MCT power curve - analysis

MCT has just published a power curve for its Seagen device in Strangford Narrows (see figure above and link here). The curve shows a period of output at the design capacity of 1.2 MW, in what is described as a “medium tide”. This tide appears to have peaked at 3.1 m/s, which may be medium for Strangford, but is pretty impressive for most sites.

We realised that it’s possible to drill into this curve to come up with some (very) theoretical ideas of the capacity factor which might be achieved by the technology. First we constructed a velocity lookup table by taking a ruler to the graph, which shows the power output (kW) at various stream speeds (m/s).

m/s - Power
0 - 0
1 - 20
1.25 - 100
1.5 - 180
1.75 - 400
2 - 600
2.25 - 900
2.4 - 1200

We then constructed a model which characterises a simplified tidal environment, with stream speed varying according to a diurnal cycle (sinusoidal variation over 24 hours, in 2 flood, 2 ebb tides) and a 28 day lunar cycle (again simple sinusoidal variation).

We entered a maximum stream speed (peak rate achieved at spring tide) and a minimum stream speed (peak rate achieved at neap tide) and constructed a lookup on an hour by hour basis to estimate the power output over a month.

Based on a maximum stream speed of 3.2 m/s and a minimum stream speed of 1.6 m/s (ie neap maximum is half as fast as spring maximum), we find that the average theoretical power output (assuming no outages) to be 450 kW, making the capacity factor 38%.

The model shows that output is sensitive to both maximum stream speed and the ratio between spring and neap peak rates. The table below shows the relationship between capacity factor and the maximum stream speed) assuming that neaps are limited to 50% of the maximum stream speed in springs. The month-average capacity factor for various maximum spring stream speeds is:

m/s - CF (%)
2.8 - 28%
3 - 34%
3.2 - 38%
3.5 - 45%
4 - 53%
The table below shows how the capacity factor is influenced by the ratio between the maximum neap speed and the maximum spring speed based on a maximum spring stream speed of 3.2 m/s. The table shows maximum neap speed and month-average capacity factor.

m/s - CF (%)
0.8 - 31%
1.2 - 33%
1.6 - 38%
2.1 - 45%
2.4 - 48%

All of these power output estimates are wildly theoretical – and should be treated with extreme caution. Next we’re going to combine this power curve with some actual tidal data from tidal diamonds on charts to see how that looks.

Another data point in windfarm valuation

By now, you will have seen Centrica's announcement on the sales of 50% interests in windfarms at Lynn, Inner Dowsing (offshore) and Glens of Foudland (onshore).

The key section is here: Centrica also announced that it has agreed the sale of a 50 per cent equity stake in its Lynn, Inner Dowsing and Glens of Foudland wind farms to the US-based investment management company TCW for a cash consideration of £84 million, and entered into agreements to raise approximately £340 million of non-recourse project finance facilities from a consortium of banks for these assets. The transactions value the wind farms at approximately £460 million in aggregate.

Using a 10% discount rate, and what we think are reasonable electricity and ROC prices (£60/MWh and £37/MWh respectively), we see the values (100%) as:

Glens of Foudland (26MW) - £35 million
Lynn (81 MW) - £134 million
Inner Dowsing (81 MW) - £134 million
Lynn (extension, 90 MW)- £181 million
Inner Dowsing (extension, 90 MW) - £181 million

So we get a total of £675 million for 100% of the windfarms - a considerably higher number. We have to drop the power price to less than £40/MWh or increase the discount rate to around 15% to get the value to line up with Centrica's valuation.

Also, Centrica announced that the 270 MW of Lincs would cost some £725 million - £2.69 million per MW installed. Not bad - less than the equivalent (announced) amount for Greater Gabbard. I wonder if this suggests turbine prices are weakening somewhat?

Novera in play

If you've got shares in Novera Energy you'll have noticed that they leapt by 32% this morning as the company announced that it had rejected an offer from largest shareholder Infinis to make an offer for the remaining shares at 62.5pence.

Using our Value of ROCs Model, we have valued Novera's assets, and applied a weighting of 100% to operational projects, 75% to projects under development, 25% to approved projects and 10% for projects in planning. We reach an asset value of around £312 million, and according to the last accounts, there is net debt of £112 million, making the net asset value £200 million or around £1.40 per share!

Even if Infinis is atttributing no value to the wind portfolio, the asset value of £244 million would justify a share price of more than 90p/share. We're holding on.

I don't believe it!

Sad to report, Trident Energy's wave energy prototype which was being deployed off Southwold came off its barge and capsized. Details here and the company's own take on things here.

Fortunately no injuries were sustained, and the damage to the device is being assessed.

Aquamarine closes £10 million funding

News today is that Aquamarine, developer of the Oyster wave devices recently installed at EMEC in Orkney, has closed a £10 million equity financing (as a precursor to another £40 million to be raised later). Details here.This funding, together with the deployment at EMEC, projects Aquamarine into the top rank of wave energy devices.

The company's press release is here.

Reading...

Lots and lots to read following various publications this week. About 750 pages in fact. As soon as I've got my head around some of it, I'll post in more detail

Floating wind turbine - -near to installation

Some while ago, I remember being rather dismissive of a floating wind turbine concept being proposed for the Minch. StatoilHydro has been approaching the problem with a rather more elegant approach, and is now close to installing the prototype 2.3 MW Hywind turbine offshore Norway. Details here.

The turbine is going into a water depth of 220 m, so the water depth is roughly twice the hub height. This may well be a solution to Norway's offshore wind needs, as the country isn't blessed with much shallow water shelf, but I'm struggling to think of suitable locations on the UKCS.

We haven't been able to find any cost information for the project though - it would be interesting to see how it stacks up against "conventional" offshore wind.

Whatever happens, we'll keep an interested eye on how the 2 year testing programme evolves.

42 bids!

The Crown Estate has announced that it has received 42 bids from 20 organisations for Pentland Firth leases.  Apparently lease applications for sites from 10 MW to 300 MW have been received, across a range of technologies and technology types (wave and tidal), and from small developers all the way up to large multi-national energy companies (I wonder if they mean oil companies, utilities or both?)

It seems to us that there is some risk here that bidders may be tempted to "land-bank", tying up sites without serious near-term development plans.  I hope the Crown Estate is sensible enough to try to make sure that only really credible companies are awarded leases in the most energetic areas.  We worry that putting today's devices into the Pentland Firth is like racing a Model T Ford around Brands Hatch - pushing early stage technology too far.

So while we're pleased at the level of interest, we hope that lessees are conservative in rolling out their technologies to less energetic sites first.

Sunday Herald story on wind resource

Couldn't resist the opportunity to link to http://www.sundayherald.com/mostpopular.var.2509982.mostviewed.blown_away_by_the_north_sea.php">this story from the Sunday Herald this week.  The gist is that Atmos Consulting has access to NASA wind data, which they appear to have processed to review the wind resource and potential energy capture from sites for Third Round offshore windfarms.

I was called up to comment on the analysis, and inevitably the quote is rather simpler than the half hour conversation I had with the journo.

Picking winners...

Redfield Consulting has just published its new review of the marine energy sector, rating 120 wave and tidal devices on dimensions of technical and commercial feasibility.  We've developed an objective scoring system, which hopefully takes woolly judgement out of the equation.

Technical feasibility: "can the device work?"

Our technical feasibility scores are determined by clear concept definition for the device, lab and tank testing, and ideally prototyping at large scale in the sea.

Commercial feasibility: "can the device operate and make money?"

Our scoring system on commercial feasibility tries to score whether the device has addressed the key questions of survivability, reliability and accessibility, as well whether the device developer has accessed third party investment, the breadth of management team and obviously whether commercial projects are under way or planned.

We're interested in your views on the scoring system and on how further discrimination can be introduced as more and more devices start full scale deployment.

We had lots of interesting feedback at the All-Energy Show, not least an impassioned plea for inclusion of a points score for greater swept area for tidal stream devices.  We'd love to hear what you, the device developer and investment community think about development of the scoring system.

The report is available now: please feel free to contact us at Redfield Consulting (inforedfieldconsulting.co.uk, and we can let you have more information.  And we plan to keep it up to date, introducing a time dimension so we can all see which devices are evolving fastest.

And the winners at the moment?...you'll have to get the report to find that out!

All-Energy triumph

Another triumphant All-Emergy conference comes to an end. Very busy and very businesslike. All in all excellent. Get it in your diary for next year!


Apologies for brevity - posted from my iPhone

London Array green light

So, the proposed further enhancement to ROCs (offering 2 ROCs/MWh to projects signing contracts by March 2010) seems to have been enough to push Eon, Dong and Masdar into committing to the London Array project (or at least phase 1 of it).

The companies have announced that the project will cost €2.2 billion (around £2 billion) and will have initial capacity of 630 MW.  This makes the construction cost around £3.17/MW installed - higher than the announced per MW cost on Greater Gabbard, suggesting that supply chain constraints are not easing particularly for developers.  

 

REH gives up on CETO and gets £30 million

First an apology to regular blog readers for the recent silence.

We're back.  

There's an interesting news story here that Renewable Energy Holdings (listed on the London Stock Exchange as REH), has sold its wave energy Intellectual Property rights to Carnegie for £30 million (in shares in Carnegie).

The CETO technology is among the more developed wave technologies, having spent some time in the water at largish scale in Australia, so this is an interesting value indication for other companies in the space which are looking to monetise their IP.   

Renewables in the Western Isles

On a trip to the Western Isles yesterday, where there's an emerging interest in marine renewables (specifically wave) as well as plans to push forward on some of the wind projects.  The largest, the Barvas Moor windfarm operated by Lewis Wind Power, is still on hold, but others are progressing.

One interesting observation was that the bay at Siader (pictured, rather badly), where a 4 MW wave-powered breakwater is to be built by Wavegen and npower, is to deliver the same peak output as the now-operating 3 x 1.3 MW Nordex turbines at Arnish Moor.

Sad to see the Arnish fabrication yard all shut up against the weather but hopefully that will be back in business soon.

6.5 GW

The Crown Estate has announced that ten companies or consortia have been awarded exclusive rights to negotiate for offshore wind leases in Scottish territorial waters. Eon, SSE, Scottish Power are the utilities represented, along with SeaEnergy Renewables, UK Renewables Development, Fred Olsen, Mainstream, Forth Ports, DONG and Fluor.

The largest project, Argyll Array to the west of Tiree, is planned to be 1.5GW and the smallest is 300 MW. The projects to the west of Tiree and Islay look to me to be in environmentally challenging locations, to put it mildly, but certainly aren't lacking in ambition.


-- Post From My iPhone

Thirty Eight!

The Crown Estate has just announced that 38 companies and consortia have been invited to tender for leases in the Pentland Firth lease round.

Obviously there's no public information on who the 38 are, but it would be interesting to know.

236 pages!

The Department of Energy and Climate Change has published its Consultation Document on the Severn Tidal Barrage. We've all got until 23rd April to wade through the 236 page document and make our responses to DECC.

The schemes reviewed include barrages and lagoons, and the consultation is here.

There's been some recent press coverage on a possible Solway barrage, details here.

 So, barrages clearly flavour of the month.