UK primed to lead Europe's £46bn wave energy market opportunity
Wave power can contribute to 10% of global electricity demand by 2050 if governments and the private sector offer financial support and political stability, with the UK primed to act as the marine energy leader.
The is the key finding from Marine Power Systems’ (MPS) Making Wave Power Work report, released today (28 June). The report claims that Europe could exploit an annual market worth more than £46bn to drive uptake in wave and tidal technologies.
MPS’ managing director Gareth Stockman said: “The world is rapidly transitioning to a low carbon future. Our vision is for wave power to provide 10% of the world’s electricity by 2050. With stable government policy, steady investment and joined up communications from industry partners, the wave energy industry can become an economic success story, following in the footsteps of more mature renewable technologies such as wind and solar to become a source of reliable, affordable, clean energy.”
The report claims that estimated global wave resources could potentially reach 4,000TWh annually. In comparison, current global electricity consumption sits at around 21,000TWh and is expected to double by 2050.
According to MPS, these figures provide a call to action for trade bodies, governments and businesses to work together to support wave energy and unlock a global market worth £76bn.
Scotland’s wave of momentum
Specifically, the report names the UK, which has already invested £450m into the sector, as an area to lead the exploration. Europe also looks set to benefit, as it accounts for 45% of wave energy companies, and the UK is accountable for a third of the EU’s wave energy potential.
Much of the UK’s investment into wave energy is located in Scotland, which last week had a new 30-turbine tidal park granted off the south-west coast of Islay. The West Islay Tidal Energy Park will have a generating capacity of up to 30MW, enough to power around 18,000 homes.
Commenting on the approval, Scottish Government minister for business, innovation and energy Paul Wheelhouse said: “Marine renewable technologies offer huge potential to the Scottish economy – and to rural communities throughout the world.
“Scotland has a third of UK’s tidal stream resources and two thirds of its wave resources. We are also home to the world’s leading wave and tidal test centre, the world’s largest planned tidal stream array and the world’s largest tidal turbine.”
In 2015, the Scottish Government-funded Wave Energy Scotland (WES) allocated £7m to 16 wave energy developers to help them commercialise their technologies.
Waves in Abundance
Infrastructure investor Equitix will allocate more than £100m to Scottish tidal power, and will work with leading developer Atlantis to aid the development of the world's largest tidal stream project. Atlantis estimates that the UK could generate 11GW of tidal stream power, more than half of the global potential.
The developer is hoping to raise funds to expand on its tidal stream projects, and this week announced a new partnership with peer-to-peer finance platform Abundance Investment to incentivise investment.
Individuals can now invest directly into tidal power through the five-year Debenture, which will pay 8% a year, issued by subsidiary Atlantis Ocean Energy.
Atlantis Resources’ chief executive Tim Cornelius said: “This is the most exciting time in the history of tidal power. We want to raise further capital to take advantage of our recent success which will help us achieve the huge potential the ocean offers for generating clean, environmentally benign, highly predictable power across the world.
“The success of our flagship Scottish project MeyGen has significantly raised awareness of tidal as one of the most rapidly growing sources of sustainable electricity generation for the future, and this offer is a chance for ordinary investors to help it grow and share in its financial success.”
Investment in the scheme starts from £5 and the debentures are eligible to be held tax-free in an Innovative Finance ISA. The bond offer hopes to raise at least £2m.