UKREiiF 2024: 'Significant' investment needed in renewable energy to keep up with manufacturing demand, says panel

The last two years have seen an ‘explosion’ in demand for manufacturing buildings as the UK moves towards its net zero targets but there needs to be a significant investment in renewable energy to keep up with demand, according to a panel of experts.

The discussion took place at an event entitled The New Industrial Revolution – How The Transition to Net Zero is Leading to a Resurgence in Manufacturing, hosted by JLL, at The UK's Real Estate Investment and Infrastructure Forum in Leeds.

Richard Yendle, associate in industrial and logistics at property giant JLL, said the global need for countries to transition their economies to net zero, along with AI (artificial intelligence), were driving a new industrial revolution.

Hide Ad
Hide Ad

"That will be as transformative as all of the industrial revolutions that have come before,” Mr Yendle said. "The transition to net zero will require huge investment in decarbonising not only transport but industry and the energy system as well.”

Left to right: Melinda Cross, head of industrial and logistics at JLL; Richard Yendle, associate, industrial and logistics at JLL; Charlie Withers, partner and development director at Tritax Big Box; Ian Belfield, director of business development at SSE Energy Solutions, Michelle Duggan, inward investment manager at Invest North East England; and Ben Sanderson, managing director at Aviva Investors.Left to right: Melinda Cross, head of industrial and logistics at JLL; Richard Yendle, associate, industrial and logistics at JLL; Charlie Withers, partner and development director at Tritax Big Box; Ian Belfield, director of business development at SSE Energy Solutions, Michelle Duggan, inward investment manager at Invest North East England; and Ben Sanderson, managing director at Aviva Investors.
Left to right: Melinda Cross, head of industrial and logistics at JLL; Richard Yendle, associate, industrial and logistics at JLL; Charlie Withers, partner and development director at Tritax Big Box; Ian Belfield, director of business development at SSE Energy Solutions, Michelle Duggan, inward investment manager at Invest North East England; and Ben Sanderson, managing director at Aviva Investors.

Transport (not including aviation and shipping) accounted for just under a quarter, external of UK greenhouse gas emissions in 2022, according to the Department for Energy Security and Net Zero, making it the largest emitting sector. Industrial processes represented about 14 per cent.

Mr Yendle added that there would be ‘major opportunties’ for growth across a number of different manufacturing sectors and their associated supply chains. “This will in turn create new demand for new buildings and infrastructure,” he added.

"Many types of advanced manufacturing will need to expand to create the required low carbon and renewable energy products, such as large scale batteries, electric vehicles and renewable energy generation products.”

Hide Ad
Hide Ad

Charlie Withers, partner and development director at Tritax Big Box, said that just over 25 per cent of his current property enquiries were manufacturing-related.

Mr Yendle added: “We’ve seen manufacturing take up a much larger piece of the pie over the last few years. It’s been dominated by logistics over the last five or 10 years but the figures for manufacturing are double what they were two or three years ago and we’re likely to see that growth continue.”

Ian Belfield, director of business development at SSE Energy Solutions, which provides access to green energy from UK wind farms for business and local authority customers, said there needed to be further ‘significant’ investment in renewable energy when the last coal-fired power station closes later this year but added that it must be a collective effort.

"The most conservative estimate would suggest that we need double the power generation capacity in the UK by 2050 and it’s likely to be more than that,” he said. “At the same time as an explosion in demand in manufacturing, there’s also a complete change in energy mix.”

Hide Ad
Hide Ad

SSE is investing up to £40bn in renewable energy over the next decade.

"We need to work together to get these things deployed,” he added. “If we are going to do decarbonise the UK at pace then collaboration is key.”

Related topics: