Denton and Reddish MP, Andrew Gwynne, showed his support for the renewable energy sector in the UK when visiting the Marine Energy Showcase in Parliament prior to the Summer Recess.
The UK is a world leader in marine energy, with 23 wave and 22 tidal stream developers, this is due to the UK possessing an unparalleled resource with 50% of Europe’s tidal energy and 35% of its wave energy. In recent years innovative companies – supported by our existing maritime economy and world leading universities – have managed to harness this energy and deliver the world’s first tidal arrays and commercial marine projects, using UK supply chains.
The Offshore Renewable Energy Catapult estimates that :
• The tidal stream industry could generate a net cumulative benefit to the UK of £1.4 billion, including considerable exports and support 4,000 jobs by 2030.
• While less a mature technology than tidal stream, wave energy could add a net positive contribution to the UK economy of £4 billion and support 8,100 jobs by 2040.
• 50-60% of the economic benefit is expected to be created in coastal areas with greater need for economic regeneration.
By 2050, the global market for marine renewables could grow to £76 billion.[i] Continued investment and support for these technologies will establish the UK as the leading global industrial centre for marine renewables and secure associated economic and trade benefits. However, across the world, almost every country with good marine resources is now aggressively supporting this industry – including Canada, the USA and China. The UK faces stiff competition from the global market for the investment, expertise and intellectual property we’ve already built up.
Added to this, a landmark report from the Offshore Renewable Energy Catapult[ii] this year projected that tidal stream has the potential to significantly reduce costs from approximately £300 per MWh today to below £90 per MWh, on 1GW of deployment.
However, at present, wave and tidal stream projects can only access support through a Contracts for Difference (CfD) auction where these technologies must compete against more mature renewables, such as offshore wind. Given this, as currently set up, the CfD is not a mechanism that will support emerging renewable technologies like wave and tidal stream as they seek to secure the early-stage investment in the smaller-scale projects that they need to drive technology down the cost-curve to full commercial competitiveness. They need a different avenue for revenue support.
[i] Highlands and Islands Enterprise, RegenSW and Marine Energy Pembrokeshire (2016) Marine energy: Key steps to maintain a Great British Success Story
[ii] OREC Catapult (April 2018) Tidal stream and wave energy, cost reduction and industrial benefit