September saw construction contracts in infrastructure almost double compared to August figures, based on a three month rolling average. This was helped greatly by an enormous £3 billion offshore wind farm, which continues the trend seen in 2015 where major offshore wind contracts have been awarded across the UK
The Race Bank offshore wind farm located off the Norfolk coast and spanning seven miles, is the highest value renewable energy contract ever recorded by Barbour ABI. The contract is so large that it has propelled the East Midlands region to the top spot for the highest total construction contract value in September, usually occupied by London (see fig 1.1).
Looking at total construction figures, according to the latest Economic & Construction Market Review from Barbour ABI, September witnessed an increase in activity, with the value of construction contracts reaching £7 billion, the highest since Barbour ABI started tracking the series.
Infrastructure accounted for almost 60% of the amount of construction contract values in September, dominating the month, with residential a distant second with 16%.
Commenting on the figures, Michael Dall, lead economist at Barbour ABI, said: “With many sectors, such as public housing and industrial, decreasing in contract values across September, it was a boost to the industry that infrastructure performed so strongly. This is another sign of continued growth in offshore renewable projects, after the shrinking of onshore subsidies.”
Encouragingly it is not just renewable energy projects that are boosting infrastructure; the main works for the Thames Tideway Tunnel also reached contract award stage in September as did a number of London Underground station upgrades. So long neglected, this is further evidence that sustained investment for infrastructure is beginning to occur within the sector across the UK. The big challenge for the industry now though is to ensure that labour and materials are in place to deliver projects of such scale.
