Blue Energy News and Press Releases

New report urges government action on Wave and Tidal Industry in UK

May 20, 2004

News from the British Wind Energy Association

(London) -- The British Wind Energy Association (BWEA), the UK's largest renewable trade association, today released new research recommending urgent Government action to kick-start the UK's wave and tidal sector to ensure the country doesn't miss out on becoming world leaders.

The study, 'Into the Blue: Financing the Future of the Emerging Wave and Tidal Power Sector', has been undertaken by Climate Change Capital, a specialist merchant banking firm focusing on climate change and energy security, and examines the level and type of financial support that the sector needs to move it forward from its current research and demonstration phase.

Companies, organisations and individuals from the utility sector, the wave and tidal industry and from within Government contributed to the report which recommends a series of actions that have been presented to Government.

Among the key conclusions listed in the report:

* The UK has a fantastic opportunity to become a world leader in the development and deployment of wave and tidal power. Most of the companies involved in the sector, including those not currently based in the UK, see the UK as the place to develop their businesses,

* Government financial support should focus on rewarding success and offer the tax payer best value for money,

* A £75 million Marine Performance Fund is proposed for the first 50 MW of wave and tidal projects and developers would obtain premium payments for a suggested five years following production of electricity,

* Given the right support framework, private capital will continue to be attracted to the sector removing the need for the Government to 'pick winners' through allocation of capital grants to companies in advance of deployment,

* Government support in the form of capital grants for grid connection, decommissioning and consenting work should also be made available at a potential cost of some £40 million,

* Continuation of capital grants at the research and development stage is also needed to bring through the next generation of technologies.

The Government is close to finalising its 2004 spending review plans and the total amount proposed by the study for allocation to wave and tidal amounts to approximately £130 million.

BWEA CEO Marcus Rand says, "While wind is key to delivering most of the 10% renewable target we need the emerging renewables, like wave and tidal, to begin to play a major role as soon as possible. The Marine Performance Fund is a smart and innovative idea as it rewards the winners but doesn't ask Government to pick them in advance."

Ian Temperton of Climate Change Capital adds, "Private capital will continue to be attracted to the sector, if the right policy framework and level of government support is put in place. The proposals derived from this study create the opportunity to combine the entrepreneurship already evident in the industry with the risk capital it needs to fund its next stage of development."

'Into the Blue' is considered a first, vital step in the emergence of the UK marine renewables industry as a significant player in the UK power portfolio. The study recommends that the first 50 MW of wave and tidal projects will receive extra financial support of £100 per MWh (10p/kWh) on top of the market value of a renewable obligation certificate (ROC).

Note: the full report can be downloaded from British Wind Energy Association

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