UK sea energy cost could halve by 2025-Carbon Trust

Fri Jul 27, 2012 12:21pm EDT

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* Levelised costs of marine energy between 0.30-0.40 pounds/KWh

* Could fall to current offshore wind cost of 0.15 pounds/KWh

* Potential to drop by over a fifth to 0.06 pounds/KWh by 2050

By Nina Chestney

LONDON, July 27 (Reuters) - The cost of wave and tidal energy in Britain could fall by over half to current offshore wind levels by 2020-2025 and by 80 percent by 2050 if much more research and development is done, a marine energy expert at the Carbon Trust said on Friday.

The cost of developing wave and tidal energy is much higher than other renewables at the moment because it is a nascent industry with a wide range of technologies and commercial viability has not yet been proven at large-scale.

The levelised cost of tidal energy is 0.30-0.35 pounds per kilowatt hour (KWh), while wave is seen at 0.35-0.40 pounds/KWh, Stephen Wyatt, head of techology acceleration at the Carbon Trust, told reporters at a briefing in London.

This compares to a wholesale electricity price of 0.06-0.07 pounds/KWh, a levelised cost of 0.10 pounds/KWh for onshore wind and 0.15 pounds/KWh for offshore wind, he added.

The levelised cost is the break-even price at which electricity is generated from a specific source.

"The building blocks are there for bringing down the cost curve. By 2020 to 2025 we can get (marine energy) costs to where offshore wind is today," said Wyatt, whose organisation advises business, governments and organisations on low-carbon opportunities and helps develop clean energy technologies.

Costs can be reduced by developing more efficient methods of operation, maintenance, installation, which currently represent more than a quarter of total costs.

Although levelised costs for wave and tidal could fall to 0.18 pounds/KWh by 2050, much more research and development would further cut those sums to under 0.10 pounds/KWh for wave and around 0.08 pounds/KWh for tidal by mid-century, Wyatt said.

"There is the potential to cut costs five-fold to reach 60 pounds/megawatt hour (or 0.06 pounds/KWh) by 2050," he added.

However, costs for clean energy techologies such as wind and nuclear could also fall dramatically by then and it is difficult to predict what the wholesale electricity price will be.

BRITANNIA RULES THE WAVES?

Around 40 wave and tidal concepts are being developed in Britain, more than any other country in the world.

Not every device will be commercially viable and no five-to-10 MW array has been constructed yet. The installation of hundreds of megawatts is not seen until at least 2020.

To move beyond single device demonstration and towards the first 5 MW arrays, bringing down the cost will be the "key challenge", as well as demonstrating the technology can deliver a significant amount of renewable energy, Wyatt said.

"From around 40 devices today you will probably see eight or nine full-scale prototypes succeed. To move to the first, 'farm' stage you will need public sector support and probably now four or five (devices) have support," he added.

The UK government is aiming to become the world leader in wave and tidal technology and is targeting 200-300 MW of capacity by 2020.

This week, the government confirmed a subsidy level proposal for next year that is more than double the current rate for tidal stream and wave power projects to help support the fledgling industry.

Some experts estimate that UK marine could supply 20 percent of the country's electricity by 2050.

However, Wyatt said it is "more realistic" to expect marine energy to generate 11 percent of UK electricity supply, or 13 GW, by 2050.

(Editing by Keiron Henderson)

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