Aquamarine Power secures first £10M for wave energy tech

Edinburgh-based wave energy developer Aquamarine Power said today it has secured £10 million ($16.2 million) of £50 million it needs to progress offshore testing of its waver energy converter technology.

And what has investors so excited? 

Unlike other approaches, all of the electrical power equipment behind the technology remains onshore, according to the company.

The company’s CEO Martin McAdam told the Cleantech Group that in addition to the financing round, the company has successfully deployed its first generation, hydro-electric device at the European Marine Energy Centre off the coast of the Orkney Islands in Scotland, with the capacity to generate 0.5 megawatts (see Aquamarine Power plans wave energy project for fall).

The project was completed last month on schedule and within predicted, but undisclosed costs.

The branded Oyster device converts renewable energy harnessed from ocean waves into usable electricity. It is expected to start producing power for full-scale offshore testing later this year, with testing predicted to take up to two years.

The funding came from a new backer, the venture wing of the Scottish government Scottish Enterprise, high-net worth investors in the UK and Ireland, and all of the company’s existing shareholders, including Scottish & Southern Energy and Scotland-based Sigma Capital.

“The Scottish government is hoping that we create a new marine energy industry, and this is seed funding to help us get established,” he said.

Much like Germany and Denmark are known for wind, Scotland is looking to be the center for marine technology (see Scotland jockeying to become a leader in marine power).

The UK is already the global leader in marine energy, and government policies and natural resources could derive 20 percent of its energy needs from wave and tidal power, according to a 2008 study (see UK holds half of Europe's wave energy potential).

Today’s financing is the first £10 million Aquamarine Power needs to commercialize its technology and achieve its cost competitive strategy, McAdam said. With discussions already underway, he expects to announce a second close in the next 90 days.

Aquamarine raised $3.1 million in October 2007 from Sigma Capital. The company was formed as a venture of Aquamarine Power and Scottish & Southern Energy, which invested £6.3 million in the startup (see Swiss group spreads the cash around).

Today’s funding is also expected to help Aquamarine Power develop its second generation device.

McAdam said the second generation Oyster has three moving, mechanical flaps in a single 2 MW unit with minimal submerged moving parts, instead of the one flap on its first generation device.

He described the technology like a large laptop, with a keyboard bolted to the seabed. The Oyster consists of an oscillator fitted with pistons that’s fixed to the sea bed, which is near the shore. It is designed to be deployed at depths of around 10 to 12 meters.

Waves activate the oscillator, pumping high pressure water through a sub-sea pipeline to an onshore turbine, he said. Then, onshore, conventional hydro-electric generators convert the high-pressure water into electrical power.

The technology is being designed to be deployed in multi-megawatt arrays.

A commercial farm including 20 devices is expected to provide renewable energy for about 9,000 homes, according to the company. Aquamarine Power says it has proven it can produce commercial-scale electricity in onshore testing at the New and Renewable Energy Centre near Newcastle.

The technology was developed by Allan Thomson, a veteran in the marine energy field, and Professor Trevor Whittaker of the Queen’s University Belfast.

McAdam said the device’s simple design allows its power generation equipment to remain easily accessible onshore.

“Being able to maintain things in the sea is quite a challenge,” he said. “You need to design it with few moving parts so you don’t have to go out very often and fix it.”

Aquamarine Power has a joint venture agreement in place with a division of Scottish & Southern Energy, Airtricity, to develop up to 1 gigawatt of marine energy by 2020, as well as agreements with utilities in Ireland and Portugal.

Aquamarine Power said it expects to have a fully commissioned, commercially available wave farm in place by 2014.