An updated Cost of Energy analysis of Minesto’s unique ocean energy technology shows substantial improvements compared to previous estimates. “These new results convince me that our technology is transforming ocean energy into one of the most cost-effective energy resources”, said Dr Martin Edlund, CEO of Minesto.
As part of its first commercial-scale project, Minesto together with ITPEnergised has completed an updated Levelized Cost of Energy (LCOE) analysis of Minesto’s marine energy converter based on new knowledge of the system, its potential and its costs.
Projections now show that Minesto’s LCOE will already fall to €100/MWh after 100MW cumulative installed capacity in tidal streams. Previous estimates showed a 50% higher cost level. This means that Minesto’s technology already at an early stage will be more cost effective than established energy such as new nuclear power.
Installing arrays of Minesto devices in continuous ocean currents, providing a much higher capacity factor than tidal streams, will have an even greater impact on the LCOE, with costs falling below €50/MWh following the installation of 100MW cumulative capacity.
“This claim is unique in the ocean energy industry – but so is our technology. It is the only known and verified marine energy product that can be deployed in continuous low-flow ocean currents, providing cost-effective renewable base load power generation to grids both large and small all over the world”, said Dr Martin Edlund, CEO of Minesto.
He continued: “These new results convince me that our technology is transforming ocean energy into one of the most cost-effective energy resources. The figures are underpinned by our light-weight design, our unique operations and maintenance concept and the fact that we will be operating at low-flow sites. It should also be noted that this analysis is based on conservative learning rates and initially high operating and maintenance cost levels expected from all new innovative solutions.”
The substantial LCOE improvement has two main drivers, said Dr Edlund: “First, the expected performance of each system has improved. This can be attributed to our quarter-scale test results, new simulations data and a new verified turbine blade design developed in-house. Secondly, our operating and maintenance concept has improved considerably.”
Commenting on the updated LCOE analysis, Dr Ned Minns, Offshore Group Manager at ITPEnergised said: “Minesto compare well to other tidal energy technologies, with significantly lower capital costs. Their cost reduction trajectory in the coming years is on the conservative side due to the cautious assumptions used throughout. Their forecast learning rate matches the prediction by SI Ocean*, however it is only half of that recently achieved by offshore wind and solar, according to Bloomberg**. High levels of learning are more readily achieved by innovative designs like Minesto’s, and if they follow the path of offshore wind and solar, their cost reductions could be achieved sooner than predicted in the model.”
“Minesto’s diligence when using the most accurate data available, and creating a model based on standard practice, has led to the creation of an extremely thorough Cost of Energy forecast model which probably doesn’t have an equal in the industry”, Dr Minns added.
* Strategic Initiative for Ocean Energy, a project coordinated by Ocean Energy Europe in close cooperation with the European Commission’s Joint Research Centre, the UK Carbon Trust, Portugal’s Wave Energy Centre, Edinburgh University, Renewable UK and DHI.
** Bloomberg New Energy Outlook 2017