Development and commercialization of marine energy technologies is “taking longer than hoped and costing more money than expected”, a new report from Bloomberg New Energy Finance has found.

The analysis firm has revised its 2020 global installation forecast for the sector downward to 21 MW for wave power, down 72 per cent on its previous forecast, and to 148 MW for tidal power, down 21 per cent.

The ocean energy sector has been “riddled with setbacks and investor fatigue”, BNEF said, although countries including the UK, France, Australia and Canada have continued to support it through incentives.

“Caution is necessary,” said Angus McCrone, BNEF senior analyst. “Taking devices from small-scale demonstrator stage to the pre-commercial array stage is proving even more expensive and time-consuming than many companies and their investors expected.”

In the first half of this year, the report noted, a number of projects have been cancelled due to lack of funding and some companies have shut down altogether. Australian wave energy firm Oceanlinx went into receivership in April; US-based Ocean Power Technologies cancelled its wave project off the coast of Victoria, Australia in July, saying the project wasn’t commercially viable; and Ireland’s Wavebob was liquidated after a two-year search for an investor or strategic partner.  Siemens-backed Marine Current Turbines’ Skerries array in Anglesey, Scotland lost a £10m ($16.6m) UK government grant after project delays breached agreed-on deadlines.

However, BNEF noted that there is still some good news for the sector. UK-based tidal technology and project developer Atlantis Resources received a $10.55m grant from the European Commission’s Seventh Framework Programme for Research and Technological Development; the company also successfully floated a £12m IPO on the London stock exchange. Andritz Hydro Hammerfest has produced significant power with its 1 MW tidal device at the European Marine Energy Centre (EMEC) in Orkney, Scotland, as has Alstom with tidal turbines from the former Tidal Generation Ltd (TGL) (pictured), which Alstom acquired in 2013. And project developer Tidal Lagoon Swansea Bay is awaiting notice from the UK government on permitting and subsidy support for a 320 MW project off the Welsh coast.

Commenting on BNEF’s findings, Dee Nunn, Wave and Tidal Development Manager at British wind and marine energy trade body Renewable UK, told PEi that “there’s clear evidence that the marine energy sector is continuing to take significant strides forward”.

“As the industry expands, it’s inevitable that some companies will forge ahead with projects coming to fruition, while others fall by the wayside for various financial and technical reasons  –  that’s the case in every single sector, and has been so ever since the Industrial Revolution began,” she said.

Referring to the UK’s world-leading position in the ocean energy sector, Nunn added: “No one should make the mistake of underestimating the UK’s achievements as well as our potential – there’s no denying the direction of travel that’s already firmly established here in the UK for the marine energy industry and we must strive to maintain this lead as other countries like France, Canada and Ireland begin to recognize the economic and environmental benefits of wave and tidal energy.”

Nunn pointed to further recent successes for the sector, such as Tidal Energy’s unveiling last week of its Delta Stream device; Nova Innovation’s deployment of the world’s first community-owned tidal generator in Scotland; Seatricity’s wave energy device beginning testing at the WaveHub testing centre in Cornwall, and Pelamis’s P2 tidal devices reaching 10,000 hours of grid-connected operation at EMEC.

“The industry is focussing hard on cost reduction too,” she added.  “For example, this month the SubHub project in Edinburgh, Scotland won over half a million pounds of funding to bring down the cost of installing tidal turbines. These are ground-breaking, cutting-edge projects which will help us to maintain the UK’s global lead in wave and tidal energy.”