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Wave Energy Centre
Wave
Energy
Centre
Present status of wave energy
Challenges & Barriers to commercialization
Public policies to support wave energy
Conclusions
Wave Energy: From Demonstration
to Commercialization
Wave
Energy
Wave Energy Centre
Centre
• Private, non-profit, 11 companies + 3 R&D
Pico OWC
• Areas:
Pelamis
o
Power Buoy
Plant monitoring & assessment
o Numerical modelling
o Due diligences
o Strategic assessments (companies and
public administration)
o Socio-economic studies
o Training
o Support public policies
o Dissemination
Wave
Energy
Wave Energy Centre
Centre
2008 Funding: € 850.000
OWC
Pico o Fees: 5% Pelamis
o Power
National R&D: 15% Buoy
o EU funding: 60%
o Services to companies: 20%
• Staff expertise:
Hydrodynamics Environment
Monitoring Technology
Economics Communication
Wave
Energy
Present status of wave energy
Centre
PICO 1999
OWC - 400 kW
Wave
Energy
Present status of wave energy
Centre
LIMPET 2000
OWC - 500 kW
Wave
Energy
Present status of wave energy
Centre
AWS 2001
2 MW
Wave
Energy
Present status of wave energy
Centre
Wave Dragon 2003
(1:4.5 scale) 20kW
Wave
Energy
Present status of wave energy
Centre
Power Buoy 2005
40 kW
Wave
Energy
Present status of wave energy
Centre
Wavebob 2006
(1:2 scale)
Wave
Energy
Present status of wave energy
Centre
Pelamis 2005 750 kW
1st farm 3 units: 2.25 MW 2007
Wave
Energy
Present status of wave energy
Centre
Wave Roller 2006
Wave
Energy
Present status of wave energy
Centre
Energetech OWC 2005
Wave
Energy
Present status of wave energy
Centre
FO3 2006
Wave
Energy
Present status of wave energy
Centre
Aqua Buoy
2007
Wave
Energy
Present status of wave energy
Centre
Ocean Energy OWC 2007
Wave
Energy
Present status of wave energy
Centre
Islandberg 2006
Wave
Energy
Present status of wave energy
Centre
• Year 2000: 2 shoreline OWC pilot plants
Pico OWC near or offshore prototypes orPelamis
• Year 2007: 12 pilot plants
• First “commercial”Power Buoy in Portugal)
park – 2007 (Pelamis
DEMONSTRATION PHASE ATTAINED
• 5 basic different concepts, many different designs
• No operational experience
Wavebob
• Costs to go down by a factor of 4
Challenges, Risks & Barriers to
commercialization
Wave
Energy
Centre
Challenge: Converge to 1 or 2 concepts and develop
robust and competitive technologies supported by
standards and best practices
Risks:
Higher than expected development costs
Higher than expected maintenance and operational costs
Smaller energy production or energy price
Negative impact and conflicts of uses higher than
expected at very large scale utilization.
Challenges & Barriers to
commercialization
Wave
Energy
Centre
Barriers:
No electrical grid access
No room in the energy mix
Administrative processes long and UNPREDICTABLE
(Licensing, Grid Access, Public Funds, Tariffs)
No or limited access to relevant data (waves, winds,
currents, type of soil…) in a proper format
Public Policies
Wave
Energy
Centre
Simplification of licensing procedures
Access to the electrical grid
Access to field data
Promote internal market:
• Feed-in tariff
• Define internal market (% of energy mix)
Portuguese Public Policies
Wave
Energy
Centre
Pilot Zone:
• Simplified and fast licensing through a Managing Company for
demonstration, pre-commercial and commercial phases
• 80 MW (medium voltage) + 250 MW (high voltage) connection
• GIS with relevant data
• Infrastructures promoted by the Managing Company
(law expected to be published in October/November 07)
Portuguese Public Policies
Wave
Energy
Centre
Portuguese Public Policies
Wave
Energy
Centre
Feed-in tariff:
• 260 €/MWh for demonstration
• 160 ~ 210 €/MWh for pre-commercial
• 75 ~ 160 €/MWh for commercial
Tariff depends on installed power per technology in Portugal and
elsewhere and quality of the technology & project.
Portuguese Public Policies
Wave
Energy
Centre
World Power (MW)
300 600
0,3
DEMO (< 4MW per technology)
0,25
0,2 PRE-COMMERCIAL (< 20 MW per technology)
€/kWh
0,15 COMMERCIAL
0,075
0,1
0,05
0
1 10 20 100 250 1000
National Power (MW)
Wave
Energy
Feed-in tariff: CAPEX evolution
Centre
• Initial cost: 3.5 M€/MWh for the first 2,25 MW
• Learning factor: cost reduces 20% per duplication of installed MW
Capex evolution
4
3,5
3
Capex (M€/MW)
2,5
2
1,5
1
0,5
0
0 500 1000 1500 2000 2500 3000 3500
World installed power (MW)
Wave
Energy
Feed-in tariff: Cost of energy
Centre
• Equivalent annual hours: 2190 (25%)
• Capital cost: 8%
• Annual operation and maintenance costs: 8% of Capex
• Return period: 15 years
• Use of annuity method gives
Wave
Energy
Feed-in tariff: Tariff & cost of energy
Centre
• Tariff = cost of energy Base tariff = 75 €/MWh
300,0
250,0
200,0
€/MWh
150,0
100,0
50,0
0,0
0 500 1.000 1.500
Installed pow er [MW]
Feed-in tariff: Scenarios of world
growth of installed power
Wave
Energy
Centre
• Assumed growth of installed power : P=P0na (n = year)
Scenario 1 => a = 3
Scenario 2 => a = 3.2
Scenario 1 => a = 3.5
Feed-in tariff: Scenarios of world
growth of installed power
Wave
Energy
Centre
200
3
150
2
GW
100
50
1
0
0 5 10 15 20 25 30 35
Years
Wave
Energy
Feed-in tariff: Some results - I
Centre
• Base tariff for Renewables: 75 €/MWh
• Number of years of subsidised tariff: 12
• Device lifetime: 15
Wave
Energy
Feed-in tariff: Some results - II
Centre
200
200
22
3 3
GW, TWh/year , M€/year
GW, TWh/year , M€/year
150
150
22 22
100
100 11
3 11
50
GW,
50
11
00
00 55 10
10 15
15 20
20 25
25 30
30 35
35
Years
Years
Wave
Feed-in tariff: Some results - III
Energy
Centre • Scen. 4 - Equivalent annual hours: 2628 (30%)
200
GW, TWh/year , M€/year
150
1
100
50
0
0 5 10 15 20 25 30 35
Years
Wave
Energy
Feed-in tariff: Some results - IV
Centre
• SCENARIO 1:
• Total subsidy: € 1.3 billion (along 20.5 years)
• Total energy produced by waves: 278 TWh (along 20.5 years)
• Average subsidy per MWh produced by waves: 4.6 €
• Compare with the estimated world market of € 500 billion
(0.26%)
• Required installed power: > 25 GW
• Need for international collaboration
Wave
Energy
Conclusions
Centre
• In spite of the very high expectations on wave energy, present
costs are high and no operational experience is still available.
• A large number of barriers can be identified, most of which may be
removed or significantly reduced with proper public policies
• Market development is essential and the subsidised tariff is the
most important means to finance the development
• The total amount involved in the subsidised tariff is small if
compared to the world market
• The average subsidised tariff is small if compared to renewable
energy base tariff.
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