UK Prime Minister Boris Johnson welcomed world leaders to Glasgow COP26 announcing the fight against global climate change is at ‘one minute to midnight’. He joins the world’s most senior figures – including royalty and the Pope himself – in efforts to crystalise the severity of our climate crisis. In essence, time is up, and aspiration must rapidly turn to action if we are to slow global warming and avert catastrophe.
As a major contributor to climate change, energy generation will of course be front and central in forthcoming debates. And with billions already pledged to limit temperature rises, the demand for innovative solutions to drive the clean energy transition has never been greater.
Offsetting intermittency of wind and solar
The key challenge for the energy transition is not the total available capacity of renewable energy, rather to ensure that supply always meets demand. In recent decades wind and solar sectors have grown exponentially, playing a significant role decarbonizing our electricity systems. However, both sources present challenges due to intermittency and limited predictability, resulting in volatility in electricity markets. At times of low wind and solar generation, prices spike when supply doesn’t meet demand. Naturally, with increasing penetration of intermittent renewables, price volatility is likely to become more pronounced.
By contrast, wave energy has a much more consistent and predictable production profile. Created by weather systems, built up over several days across large oceans, the energy content is concentrated and smoothened. This delivers a consistent power profile to coastlines offsetting the intermittency of wind and solar. With little or no visual impact, wave farms can be built close to the main consumption centres, along coastlines where most people live, reducing transmission capacity.
Combined energy arrays and clean hydrogen production
In order to deliver the lowest-cost, zero-carbon electricity systems we must combine complementary renewable energy sources such as wave, tidal, wind and solar. Working in unison they require less storage capacity compared to a pure wind, solar storage system, while also offering a natural balancing solution. This creates a more reliable and lower-cost alternative to stabilize low-carbon electricity systems in many parts of the world.
In addition, wave energy can also support the production of renewable hydrogen – which is likely to be a key solution helping decarbonize heavy industry and transport – by offering a more constant operation and higher profitability for electrolyse operators, compared to wind or solar.
Higher average value
Due to its grid balancing value, wave energy is expected to have a higher average value compared to wind and solar in future electricity markets. In-depth analysis performed by electricity system experts shows that adding wave into an energy system can significantly reduce the amounts of wind, PV, storage and grid capacity, while still balancing supply to demand at all times.
Despite the higher CAPEX, OPEX & LCOE of wave energy, compared to wind and solar, a lower system cost is achieved, making it competitive at a higher cost per MW produced. Furthermore, the average cost of generation (LCOE) is unlikely to hold as greater level of importance in future electricity markets. Rather, with increasing penetration of intermittent generation, value will be determined by ‘when’ each MWh is delivered during the year, which wave energy is uniquely positioned to capitalise upon.
Broad market opportunities
Wave energy holds great potential for use across multiple sectors from Utilities to Oil & Gas and Island markets, where the technology offers increasing levels of competitiveness as the installed base increases. Due to its ‘grid-balancing’ value, wave energy will be competitive in the utilities market without subsidies at a higher LCOE compared to wind and solar. Meanwhile, wave energy can be used to power offshore installations in the Oil & Gas market, which is tolerant to higher electricity costs, and largely limited to wind energy. Furthermore, many islands and remote locations around the world rely on expensive electricity generated by hydrocarbons, offering an attractive entry market for wave energy.