OES Annual Report 2012 - Ocean Energy Systems

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Support Initiatives and Market Stimulation Incentives
During this past year a variety of market stimulation activities were introduced that will continue to be
pursued in 2013. First, the re-authorization of the Marine Renewable Energy Promotion Act proposes:
higher funding levels to DOE, the creation of a new adaptive management program, and the prioritization
of a device verification program that would accelerate commercialization. Additionally, the Act includes
companion tax legislation that provides a five-year tax depreciation schedule to MHK – an incentive currently
available to other renewable energy technologies. Furthermore, Department of Defense appropriators and
members of the Armed Services committees are collaborating to develop language that would help the
U.S. Navy to formalize its MHK R&D efforts, and provide additional funding for these activities under the
Navy energy program office. In addition, a number of states have authorized clean energy incentives that
further support water power development. To compile these efforts, DOE maintains a Database of State
Incentives for Renewables and Efficiency (DSIRE) which can be found at http://www.dsireusa.org
Main Public Funding Mechanisms
The primary means by which the U.S. federal government supports ocean energy is by providing grants to
competitively-selected companies and institutions active in ocean energy R&D in the United States – much of
which is funded through the DOE Wind & Water Power Program. Throughout 2012 DOE continued to support
industry demonstration projects through its Technology Readiness Level Advancement Initiative as well as
Advanced Water Power grants. This past year DOE issued a Funding Opportunity Announcement (FOA) for
ocean energy technology, titled “In-Water Wave Energy Conversion (WEC) Device Testing Support.” This
FOA is particularly significant for the wave energy industry because it offers $500,000 to one project to deploy
and test a buoy (point-absorber) WEC for one year at the Navy’s Wave Energy Test Site (WETS) off of Marine
Corps Base Hawaii in Kaneohe Bay, Oahu. On September 25, 2012 Northwest Energy Innovations was
selected to receive the award for their Wave Energy Technology – New Zealand (WET-NZ) device.
Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) are U.S.
Government programs in which federal agencies set aside a small fraction of their funding for competitions
only open to small businesses. These programs help emerging MHK technologies advance along the DOE
Technology Readiness Level (TRL) chain. Small businesses that win awards in these programs keep the
rights to any technology developed and are encouraged to commercialize the technology. In April 2012
DOE announced that $9 million would be available to fund approximately 50 small businesses developing
a variety of renewable energy technologies. Each selected project would receive a Phase I award of up to
$150,000. Awardees with successful projects would also have the opportunity to compete for follow-on
Phase II funding for as much as $1 million per project. Two notable projects that received 2012 SBIR/STTR
funding are FloDesign and Oscilla Power.
Relevant Legislation and Regulation
In 2010 President Obama signed an Executive Order establishing a new National Ocean Council and
adopting a new national ocean policy to enhance stewardship of U.S. ocean waters and the Great Lakes. In
2012 the National Ocean Council released a Draft Implementation Plan for the policy and began regional
marine planning efforts in many parts of the country, which will facilitate efforts to plan for energy generation
from U.S. ocean resources.
The Department of Interior’s Bureau of Ocean Energy Management (BOEM) has established additional State
Task Forces in Oregon and Hawaii to help identify lease blocks best suited for wave energy development
and is continuing to establish similar Task Forces in other states. In addition, BOEM and FERC announced
revised guidelines for MHK developers pursuing permitting and licensing on the U.S. Outer Continental
Shelf. The revisions further clarify the regulatory process and help streamline the procedure for authorizing
research and testing of MHK devices.
ANNUAL
REPORT 2012