Tidal stream energy: the huge opportunity bubbling in Scotland’s oceans

By Johanna Money, Energy Transition Specialist, Policy and Research - Marine Energy at Scottish Enterprise

We recently published an economic review of the potential opportunities that tidal stream power could bring to Scotland between now and 2050. Having commissioned the expertise of the University of Edinburgh’s Policy and Innovation Group to undertake this independent review, the report looks at both the economic benefits of this growing renewable energy sector and the supply chain opportunities that Scotland is best placed to capture.

The reliable renewable

Tidal stream energy is a type of renewable energy that captures energy from the movement of the tides around coastlines. The tides, formed by the interactions of the earth, moon and sun’s gravitational forces, are a predictable source of renewable energy.

This predictability is rare in renewable energy and studies have shown that it is particularly useful for cutting the cost and carbon intensity of the national grid – if it can be deployed at scale. While wind power and solar power fluctuate with the weather, tidal remains predictable, with two tidal cycles a day, every day.

Capturing the energy

There are different ways to capture energy from the tides. Our focus at Scottish Enterprise is on tidal stream, also known as tidal current. Tidal stream uses underwater turbines, where they are either suspended from floating platforms or mounted to the seabed, to capture the movement of the water. Many tidal devices resemble the configuration of a wind turbine, although there are other models, such as the ‘tidal kite’.

Water is about 800 times more dense than air. This means that while tidal stream set-up may be similar to that of wind turbines, their blades are considerably shorter and can capture more energy from a smaller area.

Scotland leading the rest of the world

Due to tidal energy’s dependency on location and natural conditions, there are specific hotspots of resource around the world. These include France, Japan, Indonesia and Canada, amongst others. Scotland is one of these hotspots and has a significant natural resource around our coastline and islands. Coupling this resource with Scotland’s natural innovative streak and subsea engineering experience means tidal energy has excelled.

Scotland began its pioneering marine energy research in the 1970s, when it explored the technology for capturing energy from the waves. In the early 2000s, this research intensified, and we saw the development of the groundbreaking EMEC: European Marine Energy Centre (EMEC), the first and only real-sea grid connected test and demonstration centre for wave and tidal energy. Based in Orkney, one of Scotland’s northerly archipelagos, it has been the test bed for 35 wave and tidal devices to date and continues to showcase the technical development in this sector.

Growing pipeline

Our report highlights that having developed this lead in tidal stream energy, Scotland is set to reap the benefits, if there is continued support for the sector comprising a concerted effort from industry and partnership working.

The pipeline of projects in Scotland and the UK is growing and supported through the UK Government’s revenue support mechanism for renewable energy. The Contracts for Difference (CfD) mechanism, was made available to tidal stream projects in 2022. Since budget was allocated to tidal, the pipeline has grown from the 10 megawatts (MW) currently installed in Scotland (over half the global total) to a potential of over 80 MW (120 MW in the UK), enough to power approximately 80,000 homes, before 2030.

Global outlook

To help measure the economic impact, our review used the Gross Value Add (GVA) metric, to convey the scale of the contribution that this sector could make to the Scottish economy.

The analysis for the review follows the work that the Policy Innovation Group has undertaken in recent years including activity as part of the International Energy Agency – Ocean Energy Systems programme and the UK Supergen ORE hub. This looked at the global and UK outlook for tidal energy, which highlighted a significant global market for tidal stream of 120 GW by 2050.

Economic value

Our review investigates a series of scenarios showing different focus markets for the sector. In a scenario where Scotland has maintained its strong use of a local supply chain, the GVA benefit could be ￡4.4 billion from UK projects, and where Scotland becomes a key exporter of the technologies, a further ￡11.4 billion in GVA to Scotland cumulatively by 2050.

These figures were derived from looking at both the likelihood of there being Scottish company involvement in projects here and abroad and what the local content, or retention rate, of specific project area could be.

The results paint a picture that there is much to be gained from the development of the tidal sector, with high retention rates following on from early support to the sector, coupled with Scotland’s experience in subsea engineering and offshore innovation.

Job creation

In addition to the GVA analysis, the review also considered the jobs, in ‘full-time equivalents’ (FTEs), that would be created by the build out of the tidal stream opportunity.

The report shows that jobs from tidal energy could reach 4,450 in Scottish companies from Scottish projects with a potential for a further 16,600 from international projects in 2050. Initially there is a predominance of jobs in manufacturing. However, as more projects are built out there is a growth in the jobs associated with operations and maintenance (O&M) as well as continued manufacturing. The nature of these jobs would change over time, with just over half of the jobs in 2035 relating to the manufacture of the generator, and in 2050, over a quarter of the jobs would be associated with O&M.

Supply chain

The review also looked at the lead that Scotland has in the tidal stream energy supply chain - specifically key technology subcomponents and services. Their competitiveness was assessed and ranked into four categories: following the market, matching the market, leading the market, and ‘All to Play for’ where no market currently shows a defined leadership.

The review also looked at the skills Scotland possesses across a number of areas of expertise, such as demonstration and installation, highlighting where future support could be focussed to potentially move categories from ‘All to play for’ to ‘Leading’, ensuring that Scottish leadership in particular areas is maintained, such as in blades and anchors.

There are particular opportunities for the supply chain in manufacturing and O&M, which have been highlighted in the jobs section above. However, the supply chain is much wider than this, and there’s also an opportunity for SMEs to engage in the planning, development, modernisation (digitalisation) and activities such as survey and monitoring.

Room for collaboration

The report also highlights that, although there are a number of similarities across other offshore renewable energy supply chains, which it recommends actively collaborating with, there is also a difference in the scale of the devices and projects which opens up more of the supply chain to engage in offshore renewables as a whole.

So if we look at ports and harbour requirements as an example, the constraints on available space (lay down areas), clearance, heavy lift capabilities and draft are all much lower than that for fixed and floating offshore wind. This allows more of Scotland’s supply chain and infrastructure to be involved in opportunities in renewables offshore.

An essential addition for our energy transition

Not only does tidal stream energy present opportunities for the supply chain, but it is a necessary addition to our energy portfolio. By diversifying our energy supply, we help strengthen our grid. The additional renewable generation will also be required as our energy demand continues to increase as transport and heat electrify. The benefits of tidal stream’s predictability will only strengthen the case for including it in our energy mix.

Next steps

The report provides a series of recommendations for being able to secure the benefits from this sector. These cover the actions for government as policy makers, as well as for the stakeholders that will deliver the projects including technology developers and investors.

For tidal stream to succeed, and these benefits reaped, effort is required from all quarters. Clear policy guidance will also allow companies to scale at the rate needed to maintain and grow the supply chain and ultimately deliver this innovative sector.

Download the report to read more about the economic benefits associated with Scotland’s tidal energy sector.

If your company is looking to engage with the tidal stream energy supply chain, get in touch or visit our website to learn more about how we can support your business.

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