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.

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.

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!

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.

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.

The Saltire Prize

The Scottish Government made an announcement on the Saltire Prize yesterday evening. Although some opponents point out that this is twelfth time this has been announced, this announcement adds some new specifics - most notably the target of 100 GWh over two years from wave or tidal devices in Scottish waters.


The text is here:

Purpose
The purpose of the Scottish Government’s £10 million Saltire Prize is to stimulate innovation across the world that will lead to delivery of the best wave and tidal energy technology.

Challenge
The Saltire Prize will be awarded to the team that can demonstrate in Scottish waters a commercially viable wave or tidal energy technology that achieves a minimum electrical output of 100GWh over a continuous 2 year period using only the power of the sea and is judged to be the best overall technology after consideration of cost, environmental sustainability and safety.

Outline of the Challenge
The Prize will be open to any individual, team or organisation from across the world who believes they have wave or tidal technology capable of fulfilling the Challenge.

Competitors will be challenged to deploy a device (or array of devices) in Scottish waters which uses wave and tidal technologies to generate over 100GWh of electricity in any 2 consecutive year period. Having reached this output threshold, competitors will be judged on the cost, environmental sustainability and safety of their projects.

Next Steps
The Saltire Prize is now open for initial registration. To register interest in the Saltire Prize, the registration form can be found at www.saltireprize.com

Registering interest in the Saltire Prize will ensure that you receive a copy of the Consultation paper on the Saltire Prize guidelines in January 2009. As part of our design process, the Scottish Government is keen to seek comments on the draft Saltire Prize guidelines in advance of publication. Following consideration of the comments received, the finalised guidelines will be published by 30 June 2009 and registration of interest will also ensure you receive a copy of the full application pack and guidelines at this time.

Speaking for Redfield, we'll be registering an interest, specifically to see the consultation paper in January. We have previously suggested a prize of this kind, although our initial reaction is that 100 GWh is maybe 5 times too high as a target...it would imply around 25 MW of installed capacity running at a capacity factor of 25% for the full two years - we think 10 MW running for a year would do the trick.

Present power prices and multiple ROCs (which make a MWh of marine power worth maybe £200) mean that the winning project would have received £20 million in revenue. In the context of such a project, the value of the prize is relatively small, but experience with the X-Prize (and other similar prizes) was that a chunky cash prize triggered development work worth a multiple of the prize fund, and that's clearly what aimed for here.

For reasons too complex to go into here, Redfield feels rather proprietorial about the Saltire Prize, so we're very pleased to see this announcement firming up the prize terms. We'd be keen that the subjective bit about "consideration of cost, environmental sustainability and safety." should be downplayed, or addressed very early so there's no question when a project crosses the 100 GWh finish line.

Trident joins the "metal in the water" club

Trident Energy was covered in the Eastern Daily Press online news site the other day.

Trident is joining the somewhat exclusive club of companies which have deployed significantly-rated wave (or tidal stream) devices in the water. The plan is to deploy this scale prototype for 3-6 months, before designing and deploying a 1 MW device.

Redfield's reaction to this prototype is

1. gosh- Trident's emerged from the left field, we weren't previously aware that Trident was at this stage of development (largely as the website was essentially a placeholder until very recently(/li>
2. it looks a bit flimsy (although East Coast waves are relatively benign)
3. there looks to be a fair bit of material for the rated power output (which we interpret as well under a MW, based on comments on the company's website

This announcement comes as part of the launch of the Orbis Centre (the Renewables East hub building - aiming to generate employment in offshore renewables.

Pelamis goes live in Portugal

After what can fairly be described as an extended commissioning period, Pelamis announced today that the Portuguese project comprising 3 750 kW devices has been officially inaugurated by the Portuguese Economy Minister.

There's some interesting stuff in the press release. The project has an installed capacity of 2.25 MW and cost €9 million: put another way, that's £3.16 million/MW. Compared with recently published figures for Greater Gabbard offshore windfarm, which estimate capital costs at around £2.8 million/MW, this suggests that wave is almost competitive with offshore wind already. And wave gets 2 ROCs/MWh in the UK (maybe 5 in Scotland), against 1.5 ROCS/MWhr for offshore wind.

So unless there's a load of hidden cost in the Portuguese project, this is really encouraging for wave power.

Cheeky Wavegen aiming for the Saltire Prize?

In a press release in late July (here), Wavegen announced the "official start" of a 100 kW turbine at the Islay LIMPET site.

The odd thing is that the LIMPET has been operational since 2000, with turbines of more than 100 kW installed in the past. It's not clear to us how this is really news, although there is some limited discussion of "new breakwater turbines" being tested. Is this just Wavegen seeking to position itself as a contender for the Saltire Prize?

"have been deployed"?

The Economist this week has a section on wave energy technology, and intriguingly refers to Pelamis as follows:

"Three such devices...have been deployed (my italics) off the coast of Portugal.

Now, the Economist is usually pretty reliable on its fact checking, but the Pelamis Wave Power website makes no reference to a successful installation. I wonder who's right...has the Economist got ahead of itself, or is PWP being unexpectedly modest?

OPT joins the multi-MW club

Ocean Power Technology has just announced a 10 MW wave energy project in Australia with potential for expansion up to 100 MW later.

It joins the exclusive club of wave energy developers with multi MW projects at some stage in development. Others which come to mind are Pelamis Wave Power with 2.25 MW in Portugal and Scotland, with expansion options, the WaveHub - comprising a few MW from each of Pelamis, OPT, Oceanlinx and Fred Olsen - and Finavera which has a couple of projects in the Pacific NorthWest.

Some other developers might claim to be near to joining the club (WaveDragon, Archimedes WaveSwing), but they're some way off yet (unless I've missed some!)

Meanwhile, also on Lewis

Elsewhere in the Western Isles, and in an announcement with slightly unusual timing, npower has announced that it has formally submitted a planning application for the 4MW wave-powered breakwater project at Siadar.

With the recent "no" decision on the Barvas Moor project, it will be interesting to see if the active community in the Western Isles is supportive of this much smaller project or not.

With 4MW of installed capacity, average output might be 1MW (based on a capacity factor of 25%). The usual rule of thumb is that a household uses c. 5,000 kWhr/yr. This is an average of just over half a kW - which sounds low to me, especially for the often electrically-heated Western Isles. If this is right, this project could power around 2,000 houses. There are probably 6,000-10,000 homes on Lewis (based on 2-3 people per home, and Wikipedia's population figure of 19,000), and if this average power usage figure is right, this would mean that 20% - 33% of local homes would be powered by this project.

There are many heroic assumptions in this back of an envelope assessment, but it's clear that the project could make a real local impact.

Global Marine Renewable Energy Conference - New York, April 2008 - an investigation of wave energy and tidal energy

The Global Marine Renewable Energy Conference finished yesterday with a tour de force by Verdant Power. More of that later, but first my reactions to the main agenda. I've summarised the highpoint of each session here

Session 1: George Hagerman, Virginia Tech: Resource potential and technology status - excellent and knowledgeable overview of technology

Session 2: Keynote addresses. For me, the best was Matt Simmons. Matt is author of "Twilight in the Desert" and founder of Simmons & Co. International, an oil-oriented investment banking firm. I first met Matt a few years ago, when I talked to him about a large UK offshore windfarm project. From memory, he was deeply sceptical then, but his thesis is now that oil production is soon to rapidly decline, and to avoid massive social dislocation and wars over limited resources, it's essential we now pursue alternative energy sources. It's a compelling thesis and convincingly presented. Matt's putting money where his mouth is, by supporting the new Ocean Energy Institute (to be built in Maine).

Sessions 3 and 4: Lots of worthy technical commentary and review of support mechanisms, from which nothing in particular lodged in the memory. Nice to see the UK well represented though.

Session 5: the main event - developers talking about financing their technologies. An interesting range of experiences and firms at different stages in the process. There was still some evidence of the wishlist - more complaining about the difficulties of getting across the "valley of death" than constructive suggestions on how to do it, though. Although, I suppose if you've got a great idea for closing the deal, you're going to want to keep it to yourself.

And that was day one. Unless you count the Canadian reception (and not a Labatt's in sight) and rumours of a bash at the Irish Embassy.

Day 2 opened with Congressman Jay Inslee, who put forward a very positive legislative agenda, which he promises he's working night and day to get through the House. These include a feed in tariff and a renewables obligation- which the conference participants rated the most important stimuli for the rollout of marine renewables.

Session 1 was a chance for EMEC and WaveHub to talk about their regulatory experiences, and for FERC and the MMS to talk about how consenting might work in the US.

Session 2 went through some of the environmental issues facing the Portuguese wave centre, and some other environmental matters. Bit of a chance for the academics to lobby for the "research feast" warned of by Neil Kermode of EMEC in the previous session.

Finally: closing remarks by Senator (R-AK) Lisa Murkowski. Unable to resist a certain partisan finger-pointing, but (unsurprisingly for a representative from Alaska), the Senator was pretty positive on marine renewables. Apparently, Alaska has more coastline than the rest of the US out together!

The final keynote was from NTSERDA's CEO, who's spending $2.5 million on R&D in the New York area (substantially on Verdent, I suspect), compared with a national total of $13 million from federal funds over the next two years.

In summary, as always with conferences the real value came from the talking to new people over the water cooler (or donut stand). I was very impressed that about 300 people made the trip to New York from all over the world, but also that many were from the US (where I hadn't thought so much was going on in marine renewables). The demographic split showed the largest groups were developers and academics - so the industry still needs to be attracting more investors, bankers and (probably) lawyers.

Off to New York

So it's off to New York for the ambitiously-named "Global Marine Renewable Energy Conference."

I'm particularly keen to hear about developers, including

• Ron Smith, Verdant Power, United States


• George Taylor, Ocean Power Technologies, United States


• John Cooper, Ocean Renewable Power Company, United States


• Des McGinnes, Pelamis Wave Power, Scotland


• Andrew Parish, Wavebob Ltd., Ireland


• Martin T I Wright, Marine Current Turbines Limited, Scotland

and also about financing and revenue support in the US and Canada.

It's an early start: 0720 on Thursday, so I'm glad I'm flying west to attend the conference!

I'll be sure to report back as the conference progresses...

Saltire prize - £10 million (got your attention now?)

Alex Salmond has announced the Saltire Prize - a £10 million prize for advances in clean energy.

Remember the Ansari X-Prize - the privately sponsored prize for the first people to put a craft into space twice within two weeks? Or the Orteig prize, which pushed Lindbergh to fly the Atlantic? Well, the Saltire Prize is intended to trigger and stimulate the same kind of step change in renewables. Obviously Alex Salmond wants the prize to nucleate industries in Scotland, where the wave and tidal (and wind) resources are exceptional.

To my way of thinking, the success of these earlier prizes was driven by the clear and unambiguous targets (getting into space, flying the Atlantic). It's not clear yet, from Alex's speech at least, what the criteria for winning the prize will be. There's a waffley bit in the press release:

The key elements of the Saltire Prize are:

• capturing imaginations: challenge that can inspire a revolution in green energy


• global challenge: high profile prize open to teams from across the world


• relevant to Scotland: relevant to area in which Scotland has strong natural resource and can be demonstrated in Scotland


• capitalises on Scotland's expertise: challenge will reflect area in which Scotland has strong technical expertise and people already working


• achievable in the short-medium term: challenge ideally achievable within a 2-5 year timeframe

I hope the criteria are clearer when they get defined, as this prize won't pull in the effort and investment unless people know what it takes to win.  I love the idea though (mainly because it's an idea I've had myself, but Redfield Consulting doesn't have the budget that Alex has), so let's hope it really gets things moving in the sector.

WaveHub "retimetabled"

The Southwest Regional Development Agency has just announced a new timetable for the WaveHub project. The project has been pushed back by a year, to allow the developers to have another go around with tendering to try to get a better price on the deal. This has to be the most positive spin on a project delay that I've seen in a long time!

WaveHub says that it is still " at the forefront of wave energy development on a worldwide basis", but it's not really very clear how this can be the case when there's nothing in the water yet.

The remorselessly upbeat WaveHub website has yet to mention the news.

Relative costs of carbon abatement

Here's a thought from the skeptical environmentalist school.

If we're worried about carbon abatement (and I am), shouldn't we be looking for best value least cost solutions? If so, let's look at the relative costs of abated carbon from difference sources:

Roughly speaking, a marginal MWh of power in the UK, as provided by gas-fired CCGT, involves 0.4 tonnes of CO2. A MWh from coal is responsible for around 1 tonne of CO2, and nuclear and renewables are effectively zero carbon (not including embedded carbon in construction, decommissioning and operation). There's an interesting factsheet here...

The current carbon price in the ETS is around €22/tonne, so a permit to emit this MWh from CCGT (in principle somehow magically making it carbon neutral, or at least "allowing" it), would cost around £12/tonne or around £5/MWh. For coal, the same permit would cost c. £12/MWh.

Now, I realise that the ETS doesn't correctly internalise the carbon cost yet. Or put another way, the current ETS price isn't sufficient to make generators indifferent between renewables and fossil-fired generation.

Under the Renewables Obligation, onshore wind gets an effective subsidy of 1 ROC/MWh, and a ROC is currently worth around £50. So the additional cost of a wind-generated abated MWh is around £45 relative to gas and £38 relative to coal. Wave and tidal power will get 2 ROCs per MWh from April 2009, and offshore wind 1.5 ROCs, making these premia nearly £100/MWh. There are good strategic national reasons for encouraging these technologies, not least that as fossil prices go up, having renewables capacity offers security of energy supply and also that these businesses, specifically offshore wind, wave and tidal, could be nucleated in the UK (which has world-leading resources in these areas).

At the moment, there's a lot of heat and not much light about Carbon Capture and Storage. At the moment, CCS looks as if it will benefit from the ETS value of the the carbon not emitted - but this benefit is nothing close to the value of RO. How about including CCS in the Renewables Obligation, to help meet these targets and provide a more attractive incentive mechanism?

Progress for Renewable Energy Holdings

This, from the Renewable Energy Holdings website today...

Second CETO II Wave Energy Unit deployed & Sites under review in EDF EN collaboration

Renewable Energy Holdings plc (AIM: REH), the AIM quoted investor and operator of proven and innovative renewable energy technologies, is pleased to announce the successful deployment of the second CETO II Wave Energy prototype off the CETO test site at Fremantle in Western Australia.

In short, the CETO technology appears to use wave motion captured at tethered buoys to pump high pressure seawater which is then used to spin a turbine onshore. It's a great idea to keep the electrics out of the water, but I do wonder what kind of hydraulic losses there are. This schematic helps to describe the CETO technology.

This and the ORECon news in the same week - maybe wave's picking up steam again. Let's hope Pelamis can get deployed soon too, to really get some momentum in the sector.

In the meantime, nice one REH and CETO - we'll keep eyes open for more news.