By Felicity Jones of GL Garrad Hassan
Risk. When considered in the context of wave and tidal energy, this word conjures up shipwreck-style scenes of crashing waves and severe storms. It is associated with the challenges posed by the very marine forces that devices seek to harness, raising important questions: Can we install this device? Will it perform as expected? Will it even survive?
These technical challenges are undoubtedly important. Get it wrong and the consequences are grave: costly delays, loss of revenue and reputational damage. But is it necessarily the technology – and its interaction with the resource – that is driving the risk profile of wave and tidal projects? Earlier this year, GL Garrad Hassan was commissioned by RenewableUK to examine this very question. Our findings are published in the report, Conquering challenges and generating growth, launched at the association’s Wave & Tidal Conference at the end of February.
Adopting a ‘bird’s eye view’ of the industry, we found that much of the risk emerges from the political and electricity systems in which marine energy devices must operate. Despite the perception that wave and tidal risk is found mainly ‘in the water’, much of it is firmly based on dry land. Developers face many hurdles such as uncertainty around financial support under Electricity Market Reform, grid charges and delays, and onerous environmental monitoring requirements.
Managing these risks requires collaboration between industry and Government, and our risk register proposes a range of mitigation strategies for them to consider. These range from reallocating the risks of upfront grid charges via an industry consortium, to ensuring that the level of future revenue support is evidence-based.
At a more fundamental level, a change of perception is needed. Rather than imagining a calamitous shipwreck-style scene, the wave and tidal industry should realise that it may have as much to fear from running aground in parliamentary debating chambers and the power grid as from the forces of nature.
Felicity is an Analyst in the global Strategy and Policy team at renewable energy consultancy GL Garrad Hassan. In this role she advises industry, governments and financial institutions on market entry and policy design for offshore wind, wave, tidal and solar energy. Felicity has a first class degree in Philosophy, Politics & Economics (PPE) from Oxford University and a Distinction in MSc Environmental Technology from Imperial College London.
GL Garrad Hassan’s risk register analysis is available online: http://www.gl-garradhassan.com/en/26949.php
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