Case Study : How Can Ireland Become The Prime Mover In Wave Energy?Green Energy ExpMay, 2010
Harvey Appelbe
© Vattenfall AB
Case study: Tonn Energy
• Background: who are we?
• Day 1: what we expected?
• Year 1: what happened
• Year 2: what is happening
© Vattenfall AB 2
• Year 2: what is happening
• Year ?: what could happen
Europe’s main electricity companies
European electricity generation TWh Net sales, EUR billions
90
80
70
60
50
Background: Who are Vattenfall?
© Vattenfall AB© Vattenfall AB 29
40
30
20
10
0
€18B170 TWh
Five strategic ambitions
Number One forthe Environment
Number One for the Customer
Background: Who are Vattenfall?
© Vattenfall AB© Vattenfall AB 11
Employer of Choice
Benchmark for the Industry
Profitable Growth
A substantial contribution to sustainable development is essential for trust and for licence to operate and grow.
• New low-emitting energy generation• Increased efficiency of existing production• R&D to reduce CO emissions and
Number One for the Environment
Background: Who are Vattenfall?
© Vattenfall AB© Vattenfall AB 13
• R&D to reduce CO2 emissions and increase renewable energy
• Promotion of global and market-oriented climate solutions
Profitable Growth
Size carries strategic advantages.Profitable growth is vital forcompetitiveness and sustainedeconomic value.
• Organic expansion – construction of new plants, upgrading and renewal
Background: Who are Vattenfall?
© Vattenfall AB© Vattenfall AB 14
new plants, upgrading and renewal of existing plants
• Acquisitions in priority markets – the UK, the Benelux countries, France and Central Europe
• Business development – focus on efficient use of energy and biomass fuels
Making electricity clean
Strategic direction over the coming decades
• Reducing environmental impact from all operations
• Emphasising the important role of electricity in the future sustainable society
Commitment to customers and society
Background: Who are Vattenfall?
© Vattenfall AB© Vattenfall AB 18
Commitment to customers and society
• Operations climate-neutral by 2050 (by 2030 for the Nordic operations)
• 50 per cent reduction in emissions from own operations by 2030 compared with 1990
Climate goals integrated in business strategy
• Long-term profitable growth needed to realise vision
Expanding generation, expanding renewables
2008 2030
23,1
44,1
15%
40%
170 TWh
CoalCCS
Coal
Background: Why Ocean Energy?
© Vattenfall AB 8
30,42,4
44,1
Coal Gas Nuclear Coal CCS Renewables
20%
20%
5%
Coal
GasNuclear
Renewables
Vattenfall’s CO 2 emissions roadmap
Background: Why Ocean Energy?
© Vattenfall AB 9
- Technology?- Politics?- Economy?
Vattenfall’s targetReduce emissions by 50% from 1990 to 2030
2030 – 2050: 100% emission neutral
Vattenfall wants to grow and intends to be climate neutral in 2050: “making electricity clean”
Options include ...• Nuclear power; where it is accepted• Efficient and smart energy consumption
Background: Why Ocean Energy?
© Vattenfall AB 10
• Efficient and smart energy consumption• Smart grids that can handle renewable generation
...and lots of new renewable energy ... • Offshore Wind Power • CCS-technology• Ocean Energy
Global Ocean Energy (Winter)
Background: Why Ocean Energy?
© Vattenfall AB 11
Ocean Energy projects
Background: Why Ocean Energy?
© Vattenfall AB 12
Previous or existing devicePlanned future scheme
Vattenfall’s Ocean Energy Program
Program Management
Administration &
Steeringcommitté
Ulf Tisell
Dr. Lars StrömbergGöran Lundgren
Owner Dr. Helmar Rendez
Annika Andersson (L)Gunilla Andrée (L)Magnus Andersson (T/P/S)Fredrik Carlsson (T)Katarina Eriksson (L)Erik Fröberg (P/T)Anders Johnsson (P)Jonas Gidlund (T/P/S)Pehr Hjalmarsson (P)
(T) Technology & Grid(L) Localisation & Environm.(P) Pilote projects(S) Site development
Background: The Ocean Energy Program
© Vattenfall AB 13
ManagementAdministration &Communication
Localisation &environment
Technology &grid
Pilotprojects
Sitedevelopment
Per Holmberg Kristin Andersen José SilvaOskar Danielsson
Urban Henfridsson
Lars UgglaBirgitta Berglöw
Ulf Tisell
Vattenfall competence pool
Pehr Hjalmarsson (P)Tor Isdal (S)Thommy Karlsson (P)Niclas Christoffersson (T/P/S)Dean McGowan (L)Thomas Olsson (L)Jonas Persson (T)Daniel Salomonsson (T)Erik Segergren (T/S)Marco Sipi (P)Erik Sparrevik (L/P)Lovisa Stenberg (T)Kerstin Strandanger (T/P/S)Kristian Toresson (T/S)Kjell Wester (L)
Cheese
Background: The Ocean Energy Program
© Vattenfall AB 14
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30
2010 2011 2012 2014 2016 2018 2019 2020 20212009
Demo PhaseGrid Connected
Commercial PhaseProfitable
2022
Pilot Phase
Learning curve
€ct/kWh
Background: The Ocean Energy Program
© Vattenfall AB 15
0
5
10
15
20
25
0 250 500 750 1000 1250 1500 1750 2000 2250 MW
Carbon Trust 2006, 10-15 % learning rate
*
Vattenfall Estimation
Vattenfall Estimation
ScotlandIreland
Sweden
30
2010 2011 2012 2014 2016 2018 2019 2020 20212009
Demo PhaseGrid Connected
Commercial PhaseProfitable
2022
Pilot Phase
Learning curve
€ct/kWh
Background: The Ocean Energy Program
© Vattenfall AB 16
0
5
10
15
20
25
0 250 500 750 1000 1250 1500 1750 2000 2250 MW
Carbon Trust 2006, 10-15 % learning rate
*
Vattenfall Estimation
Vattenfall Estimation
ScotlandIreland
Sweden
2000 MW
The work
Environmental impact certainty
Operation in real marine climate.
Hard to predict the economics (incl O&M)
Background: The Ocean Energy Program
© Vattenfall AB 17
economics (incl O&M)
Transmission grid capacity and upgrade.
Subsea super grid to be developed.
Public and local appetite
Early days. Back several horses.
Background: The Ocean Energy Program
© Vattenfall AB 18
Seabased
Pelamis
Wavebob
Technology / technologies proved to gain best economical result
Vattenfall - Proof of concept 10-20 MW per plant
Wavebob
• Do pilot tests• Establish sites• Increase know-how
• Demonstrations• Site Development
Commercialwave and tidal
farms
2010 2011 2019 2020 20212009 20222012 2013 2017 2018
The race
Background: The Ocean Energy Program
© Vattenfall AB 19
to gain best economical result
On markets with the best commercial conditions
100-200 MW 100-200 MW
10-20 MW per plant
Making use of national market support schemes
Pilot tests Demonstrations
Seabased
Pelamis
Technology / technologies proved to gain best economical result
Wavebob
• Do pilot tests• Establish sites• Increase know-how
• Demonstrations• Site Development
Commercialwave and tidal
farms
2010 2011 2019 2020 20212009 20222012 2013 2017 2018
Tonn Energy is Ireland in this race.
Proof of concept arrayInvestigatePrepare
Background: Tonn Energy
© Vattenfall AB 20
to gain best economical result
On markets with the best commercial conditions
100-200 MW 100-200 MW
Making use of national market support schemes
Pilot tests Demonstrations
Seabased
Pelamis
Proof of concept arrayLearn more
PrepareLearn
Criteria
• Scalable Technology
• Wave climate
• ”Full load hours”
• Technical availability
Day 1: What we expected
© Vattenfall AB 21
• Technical availability
• Incentives
• Open for business
• O&M strategy
Criteria
• Scalable Technology
• Wave climate
• ”Full load hours”
• Technical availability
Day 1: What we expected
© Vattenfall AB 22
• Technical availability
• Incentives
• Open for business
• O&M strategy
Criteria
• Scalable Technology
• Wave climate
• ”Full load hours”
• Technical availability
Day 1: What we expected
© Vattenfall AB 23
• Technical availability
• Incentives
• Open for business
• O&M strategy
Mullaghnmore Head, Ireland: 1 December 2007
14m waves recorded at wave bouys.
© Vattenfall AB
Criteria
• Scalable Technology Wavebob
• Wave climate
• ”Full load hours”
• Technical availability
50 KW/m wave
3000 – 5000 hours
60 – 80%
Day 1: What we expected
© Vattenfall AB 25
• Technical availability
• Incentives
• Open for business
• O&M strategy
60 – 80%
220 €/MWh
Criteria
• Scalable Technology Wavebob
• Wave climate
• ”Full load hours”
• Technical availability
50 KW/m wave
3000 – 5000 hours
60 – 80%
Day 1: What we expected
© Vattenfall AB 26
• Technical availability
• Incentives
• Open for business OE Strategy
• O&M strategy
60 – 80%
220 €/MWh
Criteria
• Scalable Technology Wavebob
• Wave climate
• ”Full load hours”
• Technical availability
50 KW/m wave
3000 – 5000 hours
60 – 80%
Day 1: What we expected
© Vattenfall AB 27
• Technical availability
• Incentives
• Open for business OE Strategy
• O&M strategy ?!
60 – 80%
220 €/MWh
Ocean Energy - Main focus on wave power
UK 840 TWh
Ireland 525 TWh
Norway 500 TWh
Portugal 80 TWh
Denmark 30 TWh
Sweden 30 TWh
Germany 5 TWh
Wave Power Potential Huge potential in our part of the world
Several technologies brought to our attention
Three Business Groups as of 2009
Vattenfall Nordic(Sweden, Finland, Denmark)
Vattenfall Pan -Europe
Setup
Day 1: What we expected
© Vattenfall AB 28
Portugal 80 TWh
Vattenfall´s Core Market
A little bit more lasting and predictable than
wind
Our ambition is 30 TWh/afor 2030
© Vattenfall AB 21
Vattenfall Central Europe(Germany and Poland)
Vattenfall Pan -Europe(Wind, Nuclear, Engineering)
Roadmap
Year 1: What happened
Growth / Maturity
€CommercialViability
OperationalFeasibility
TechnicalReliability €
© Vattenfall AB 29
?000MW
West Coast
250MW
Site 1
Commercialisation
5MW
Belmullet
Graduation
i1MW
Galway
TechnicalFeasibility
Incubation
i
€
Graduate Project
Year 1: What happened
© Vattenfall AB 30
Graduate Project
�Environmental Impacts
�Commercial Fisheries
�Recreation users
�Shipping navigation
�Infrastructures (ports, roads)
Year 1: What happened
© Vattenfall AB 31
�Public concern and opinion
�Seascape
�Archaeology and heritage
�Survivability
�Operation & maintenance
Graduate Project Permit Plan
Year 1: What happened
H1 H2 H3 H4
Project Management
Foreshore License
License application successful
On-shore planning
Environmental Impact
AssessmentMarine Archeology
Foreshore Lease
Design specifications
Foreshore Lease
© Vattenfall AB 32
Marine Archeology
ESB Network Application
Technical specifications
CER License to construct
CER License to generate
Power purchase agreement
Health & Safety
Community Engagement
PR Compaign
Public Information Campaign
InsuranceSupply chain & Logistics
Deployment specifications
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEU
DAFF
ElectricalConnection
© Vattenfall AB 33
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 34
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 35
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 36
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 37
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 38
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Consenting agencies
Year 1: What happened
DCENR
CER
SEI
ESBn
Eirgrid
MarineForeshoreLease
Licence toConstruct
OEDU
DAFF
ElectricalConnection
© Vattenfall AB 39
DHELG
DúchasUAU
CoCo
AnBord
UdarásCommunity
Planning
EnvironmentalImpact
CommunityAcceptance
DoCRGA
Go
Wait
Stop
Project Management
Foreshore License
License application successful
On-shore planning
Environmental Impact
AssessmentMarine Archeology
Foreshore Lease
Design specifications
Graduate Project Permit Plan
Year 1: What happened
Foreshore Lease
H1 H2 H3 H4
© Vattenfall AB
Marine Archeology
ESB Network Application
Technical specifications
CER License to construct
CER License to generate
Power purchase agreement
Health & Safety
Community Engagement
PR Compaign
Public Information Campaign
InsuranceSupply chain & Logistics
Deployment specifications
40
Solution
Year 2: What is happening
VendorDevices
WaveClimate
SubseaCables
Substation
ESBnConnection
DeviceArray
WaveClimate
SubseaCable
Substation
ESBnConnection
© Vattenfall AB 41
LandLease
On landPlanning
Connection
CERPermission
ForeshoreLease
EIS
LandLease
On landPlanning
Connection
CERPermission
ForeshoreLease
EIS
SEAI Tonn Energy
Collaboration
Year 2: What is happening
PartnerDevices
DedicatedCables
ESBnConnection
CERPermission
DeviceArray
WaveClimate
SubseaCable
ESBnConnection
CERPermission
VendorDevices
WaveClimate
SubseaCables
Substation
ESBnConnection
DeviceArray
WaveClimate
SubseaCable
Substation
ESBnConnection
© Vattenfall AB 42
Permission
ForeshoreLease
Substation
LandLease
On landPlanning
Permission
EIS
LandLease
On landPlanning
Connection
CERPermission
ForeshoreLease
EIS
LandLease
On landPlanning
Connection
CERPermission
ForeshoreLease
EIS
SEAI Tonn Energy Collaboration
Collaboration
Year 2: What is happening
© Vattenfall AB 43
5MW: Belmullet
© Vattenfall AB 44
Roadmap
Year ?: What could happen
Growth / Maturity
€CommercialViability
OperationalFeasibility
TechnicalReliability €
© Vattenfall AB 45
?000MW
West Coast
250MW
Site 1
Commercialisation
5MW
Belmullet
Graduation
i1MW
Galway
TechnicalFeasibility
Incubation
i
€
2040
Year ?: What could happen
Scot
Scan
© Vattenfall AB 46
IRL
Iberia
2040
Year ?: What could happen
Scot
Scan
10GW
© Vattenfall AB 47
IRL
Iberia
10GW
$3B pa
2040
Year ?: What could happen
© Vattenfall AB 48
2030
Year ?: What could happen
Scot
Scan
5GW
© Vattenfall AB 49
IRL
Iberia
5GW
$1.5B pa
2030
Year ?: What could happenHallHallHallHallå
© Vattenfall AB 50
2020
Year ?: What could happen
Scot
Scan
© Vattenfall AB 51
IRL
Iberia
0.5GW
2020
Year ?: What could happen
Scot
Scan
© Vattenfall AB
0.5GW
52
IRL
Iberia
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Learnings
SEA/OREDP
Reorganisation
Awareness Consultation
Test Site
Environmental
Spatial Planning
Permitting
Public Attitude
© Vattenfall AB 53
Allocation
Consenting
Permitting
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Learnings
SEA/OREDP
Reorganisation
Awareness Consultation
Test Site
Environmental
Spatial Planning
Permitting
Public Attitude
© Vattenfall AB 54
Analysis
Allocation
Consenting
Construction
Design
Grid Access
Permitting
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Learnings
SEA/OREDP
Reorganisation
awareness Consultation
Test Site
Environmental
Spatial Planning
Permitting
Public Attitude
© Vattenfall AB 55
Analysis
Allocation
Consenting
Construction
Design
Grid Access
Permitting
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Learnings
SEA/OREDP
Reorganisation
awareness Consultation
Test Site
Environmental
Spatial Planning
Permitting
Public Attitude
© Vattenfall AB 56
Analysis
Allocation
Consenting
Construction
DesignEvaluation
Construction
Design
Consenting
Grid Access
Permitting
Industrial Development
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Learnings
SEA/OREDP
Reorganisation
awareness Consultation
Test Site
Environmental
Spatial Planning
Permitting
Public Attitude
© Vattenfall AB 57
Construction
Analysis
Allocation
Consenting
Construction
DesignEvaluation
Design
Consenting
Grid Access
Permitting
Industrial Development
Timeline
Year ?: What could happen
2010 2012 2016 20202014 2018
Test Site
Environmental
Learnings
SEA/OREDPSpatial Planning
Permitting Reorganisation
awarenessPublic Attitude Consultation
© Vattenfall AB 58
AnalysisGrid Access
PermittingAllocation
Consenting
Construction
DesignIndustrial Development Evaluation
Design
Consenting
InfrastructurePlanning
Policy/mobilise
Construction & development
Construction
If climate change is still a problem...
Utilities like Vattenfall will develop wave farms of utility scale.
Vattenfall, on its own, have ambitions for some 30TWh for 2030+
This means a CAPEX of some €15B - €20B, and
© Vattenfall AB 59
This means a CAPEX of some €15B - €20B, and an annually O&M cost of some €0,5B:• Boats / seamen• Workshop / mechanics• Workshop / electricians
Initially half in Ireland, half in Scotland?
HELP!
Case study: Tonn Energy
• Background: who are we? An example multi-national looking to invest
• Day 1: what we expected? Great resource, & open for business
• Year 1: what happened Opening for business
• Year 2: what is happening Open for collaborative work
Summary
© Vattenfall AB 60
• Year 2: what is happening Open for collaborative work
• Year ?: what could happen Jigsaw pieces fall into placeBe the most open for businessBe the earliest
Be the best. Take the opportunity.
Take the opportunity....
• 2010, formulate a spatial plan (SEA/OREDP) for Ocean Energy
• 2011, allocate some sea floor to earnest, qualified developers.
• 2012, design and plan the grid capacity required to these sites
• 2013, commence construction of the grid capacity
Summary
© Vattenfall AB 61
• 2013, commence construction of the grid capacity
• 2014, commence construction of the infrastructure (ports, workforce...)
• 2014-16, go through the consenting process for these projects
• 2017, ramp up to employment, construction and deployment
• 2020, be the first country to have an open, effective process and 500MW