Investment |
Scaling up investment in ocean energy
Ocean energy development projects have recently benefited from investment drives and expansions
GOVERNMENTS AROUND THE WORLD have set a goal of transitioning to clean energy, which is an essential part of mitigating climate change. Renewable energy sources such as solar and wind have made significant progress in this regard over the past few years. However, renewable energy sources such as ocean energy must be scaled up if the energy system is to reach full decarbonisation. That’s according to a new report by the International Renewable Energy Agency (IRENA) and Ocean Energy Europe, which shows that ocean energy technology development has recently benefited from investment drives. Ocean energy has a global market potential of 350GW predicted by 2050, making it a viable option for producing clean and predictable electricity to coastal countries and island communities worldwide. Moreover, investment in ocean energy can create 680,000 jobs and support coastal communities historically engaged in the shipbuilding and oil and gas industries. Despite this potential, the development of ocean
energy technologies has faced recurring challenges, such as a lack of funding opportunities and market visibility. The report states that ocean energy must now scale up investment, but relying solely on market actors to deploy projects won’t be possible. Since ocean energy technologies are still expensive and have high risk factors, private investors will not engage without market visibility and clear government targets. Over recent years, wind energy and solar have been
brought to market and developed into commercial technologies, benefiting from government support such as feed-in tariffs, clear renewable energy targets, and dedicated deployment zones. The new report states that ocean energy now needs such clear signals from governments to help attract private investment.
38 | May 2023 |
www.waterpowermagazine.com
Different investment instruments will be required as ocean energy technologies are at different stages of development, or technology readiness levels. However, a more suitable financial framework will facilitate faster development, cheaper support, and greater cost reductions, ensuring the most direct path to industrial roll-out. Tidal stream and wave technologies are the closest
to reaching maturity, and the report focuses on these since they have greater global application potential and are more scalable. With the global ocean energy potential expected to increase exponentially over the next few decades, the report argues that private investors will find it profitable to invest in ocean energy if governments implement the necessary regulatory framework and signal their commitment to the industry.
Emerging tidal technology Wales, a country with a long coastline, has the driving
ambition to make itself a world center for emerging tidal technology. The country’s First Minister Mark Drakeford has announced a £750,000 fund for tidal lagoon research, which will be available for at least three research projects focusing on the deployment of tidal lagoon technology. This funding will help address barriers to development and give greater insight into the benefits it could bring to Wales. “We cannot deliver this by ourselves,” Drakeford said. “We need to work in partnership with the industry to build the right environment for the sector to flourish. The research will make a significant contribution to delivering a future tidal lagoon project in Wales and move the sector forward as a whole.” Ioan Jenkins, chair of the Tidal Range Alliance, said, ““The Tidal Range Alliance is pleased the Welsh
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