Minesto’s technology transforms ocean energy into one of the most cost-effective energy resources, new Cost of Energy analysis states

October 12, 2017

An updated Cost of Energy analysis of Minesto’s unique ocean energy technology shows substantial improvements compared to previous estimates.
“These new results convince me that our technology is transforming ocean energy into one of the most cost-effective energy resources”, said Dr Martin Edlund, CEO of Minesto.

As part of its first commercial-scale project, Minesto together with ITPEnergised has completed an updated Levelized Cost of Energy (LCOE) analysis of Minesto’s marine energy converter based on new knowledge of the system, its potential and its costs.

Projections now show that Minesto’s LCOE will already fall to €100/MWh after 100MW cumulative installed capacity in tidal streams. Previous estimates showed a 50% higher cost level. This means that Minesto’s technology already at an early stage will be more cost effective than established energy such as new nuclear power.

Installing arrays of Minesto devices in continuous ocean currents, providing a much higher capacity factor than tidal streams, will have an even greater impact on the LCOE, with costs falling below €50/MWh following the installation of 100MW cumulative capacity.

“This claim is unique in the ocean energy industry – but so is our technology. It is the only known and verified marine energy product that can be deployed in continuous low-flow ocean currents, providing cost-effective renewable base load power generation to grids both large and small all over the world”, said Dr Martin Edlund, CEO of Minesto.

He continued: “These new results convince me that our technology is transforming ocean energy into one of the most cost-effective energy resources. The figures are underpinned by our light-weight design, our unique operations and maintenance concept and the fact that we will be operating at low-flow sites. It should also be noted that this analysis is based on conservative learning rates and initially high operating and maintenance cost levels expected from all new innovative solutions.”

The substantial LCOE improvement has two main drivers, said Dr Edlund: “First, the expected performance of each system has improved. This can be attributed to our quarter-scale test results, new simulations data and a new verified turbine blade design developed in-house. Secondly, our operating and maintenance concept has improved considerably.”

Commenting on the updated LCOE analysis, Dr Ned Minns, Offshore Group Manager at ITPEnergised said: “Minesto compare well to other tidal energy technologies, with significantly lower capital costs. Their cost reduction trajectory in the coming years is on the conservative side due to the cautious assumptions used throughout. Their forecast learning rate matches the prediction by SI Ocean*, however it is only half of that recently achieved by offshore wind and solar, according to Bloomberg**. High levels of learning are more readily achieved by innovative designs like Minesto’s, and if they follow the path of offshore wind and solar, their cost reductions could be achieved sooner than predicted in the model.”

“Minesto’s diligence when using the most accurate data available, and creating a model based on standard practice, has led to the creation of an extremely thorough Cost of Energy forecast model which probably doesn’t have an equal in the industry”, Dr Minns added.

* Strategic Initiative for Ocean Energy, a project coordinated by Ocean Energy Europe in close cooperation with the European Commission's Joint Research Centre, the UK Carbon Trust, Portugal's Wave Energy Centre, Edinburgh University, Renewable UK and DHI.

** Bloomberg New Energy Outlook 2017

For additional information please contact:

Dr Martin Edlund
CEO, Minesto AB
+46 31 29 00 60
press@minesto.com 

Magnus Matsson
Communications Manager, Minesto AB
+46 70 570 75 08
press@minesto.com

Background: Minesto’s Cost of Energy model and technology development milestones

Minesto’s Cost of Energy model was originally developed in collaboration with ITPEnergised in 2015. It is based on a combination of the Carbon Trust and SI Ocean methodologies, both widely used in the tidal industry, to calculate the LCOE of Minesto’s ocean energy technology. The model is used both as a LCOE calculator and a forecaster, enabling the prediction of the LCOE through the development of new generations of Minesto devices over time. 

Functionality and power production of Minesto’s technology have been verified in ocean testing of scale prototypes. To date, five prototypes have been built and tested, and electricity was first produced in 2009.

The first test of the technology in authentic ocean environment was completed at Minesto’s test and demonstration facilities in Strangford Lough, Northern Ireland by the end of 2011. In 2013, a 3-meter wing prototype was deployed and that scale has since that been undergoing extensive testing in the tidal streams of Strangford Lough.

Minesto's research and product development plan is to continue prototype testing in Northern Ireland, and in parallel build and commission a 0.5MW device in Holyhead Deep, Wales. The purpose is to demonstrate Minesto’s marine energy converter in commercial-scale. This installation, planned to 2018, will be followed by a gradual expansion to a multi-turbine array. In February 2017, Minesto announced plans to expand the installed capacity in Holyhead Deep to 80MW.

About Minesto

Minesto is a marine energy technology company with the mission to minimise the global carbon footprint of the energy industry by enabling commercial power production from the ocean.

Minesto’s award winning and patented product, called Deep Green, is the only verified marine power plant that operates cost efficiently in areas with low-flow tidal streams and ocean currents.

In May 2015, Minesto secured a €13m investment from the European Regional Development Fund through the Welsh European Funding Office, for the commercial rollout of Deep Green.

Minesto was founded in 2007 and has offices in Gothenburg, Sweden, Holyhead, Wales and Portaferry, Northern Ireland. The major shareholders in Minesto are BGA Invest and Midroc New Technology. The Minesto share (MINEST) is traded on the Nasdaq First North Stockholm stock exchange, with G&W Fondkommission as Certified Adviser.

Read more about Minesto at www.minesto.com

Press images and other media material is available for download via bit.ly/minestomedia.

About ITPEnergised

ITPEnergised is a leading international consultancy offering renewable energy, natural resources, environmental, engineering, technical advisory and asset management services for clients with onshore and offshore projects.

ITPEnergised’s expertise in offshore energy projects dates back to 1991 and this experience in the sector allows the company to offer comprehensive, technical consultancy on offshore engineering design and due diligence. ITPE offers a range of project support services to project developers as well as providing strategic advice to private clients on their market business plans and governmental agencies on their techno-economic feasibility assessments for offshore energy.

Following Energised Environments Limited's acquisition of Bristol-based IT Power Consulting Limited in mid-2016, the merged businesses have been re-branded as ITPEnergised.

Read more about ITPEnergised at www.itpenergised.com

The information in this press release is such that Minesto AB (publ) shall announce publicly according to the EU Regulation No 596/2014 on market abuse (MAR). The information was submitted for publication, through the agency of the contact person set out above, at 09:00 CEST on 12 October, 2017.