We hope you are doing well so far in this New Year. Below is an update on the latest news from Washington related to advancement of the marine energy industry here in the United States and around the world.
We are excited by the progress achieved in 2018 toward commercialization of wave, current, tidal and riverine power converters. We also appreciate the challenges that still lie ahead facing the marine energy industry. Key among these is adequate funding for technology development, testing and demonstration. We are thankful that the U.S. Congress has provided historic funding levels for the Department of Energy (DOE) Water Power Technologies Office (WPTO), along with the U.S. Navy, to work on advancing marine energy technologies.
Significant Congressional lobbying and federal marketing are required to secure these funding levels. Unfortunately, President Trump in his first two years in office has attempted to significantly reduce funding for the DOE WPTO, and we expect the same in his FY 2020 budget request to Congress in the coming weeks. Without support from SMI’s marine energy clients, which we greatly appreciate, our work to advocate in Washington for the marine energy industry could not happen. In addition, we strongly encourage our readers who are in a position to do so to join the National Hydropower Association’s Marine Energy Council (MEC), which plays a key role in advocating here in the Nation’s capital for increased federal support for the industry. We greatly value the leadership of President and CEO Linda Church-Ciocci and the entire staff at NHA, along with the volunteer executive team of the MEC.
Finally, we are thankful that several SMI clients were successful in securing federal funding during 2018 to develop new marine energy technologies or increase research and testing capabilities. We are happy to discuss how the SMI team could support the federal marketing and lobbying efforts of your company or organization to secure new funding in 2019 and beyond.
Thank you for your interest in marine energy technology development. We look forward to seeing you soon. Best wishes for a healthy and successful 2019!
Damian Kunko and Paul Gay
Marine Energy Opportunity – Help Convey the Message
We are often asked by policy makers why they should care about the potential of marine energy – the next generation of renewable power technologies. If you have the opportunity to meet with elected officials and would like to promote marine energy, here are some select talking points:
– Marine energy has tremendous potential to produce significant amounts of clean, renewable power while creating high-quality employment opportunities and is a clean, safe, predictable and reliable form of energy.
– The resource is close to population centers and can provide power to many different maritime markets and the Blue Economy.
– Marine energy can also revitalize our nation’s ports and shipyards as devices can be built and maintained near generation sites. The economic development potential is great.
Additionally, it is helpful to convey that there is a global competition to commercialize marine energy technologies. We encourage you to highlight reports which can support our case for continued government investment in this sector. For example, the European Commission report on wave and tidal energy which has forecast global installed capacity to hit up to 3.9GW by 2030 based on current levels of political support. Ocean Energy Europe predicts that by 2050, 100GW of marine energy can be installed in Europe and meet ten percent of European electricity demand. The International Energy Agency Ocean Energy Systems 2050 Vision predicts 300 GW of global marine energy installed capacity, with $35 billion in investment and 680,000 direct jobs.
2018 was an exciting year for the marine energy industry. The U.S. Department of Energy’s Water Power Technologies Office was funded at $105 million per year in Fiscal Years (FY) 2018 and 2019, with $70 million per year earmarked specifically for marine energy activities. The Vigor shipyard in Portland, Oregon is constructing the Ocean Energy USA wave power converter, which will be deployed at the U.S. Navy’s Wave Energy Test Site (WETS) at Marine Corps Base Hawaii later in 2019. Oregon State University and its partners continue development of PacWave, a multi-megawatt grid connected open water wave energy test site near Newport, Oregon. Also, Columbia Power Technologies, Oscilla Power, CalWave, Aquaharmonics, Resolute Marine,Verdant Power, and ORPC continue to lead the U.S. in developing new marine energy technologies. The WPTO recently announced $25 million in new awards for technology advancement. Also, in June, the WPTO provided $6.7 million to six previously selected awardees.
Internationally, there was some interesting developments recently announced with Orbital Marinecompleting a $7 million round of crowdfunded investment to build their next-generation device. The Meygen tidal project continues to show great progress with SIMEC Atlantis deploying additional turbines. China is also making strides in developing tidal energy capacity with a new 3.4 MW tidal power station.
In other news, PBS recently broadcast a two-part segment on marine energy. Part 1 is here and Part 2 features an interview with the DOE WPTO’s Tim Ramsey, starting at the seven minute mark. We encourage you to review the recent IEA Ocean Energy Systems Country report and TETHYS reports for developments in the marine energy sector. We also find the wave and tidal section of renews.biz to be an excellent source of industry news.
WPTO Maritime Markets RFI
Last summer, the WPTO released a Request for Information (RFI) on a draft report that details twelve maritime markets where applications may exist for marine energy technologies. The markets are: Ocean Observations; Unmanned Underwater Vehicles/Autonomous Underwater Vehicles Recharge; Data Centers; High Cost Utility Grids; Isolated Community Grids; Canal Power; Aquaculture; Algae; Desalination of Seawater; Seawater Mining; Shoreline Protection; and, Disaster Relief and Recovery. The WPTO sought feedback on the content of the draft report, input on the value of each market and recommendations on next steps and future efforts to investigate these potential markets. Thanks to all the entities that provided feedback to the WPTO, which we expect will positively impact future federal marine energy investments. We look forward to reading the final report and following up on its recommendations.
Congressional Funding Action for the WPTO
No doubt you have seen the news about the partisan political landscape in Washington as we enter the second month of the partial federal government shutdown. Despite these challenges, we have had great success working with our Congressional champions, industry partners and other interested parties to increase federal investments in water power during the past two years. DOE was funded for the full fiscal year and the great WPTO staff is hard at work supporting the industry. In addition, many of SMI’s water power clients received some level of support in 2018 to develop new technologies, build testing infrastructure and expand research capabilities, for which we continue to be grateful.
We have been disappointed that President Trump has proposed to significantly reduce the research and development activities of the DOE WPTO in Fiscal Years 2018 and 2019. We do not expect anything to change for this upcoming budget cycle. Fortunately, water power has been one of the areas which has seen strong support on Capitol Hill from Republicans and Democrats alike. We look forward to rallying our growing list of bipartisan water power Congressional supporters to block any future proposed cuts and position the WPTO for stable or increased funding.
We particularly appreciate Senator Lamar Alexander (R-TN), Senator Dianne Feinstein (D-CA), Rep. Mike Simpson (R-ID) and Rep. Marcy Kaptur (D-OH), leaders of the Senate and House Energy and Water Development Appropriations Subcommittees, and their excellent staff, for their ongoing support of marine energy. We are also thankful for the efforts by Rep. Suzanne Bonamici (D-OR), Rep. Scott Perry (R-PA) and Rep. Chellie Pingree (D-ME), along with their staff, to rally 42 of their colleagues to write to the House Appropriations Committee in support of robust funding for the WPTO. They also led the effort to pass a floor amendment to add $15 million for the WPTO during consideration of the energy and water appropriations bill in the House of Representatives.
Last September, the FY 2019 omnibus appropriations bill was signed into law. The legislation incorporated the annual energy and water development measure which included $105 million for the DOE WPTO, including $70 million specifically for marine energy activities – the same as FY 2018, a record high. The final directive report language from Congress for the WPTO is below:
“Water Power – Within available funds, the agreement provides $70,000,000 for marine and hydrokinetic technology research, development, and deployment activities, including research into mitigation of marine ecosystem impacts of these technologies. The Department is directed to continue development of the open-water wave energy test facility with previously provided funds. Within available funds, the agreement provides $30,000,000 for a balanced portfolio of competitive solicitations to support industry- and university-led research, development, and deployment of marine and hydrokinetic technologies; and support wave, ocean current, tidal and in-river energy conversion components and systems across the high- and low-technology readiness spectrum to increase energy capture, reliability, survivability, and integration into local or regional grids for lower costs and to assess and monitor environmental effects. Within this amount, the agreement provides not less than $8,000,000 to support collaborations between universities, Marine Renewable Energy Centers, and the national laboratories and not less than $5,000,000 to prioritize infrastructure needs at the marine and hydrokinetic technology testing sites operated by the Marine Renewable Energy Centers. In addition, the Department is directed to continue its coordination with the U.S. Navy on marine energy technology development for national security applications at the Wave Energy Test Site and other locations. Within available funds, $35,000,000 is provided for conventional hydropower and pumped storage activities, including $6,600,000 for the purposes of section 242 of the Energy Policy Act of 2005. The agreement provides $5,000,000 for a competitive funding opportunity for industry-led research, development, and deployment of cross-cutting energy converter technologies for run-of-river and tailrace applications to better utilize underdeveloped low-head and other hydropower resources.”
Water Power Reauthorization Update
We continue to work with our Congressional champions, particularly Senator Lisa Murkowski (R-AK), Senator Ron Wyden (D-OR) and Rep. Ted Deutch (D-FL), to reauthorize the marine energy activities of the WPTO. Congress originally authorized this work in its landmark 2007 energy bill. In 2017, Senator Wyden, along with Senator Angus King (I-ME), Senator Jeff Merkley (D-OR), Senator Brian Schatz (D-HI) and Senator Mazie Hirono (D-HI), introduced the Marine Energy Act (S. 1036), which would authorize $300 million in future federal investments to support R&D activities for marine energy technology commercialization efforts. Unfortunately, Congress did not approve the legislation before the end of the 115th Congress. We are now meeting with Congressional staff on new legislation modeled after S.1036 to be introduced in the new 116th Congress. We will keep you apprised of our progress.
U.S. Navy Update
We continue to lobby Congress to increase funding for the U.S. Navy to invest in research, development and testing of marine energy technologies. Our focus remains on securing language in the annual defense authorization and appropriations bills developed by Congress to provide programmatic guidance to the Pentagon for those efforts. For FY 2019, we worked with our Congressional champions to secure a $7 million Navy Energy Program increase for marine energy research in the Defense Appropriations measure. We also lobbied for inclusion of language that should benefit academic research activities related to the use of marine energy for autonomous systems. We are thankful for the efforts by Senator Patty Murray (D-WA), Senator Dick Durbin (D-IL), Senator Richard Shelby (R-AL) and Rep. Adam Smith (D-WA) related to Navy funding for marine energy testing and demonstration.
We expect more interest by the Navy to invest in marine energy technology development as devices and new capabilities continue to be successfully demonstrated at the U.S. Navy Wave Energy Test Site in Hawaii. One example is the recent deployment of the Fred Olsen autonomous wave energy converter, the BOLT Lifesaver, which powered environmental monitoring sensors developed by the Pacific Marine Energy Center.
Looking ahead for 2019, we have developed the following priority areas that will support our client’s interests in commercializing the marine energy sector. We look forward to working with you to advance these recommendations.
1. Continue to increase funding for the DOE WPTO and Navy Energy Program to support R&D and test facility construction and operations
2. Pursue congressional legislation to re-authorize the WPTO to allow additional funding to be allocated to various industry priorities.
3. Seek legislation to authorize and fund new power production incentives for marine energy to subsidize early stage pre-commercial testing.
4. Support WPTO efforts to encourage new market access related to powering maritime electrification activities, including devices for remote sensing, environmental monitoring, aquaculture, fuel production, etc.
5. Work with other federal programs on cross-cutting R&D with the WPTO – such as the Wind office’s increased support for offshore wind and other potential sponsors of marine energy development for applications beyond utility scale power generation.
We are looking forward to participating in several important conferences related to marine energy technology advancement during 2019. We hope to see you at the upcoming International Marine Renewable Energy Conference during the annual Waterpower Week in Washington held this year from April 1-3. This year’s event will be at the flagship Marriott Marquis. Other industry conferences of interest this year include the following. Please let us know of any we may have missed.
–Offshore Technology Conference – May 6-9 – Houston, TX
–US Offshore Wind – June 10-11 – Boston, MAEWTEC – Sept. 1-6 – Napoli, Italy
–Pacific Ocean Energy Trust – Sept. 10-12 – Portland, OR
–Ocean Energy Europe – October – Dublin, Ireland
–Marine Renewables Canada – November
Finally, we are pleased to remind our readers that Washington, DC was selected as the host city for the International Conference on Ocean Energy (ICOE) 2020 event. The event is tentatively scheduled for May 4-6, 2020. Stay tuned for details on how you can participate in the planning for this important chance to showcase to the world the marine energy market opportunities here in the United States.