OCEAN ENERGY MARKETS
Ocean energy refers to any energy harnessed from the ocean by means of ocean waves, tidal range (rise and fall), tidal currents, ocean (permanent) currents, temperature gradients, and salinity gradients.1 At the end of 2013, global ocean energy capacity was about 530 MW, with most of this coming under the category of tidal power.2
The largest ocean energy facilities in operation are all tidal projectsand are used for electricity generation. Theyinclude the 254 MW Sihwa plant in South Korea (completed in 2011), the 240 MW Ranee station in France (1966), the 20 MW Annapolis plant in Nova Scotia, Canada (1984), and the 3.9 MW Jiangxia plant in China (1980).3 Other projects are smaller, and many are pre-commercial demonstration projects, with a notable concentration of tidal and wave energy development installations (about 11 MW) in the United Kingdom.
Although no commercial capacity additions were identified for 2013, some large pilot machines were installed at the European Marine Energy Centre (EMEC) in Orkney, Scotland. Alstom (France) deployed its 1 MW tidal stream turbine there in early 2013, which subsequently reached full power operation; further testing was to continue into 2014.4 Another tidal turbine deployed at EMEC in 2013 was the 1 MW HyTide unit by Voith Hydro Ocean Current Technologies (Germany), following testing of a smaller model in South Korea.5
Several large projects were also granted consent in 2013 and early 2014, with construction expected to begin within the next few years; most of these developments are planned for U.K. coastal waters. Scotland awarded approval to MeyGen Ltd. (U.K.), now fully owned by Atlantis Resources Ltd. (Singapore), for the 86 MW first phase of what could eventually be a 398 MW tidal array in the Inner Sound of Pentland Firth. MeyGen plans to start with a demonstration of six turbines, with construction commencing in 2014.6 Consent was also granted for a 40 MW (40-50 device) wave farm off the coast of Lewis, Scotland, which is considered one of the best wave energy locations in Europe. The deployment of Aquamarine Power's (Scotland) Oyster wave energy devices will take place in the coming years, alongside necessary grid interconnection.7
i - Sistema de Interconexión Eléctrical de los Países de América Central.
In March 2014, the U.K. government accepted an application forthe proposed 240 MW Swansea Bay Tidal Lagoon, advancing this concept closer to realisation.8 Construction is planned for the period 2015-2018.9 Meanwhile, the proposed Severn Barrage in Wales (U.K.), which might provide 5% of the U.K.'s electricity demand if built, was dealt a heavy blow when a parliamentary committee said that the project should not go ahead as presented because it had not yet demonstrated evidence of economic, environmental, and technological viability.10
Another potential 240 MW tidal project, proposed for the Alaska coast (United States), was granted a preliminary permit extension in early 2014, for the purpose of establishing project feasibility.11
OCEAN ENERGY INDUSTRY
Ocean energy technologies continued to advance during 2013, with a wide variety of devices under development. Industry firms advanced their goals through acquisitions and collaborative agreements, and governments often lent a hand.
Scotland's EMEC, the world's leading test facility for wave and tidal energy converters, continued to share its expertise globally during 2013. It announced an agreement to help set up a test facility in Singapore—the latest of several agreements with parties across North America and Asia.12 In addition, neighbouring Ireland recently launched its Offshore Renewable Energy Development Plan, committing funds for test facilities, R&D, and a feed-in tariff for ocean power.13 (See Policy Landscape section.)
Alstom started the year by completing the acquisition of Tidal Generation Limited from Rolls-Royce Holdings plc.14 By an agreement between Alstom and ScottishPower Renewables (Scotland), which is owned by Iberdrola (Spain), four of Alstom's 1 MW tidal turbines will be deployed at the planned Sound of Islay array, beginning in late 2015.15 In late 2013, Voith Hydro acquired the remaining 20% share of Voith Hydro Ocean Current Technologies from Innogy Venture Capital.16 As noted above, both companies launched turbines at EMEC in 2013. Voith's HyTide turbine has a direct drive (no gears), uses symmetrical blades for bi-directional operation, and relies on sea water ubrication, all for simplicity and robustness in the harsh marine environment.17 Unlike the HyTide, which has a fixed nacelle and blades, Alstom's turbine has adjustable nacelle position and blade pitch for maximum energy potential.18
Atlantis Resources Ltd, developer of the AR1000 1 MW tidal turbine, raised capital in its initial public offering in early 2014 and received additional funding from the European Commission.19 Atlantis plans to use the funds to advance the MeyGen project, including the AR1500 turbine developed with Lockheed Martin (United States), and to fund its AR1000 demonstration project in China. Atlantis acquired all remaining shares in MeyGen Ltd from GDF Suez (France) and Morgan Stanley (United States) in October.20
In early 2013, DCNS (France) acquired a majority stake in OpenHydro (Ireland), which continued to test new versions of its open-center tidal turbine at EMEC.21 Later in the year, DCNS announced an agreement with Fortum and AW-Energy (both Finland) to develop a 1.5 MW wave power demonstration project in Brittany, France, using AW-Energy's WaveRoller device.22 In September 2013, the French government issued tenders for pilot tidal projects off the coast of France.23 Both DCNS and GDF Suez have expressed interest in the projects, the latter possibly joining forces with Voith and Alstom for their tidal turbines.24
Aquamarine Power continued testing of its second Oyster 800 wave energy device at EMEC, and Pelamis Wave Power (Scotland) continued to develop its articulating cylindrical wave energy converter.25 Pelamis tested new scale models in 2013, with the aim of improving power, reliability, and economics of the device through changes in configuration, shape, and controls.26 In partnership with the University of Dundee, Pelamis is investigating the advantages of utilizing concrete, in place of steel, as the main construction material for its device, for improved design options and economics.27 Vattenfall (Sweden) intends to start testing of the latest Pelamis device at EMEC in 2014.28
Wello Ltd (Finland) redeployed its Penguin wave energy converter at Orkney in July 2013. The device fully encapsulates a rotating eccentric mass that is actuated by waves, driving a generator typically used in wind turbines.29 Seatricity (U.K.), another relatively new wave technology company, is poised to develop a 10 MW array of its Oceanus 2—a buoy-type device that pumps seawater onshore for power generation—at the Wave Hub test facility in Cornwall (U.K.).30
Minesto (Sweden) started tests in Ireland of a 1:4 scale prototype of its Deep Green tidal device, which it describes as an underwater kite that is designed to work well in low-velocity currents. Deep Green marries a turbine with a wing and a tether, capturing tidal energy while looping tangentially to the direction of the tide. A full-scale device is to be deployed by 2015.31
China announced funding for ocean energy technology in 2013, including a 200 kW turbine developed by Harbin Engineering University, as part of a plan to use ocean energy to improve sustainability of remote islands.32 Other Chinese pilot projects aunched in late 2012 and 2013 included wave energy converters developed by Guangzhou Institute of Energy Conversion, and a 120 kW wave buoy developed by Shandong University.33
In early 2014, the European Commission launched a two-step action plan to support ocean energy in Europe.34 The first step was the launch of the Ocean Energy Forum in April, with the aim of bringing together a wide range of stakeholders to find solutions to issues challenging the industry.35
1 Ocean Energy Systems (OES), also known as the Ocean Energy Systems Implementing Agreement, isan inter-governmental collaboration among countries that operates under a framework established by the International Energy Agency (IEA) in Paris, at http://www.ocean-energy-systems.org/ocean_energy/. The definition of ocean energy used in this report does not include offshore wind power or marine biomass energy.
2 Global installed capacity based on OES, Annual Report 2012 (Lisbon: 2012), Table 6.1, http://www.ocean-energy-systems.org/oes_reports/annual_reports/2012_annual_report/; OES, Annual Report 2013 (Lisbon: 2013), Table 6.2, http://www.ocean-energy-systems.org/documents/82577_oes_annual_report_2013.pdf/; IEA, Medium-Term Renewable Energy Market Report 2013 (Paris: Organisation for Economic Co-operation and Development (OECDVIEA, 2013), p. 179; and sources for 2013 capacity installations as noted elsewhere in this section.
3 Capacity values from OES, "Ocean Energy in the World," http://www.ocean-energy-systems.org/ocean_energy_in_the_world/; OES, Annual Report 2012, op. cit. note 1; Électricitedé France (EDF), "Usine marémotrice de La Rance," http://energie.edf.com/hydraulique/energies-marines/carte-des-implantations-marines/usine-maremotrice-de-la-rance/presentation-51516.html.
4 Alstom, "Alstom's tidal turbine reaches 1MW in offshore conditions," press release (Levallois-Perret, France: 31 July 2013), http://www.alstom.eom/press-centre/2013/7/alstoms-tidal-turbine-reaches-1mw-in-offshore-conditions.
5 Voith Hydro Ocean Current Technologies is a joint venture of Voith Hydro and RWE Innogy. Voith, "Tidal Current Power Stations," http://voith.com/en/products-services/hydro-power/ocean-energies/tidal-current-power-stations-591.html; SAL Heavy Lift GmbH, "MV Lone installed Tidal Turbine," September 2013, http://sal-heavylift.com/news-press/latest-news.
7 Aquamarine Power, "Aquamarine Power secures full consent for 40MW Lewis wave energy farm," press release (Edinburgh: 22 May 2013), http://www.aquamarinepower.com/news/aquamarine-power-secures-full-consent-for-40mw-lewis-wave-energy-farm.
8 U.K. Planning Inspectorate, "Swansea Tidal Lagoon application accepted forexamination," press release (Bristol, U.K.: 7 March 2014), http://www.gov.uk/government/news/swansea-tidal-lagoon-application-accepted-for-examination.
9 Tidal Lagoon Swansea Bay, "Timeline," http://www.tidallagoonswanseabay.com/timeline.aspx, viewed April 2014.
10 "Severn Barrage: Environment and economy benefits 'unproven'," BBC News, 10 June 2013, http://www.bbc.com/news/uk-wales-politics-22812911.
11 K. Steiner-Dicks, "FERC approves Turnagain Arm permit," Tidal Today, 26 February 2014, http://social.tidaltoday.com/environmental-permitting/ferc-approves-turnagain-arm-permit.
12 European Marine Energy Centre (EMEC), "EMEC to support development of marine energy test site in Singapore," press release (Orkney, Scotland: 7 November 2013), http://www.emec. org.uk/press-release-emec-to-support-development-of-marine-energy-test-site-in-singapore/.
13 OES, "Ireland's 1 Million Square Kilometers of Potential Ocean Energy," press release (Lisbon: February 2014), http://www.ocean-energy-systems.org/documents/70749_press_release_february_2014.pdf. The plan commits USD 35.8 million (EUR 26 million) forthe period 2013-2016 to develop testfacilities, as well as USD 26.2 million (EUR 19 million) for R&D, and a FIT tariff of USD 358/MWh (EUR 260/MWh) for the first 30 MW of ocean energy capacity.
14 Alstom, "Alstom completes the acquisition of Tidal Generation Limited (TGL) from Rolls-Royce plc," press release (Levallois-Perret, France: 30 January 2013), http://www.alstom.com/press-centre/2013/1/alstom-completes-the-acquisition-of-tidal-generation-limited-tgl-from-rolls-royce-plc.
15 Alstom, "Memorandum of Understanding signed between Alstom and Scottish Power Renewables for tidal power devices," press release (Levallois-Perret, France: 17 September 2013), http://www.alstom.eom/press-centre/2013/9/memorandum-of-understanding-signed-between-alstom-and-scottish-power-renewables-for-tidal-power-devices.
16 Innogy Venture Capital, "Innogy Venture Capital sells its stake in Voith Hydro Ocean Current Technologies," press release (Essen, Germany: 29 November 2013), http://www.innogy-ventures.com/web/cms/mediablob/en/2260764/data/477104/2/innogy-venture-capital-gmbh/lnnogy-Venture-Capital-sells-its-stake-in-Voith-Hydro-Ocean-Current-Technologies.pdf.
17 Voith, "Electricity from ocean energies," http://voith.com/en/insights/energy-transition-22419.html.
18 Alstom, op. cit. note 4.
19 Atlantis Resources, "First Day of Dealings and Admission to Trading on AIM," 20 February 2014, http://atlantisresourcesltd.com/medianews/news/288-first-day-of-dealings-and-admission-to-trading-on-aim.html.
20 Atlantis Resources, "Atlantis Resources Secures €7.7 Million from European Commission," 20 February 2014, http://atlantisresourcesltd.com/medianews/news/287-atlantis-resources-secures-7-7-million-from-european-commision.html.
21 OpenHydro, "DCNS takes control of OpenHydro," press release (Paris: 14 March 2013), http://www.openhydro.com/news/OpenHydroPR-140313.pdf; EMEC, "Open Hydro," http://www.emec.org.uk/about-us/our-tidal-clients/open-hydro/
22 DCNS, "Fortum, DCNS, AW-Energy and Bretagne Region cooperate on wave power demonstration project in France," press release (Paris: 19 September 2013), http://en.dcnsgroup. com/2013/09/19/fortum-dcns-et-aw-energy-soutenus-par-la-region-bretagne-unissent-leurs-forces-dans-un-projet-de-developpement-de-l%e2%80%99energie-des-vagues-en-france/.
23 "UPDATE 1-Hollande mobilises French industryfortidal energy push," Reuters, 30 September 2013, http://www.reuters.com/article/2013/09/30/france-marine-energy-idUSL6N0HQ2DT20130930.
24 Andrew Williams, "GDF Suez: Tapping into 80% of French tidal power potential," Tidal Today, 6 November 2013, http://social. tidaltoday.com/technology-engineering/gdf-suez-tapping-80-french-tidal-power-potential; DCNS, "Tidal Energy- From Marine currents to electrical current," http://en.dcnsgroup.com/energy/marine-renewable-energy/marine-turbine/.
25 Aquamarine Power, "Aquamarine Power secures full consent for 40MW Lewis wave energy farm," press release (Edinburgh: 22 May 2013), http://www.aquamarinepower.com/news/aquamarine-power-secures-full-consent-for-40mw-lewis-wave-energy-farm.
26 Pelamis Wave Power, "ETI project boosts power capture of Pelamis wave device," 23 September 2013, http://www.pelamiswave.com/news/news/145/ETI-project-boosts-power-capture-of-Pelamis-wave-device.
27 Pelamis Wave Power, "Knowledge Transfer Partnership with the University of Dundee," 12 July 2013, http://www.pelamiswave.com/news/news/139/Knowledge-Transfer-Partnership-with-the-University-of-Dundee.
28 EMEC, "Vattenfall," http://www.emec.org.uk/about-us/wave-clients/vattenfall/.
30 Wave Hub, "Seatricity secures berth at Wave Hub," 10 December 2013, http://www.wavehub.co.uk/news/seatricity-secures-berth-at-wave-hub/.
31 Minesto, "Minesto's step-change marine power plant now producing electricity in Northern Ireland proving viability for huge ocean current power market," press release (Gothenburg, Germany 12 November 2013), http://minesto.com/Resources/minesto-pm-in-operation-engfinal.pdf; Minesto, "Deep Green Technology," http://minesto.com/deepgreentechnology/index. html.
32 OES, "China Turns to the Ocean in a New Quest for Power," press release (Lisbon: May 2013), http://www.ocean-energy-systems.org/news/china_turns_to_the_ocean_in_a_new_quest_for_power/
34 European Commission, "Commission sets out an action plan to support the development of blue energy," press release (Brussels: 20 January 2014), http://europa.eu/rapid/press-release_IP-14-36_en.htm.
35 European Commission, Maritime Affairs, "Ocean energy forum workshop - Brussels," 4 April 2014, http://ec.europa.eu/maritimeaffairs/policy/ocean_energy/forum/workshop-brussels/index_en.htm.