Net Zero Technology: Innovation Priorities 2025-2035 | May 2025
The Supply Chain Opportunity
The UK’s energy sector has long been a cornerstone of the economy. It has provided individuals and businesses with opportunities and jobs for decades. As the energy system pivots to a more sustainable future, it is essential that the resulting economic growth potential is fully realised.
The UK energy supply chain is projected to grow at a 4% compounded annual growth rate (CAGR) between 2023 and 2040, reaching £30 billion of energy spend in that year, as shown in Figure 5. This is driven by the investment required to achieve the energy transition across the NZTC technology focus areas.
The transition to net zero presents an unparalleled opportunity for economic growth. Between 57% and 83% of the annual spend on new energy verticals, hydrogen, CCS and floating wind, is addressable by the oil and gas supply chain. To fully capitalise on this opportunity, it is imperative that government, industry, academia and investors collaborate to maximise investment and foster the growth of domestic businesses capable of competing in international markets.
For the UK to be recognised as a leader in net zero innovation and take full advantage of the global energy transition opportunity, it must build on its strengths and capitalise on its unique net zero innovation asset base.
NTZC is one of these strengths and is already positioned to help the UK achieve its goals, creating skilled UK jobs and economic growth, increasing energy security and lowering costs, accelerating the pace of industrial decarbonisation and achieving our net zero targets, transitioning the supply chain and supporting a just energy transition.
Achieving net zero is a global ambition
With energy transition technology the demand is truly global to solve the climate challenge we collectively face. What we are developing at NZTC has application and utility on a global scale.
The economic opportunity of meeting this demand, valued using the carbon price, is estimated globally at £10 trillion by 2050. There are substantial export markets to target with Rystad Energy forecasting the global addressable export market for the UK supply chain to be circa £1.2 trillion in floating offshore wind (FOW), carbon capture and storage (CCS) and hydrogen over the 2030–2040 timeframe. Figure 6 below highlights the contribution to the £1.2 trillion market from each energy vertical:
Source: Rystad Energy (2024), ‘UK oil and gas supply chain and opportunities in the energy transition’. Reformatted by NZTC
The UK’s largest potential lies in FOW, with the UK’s share of global and European spending between 2030 and 2040 to reach 36% and 45% respectively. In addition, average annual spending in the UK’s domestic FOW market is to reach £8.2 billion between 2030 and 2040. Combined with early mover advantage, the UK can win European revenues primarily in segments where the UK holds its key strengths such as mooring solutions, dynamics cables, ports and logistics and vessels.
Meanwhile, despite the UK being expected to achieve a smaller global share of spending, hydrogen and CCS present much larger addressable global markets, with high existing UK O&G supply chain capability (80% and 83% respectively). For hydrogen, the UK excels in engineering, onshore fabrication and construction, whilst for CCS the UK can capitalise on its historical competency in delivering subsea technology globally, focusing on well construction, subsea EPCI, subsurface and flow assurance.
The addressable market for the UK undeniably presents a significant opportunity for the supply chain and there are skills, technologies and expertise that we can deploy and export now to begin to capitalise on this. Existing technologies and systems will only take us so far. We need to innovate and develop deep partnerships across industry to fully realise this opportunity.
