The next 18 months are set to determine the fate of a small Bristol company’s efforts to commercialise its world-leading marine renewable energy technology.
Marine Current Turbines (MCT) operates the world’s first large-scale tidal turbine of its type in the world and estimates the technology has the potential to supply up to 10 per cent of the UK’s energy within the next 10 years.
But to achieve that, the company has to persuade energy and engineering companies of the long-term credibility of its single working commercial prototype.
Martin Wright, the managing director, told the Financial Times: “Potentially it’s going to be no business at all or it’s going to be huge.”
Energy from the oceans has often been viewed as a way for governments to meet carbon emissions reduction targets and has been pursued by companies in the US and Europe – but none have as yet managed a large-scale commercial operation.
The flagship project for MCT is called SeaGen. Licensed for five years, it was installed two years ago at the edge of Strangford Lough, a noted beauty spot and important wildlife ground in County Down, Northern Ireland. The site was chosen both for its fast tidal flows and for its sensitive environmental location.
Unlike a field of wind turbines, the marine turbine is relatively unobtrusive and works like an underwater windmill. Rotors measuring 16m in diameter are driven by the tidal currents and Mr Wright says the predictability of the tides give it an advantage over wind energy.
The site was partly chosen to measure the technology against existing environmental concerns.
Strangford Lough is a breeding ground for common seals, but the company says that the speed of the rotors is about 12-14 revolutions per minute and are therefore unlikely to pose a threat to any marine wildlife.
Further projects are being discussed, with plans to deploy the technology in the Skerries off Anglesey in Wales, Brough Ness on the southern tip of Orkney in Scotland and in Bay of Fundy in Nova Scotia, Canada.
But Mr Wright acknowledged that in time MCT would need to have deeper pockets and build a more solid reputation among risk-averse utility companies, either as an independent business or part of a big engineering group such as GE or Alstom.
“It’s not a game to be carried out by minnows. MCT needs to either raise money or sell so it becomes a better counterparty to projects.”
The project has sometimes encountered teething troubles. A computer problem caused damage to one of the rotors and the project ran at only half power for much of 2008.
However, for all the questions concerning environmental damage and reliability, cost will remain a central issue.
To date, the company has raised £40m ($58m) in total from private equity funding. Earlier this year, Siemens, the German engineering company, joined a round of fundraising, making its first investment in the ocean power market.
Other investors include Bank Invest, the Carbon Trust, EDF Energy and High Tide. Accounts for the year to December 2008 showed MCT making a loss for the year of £9.2m from £2m a year earlier.
MCT estimates the device generates electricity at about $5.5m (£3.8m) per megawatt installed, which is roughly double the cost of offshore wind energy.
But Mr Wright regards it as a success, given that MCT lacks scale and has been building a prototype. “We haven’t even started going down the cost-reduction curve yet,” he said.
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