonanza in Scotland and our manufacturing capacity could be reduced to next to zero if CS Wind is not saved.”

In his letter to the First Minister, Mr Rafferty has told of the “worrying situation” facing the CS Wind workforce but said that a decision over a contract to provide 40 towers for Hornsea Project Two could be a lifesaver - providing 12 months of work.

“I am sure you will agree that it would be disastrous for Scotland’s renewables manufacturing capacity if CS Wind lost out due to the ongoing uncertainty over the factory’s future. I would, therefore, ask that an urgent intervention is required including a meeting involving Unite, CS Wind and those Ministers with the relevant ministerial responsibilities... to ensure that as much as possible is done to secure future contracts at CS Wind.”

Accounts lodged by CS Wind in April show directors saw the outlook for the next financial year as “positive”. It posted pre-tax profits in 2018 of £7.1m – up from a loss of £191,000 in 2017.

The business has made a £27m investment in the facility since taking over, while also having deals with Danish firm Orsted and Swedish company Vattenfall.

It has blamed the move on challenging market conditions for onshore towers and difficulties with supply chain companies in the offshore sector.

A Scottish Government spokesperson said: “This has been a very difficult time for workers at the CS Wind tower facility at Machrihanish and our priority has been to support the company in its attempts to secure future work for the site to plug a gap in its order book.

"We have explored all areas where we can assist the company to retain its workforce for the longer term, such as funding infrastructure improvements to lower transport costs, but the Scottish Government does not have a legal route to gap fund manufacturing itself as this would constitute a breach of State Aid regulations. Clearly, the site has also been hurt by the reduction in onshore wind construction, arising from inexcusable exclusion of that technology from recent Contracts for Difference auction rounds and the ending of the Feed In Tariff regime.

“The Rural Economy Secretary hosted an economic summit in Campbeltown bringing together local stakeholders, the Scottish Government, our agencies and local employers to identify possible economic opportunities for the area.

“In the event of any employees ultimately facing redundancy, which we are working hard to avoid, we would provide support through our Partnership Action for Continuing Employment (PACE) initiative.

“Renewables are a crucial part of our transition to a low-carbon economy which is why earlier this year we convened an offshore wind summit with unions, companies and other interested parties who agreed to take urgent action to ensure more companies benefit from the awarding of contracts for offshore wind projects. We will be reconvening this summit early in the new year.

“The Minister for Energy, Connectivity and the Islands has highlighted the challenges to the onshore wind supply chain caused by removal of support and, in respect of offshore wind, has continued to call upon the UK Government to consider how the Contract for Difference (CfD) process can be restructured to consider the value added to the Scottish and UK economies and to encourage wider and more meaningful use of the Scottish and UK’s supply chains.”