Marine energy in Scotland is no longer an opportunity – it is a serious business, a major gathering of industry bosses was told today.
The emerging sector has the ability to be a new long-term industry in Scotland, bringing with it jobs and investment.
But the industry still faces major challenges, including securing long-term stability in the form of support and funding from government to help make projects commercially viable and attract investors, the
Scottish Renewables Marine Energy Conference in Inverness was told.
Ken Street, business development manager of Alstom Ocean Energy, said: “It is serious business for us and I know for several other original equipment manufacturers in this sector.”
Alstom, the global transport infrastructure, power generation and transmission group, put its money into marine in June this year when it bought a 40% stake in Inverness-based marine energy firm AWS Ocean Energy.
Mr Street said, based on capital costs of £3.4million a megawatt, there was a £12billion market in Europe – or £400billion worldwide.
He said the industry was at a “tipping point” but that there was a hurdle for firms moving from single devices like those currently being tested at the European Marine Energy Centre in Orkney, a question mark over transmission of energy created and, crucially, the need for long-term commitment from government.
His comments, including the potential for the industry, were echoed by others at the event.
Niall Stuart, chief executive of Scottish Renewables, said it had been a landmark year for the industry in Scotland, with the first consent agreed for a tidal array and Alstom investing in AWS.
Voith Hydro Maygen, also based in Inverness, had seen its wave power plant installed in northern Spain – described as the world’s first commercial wave plant.
Calum Davidson, of Highlands and Islands Enterprise, told the event: “The marine energy sector offers Scotland a unique opportunity to create a long-term world leading industry.
“To do that we need strong leadership and that has to come from everyone – agencies, government and industry.”
Other issues facing the industry included grid connection issues and costs to capital funding, infrastructure, skills, the supply chain, technology and planning and consenting regimes, said Mr Stuart.
He highlighted the risks to businesses through the collapse of Scottish wind turbine manufacturer Proven Energy, which went into receivership last week.
He also said technology companies were in the main small and under capitalised and the sector was fragmented.
A government review of what support wave and tidal projects get was imminent, said Neal Rafferty, senior policy adviser on marine renewables for the Scottish Government.
This could see enhanced support for firms working on initial build of projects. Issues over transmission charges were also being taken up with Ofgem, the event was told.
The conference concludes tomorrow.
A show of hands by delegates at the Conference revealed doubt over whether marine energy could meet government targets by 2020.
The Scottish Government has a target of 800MW of power from marine energy by 2020.
A panel of experts at the event agreed a target of about 1GW could be achievable.
However, a straw poll of the audience found most thought it could not be met.
Asked if they thought the target was too high or the date too soon, most agreed with the latter.
Asked when 1GW might be achieved by, most thought 2025 would be more realistic.
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