- Email: [email protected]
Wave and tidal energy
Ocean energy
WAVE AND TIDAL ENERGY Its Emergence and the Challenges it Faces Like a new frontier for power generation, wave and tidal enced currently have somewhat mitigated technologies have attracted considerable attention in the past earlier forecasts although upside potential is important, with many as yet unansix months, with the industry finally emerging from a long and nounced projects expected to emerge as the uncertain period of embryonic development. As the industry is period progresses. maturing, it is important not to forget the difficulty in balancing industry prospects with the many obstacles along the way. Early growth in UK In the future, continued growth is expected Benoit Dal Ferro, Douglas-Westwood Ltd reports. and the Carbon Trust expects that most of
I
ndeed, whilst considerable uncertainty remains, the global wave and tidal resource may be grossly estimated as respectively 1 and 1.5 times the world consumption. Most of this resource is currently technically inaccessible or located far away from human settlements; hence only 10 to 25% of electricity may be realistically generated by wave and tidal. However, we believe the investment required to extract this power from the oceans would exceed £600 billion, a figure similar to Airbus forecasted sales of new passenger and freighter aircraft for the next twenty years - a very substantial opportunity. (Figures 1 and 2)
80MW in 2011, subject to time-keeping and survival of installed units. The still precommercial status of most devices is associated with high up-front cost due to technology development, limited project size and the difficulty of finding investors for these 'high-risk' ventures. However, the past six months have seen tremendous anticipation in the sector with new projects being frequently announced: delays experi-
the early growth is likely to occur in the UK. This is no surprise as the country benefits from one of the largest practical resources in Europe: around 50TWh/y for offshore wave and 18TWh/y for tidal power, equivalent to around 18% of the country’s electricity consumption. As the UK is increasingly reliant on foreign gas and 17m people live within 10km of the coast - notwithstanding 40% of British industry - tapping into marine energy is an important prospect. With several projects
By contrast, installed capacity worldwide is still insignificant. The present sub10MW capacity is expected to reach nearly
Author information Contact: Benoit Dal Ferro, DouglasWestwood Ltd, St Andrew's House, Station Road East, Canterbury CT1 2WD, UK. Tel: +44 1227 781 098; [email protected]; www.dw-1.com
46 reFOCUS
May/June 2006
Figure 1: Wave & tidal energy world cumulative capacity forecast by main generation type (20012011).
1471 0846/06 © 2006 Elsevier Ltd. All rights reserved.
Ocean energy
Mossel Bay. Even China, in light of surging energy demand, is considering developing its nearly 7,000GW tidal stream potential, with the use of highly cost-effective Tidal Electric's lagoon concept off Dandong City in the Liaoning Province.
Challenges
Figure 2: Wave & tidal energy world capacity forecast by country (2001-2011)
heading to the water such as, for example, the 1MW Seagen device in Northern Ireland, the Wave Dragon converter off Milford Haven and a Tidal Lagoon off the Welsh coast, momentum is building. The UK has sent positive signals to the industry with the establishment of an earlystages planning and consent regulation for marine renewables in November 2005. Other important assets of the British industry include the European Marine Energy Centre (EMEC) based in Orkney - a certification and testing organisation which will open its tidal energy stream facility in 2006 and the Supergen Marine programme - a university and research consortia dedicated to tackling specific R&D barriers. Upkeep has been important locally, with the involvement of the Scottish Executive in Orkney, NAREC testings in Blyth, and the South West Renewable Development Agency's "Wave Hub" project - an innovative underwater socket which will allow technology developers to share grid connection costs and ease developmental issues such as planning consent. Further to the completion of the Marine Renewable Energy Challenge by the Carbon Trust, the final report recommended that a further £80 million should be invested in R&D and development support in order to speed up cost reduction and attract the £100-200 million in private investment necessary to reach critical capacity. The study concludes that by 2020, the tidal
www.re-focus.net
The encouraging signs around the world should not make us forget the very young nature of the industry. From a UK perspective, assuming the Carbon Trust expectations are met in 2020, there are still numerous barriers to overcome. Firstly, the industry will have to hunt subsidies and early investors unafraid of dealing with an improving, yet incomplete regulatory framework.
stream industry could represent about In the UK, the proposed Marine Bill is an 2.5GWe or about 3% of the UK installed capacity for electricity generation, a total opportunity to address this issue through the creation of a unified entity - a Marine investment of about £4 billion. Agency - but it must provide an effective Other prospects way of securing planning permission. As However, it would be wrong to assume that Michael Hay, Marine Renewable the sector is relying on the British contribu- Development Manager at the British Wind tion alone. Increasingly, foreign nations are Energy Association stated, "it is vital that building up capability and attracting proj- projects are able to enter the water as effiects. Within the EU, the Scottish wave ciently as possible in areas that provide energy converter Pelamis will be installed in excellent potential for power production." Portugal where securing the £30 billion local market has been granted a national Furthermore, wave and tidal projects will priority status. In Ireland, the Marine have to access a shoreline grid which is Institute/Sustainable Energy Ireland initia- mostly weak and congested. Identification tive is establishing a 37-hectares wave ener- of point of entry through Distributed gy test site a mile and a half off the coast of Generation planning tools currently funded Spiddal, in County Galway. The Wavebob by the DTI Innovation Programme could device has already arrived in Galway docks provide an answer. In addition, shared conto be deployed. nection through facilities such as the 'Wave Hub' may ease the planning and sharply Outside Europe, Australia is already reduce both costs and risk. However, the building-up on its experience with the Port- significant difference between devices’ tarKembla wave device, as manufacturer get locations may mean that there could be Energetech is harvesting export leads. In the some difficulty in finding partners - in US, Governor Ted Kulongoski, is pushing addition to the threat for effective projects for a $3 million federal earmark to establish to share connection with less reliable a national Wave Energy Research, devices. Development and Demonstration Centre whilst in Canada, feasibility studies are In the longer-term, joining the dots under way to exploit the immense tidal between resource and demand for power potential of the Bay of Fundy. In South will become the greatest issue. As the UK Africa, Genesis Eco is considering the situation exemplified, about 79% of the development of a 10MW pilot wave farm at tidal resource is located in the Pentland a tag price of £20 million which could lead Firth and the Channel Islands whilst to a further 30MW commercial farm in Carbon Trust studies shows that more than
May/June 2006
reFOCUS 47
Ocean energy
83% of energy can be found below 40m - i.e. in the challenging deep. For wave devices, most of the resource lies far offshore the British coast whilst an important share of the energy is released during the winter months - i.e. 45% between December and February against only 12% between May and August. Overcoming these barriers will require R&D but most importantly, substantial cost reduction which can only be achieved through large-scale deployment and industrial manufacturing. Whereas support from the UK government is vital to the development of the early-stage industry, the current £50 million Marine Deployment Fund will not be sufficient to attract investors for such a venture. The Fund is only providing a subsidy for the deployment of pre-commercial projects, which is limited to sub10MW projects and will not last in the longer term. A far more significant effort must be considered to deploy the capacity required for reaching competitive status against other forms of generation, in particular through revenue-incentives and the warranty of continued support over project life-span. The value of early market lead should not be underestimated. Back in the 1980s, the Howden Group, a Scottish firm, was leader in the development of wind turbines but threw in the towel when faced with gloomy market prospects. Twenty years later, the German Minister for the Environment can be pleased: in a low-growth and high-unemployment context, the "Jobmaschine" has created over 64,000 positions and with the Danes, Germany holds two thirds of a £11 billion annual market growing between 20 and 30% a year. This approach having been used for other technologies, the German renewable energy sector grew in 2005 by more than 10%, employing around 170,000 people an important precedent which should comfort wave and tidal as a safety net for the declining North Sea oil and gas industry. As Richard Yemm, CEO of Ocean Power Delivery most correctly pointed out, we need less a "technological push" than an "industry pull". The journey towards mainstream use of wave and tidal energy may be over a decade long but the precedent of offshore wind paved the way to prove both engineers and investors that energy could be extracted from the sea both technically and financially. Ultimately, the rationale for the growth of wave and tidal power lies in the practicality of renewables as a source of energy and investment. The current economical paradigm assumes fundamentally that: 1) demand will always be met by 'affordable' sources of power and 2) there will always be a simple solution around that can be deployed quickly. This is a very dangerous misunderstanding as the energy system underpins any other sector in the economy and evolves in long cycles of around 50 years, mobilising considerable investments. Our continent cannot passively rely on 'technological advance' to resolve any future issue. Only a resolute industrial policy can secure the commercial benefits of wave and tidal energy, transforming field-trialled ideas into demonstrated business models.
48 reFOCUS
May/June 2006
www.re-focus.net
WAVE AND TIDAL ENERGY Its Emergence and the Challenges it Faces Like a new frontier for power generation, wave and tidal enced currently have somewhat mitigated technologies have attracted considerable attention in the past earlier forecasts although upside potential is important, with many as yet unansix months, with the industry finally emerging from a long and nounced projects expected to emerge as the uncertain period of embryonic development. As the industry is period progresses. maturing, it is important not to forget the difficulty in balancing industry prospects with the many obstacles along the way. Early growth in UK In the future, continued growth is expected Benoit Dal Ferro, Douglas-Westwood Ltd reports. and the Carbon Trust expects that most of
I
ndeed, whilst considerable uncertainty remains, the global wave and tidal resource may be grossly estimated as respectively 1 and 1.5 times the world consumption. Most of this resource is currently technically inaccessible or located far away from human settlements; hence only 10 to 25% of electricity may be realistically generated by wave and tidal. However, we believe the investment required to extract this power from the oceans would exceed £600 billion, a figure similar to Airbus forecasted sales of new passenger and freighter aircraft for the next twenty years - a very substantial opportunity. (Figures 1 and 2)
80MW in 2011, subject to time-keeping and survival of installed units. The still precommercial status of most devices is associated with high up-front cost due to technology development, limited project size and the difficulty of finding investors for these 'high-risk' ventures. However, the past six months have seen tremendous anticipation in the sector with new projects being frequently announced: delays experi-
the early growth is likely to occur in the UK. This is no surprise as the country benefits from one of the largest practical resources in Europe: around 50TWh/y for offshore wave and 18TWh/y for tidal power, equivalent to around 18% of the country’s electricity consumption. As the UK is increasingly reliant on foreign gas and 17m people live within 10km of the coast - notwithstanding 40% of British industry - tapping into marine energy is an important prospect. With several projects
By contrast, installed capacity worldwide is still insignificant. The present sub10MW capacity is expected to reach nearly
Author information Contact: Benoit Dal Ferro, DouglasWestwood Ltd, St Andrew's House, Station Road East, Canterbury CT1 2WD, UK. Tel: +44 1227 781 098; [email protected]; www.dw-1.com
46 reFOCUS
May/June 2006
Figure 1: Wave & tidal energy world cumulative capacity forecast by main generation type (20012011).
1471 0846/06 © 2006 Elsevier Ltd. All rights reserved.
Ocean energy
Mossel Bay. Even China, in light of surging energy demand, is considering developing its nearly 7,000GW tidal stream potential, with the use of highly cost-effective Tidal Electric's lagoon concept off Dandong City in the Liaoning Province.
Challenges
Figure 2: Wave & tidal energy world capacity forecast by country (2001-2011)
heading to the water such as, for example, the 1MW Seagen device in Northern Ireland, the Wave Dragon converter off Milford Haven and a Tidal Lagoon off the Welsh coast, momentum is building. The UK has sent positive signals to the industry with the establishment of an earlystages planning and consent regulation for marine renewables in November 2005. Other important assets of the British industry include the European Marine Energy Centre (EMEC) based in Orkney - a certification and testing organisation which will open its tidal energy stream facility in 2006 and the Supergen Marine programme - a university and research consortia dedicated to tackling specific R&D barriers. Upkeep has been important locally, with the involvement of the Scottish Executive in Orkney, NAREC testings in Blyth, and the South West Renewable Development Agency's "Wave Hub" project - an innovative underwater socket which will allow technology developers to share grid connection costs and ease developmental issues such as planning consent. Further to the completion of the Marine Renewable Energy Challenge by the Carbon Trust, the final report recommended that a further £80 million should be invested in R&D and development support in order to speed up cost reduction and attract the £100-200 million in private investment necessary to reach critical capacity. The study concludes that by 2020, the tidal
www.re-focus.net
The encouraging signs around the world should not make us forget the very young nature of the industry. From a UK perspective, assuming the Carbon Trust expectations are met in 2020, there are still numerous barriers to overcome. Firstly, the industry will have to hunt subsidies and early investors unafraid of dealing with an improving, yet incomplete regulatory framework.
stream industry could represent about In the UK, the proposed Marine Bill is an 2.5GWe or about 3% of the UK installed capacity for electricity generation, a total opportunity to address this issue through the creation of a unified entity - a Marine investment of about £4 billion. Agency - but it must provide an effective Other prospects way of securing planning permission. As However, it would be wrong to assume that Michael Hay, Marine Renewable the sector is relying on the British contribu- Development Manager at the British Wind tion alone. Increasingly, foreign nations are Energy Association stated, "it is vital that building up capability and attracting proj- projects are able to enter the water as effiects. Within the EU, the Scottish wave ciently as possible in areas that provide energy converter Pelamis will be installed in excellent potential for power production." Portugal where securing the £30 billion local market has been granted a national Furthermore, wave and tidal projects will priority status. In Ireland, the Marine have to access a shoreline grid which is Institute/Sustainable Energy Ireland initia- mostly weak and congested. Identification tive is establishing a 37-hectares wave ener- of point of entry through Distributed gy test site a mile and a half off the coast of Generation planning tools currently funded Spiddal, in County Galway. The Wavebob by the DTI Innovation Programme could device has already arrived in Galway docks provide an answer. In addition, shared conto be deployed. nection through facilities such as the 'Wave Hub' may ease the planning and sharply Outside Europe, Australia is already reduce both costs and risk. However, the building-up on its experience with the Port- significant difference between devices’ tarKembla wave device, as manufacturer get locations may mean that there could be Energetech is harvesting export leads. In the some difficulty in finding partners - in US, Governor Ted Kulongoski, is pushing addition to the threat for effective projects for a $3 million federal earmark to establish to share connection with less reliable a national Wave Energy Research, devices. Development and Demonstration Centre whilst in Canada, feasibility studies are In the longer-term, joining the dots under way to exploit the immense tidal between resource and demand for power potential of the Bay of Fundy. In South will become the greatest issue. As the UK Africa, Genesis Eco is considering the situation exemplified, about 79% of the development of a 10MW pilot wave farm at tidal resource is located in the Pentland a tag price of £20 million which could lead Firth and the Channel Islands whilst to a further 30MW commercial farm in Carbon Trust studies shows that more than
May/June 2006
reFOCUS 47
Ocean energy
83% of energy can be found below 40m - i.e. in the challenging deep. For wave devices, most of the resource lies far offshore the British coast whilst an important share of the energy is released during the winter months - i.e. 45% between December and February against only 12% between May and August. Overcoming these barriers will require R&D but most importantly, substantial cost reduction which can only be achieved through large-scale deployment and industrial manufacturing. Whereas support from the UK government is vital to the development of the early-stage industry, the current £50 million Marine Deployment Fund will not be sufficient to attract investors for such a venture. The Fund is only providing a subsidy for the deployment of pre-commercial projects, which is limited to sub10MW projects and will not last in the longer term. A far more significant effort must be considered to deploy the capacity required for reaching competitive status against other forms of generation, in particular through revenue-incentives and the warranty of continued support over project life-span. The value of early market lead should not be underestimated. Back in the 1980s, the Howden Group, a Scottish firm, was leader in the development of wind turbines but threw in the towel when faced with gloomy market prospects. Twenty years later, the German Minister for the Environment can be pleased: in a low-growth and high-unemployment context, the "Jobmaschine" has created over 64,000 positions and with the Danes, Germany holds two thirds of a £11 billion annual market growing between 20 and 30% a year. This approach having been used for other technologies, the German renewable energy sector grew in 2005 by more than 10%, employing around 170,000 people an important precedent which should comfort wave and tidal as a safety net for the declining North Sea oil and gas industry. As Richard Yemm, CEO of Ocean Power Delivery most correctly pointed out, we need less a "technological push" than an "industry pull". The journey towards mainstream use of wave and tidal energy may be over a decade long but the precedent of offshore wind paved the way to prove both engineers and investors that energy could be extracted from the sea both technically and financially. Ultimately, the rationale for the growth of wave and tidal power lies in the practicality of renewables as a source of energy and investment. The current economical paradigm assumes fundamentally that: 1) demand will always be met by 'affordable' sources of power and 2) there will always be a simple solution around that can be deployed quickly. This is a very dangerous misunderstanding as the energy system underpins any other sector in the economy and evolves in long cycles of around 50 years, mobilising considerable investments. Our continent cannot passively rely on 'technological advance' to resolve any future issue. Only a resolute industrial policy can secure the commercial benefits of wave and tidal energy, transforming field-trialled ideas into demonstrated business models.
48 reFOCUS
May/June 2006
www.re-focus.net