Update on the OEDUEoin Sweeney

Sustainable Energy Authority of Ireland

Economics of Ocean and Marine Renewable Energy Monday, 13st June, 2011

OE Development Roadmap

2009

2010

2011

2012

2015

2020

Support Pilot projects, new concepts

Full scale demonstrators

Small-scale arrays 10MW/20 devices

Arrays of 100s MW

500MW installedGovernment

Targets

OE Programme Actions

2009

2010

2011

2012

2015

2020

Establish grid-connected test facilities

Fund industry research, development and demonstration

Enhance Research Infrastructure

Undertake Strategic Environmental Assessment and establish new planning

system

Intensify resource and site assessment

Promote development of engineering and other supply chain capabilities

Support grid infrastructure development studies

Summary Progress since 2009

• Ocean Renewable Energy Development Plan formulated• Strategic Environmental Assessment nearing completion• Fit-for-purpose Planning system in the works• New national wave tank facility in planning as part of MERC• Development of open-ocean grid-connected wave test

facility underway• 20 industry projects supported +others by EI, with high

profile for a number of Irish technology developers • Complementary high-profile industry ICT initiatives as part of

SmartBay• Greater awareness of supply chain opportunities and

requirements

• Policy Juncture• Activities in several related areas – many policy

decisions open• Need to reform foreshore consenting• SEA on development scenarios to inform policy

going forward and ensure environmental considerations built into any development

• Year long study by consultants undertaken to produce SEA Environmental Report

Draft Offshore Renewable Energy Development Plan

SEA Development Scenarios to 2030

Low Scenario (MW)

Medium Scenario(MW)

High Scenario (MW)

Offshore Wind

800 2300 4500

Wave & Tidal Current

75 500 1500

Planning & Foreshore Leasing

• Foreshore Acts 1933 to 2009• Lease required for development• Regulatory functions transferred to Dept of

Environment January 2010• Marine Spatial Plan• Intention: Establish a robust and effective

foreshore consent system that provides rigorous environmental controls and that is integrated with existing consent systems relating to development on land.

SEA- Assessment Results in each assessment area

Assessment Area**

Fixed Wind (MW)

Wave: 0 to 100m Water Depth   (MW)

Wave: 100m to 200m Water Depth (MW)

Tidal (MW)* Floating Wind (MW)

Total

1: East Coast (North)  

1200 to 1500 1200 to 1500

2: East Coast (South)  

3000 to 3300 750 to 1500 3750 to 4800

3: South Coast           

1500 to 1800 6000 7500 to 7800

4: West Coast (South)  

600 to 900 500 to 600 3000 to 3500 5000 to 6000 9100 to 11000

5: West Coast            

500 5000 6000 to 7000 7000 18500 to 19500

5a: Shannon Estuary   

0 0

6: West Coast (North)  

3000 to 4500 7000 to 8000 6000 to 7000 750 to 1500 7000 to 8000 23750 to 29000

Total                         

9800 to 12500

12500 to 13600

15000 to 17500

1500 to 3000 25000 to 27000

63800 to 73600

SEA Conclusions: Cumulative Effects

• Possible to reach scenarios without significant adverse effects on environment

• Cumulative Assessment• Floating wind - still emerging• 4500MW fixed offshore wind potentially

achieved entirely off the east coast (areas 1 & 2) or entirely in area 6

• Significant wave resource could be developed in 4,5 and 6

• Tidal potential more constrained – Assessment Areas 2 and 6

Planning & Foreshore Leasing

• Foreshore Acts 1933 to 2009• Lease required for development• Regulatory functions transferred to Dept of

Environment January 2010• Marine Spatial Plan• Intention: Establish a robust and effective

foreshore consent system that provides rigorous environmental controls and that is integrated with existing consent systems relating to development on land.

OREDP Recommendations

9 Recommended Actions• Collaboration & Co-ordination• SEA Monitoring Requirements• Addressing Data, Information & Knowledge Gaps• Consenting & Permitting• Guidance & Advice

http://www.seai.ie/Renewables/Ocean_Energy/Offshore_Renewable_SEA/Consultation/

OREDP/SEA Next Steps

• Public consultation ended in April• Transboundary Consultation• + 60 submissions • Review feedback underway• Post consultation report• Finalise draft plan• Issue Ministerial statement as to how

environmental considerations integrated into plan and how feedback considered

Initial Industry Wave Development Zones

Produced to allow for a ‘ joined-up’ approachto :• Planning• Grid • Infrastructure• Services

Eirgrid now modelling connection scenarios at these locations

Industry Funding

•20 OEDU industry contracts now issued•Total value of projects €11.8m•Grant aid - €4.9m

Need to review strategy wrt OE technologies. Two aspects to industry strategy:Support devpt of Irish technologiesEncourage devpt of industry ‘cluster’

•Emphasis now on getting projects into the water•Support pilot deployments and pre-commercial arrays•Accelerate formation of supply-chain – MRIA, AOEA

Market Capture Infrastructure & Knowledge Diffusion

SMEs

Marine/Energy Research Centres

+Multinationals

ICT & Sensor Research Centres

En

gin

eeri

ng

an

d M

ari

ne

En

vir

on

men

tal M

on

itori

ng

an

d I

CT

Uti

liti

es S

T A

T E

A

G E

N C

I E

S

E U

R O

P E

En

terp

rise

Clu

ste

r Eff

ect

Venture Finance&

Seed Financing

FDI

Ocean Technology Companies

Marine Energy

Test Facilities

Marine Energy Cluster Strategy

HSE Management

Applied research

Laboratory testing

Computer Based

Analysis

Scale prototype testing

Prototype manufacturin

g

Testing facilities

Bespokemanufacturing

Demonstration site

development

Data gathering and analysis Intellectual

Property management

Certification process

Concept Design

Intellectual Property

Prototype Developme

nt

Tank Testing

Design for Manufactur

e

Demonstration Testing

Securing Funding Sales and Marketing

Concept Engineering

Market Analysis 3rd Party Data Validation

Prototype Certification

Overlaps with “Guide to an

Offshore Wind Farm”

Design for Manufactur

e

Computer Based

AnalysisTest Protocol

and Data Analysis

TRL 1-3

Proof of Concept

TRL 3 – 5

Concept Development

TRL 6 -7

Prototype Demonstration

TRL 8-9

Full Scale Demonstration

Technology Development

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Drilling

Site Development & Proje

ct Consent

Installatio

n

Operation

& Maintenance

Decommissioning

Installation solutions & project

management

Device installation

vessel

Sea Based Support

Foundation/ reaction

installation vessel

ROV and dive support

Export and array cable

installation vessel

Offshore substation installation

vessel

Construction Ports and

docks

Installation Management

& Support

Foundation / Reaction

system

Electrical Connecting

Devices

Commissioning Electrical

Connection & Commission

Site Preparation

s

Installation HSE management

Onshore Civil Engineering

Temporary Pontoon

Structures

Commercial Deployment

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Mayo Wave Test SiteFull-scale grid-connected

Galway Bay site¼ scale non-grid connected

StrangfordQUB Tidal Test facility

Research Infrastructure and Test SitesHow best to build and position these?Shift emphasis to support deployments?

CorkOE Test tank facility

AMETS- Lease application Q3

Construction and Installation Activities for Fixed Offshore Wind Farms Belfast Dublin Cork

Manufacturing Facility Associated with Fixed Offshore Wind Farms Belfast Cork Arklow

Wave Testing Support Shannon Galway Killybegs

Tidal Testing Support Derry Belfast Dublin Cork

Construction and Installation Activities for Commercial Scale Wave Killybegs Derry Shannon Galway Cork

Construction and Installation Activities for Commercial Scale Tidal Belfast Dublin Derry

Current RPS Study to identify Key Ports for MR Development and Shipping opportunities

We should see 2020 as a waypoint on a much longer path

Develop actions around a longer-term vision for electricity from offshore wind, as well as wave and tidal resources

2030 2040 2050

10GW 25GW ? ?

Big- picture Scenario

Ocean Energy in Europe

European Projections for Ocean Energy

Utilities announce ambitious plans for marine renewables:

EDF (France), Iberdola (Spain), RWE (UK), Statkraft (Norway) and Vattenfall (Sweden).

Vattenfall referred specifically to Ireland:

“Vattenfall, on its own, has ambitions for some 30 TWh for 2030+. Harvesting 30 TWh means an investment of some €15-20bn, and an annual O&M cost of some €0.5bn, initially half in Ireland, half in Scotland.” (World OE Conference)

3.6 GW40,000 jobs

188 GW

471,000 jobs

2020

2050

Indicative Value- UK Offshore Valuation Report 2010

Installed capacity Resource utilisation Capital expenditure Annual Revenue

Scenario 1 78 GW 13% £170B £28B

Scenario 2 169 GW 29% £443B £62B

Scenario 3 406 GW 76% £993B £164B

‘The UK is now most of the way through its first great offshore energy asset, our stock of

hydrocarbon reserves. The central finding of this report is that our second offshore

asset, of renewable energy, could be just as valuable. Britain’s extensive offshore

experience could now unlock an energy flow that will never run out.’

Boston Consulting Group 2010

Economic Potential for Ireland

2020

2030

Wave and tidal capacity and electrical generation potential to 2050

Ocean energy has potential to grow at differing ratesdepending on policy, device technology, and infrastructure

Eirgrid modelling

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Cost Assumptions

Parameter 1 GW InterconnectorBetween IE and GB Between IE and FR

Capacity (MW) 1,000 1,000Specific Cost (€M / MW) 1.0 1.5

Total Cost (€M) 1,000 1,500Lifetime (years) 20 20

Discount Rate (%) 6 6Annual Cost (€M p.a.) 87.2 130.8

Parameter 1 GW Offshore WindCapital Cost Connection Cost

Capacity (MW) 1,000 1,000Specific Cost (€M / MW) 3.0 0.5

Total Cost (€M) 3,000 500Lifetime (years) 20 20

Discount Rate (%) 10 6Annual Cost (€M p.a.) 352.4 43.6

Routes are indicative only.

Planning at EU level

Renewables Supergrid

Reduce greenhouse gas emissions by

Electricity generationincrease by at least

80%UN International Panel on Climate Change

100% International Energy Agency

We have a long way to go and others are moving faster...

Potential 2050Scenarion

50 GW Production€ 15bn - Export of

Electricity70 000 jobs

Research Infrastructure

SEA & Planning

Supply ChainGrid DevelopmentEnterprise

Development

Test Facilities

Scale and pace of actions not commensurate to the opportunity and challenge

• Expand the scope of the Ocean Energy strategy to include all marine renewable energy resources.

• Strengthen the mechanisms to implement the OREDP.

• Strengthen resources and accelerate planning around grid issues - reinforcement, offshore grid, interconnection, and mechanisms for the export of electricity.

• Galvanise actions to develop the supply chain.

Some key messages for action

Summary

• EU on once-off transition to low carbon society

• Green Power Generation is inevitable• We have Comparative Advantage in ocean

energies• Huge employment potential of wind, wave

and tidal• Huge Export Market on our doorstep• This is a unique economic opportunity

The message we want to put out

ICOE 2012The National Convention Centre

(Bilbao 2010 – 700 attendees)• Industry exhibition• Partners – IEA and European Ocean

Energy Association

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Thank You