Greetings from Washington! We hope that the New Year finds you well. As we finalize our annual year end water power report, the U.S. Federal Government has experienced its first shutdown in over five years. The partial closure seems a fitting end to what was a unique year here in the nation's capital. Despite facing multiple challenges, we had great success working with our Congressional champions, industry partners and other interested parties to increase federal investments in water power. Many of SMI's clients received some level of support in 2017 to develop new technologies, build testing infrastructure and expand research capabilities.
Since our last update, we continue to lobby Congress to provide robust funding for water power activities at the U.S. Department of Energy and important U.S. Navy programs to test and develop marine energy systems for a variety of national security applications. We have also engaged program staff to ensure the DOE Water Power Technologies Office is focused on the industry's priorities.
While most federal R&D accounts are under pressure given the substantial budget cuts proposed last year by President Trump, water power has been one of the areas which has seen strong bipartisan support from Republicans and Democrats alike. We are fortunate that Members of Congress and staff from both parties go above and beyond to help support commercialization of advanced water power generation technologies because they view these federal investments as a potential game changer.
We are encouraged by some notable recent industry successes overseas, which include marine energy systems producing electricity such as the Scotrenewables SR250 and the Sustainable Marine Energy PLAT-I. Recent news on marine energy projects from around the world can be found at RENews - Wave and Tidal or the IEA-Ocean Energy Systems Country Reports. You can also find updates on the PNNL Tethys or the DOE Water Power News sites.
Please contact us if your company or organization could benefit from SMI's federal marketing and lobbying services. We have a proven track record of successfully supporting companies and other entities in the marine energy sector. In addition, please consider joining the National Hydropower Association's Marine Energy Council. The MEC provides important industry leadership and advocacy here in Washington, as well as valuable information and the potential for new partnerships that can be helpful to your organization's growth prospects.
We appreciate your continued interest in water power and marine energy. Best wishes for a productive and successful 2018!
Damian Kunko and Paul Gay
Notes from the 2017 Ocean Energy Europe, Marine Renewables Canada Conference, and the DOE Alternative Markets Forum
The Ocean Energy Europe conference in October 2017 was well attended and we counted representatives from 25+ technology developers. Even with Brexit looming, the mood was fairly optimistic and much improved from a few years ago when Pelamis and Aquamarine Power were going out of business. The E.U./regional ministers representing the energy and economic development positions for their respective governments all mentioned that they were motivated by the opportunity to tap into a projected $50 billion marine energy market by 2050. We conservatively estimate that there is at least $250M+/yr in both private and public funding being spent on R&D/commercialization efforts in Europe.
There were at least 70 exhibitors and several country pavilions that hosted their technology developers and related supply chain. It is still clear that the E.U. continues to lead the marine energy sector with tidal arrays being installed and several wave energy technologies being tested at EMEC and other test sites. However, several developers expressed the potential need to leave the U.K. should they not be able to participate in E.U. R&D funding calls, which could be an opportunity for the U.S.
U.S. representatives at the conference included Reenst Lesemann (Columbia Power), Mary Ann Adonizio (Verdant Power), and Alejandro Moreno (DOE). Mary Ann gave an update on Verdant's New York RITE project and Alejandro covered the DOE WPTO history and progress. Alejandro did a great job representing U.S. interests, DOE's projects and future plans. Overall, the OEE conference agenda was well thought out and we hope to emulate some of the topic areas into IMREC/Water Power Week - April 30 - May 2nd.
We attended the annual Marine Renewables Canada conference last November. The conference program is here. There were at least 150 attendees and 12 exhibitors. There was significant federal and provincial leadership at the event and the main focus continues to be on the Bay of Fundy tidal energy projects. It was apparent that the Trudeau administration has had a stimulating effect on RE projects and plans to invest $200M in new funding for emerging renewable energy technology demonstrations - some likely targeted at supporting devices going into FORCE/Bay of Fundy. The tidal energy technology developers represented at the conference included Open Hydro/DCNS, Schottel/Blackrock, and Scotrenewables. Project developer/financier DP Energy also attended. Other companies with interesting projects included Big Moon Power, Waterotor, and Mavi Innovations. Waterotor was the only technology developer with an exhibit and a pre-commercial test unit.
In December, we attended the DOE Alternative Markets Forum in Washington DC. It was great to see the WPTO bring together experts from high potential niche markets for marine energy technologies. Topics of discussion included markets related to Micro and Macro Algae; Aquaculture; Ocean Observation/Navigation; Resident Autonomous Underwater Vehicle/Unmanned Underwater Vehicle Recharging; Desalination of Seawater; and, Seawater Mineral Extraction. Click here for additional information and forum topic background notes.
As for 2018, in addition to the annual Marine Energy Conference in Washington, we look forward to attending ICOE next year in Cherbourg, Normandy - June 12-14. We believe the excellent marine energy development efforts underway in France, the U.K, Spain and other countries will give fresh perspective on future growth opportunities in the U.S. We are hoping the U.S. can send a significant delegation to the conference in order to see first-hand the progress being made in Europe to develop a vibrant marine energy industry.
DOE Water Power Funding for FY 2018
As we reported in our last newsletter, it took the 115th Congress and the new Trump Administration the first four months of 2017 to finalize the funding levels for the remaining five months of Fiscal Year 2017, which concluded on September 30, 2017. However, the end result was a substantial win for the water power industry with the highest levels of federal investments in technology R&D seen since the program was restarted in Fiscal Year 2008.
Given this increase in funding for water power, we were disappointed to see President Trump propose drastic funding cuts to various research and development accounts across the federal government in his Fiscal Year 2018 budget. For example, President Trump proposed a $64 million cut to the Water Power Technologies Office, from $84 million to $20 million. Such a reduction would greatly impact efforts to foster a domestic marine energy industry and development of new water power technologies.
Fortunately, working with our clients and other supporters, we have been able to rally our growing list of bipartisan water power Congressional champions to block President Trump's harmful proposed cuts and position the WPTO to maintain level funding from Fiscal Year 2017. See our last report for more details on funding allocations. This would be a great success and we appreciate the Members of Congress and staff who have helped to make it happen! For more information on specific programs and how Congress allocates funding for various research initiatives, please contact Damian or Paul.
National Defense Authorization Act - Marine Energy Support
SMI worked closely with our clients and other interested parties during consideration of the annual defense authorization bill to secure favorable legislative language to ensure the U.S. Navy continues to support development of marine energy technologies. Special thanks to our congressional champions, including House Armed Services Committee Ranking Member Rep. Adam Smith (D-WA), for inserting language helpful to the marine energy industry (see below). The FY 2018 defense authorization bill was signed into law December 12th, 2017.
"Marine and Hydrokinetic Technology - The committee is aware of the U.S. Navy's vision in the 30-year research and development plan for supporting energy harvesting, undersea sensor nets, and unmanned underwater vehicle operations. In order to conduct many of the development and research projects planned by the Navy, the committee recognizes the need to have sufficient infrastructure to not only test, but also to do a broader range of experimentation, prototyping, and development that will be necessary for future naval capabilities. The committee encourages the Navy, in coordination with its other Federal partners, to continue its support for the development of marine and hydrokinetic technologies, including research, testing, and demonstration of maritime security systems, at-sea persistent surveillance and communications systems, and unmanned undersea vehicle charging. The committee believes that support from existing facilities, such as the Navy's Wave Energy Test Site in Hawaii and other research facilities that are supporting marine and hydrokinetic energy systems technology development, will be critical to developing the naval force of the future."
Department of Defense FY 2018 Marine Energy Funding
SMI led the effort to ensure Congress provided $25 million in the FY 2018 Defense appropriations bill for the U.S. Navy to support Alternative and Renewable Energy research and development. These funds include the Navy's various marine energy investments, such as the Wave Energy Test Site in Hawaii and other programs nationwide. These investments are important for developers to access as there are no cost-share requirements. The defense appropriations bill has been approved by the House of Representatives but awaits further action as part of the final negotiations on Fiscal Year 2018 funding. For more information on these research programs and funding allocation, please contact Damian or Paul.
Energy and Natural Resources Act - Future Action in 2018?
Last year, Senator Lisa Murkowski (R-AK), Chair of the Senate Energy and Natural Resources Committee, and Senator Maria Cantwell (D-WA), the committee's Ranking Member, introduced a revised bipartisan energy bill, the Energy and Natural Resources Act (S. 1460), with the hope of Senate passage before the end of 2017. This legislation is similar to the energy bill that was nearly finalized during the closing days of the Obama Administration late in 2016. The legislation includes Senator Wyden's Marine Energy Act (S. 1036), which authorizes $300 million in future federal investments to support R&D activities for marine energy technology commercialization efforts. We expect another attempt to move this legislation in 2018 - potentially as part of a so called "Infrastructure Package." We will continue to work with our Congressional champions to ensure support for the marine energy industry. Please contact us if you have any interest in how this process works and impacts it may have on the development of a marine energy market in the U.S.
SMI is a full-service government relations firm that provides clients with consulting services focused on strategic marketing and capturing federal funding. SMI is dedicated to helping clients develop and demonstrate clean energy technologies through government program and industry marketing support. Our experienced team works with the Federal Government to secure funding and shape policy as well as promoting legislation that encourages clean energy development and deployment.
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