In these financially constrained times it is encouraging to see that governments south and north of the border are willing to continue to scrape together money to support marine renewables. It is also gratifying to see that Westminster and Holyrood are playing together on this strategically important area, the harvesting of energy from our tides and waves, by synchronising the funding that is being made available.
In the last few weeks there have been three funds announced.
1. DECC have announced the £20M ‘Marine Energy Array Deployment’ fund (MEAD ). This is being administered by the Carbon Trust and is intended to provide essential funding to help get the leading wave and tidal energy developers plans progressed to the point where they are able to put in groups of machines or ‘arrays’.
2. The Scottish Government has announced two funds. The first ‘Marine Renewables Commercialisation Fund’ (MRCF ) will be £18M and the detail is still being worked on, but is likely to follow similar lines as MEAD.
3. The other Scottish fund is the ‘Renewables Renewable Energy Investment Fund’ (REIF ) is a remarkable £103M. This is half of the money that Treasury eventually returned to Scotland (it having been paid by Scottish electricity consumers in previous years and held by OFGEM). This fund is to be more of an investment vehicle that is planned to work in parallel with the Green Investment Bank.
The intention is that it will invest in RE projects in order to get others to join the party, but in due course will expect to get its money back to re-invest in other schemes in later years. This is therefore the ‘patient money’ the industry has been calling for, i.e. less impatient to get a return than venture capital, but still not just a grant.
There are of course a whole raft of rules about how big the projects need to be and when they have to be operating by, but these are very useful sign of the Governments’ continuing commitment to bring this industry into being. Naturally there are concerns that they are just a drop in the ocean compared to the sort of money that this will take to make this work properly, but for the moment it will help developers prove that the prototypes can indeed be rolled out at scale.
To date the developers reckon they have attracted between 4 to 6 times the amount of public money put in from private investors and they plan to continue to bring it in to make this industry a reality.
So we seem to have some more of the key building blocks in place to build the technology to treat our carbon addiction. All we have to do now is to make the most of them.