Wave and tidal energy need radical new approaches if the industry is to achieve grid parity in the near future at a reasonable cost, said Giles Hundleby, Associate Director of BVG Associates, speaking at ICOE 2016.
In effect, this probably means grid parity with at least 2 GW of installed capacity by 2030, requiring a total subsidy investment of £3 billion for wave and £4 billion for tidal, BVG Associates states.
“Current thinking needs to be turned on its head,” said Hundleby . “Instead of looking at savings using today’s devices, we must work back from grid parity at a given market size at a given point in the future to get targets relevant for now – this will drive different decisions.”
BVG Association stated tidal and wave can learn lessons from offshore wind which developed effective stakeholder engagement and improved the cost of energy. However, the consultancy pointed out that wave and tidal sectors do not have the luxury of the many decades wind energy has had to get to the stage where its economics are as attractive as its environmental benefits.
“Without a fast and robust route to grid parity that investors and governments believe in, these sectors do not have a future. So we must work back from grid parity to see what we need to do now to achieve it as quickly as possible,” concluded Hundleby.
This enables focus on approaches that deliver the target capital, required cost reductions and so the scale of deployment for viability, and directs investment into the areas that deliver most benefit and give reassurance to potential investors, BVG Associates’ press release reads.