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With $1.2 billion of capital expenditure forecast between 2011 and 2015, wave & tidal current stream is entering a commercial period. Small commercial projects are starting to be realized with a dramatic increase towards the end of the forecast period. This increase is led in large part by the UK’s first licensing round, which has encour- aged large projects to come forward from utility compa- nies. A growing number of wave and tidal current stream technologies have progressed to a near-commercial status. The next two years will be vital in creating an investment environment that allows the financial community to fund these projects and to invest in the necessary supply chain. Market forecasts A total of 150MW of wave and tidal current stream capacity is forecast to be installed between 2011 and 2015. Installations in 2011 are more than double those in 2010 and further rapid growth will take place as more devices are installed at full-scale and the first commercial projects start coming online. Commercial projects take- off noticeably in 2014 when installations more than dou- ble. Installations are set to increase further in 2015. There is some upside potential given that developers have not in all cases planned projects beyond their pre-commercial devices. The largest market is the UK, which is set to install 110MW of wave and tidal current stream projects over the next five years. An excellent wave and tidal resource, together with encouraging levels of government funding, market mechanisms and site licensing make the country the strongest market for both wave and tidal. Driven by a strong tidal resource, strong R&D and support, Canada is the second largest market. The USA is also making progress, again with much R&D funding attracting devel- opers. Split by sector, it is evident that tidal current stream installations are expected to be greater than wave (91MW against 59MW) over the next five years. Over $1.2 billion of capital expenditure (capex) is expected in the 2011-2015 period. This is six times greater than the $188 million spent over the previous five years. The big increases in 2014 and 2015 are due to the first significant commercial projects coming online. The UK is by far the biggest market; capex here will reach almost $900m across the next five years, with annual expenditure topping $500m in 2015. Split by sector, tidal current stream projects will see almost 54% more expenditure than wave. The tidal sector is expected to see capex of close to $750m over the next five years, with annual expenditure of over $260m by the end of the period. Wave energy projects will see expendi- ture of almost $500m over the 2011-2015 period with annual spend reaching $250m in 2015. 24 MTR June 2011 World Wave& Tidal Market With $1.2 billion of capital expenditure forecast between 2011 and 2015, wave & tidal current stream is entering a commercial period. Small commercial projects are starting to be realized with a dramatic increase towards the end of the forecast period.
