MeyGen gets go-ahead
MeyGen, which claims to be the world’s largest tidal stream development, has announced that it has agreed terms for a funding package to finance the construction of the first phase of its 398MW tidal array project in the Pentland Firth, Scotland, UK.
The MeyGen project, owned by tidal power company Atlantis Resources, has successfully led a funding syndicate to raise approximately £50 million which will be used to finance the initial stage of the wider MeyGen project. This initial stage (Phase 1A) will include the installation of 4 X 1.5 megawatt turbines offshore as well as the construction of all onshore infrastructure to support the project, including the onshore power conversion centre and grid connection.
When completed, the project will include up to 269 turbines submerged on the seabed, generating enough energy for 175,000 homes in Scotland. As the first large-scale tidal project of its type in the world to successfully reach a funding agreement, the MeyGen project could be a catalyst for the global tidal power market, potentially signalling the transition of the industry from demonstration projects to commercial arrays.
The funding syndicate includes: Atlantis; the Department of Energy & Climate Change; The Crown Estate; Scottish Enterprise via the Renewable Energy Investment Fund (REIF); and Highlands and Islands Enterprise.
HSBC will be acting as the security trustee and account bank for the project, having also facilitated various guarantees to key stake holders (National Grid Plc and Scottish Hydro Electric Power Distribution Plc) to support the project.
The finance package includes a combination of equity, debt and grants, and 60 percent of the project cost will be invested in the UK supply chain. Significant project supply chain partners will include ABB, Andritz Hydro Hammerfest, Global Energy Group and James Fisher Plc.
As a result, the project has won the support of the Scottish government via Scottish Enterprise’s Renewable Energy Investment Fund, the British government, and The Crown Estate.
Energy Secretary Ed Davey said: “This innovative and exciting project puts Scotland and the UK on the map as a global leader in marine technology – meaning jobs, better energy security and the potential to export this technology to the world.” Perhaps with a slight whiff of the Scottish independence referendum debate, Davey added: “The project also shows what can be done when the UK and Scottish governments work together to provide a lasting benefit for the people of Scotland.”
MeyGen believes that wave and tidal power have the potential to provide more than 20% of the UK’s electricity needs.
By Jake Frith
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