Industrial clusters

As the refining sector looks for ways to maintain its status as a major employer in a highly-skilled industry, one possible role is to play a part in the establishment of high-technology industrial clusters that contribute to the economy by creating low-carbon products in a carbon neutral way.

What are industrial clusters?

The 'cluster concept' seeks opportunities between adjacent industries for integrated processes, operations and business models. In particular, clusters offer an opportunity for businesses to improve energy efficiency, produce low-carbon products and technologies and decarbonise their operations to a greater extent than could be achieved alone.

Companies in a cluster could draw on collaborations with non-commercial actors, such as government agencies, educational and skills providers and other institutions to provide specialist training, information, research and technical support.

What role can the downstream oil sector play in supporting industrial clusters?

The downstream oil sector has a presence across almost every region of the UK, and each UK refinery exists in geographical proximity to other energy intensive industries. This is potentially a major opportunity for the refining sector to play a central part in the UK's energy transition, leveraging their scale, expertise and resources to participate in clusters.

Potential stakeholders include other energy intensive industries, renewables industries, other fossil fuel producers, forecourt operators, Combined Heat & Power (CHP) operators, 3D printing companies and non-industrial partners like housing providers, local and devolved governments, universities and other Higher Eduction and Further Education providers.

What is needed to make clusters a success?

Several factors are needed to make clusters a success. This will require in most cases a common infrastructure, supply chain innovation and local talent pool that embraces new technology. It will also depend on the support and involvement of third parties, such as governments and public bodies involved in the planning/permitting process and a supportive regulatory framework.

Fuels Industry UK believes three fundamental elements are needed without which clusters cannot succeed:

1. Strong leadership - The strongest clusters are private sector-driven. Individual leaders within these companies will be invaluable in championing a successful initiative, able to move their companies into closer alignment with overall cluster objectives.

2. Shared vision - Cluster objectives will need to be defined by a shared vision between a critical mass of companies who understand its collective benefits.

3. Modular approach - Ensuring the appropriate scale and sustainability of any new cluster is critical to its success. Clusters must therefore think carefully about the pace at which they form and consider a phased or modular approach that focuses first on the core businesses in the cluster before expanding in a measured way to include new participants.

To read more, please visit our Case Studies