'Sandals and beards' are banished in a quest to find 20,000 volts under the sea

Tim Webb travels to the Orkneys to discover a source of clean power that's big on innovation but short on funds
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The Independent Online

A converted Victorian school in the village of Stromness in the Orkney Islands is the unlikely home to the world's first - and only - testing centre for wave and tidal energy machines. In three tiny offices, scientists from all over the world pore over computer data from their sea-borne prototypes to try to show that this newest form of renewable energy actually works.

A converted Victorian school in the village of Stromness in the Orkney Islands is the unlikely home to the world's first - and only - testing centre for wave and tidal energy machines. In three tiny offices, scientists from all over the world pore over computer data from their sea-borne prototypes to try to show that this newest form of renewable energy actually works.

In broken English, Arvo Jarvinen, director of the Finnish company AW Energy, demonstrates by means of a computer simulation his company's Waveroller tidal device, which is fixed on the seabed in shallow water in the nearby bay. "We need measurements to give the big energy companies," he explains. "They are always asking 'Can you show it works?' and 'Do you have measurements?'"

The Government has estimated that enough marine machines could be in place by 2025 to generate up to 5,000MW of electricity, enough to power five cities the size of Birmingham. But big energy companies have their doubts. You can't blame them. It costs an estimated four times more to generate electricity using wave or tidal machines than using a gas-fired power station, and over three times more than with onshore wind farms, currently the cheapest form of renewable energy. But no one knows the exact figures because marine energy is still at an experimental stage.

Jon Boston, development manager for marine renewables at Npower Renewables, owned by the German energy giant RWE, says: "Marine is where wind power was 20 years ago. There are lots of new ideas out there, but not many have been proven and even fewer have actually been deployed at sea. Large energy companies have moved away from technology development in recent years. We are watching the sector closely but would need the big questions answered before making large-scale investment."

Privately, one executive at another energy group says the marine energy industry has a "wacky sandals and beards" image.

Marine may be a long way behind wind energy, but it is catching up fast. Two weeks ago, the Edinburgh-based company Ocean Power Delivery (OPD) announced that it had won a £5.5m order to build the world's first commercial wave-power farm. The design it will use - called Pelamis - was put through its paces at the European Marine Energy Centre (Emec) in Stromness last year.

Each Pelamis machine consists of four long, thin cylindrical sections linked together by hinged joints, to a total length of 120 metres. The machines work best in depths of 50 metres and are placed at right angles to the waves. Wave movement is converted into electricity by hydraulic pistons fitted at the joints of the sections, driving a generator. The electricity feeds via a cable on the seabed into a substation on the shore and into the national grid.

It is unlikely OPD would have won the Pelamis order without Emec, which was set up by the Government and has received about £10m in funding. Proof that prototype devices work is vital to attract the investment to develop them. Max Carcas, business development director at OPD, says Emec aims to prevent investors losing money on unreliable devices, as happened in the early days of wind energy. "There were those in the wind industry that promised the earth, the result being that investors got their fingers burnt. We want to avoid that experience."

Information from the devices Emec tests is fed digitally through fibre-optic cables along the seabed to the data centre at Stromness, where there is a staff of four. As well as using satellite navigation to make sure its devices do not drift out of position, Emec has a CCTV camera at an observation point on a cliff, and buoys in the bay to help it monitor sea conditions. If there is a problem with the tests, day or night, a computer at the data centre sends David Cousins, the operations manager, a text message.

None of the Pelamis machines tested has been lost to collisions with fishing boats or damaged by waves. "Everyone is sensitive about creating headlines about this kind of thing," Mr Cousins says. "We are very careful. Durability is key. The centre has to produce year in year out."

Pelamis is one of three marine energy prototypes in commercial development in the UK, but another 50 unproven designs from as many companies are competing for funding. Ian Temperton, a financial adviser for Climate Change Capital, a specialist merchant banking group, says the resulting confusion is one of the biggest obstacles to more investment: "It's extremely difficult for investors and buyers to understand the many different designs on the market."

But embarrassingly for the Government, OPD's Pelamis order is for a wave farm in Portugal, not the UK. This is despite the Government providing one quarter of OPD's £10m funding (the rest is venture capital funding) and announcing a £50m Marine Renewable Deployment Fund last summer. The Portuguese government is offering to pay a 12-year fixed tariff of £150 for each megawatt generated by the first developers of marine energy. This is far more than any money available to marine energy operators in the UK, says Alastair Rennie, renewables director of Amec, the construction and project management group.

After the Government announced its £50m marine energy fund last year, Emec and Scottish Power agreed a £30m joint venture with OPD to build and operate a wave farm in the Orkneys with a maximum generating power of 22.5 MW. But the project, which would be the largest of its kind in the world, has now been shelved because of the way the Government decided earlier this month to distribute the money. The maximum any developer can receive in grants and subsidies is capped at £9m, which Mr Rennie says is not enough to give companies an incentive to fund a large-scale commercial project. The money is also only available until 2008, even though there aren't nearly enough companies who can spend it by then.

"We are trying to think of ways of doing this which are not commercial suicide," Mr Rennie says. "But we are quite upset over the capping for the marine funding programme." The consortium plans to write to the new Energy minister, Malcolm Wicks, to ask him to change the funding rules.

Mr Carcas from OPD admits that there are not enough financial incentives for marine energy in the UK. "The Government is trying hard, but marine energy needs a clearer route map," he says. "The renewable obligation scheme [requiring electricity suppliers to buy a proportion of their power from renewable sources] favours the least expensive form of generation. But at the moment wind is cheaper, so why would you build a wave farm?"

Labour has done a lot in the past year to promote marine energy. But the technology is still in its infancy. Paul Jordan, programme manager at the Carbon Trust, a government quango, estimates that around £65m has been invested in the UK by the public and private sectors, which represents a tiny fraction of the funding for wind or nuclear.

No venture capitalist or energy company will want to be the first to risk investing in a commercial-scale marine-energy project without significant government backing - which isn't there. "You need to do these experimental projects on a larger scale to learn how to bring down costs," adds Mr Rennie from Amec. "We can't afford to build things just because it would be nice to do."

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