RenewableUK is highlighting a new study which calls for a fresh approach by the UK Government and devolved administrations to the way funding is allocated to the wave and tidal energy sector, to ensure the industry realises its enormous potential.
The report “Capitalising on Capability” by the Marine Energy Programme Board, which advises the Government on how to develop the industry, to be launched today in Edinburgh at RenewableUK’s Wave and Tidal 2015 conference.
It says British companies are well-placed to capture £76 billion of a global market by 2050, adding up to £4 billion to UK GDP. Companies surveyed by RenewableUK for this report have spent nearly £450 million in the UK’s marine energy supply chain. Importantly, the companies surveyed said they had spent around £7 of privately sourced money for each £1 of public funding they received. This investment supports around 1,700 people working in the wave and tidal energy sector, and the industry has the potential to support up to 20,000 jobs in the next decade.
However, the report says that, to maintain the UK’s global lead and become fully commercialised industries, wave and tidal energy need sustained and consistent practical and financial support from governments at all levels. The study urges the UK, Scottish and Welsh Governments and Northern Ireland Executive to work with the MEPB to provide a joint vision of the role of marine energy out to 2030 and beyond, together with a suitably funded strategy to commercialise wave and tidal technologies. The study warns that without a unified approach, there is a risk of duplication of effort and important measures falling between the gaps.
The report also warns that although the support provided by the Renewables Obligation and Contracts for Difference schemes has created an attractive market for commercial marine energy projects in the UK, it is impossible to secure the level of private capital needed for smaller pilot projects to demonstrate their performance. This is vital to ensure that suitable guarantees can be offered about how larger projects will perform, to make them “bankable”.
The report says a co-ordinated finance package from public and private sources is required to fund these pilot projects. It points to a recent report by the Offshore Renewable Energy Catapult which identified around £300 million in support needed to take these sectors to the next level, and to drive down overall costs in the long term. The MEPB advises that this could be drawn together by all parts of UK Government and from European funding to grow the sectors over the next 5 to 10 years. This will help to address the difficulties which led to the recent collapse of Pelamis Wave Power, as well as Aquamarine shedding staff and Siemens’ withdrawal from Marine Current Turbines.
RenewableUK’s Wave & Tidal Development Manager, Dee Nunn, said: “By implementing the actions outlined in this timely report, the UK could secure its position at the forefront of the global marine energy sector, putting recent setbacks behind us. The measures being put forward would enable industry to capitalise on the excellent resource and test facilities we already have in the UK to move the technologies to a commercial position.
“It would lead to financial close for at least 3 pilot tidal arrays on UK waters by 2018, and the first wave arrays at demonstration centres such as WaveHub off the coast of Cornwall and the European Marine Energy Centre (EMEC) off Orkney.
“This report shows that with our excellent maritime heritage, British supply chain companies are well placed to build the UK’s wave and tidal projects as they grow, as well as capturing a significant proportion of the export market in Europe and beyond to countries such as Canada, South Korea and Japan.”
Image: EMEC (Illustration)