Enough Electricity for Five Times World Demand
2007-04-30
By Nick Hodge
I think Sebastian the Crab, the resident philosopher in The Little Mermaid, captured it best in the theme song “Under the Sea,” when he sang with calypso flair:
Just look at the world around you
Right here on the ocean floor
Such wonderful things surround you
What more is you lookin’ for?
He was definitely on to something.
There really are wonderful things down there--like the potential to supply five times the world’s electricity needs with no fuel costs!
While the world annually consumes roughly 14,000 terawatt hours (tWh) of electricity, the yearly potential electricity generated from tidal currents has been estimated at 80,000 tWh.
And take a look at this:
The only mark against it is its high capital costs. But, as we’ve seen with other renewable energy technologies, these decrease over time.
Fortunately, it’s still early enough for Green Chip investors to get in on this stuff on the ground floor.
So let’s investigate this one further.
Under the Sea
Generating power from ocean currents is essentially the same as generating it from wind. The systems use similar turbines, only they’re powered by water instead of air.
So it’s possible to use already proven components, technology and knowledge gained from the existing hydro and burgeoning wind industries.
Unlike wind, tidal currents and the energy they produce are completely predictable and uninterruptible--a key feature for long-term and widespread success.
And since water is denser than air, tidal turbines can be smaller and require less force to turn, allowing systems to be used in a wide variety of locations.
There are also no land-use or aesthetic issues because the hardware is--like Sebastian the Crab--under the sea.
And we haven’t even talked about price yet.
First, let’s have a look at electricity prices over that last decade or so:
Don’t kid yourself. That uptrend isn’t slowing down anytime soon. Not when over half of the world’s electricity is generated by coal and petroleum. And we know those prices aren’t going down. In fact, since 1998 U.S. prices for steam coal for electricity production have risen 23%, and petroleum prices have swelled by over 360% per barrel.
Of course, this is exactly what the tidal energy industry is banking on. Because electricity generated from tidal current is significantly cheaper.
You see, there’s no fuel charge associated with tidal power. Once the systems are installed and operational, there’s nothing else to pay for except maintenance--unlike plants that run on fossil fuels, which continually have to buy expensive coal, oil or natural gas.
I currently pay $0.1088/kWh for electricity. But with tidal current integration added to the mix, that rate could be slashed by more than half. We’re talking about a competitive rate of a mere $0.04/kWh.
Plus, as the technology matures and with economies of scale, it is likely that costs could be reduced even further.
A Flood of Good News
Just last week we had two big announcements in the realm of marine energy. A bill introduced last Tuesday in the U.S. House of Representatives by Rep. Jay Inslee (D-WA) would provide financial support for research and development of tidal energy solutions.
The proposed legislation, dubbed the Marine and Hydrokinetic Renewable Energy Promotion Act of 2007, would provide tax and investment credits for developing tidal projects.
The bill would authorize $50 million annually in federal funds for research and development starting in 2008.
And on Thursday, a wave farm that will provide free energy to 7,500 homes in Cornwall, England was granted $142 million in funding.
The project will collect energy from wave turbines and meet 3% of Cornwall’s electricity needs. And while this small project alone will make the area a world leader in marine energy production, just wait until some larger projects start coming online.
Forget bullish. This is looking whalish.
Until next time,
Nick
energyandcapital.com |
