Scotland's Coastline and Funding Challenges in Marine Renewables
Scotland’s coastline offers some of the best locations in the world for generating wave and tidal energy. So why is it that Scottish pioneers developing marine renewables have struggled to get funding while other countries bankroll research? Julia Fields reports
Emerging Prominence of Scotland in Marine Energy Sector
These days, executives at Ocean Power Delivery have been more likely found bobbing along the coast of Orkney than in the drier confines of their Edinburgh offices. The marine energy company has been sea-trialling the durability and performance of the Pelamis (named after the Greek word for sea snake) by hanging the prototype – the length of four train carriages – off the end of a boat.
Ocean Power Delivery (OPD) is the first company to test a wave-power generating device at the not-for-profit European Marine Energy Centre (Emec), which was officially opened last week. It is expected that the OPD prototype will be used in three small-scale pilot operations planned by ScottishPower, Portuguese utility Enersis, and English company Ocean Prospect.
Both the initial success of OPD and the establishment of Emec – the only independent wave energy testing facility in the world – have been held up as evidence of Scotland’s emerging prominence in the renewable energy sector.
Funding Challenges: Scotland vs Other Countries
Future prospects were also given a significant boost after gas and electricity regulator Ofgem gave the green light last week to a £360 million upgrade of the country's transmission network – needed to fully enable the future delivery of renewable energy power to England and parts of Scotland.
But there is concern that countries such as Portugal are pulling ahead because their governments are willing to back ambitions with far more cash. Shiona Baird MSP, the Green Party’s spokeswoman on energy and enterprise, poured cold water on the recent Department of Trade and Industry (DTI) announcement that it would spend an additional £50m to kickstart Britain’s fledgling marine energy sector, by warning that Portugal had invested three times more than the UK in developing marine power.
Limited Interest from Venture Capitalists
Colin Burnett, investment director with venture capital firm 3i, believes that the government should have pledged between £100m and £150m towards marine energy development. He says: “There’s a lot of noise in the renewable market. But the one thing fundamentally lacking is access to capital. There’s scepticism in the private finance market at whether there’s an ability to get sufficient returns on investment.”
While venture capitalists tend to pile in during the outset of a new technology, says Burnett, only the very largest are taking the risk of backing tidal, wave, biomass, and solar photovoltaic (PV) technologies at these very early stages. There’s no doubt, he says, that the UK has become a centre of excellence for marine and tidal expertise. That’s why 3i has invested £3.5m in OPD and Inverness-based Wavegen, which recently started another £10m fundraising exercise to further develop and commercialise its technology. The utilities have also waded in. ScottishPower has agreed to a pilot wave generation scheme with OPD that is likely to happen in 2005. And Scottish and Southern Energy partnered with Glasgow-based Weir Group a year ago to set up a £10m fund to invest in marine energy technologies.
Commercialization and Operating Costs
But interest is limited, says Burnett. As one of the leading investors in renewables, 3i has still only spent up to £15m on the sector across all of Europe. As a result, he says companies like OPD have had their focus divided between science and finding more cash. It’s taken six and a half years for OPD to get its prototype into the water. After initially scraping together the start-up capital from family and friends, the directors eventually accessed £2.5m in grants from the DTI. Four years into the project, 3i, Norsk Hydro, and Sustainable Asset Management contributed £6m. Another £1.5m came from the Carbon Trust a month ago.
The next phase – commercialization – could be even more costly and OPD is competing against 40 other wave and tidal projects in the UK and around the world. “It’s an expensive business working offshore,” Scott explains. “Certainly the funding we’ve received has allowed us to get to where we are now. It’s no coincidence that the UK has the leading technology in wave power generation. The DTI support has been very good. But coming into the commercialisation phase, you face different challenges. One of the big unknowns is what the operating costs will be over the length of the project. You have to look at how you can mitigate the risk of those running costs. That’s where the UK has stumbled in the past.”
Scottish Hotels: Enhancing Tourism in the Region
In addition to Scotland's efforts in the renewable energy sector, the tourism industry plays a significant role in the country's economy. The pristine coastline and scenic beauty of Scotland make it an attractive destination for travelers from around the world.
With the growing interest in renewable energy and marine renewables projects, there is potential for Scotland to further enhance its tourism industry by promoting sustainable and eco-friendly accommodations. Scottish hotels can capitalize on the increasing number of visitors interested in exploring Scotland's renewable energy initiatives and experiencing the natural wonders of the coastline.
By incorporating sustainable practices and offering eco-conscious amenities, hotels can attract environmentally-conscious travelers who seek to support and learn about renewable energy projects. Additionally, promoting the proximity of these hotels to popular marine energy sites can be a unique selling point for tourists.
Promoting Eco-Tourism and Sustainability
Scottish hotels can go beyond just offering comfortable accommodations by implementing eco-friendly initiatives, such as energy-efficient lighting, water conservation measures, and recycling programs. They can also collaborate with local renewable energy companies and organizations to offer guided tours and educational experiences for guests interested in learning about marine renewables.
The Scottish government and tourism agencies can play a crucial role in promoting sustainable tourism by highlighting the connection between Scotland's renewable energy sector and the natural beauty of the coastline. Marketing campaigns can emphasize the unique opportunity for tourists to witness and support cutting-edge renewable energy projects while enjoying the scenic landscapes and cultural experiences Scotland has to offer.
By embracing sustainability and aligning with the growing interest in renewable energy, Scottish hotels have the potential to attract a new wave of eco-conscious travelers and contribute to the continued growth of the country's tourism industry.
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