Select Committee on Innovation, Universities, Science and Skills Written Evidence

Memorandum 15

Submission from the South West Regional Development Agency


  1.1  The South West Regional Economic Strategy identifies environmental technologies (including renewable energy) as one of the eight priority sectors selected for specific intervention. The South West RDA provides a variety of support to the renewable energy sector and over the past few years has committed over £7.5 million to supporting the development, demonstration and commercialisation of new energy technologies. Some of the major projects and initiatives that the RDA has supported include the establishment and funding of Regen SW, the region's renewable energy agency; grants for research and development in emerging technologies; and the South West Bio-heat Programme.

  1.2  The most significant area of activity for the South West RDA is in developing a marine renewable energy industry, for which we are developing Wave Hub and an associated economic support programme. The Wave Hub is an electrical "socket" off the north coast of Cornwall to allow companies developing wave energy technology to deploy groups (arrays) of devices in a vigorous wave climate over several years. The project aims to enable the final stage of development for companies in the UK, taking advantage of the region's strong natural resource of wave power, the existing skills and facilities in the marine sector, and the research capability in universities and research institutes to build a strong capability in marine renewables, consolidating the UK's leading position in this area.

  1.3  Wave Hub will enable device developers to access a demonstration site without the cost and time commitment of laying a cable and securing a consent. The developers will be able to prove the performance of their devices and, at the same time, form collaborations with industry and research centres to improve the economics of their devices. It will work closely with the DTI's Marine Renewable Deployment Fund and other grant funded programmes, such as the Carbon Trust's Marine Accelerator and various UK and European research programmes. It will also provide a location for determining the environmental impacts of the technologies and thereby influence stakeholders and affected communities as well as informing decisions about the location of future projects.


  2.1  The South West has a track record of developing "firsts" in renewable energy. Among almost 100 renewable electricity schemes in the region is the UK's first commercial wind farm and the first UK scheme to harness electricity from fermented farm and food waste. The region has high levels of wave, wind, hydro and solar energy and the best climate in the UK for growing energy crops. It currently has 150 businesses working in renewable energy and a number of individuals who lead the world in renewable energy modelling, project development, and device design and installation.

  2.2  Recognising the South West's potential to be a major force in the renewable energy industry and to make a significant contribution to tackling climate change, the South West Regional Economic Strategy has prioritised activity that encourages new enterprises; helps the industry to compete in the global economy; and promotes innovation. This will also help the region to deliver on its statement of intent to secure economic growth within environmental limits.

  2.3  As a contribution towards unlocking this potential in the South West's renewable energy sector, the South West RDA has committed over £7.5 million to supporting the development, demonstration and commercialisation of new energy technologies over the last few years, and supports the renewable sector in a number of different ways. Some of the major projects and initiatives that the South West RDA has provided funding for include:

    —  Regen SW—Regen SW acts as a catalyst for the development of renewable energy in the South West, with the objectives of increasing the amount of high quality renewable energy projects on the ground; securing short-term growth by supporting business in the renewable energy sector; and positioning the region for long term economic growth by developing early leadership in renewable energy technologies. Regen SW has had a number of notable successes, and is currently delivering sector support for the South West renewable energy industry.

    —  Grant for Research and Development—A variety of renewable energy companies have received grants to support their R&D, including a grant to help the development of a 4000 kW wind turbine and a feasibility study for a tidal energy device.

    —  SW Bioheat Programme—The South West Bioheat Programme aims to stimulate the bioheat industry in the South West through increasing the number of systems on the ground, supporting fuel suppliers and providing recognised training programmes across the region.

    —  Marine Renewable Energy Programme—The South West region has a long coastline with many areas having potentially commercial levels of energy for either wind or tidal stream generation projects. To capitalise on this, the South West RDA has developed a programme of activity to stimulate a world class marine energy sector in the region.

  2.4  It is our activity on marine renewable energy that is the focus of the rest of this paper.


  3.1  South West England wants to take a prominent position in marine renewable energy, capitalising on its significant potential to generate substantial amounts of electricity from wave and tidal stream resources around its coast and ample, immediately available, grid capacity. The South West RDA has long recognised the potential of the marine energy industry for the region and agreed to support demonstration projects in this sector.

  3.2  In July 2003, the South West RDA invited an expert industry panel, facilitated by Regen SW, to suggest ways in which the region's wave resources could be exploited to economic advantage. The panel considered a number of options, including carrying out surveys to map resources and environmental constraints and possible financial support mechanisms, but identified the concept of developing a proving zone for wave energy devices as the best option for the region to pursue. This would provide wave device developers with a means of taking the next step towards the commercial application of devices, and enable the future financing of commercial projects.

  3.3  In October 2003, the South West RDA commissioned an initial report into the concept of developing a Wave Hub. The Seapower South West report confirmed the likely merits of this idea of developing a Wave Hub, based upon:

    —  the region's strong wave energy resource;

    —  capacity of the electricity distribution network to accept substantial additional generation without major investment;

    —  strength of the existing marine skills base and available facilities;

    —  strength of the knowledge base including universities and research institutes such as Plymouth Marine Laboratory, the Marine Biological Association of the United Kingdom, the Met Office, and the United Kingdom Hydrographic Office; and

    —  substantial grant support available in Cornwall from the EU (Objective 1 and Convergence).

  3.4  The South West RDA considered the industry's advice, and the Seapower South West report and, in March 2004, we agreed to develop Wave Hub further. Since this time, we have kept in regular contact with the industry and are convinced that this facility is critical if the UK is to retain its position as the world leader in wave energy.


  4.1  Wave Hub is a groundbreaking renewable energy project in the South West that aims to create the world's first large scale wave energy farm by constructing an electrical "socket" on the seabed around 10 nautical miles off Hayle, on the Cornwall coast. 8 square kilometres of sea bed will be leased from the Crown Estate and up to four companies developing wave energy conversion devices (WECs) will be granted a 2 sq kilometre area, within which to moor an array of devices. The devices will then connect to the Wave Hub infrastructure on the sea floor and up to 20MW of green power will be transmitted through a sub-sea cable to the local distribution network at Hayle.

  4.2  Each developer will be granted a lease to use Wave Hub for between five and 10 years. The Wave Hub operator will record climate conditions and the electricity generated by each array. It will also monitor the environmental impacts the arrays are causing. This will enable the developers to build up a validated track record of performance that they can then use to support proposals for commercial scale wave farms in the South West and elsewhere.

  4.3  The recording of environmental impacts through research by the Wave Hub operator will inform stakeholders and regulators and provide a basis for decisions about future sites.


  5.1  The project will provide the final stage of development for wave technologies in the UK. Early stage designs can be tested at the established facilities provided by NaREC in north-east England. Single prototypes, at part- or full-scale, can then best tested at EMEC in Scotland. Wave Hub provides the final demonstration stage before the devices can be deployed commercially.

  5.2  The device developers deploying at Wave Hub can expect to benefit from the Dti's Marine Renewables Deployment Fund which offers capital support and a subsidy per unit of power generated to developers who have already completed preliminary trials at EMEC or similar facilities elsewhere.

  5.3  The Carbon Trust's Marine Accelerator Fund seeks to speed up the commercialisation of devices and the Wave Hub will provide an ideal platform for many aspects of the technology improvement they envisage.

  5.4  Government, EU and commercial funds are available for generic research and Wave Hub will provide the opportunity to research many areas of concern to stakeholders, regulators and communities. Of particular importance are effects on fish stocks; impacts on marine mammals and sea birds; effects on coastal processes, including shoreline waves used by surfers; establishing procedures to ensure navigational safety and socio-economic impacts.


  6.1  Since 2004, the South West RDA has completed studies into technical feasibility, the business case and economic viability of the project, and has subsequently commissioned the detailed design and an environmental impact assessment. Applications for consent to construct were submitted to the Dti and Defra in June 2006. Negotiations with stakeholders have now been concluded and we understand that the Departments concerned will be determining our applications within the coming weeks.

  6.2  In April 2007, the South West RDA Board resolved to go ahead with the project at a total cost (excluding allowances for depreciation and use of capital) of £27.87 million. The Agency expects this to be part-funded by up to £11.75 million from the Cornwall Convergence programme and has received a conditional offer from the Dti Marine Renewables Deployment Fund of £4.5 million, making the net cost to the Agency of £11.62 million. The costs of operating the project after construction will be met by fees paid by the device developers. The Board's decision is subject to various milestones being achieved before the cable and equipment are ordered, including completion of a site lease, consents being obtained and binding contracts being entered into by at least two device developers. The investment also has to be approved by the DTI and HM Treasury through the Central Projects Review Group.

  6.3  Subject to these requirements being fulfilled, we expect to order the cable and equipment by the end of 2007 and construct the project in 2008, or maybe 2009, depending upon the lead times to obtain the cable and equipment and the availability of cable-laying ships.

  6.4  Four device developers have been selected to work at the Wave Hub following invitations for expressions of interest and interviews to determine their suitability in terms of financial and managerial capability and the amount of testing already completed. All four have completed some level of testing in sea conditions and we are satisfied they have the capacity to proceed with building an array of devices. The South West RDA is working with this group to maximise the linkages with regional and UK suppliers and facilitating their progress wherever possible.


  7.1  Beyond Wave Hub, there are likely to be opportunities for building commercial scale projects off the South West coastline as well as export opportunities for the device developers, their suppliers and knowledge-based consultancies.

  7.2  Unlike offshore wind farms where fishing can safely take place between individual turbines, wave farms will need to exclude all fishing and other maritime activity because of the presence of mooring lines and electrical cables. Development of future sites will therefore require that areas of coastal sea will be set aside for this purpose with other maritime activities expressly excluded. This will require acceptance from commercial shipping interests and leisure craft users that these areas will be denied to them and that safety of navigation can be maintained. Fishermen will see wave farms as a further constraint on their activities. Coastal communities will be concerned to understand any possible effects on coastal erosion, erosion of sand from beaches and any adverse effects on waves used by surfers, an important aspect of the tourist industry. Our environmental impact assessment has predicted all of the latter to be negligible, but actual measurements will prove or disprove this.

  7.3  We expect that the Wave Hub will play an important part in contributing to a greater understanding of these factors and make a contribution to debates about coastal policy and, in due course, marine spatial planning.

July 2007

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