Assessment of marine energy markets and

prospects, short, medium and long term

Gareth Davies, Aquatera Ltd

Orkney, SCOTLAND

4/12/2018

WHY are we here?

• The world needs more energy

• The word needs carbon free energy

• The world needs to reduce the use of fossil fuels

• Established carbon free/low carbon energy sources don’t/can’t provide all the solutions

• CAN OCEAN/MARINE ENERGY HELP?

Global energy flows - our existing system

Global energy flows – where, how and when can marine energy help?

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We use energy in many diverse ways and situations

• Electricity

• Transport

• Heat/cooling

• Mechanical work

• Processing materials

• Security

• Food

• Waste energy

• Etc

Where, how and when can marine energy help?

Range of commercial opportunities associated with marine energy

• Project development

– Local energy supply (niche)

– Regional energy supply (condition limited)

– Global energy supply

• Technology development – For local projects (niche)

– For regional projects (condition limited)

– For global projects

• Sub-system and enabling technology development – PTOs, moorings, connectors, cables, hydraulics, instruments and

controls, models, vessels, modulators, storage systems

• Expertise and services – Engineering, energy, environmental, maritime, sustainable

management, disaster management etc

Reality is that the world comprises many different energy markets and systems!

World actually comprises thousands of individual local energy markets

Global Tidal Stream Database

9 ©Aquatera Jan 2016: Not to be shared publically

• Around 65% slow flowing sites • Around 30% medium flowing sites • Around 5% swift flowing sites • Average depth around 50 m

Global Tidal Stream Database

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Global Tidal Streams Number of Points Average Depth Less than 3.00 knots 7,349 47m Between 3.00 and 6.00 3,692 58m Greater than 6.00 641 47m TOTAL TIDAL STREAM POINTS IN DATABASE

11,682 52m

Wave power resources

Can wave and tidal energy make an effective contribution?

AT WHAT PRICE?

Prospective market segments

Technology Markets

Ultra high value low demand

High value Added value Standard value

Low value high demand

Typical range of products/services provided

Lighting, battery

charging, instruments

Ice, heat, transport,

remote locations

Community energy,

transport, products

Weak grid energy, green

users

Strong grid energy, all customers

Actual market value (US$/MWh)

>$500 to 50/ MWh

$500-150/ MWh

$150-70/ MWh

$70-30/ MWh

<$30

Typical demand package sizes

Watts - kW kW-MW MW-10MW 10MW-100MW

>100MW

Typical no. of people per site

<10 10-1000 1000-10,000 10000-100,000

>100,000

Number of sites globally (tide)

10,000 1000 200 100 <50

Length of market accessible coastline to develop globally

100,000 km 100,000 km 200,000 km 50,000 km 10,000 km

Viable distance from resource

10s m kms 10s km 100s km 1000 km?

Prospective technology classes Technology

Typical stream velocity

Typical wave

height

Typical water

depths

Early stage cost (US$) (No 2 to

10)

Later stage cost (US$) (After 100)

Mega >1MW >3.5 m/s

>20 kw/m >2 m av ht >50 m wl

40-200 m ~10M <2M

Macro 250 kW-1MW

>3 m/s 15-20 kw/m

20-100 m ~4M <1M

Midi 50kW-250 kW

>2.5 m/s

10-15 kw/m

10-70 m ~2M <500M

Mini 5kW-50kW

>2 m/s 5-10 kw/m 2-30 m ~200k <100k

Micro <5kW

1-2 m/s <5 kw/m

< 1m av ht <10 m wl

0-1000 m ~25k <10k

Marine energy - Markets vs Technology <10M <2M >3.5 m/s 40-200 m >1MW ? <4M <1M >3 m/s 20-100 m 250 kW-1MW ?

<2M <500M >2.5 m/s 10-70 m 50kW-250 kW ?

<200k <100k >2 m/s 2-30 m 5kW-50kW ? ?

<25k <$10k 1-2 m/s 0-1000 m <5kW

Early stage cost

(No 2 to 10)

Later stage cost

(After 100)

Typical stream velocity

Typical water depths

Technology

Markets

Ultra high value low demand

High value Added value Standard value

Low value high demand

Typical range of products/services provided

Lighting, small battery

charging, specialist energy

services, instrumentation

, oil & gas

Local ice, heat, transport,

mining, tourism

Community energy,

transport, isolated industry

Weak grid energy, green

users

Strong grid energy, all customers

Actual market value (US$/MWh)

>$500 to 50/ MWh

$500-150/ MWh

$150-70/ MWh

$70-30/ MWh <$30

Typical demand package sizes

Watts - kW kW-MW MW-10MW 10MW-100MW

>100MW

Typical no. of people served per site

<10 10-1000 1000-10,000 10000-100,000

>100,000

Number of sites to develop globally (tide)

10,000 1000 200 100 <50

Viable distance from resource

10s m kms 10s km 100s km 1000 km?

Competition in any market situation is with other forms of renewable (eg solar, wind,

geothermal, hydro) generation not necessarily between TEC technology

classes

Marine technology markets

>1MW ?

250 kW-1MW ?

50kW-250 kW ?

5kW-50kW ? ?

<5kW Technology Markets

Ultra high value low demand

High value Added value Standard value

Low value high demand

Short term

Medium term

Longer term

Variable conditions and markets

• Wave regimes vary in terms of: – Height, wavelength, period, steepness, alignment, wind waves vs

swell, water depth, seabed type, associated current, tidal range, wildlife sensitivity, shipping activity, seascape value

• Tidal energy regimes vary in terms of : – Velocity, spring/neap, periodicity, turbulence, alignment, tidal

range, associated waves, seabed type, water depth, wildlife sensitivity, shipping activity, seascape value

• How does this affect the market and technology landscape?

• What is the best fit, what is most use?

• Do we need to deliver integrated energy solutions?

How to integrate with energy storage or balancing options

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Generation Aggregation Transmission Distribution Use

What?

Where? Storage & balancing locations

and

Are we competing or working with wind and solar?

Orkney hydrogen case study – Energy generation/storage integration

Hydrogen generation: electrolysis

Storage

Transport

Storage

Use

Excess tide & wind energy

Vehicles, ferries, household and industrial heating,

How will the world change towards 2050

• What does accelerated climate change look like?

– Temperatures, weather, WATER, species, habitats, ocean acidity

• What does global decarbonisation look like?

– Electricity, transport, power?

– Autonomous transportation

– Resource extraction and use

– Distribution of people, wealth, industry etc?

– Blue economy

Where/when will future opportunities arise?

Which market segments? – grid, off-grid, non-electrical etc What delivered products and services? - projects, generation

technologies, enabling technologies, expertise and services

The future starts NOW

Conclusion: optimisation approach • Driving down costs to provide cheap energy is challenging

for marine energy

• Important to understand the full diversity of energy market needs

• Essential to develop technology concepts that help meet particular market needs

• Different technologies likely to take different paths

• Competition will be with other forms of energy not with other marine energy technologies