When The Waves Are on Your SideWed, 02/21/2018 - 17:59
Mexico’s Energy Reform brought a wave of opportunities for clean energies, with wind and solar being the champions of the transition. Ranking 13th globally in terms of shoreline length, Mexico has great potential to develop ocean wave power, says Francisco Carrión, CEO of MARERSA, which is focusing on the new segment.
In its 2016 Marine Energy Resources report, the World Energy Council (WEC) states that, up until the creation of the report, there was 0.5GW of commercial marine power generation capacity in operation, with 1.7GW under construction. Meanwhile, in a study conducted on behalf of the International Panel on Climate Change (IPCC), scientists estimated that the total global theoretical wave energy potential was in the range of 2-32PWh per year. These numbers vary mainly due to different technical and economical assumptions. According to the World Energy Council report, the North American region, especially along the Pacific coast, is ranked highly in its energy generation potential through wave power production technologies.
The Ministry of Energy’s 2016-2030 Renewable Energies Prospective describes ocean wave power simply as a potential clean energy. Cost has been a top factor for neglecting the source’s promise, a perception that MARERSA believes it can change. “Few countries in the world have companies that are strongly committed to wave-power technologies. This is due mainly to costs, which can make ocean wave power too expensive to develop,” says Carrión. In its Marine Energy Resources report the WEC highlights how wave energy production has the highest cost of electricity, reaching up to US$500/MWh on average. The report also highlights how such a high cost illustrates the immaturity of the technology and its relative youth, while placing hopes on the creation of economically viable technologies through R&D efforts. “MARERSA has found a way to solve this, and with our project in Lazaro Cardenas, we are going to become the first company in the world to produce an economically viable project with this technology, on a large scale.”
Generation intermittency, together with oil waste, is a problem that, although diminished with the use of renewable energies, still exists, says Carrión. “Renewable technologies, although environmentally friendly, still have some related sins. For the big champions, wind and solar, the environmental problem rests with the oil used inside the turbines and the batteries manufactured with polluting materials. Neither technology can provide a continuous, stable supply of electricity.”
Ocean wave power used to commit the same sins as these two other technologies, he continues. “Most wave power systems use hydraulic oils, just as wind turbines do, which due to temperature and pressure must be replaced almost every two years. A wave power project in Rosarito that we were working on together with CFE required an estimated 2 million liters of oil to be changed every three years, incurring both environmental and economic costs. Wave power technologies that use these kinds of oils also have the disadvantage of not being able to produce power during harsh environmental conditions when the floating devices must be retracted, stopping the flow of energy, which makes the technology intermittent just like wind and solar.”
To solve the problem of intermittency and pollution, MARERSA has come up with an innovative mechanism, which will be deployed at its Lazaro Cardenas 150MW project. It uses water, air and a set of buoys to transform kinetic energy from the ocean into potential energy ready to be transformed into electricity, even in harsh ocean conditions. Achieving the needed level of technological maturity did not come easily. “Our Lazaro Cardenas project did not develop overnight, we have been working on wave technologies since 2007. During this whole time, we improved our patents until we achieved a technology that can provide non-interruptible, 100 percent environmentally friendly energy supply. Even when the system undergoes maintenance, its modular design means it only stops production at 500kW intervals, while the overall system keeps running.”
In addition to providing a constant, economic and environmentally friendly source of electricity, the project has provided the port with other benefits. “API Lazaro Cardenas receives the biggest benefit from this project. First, we offer API compensation for using an area of the port that has no value, and actually represents maintenance costs. Because our wave-power units take the brunt of the waves, the port suffers less damage and over time, maintenance costs decrease. Finally, we reduce API’s energy-related costs by as much as 60 percent. As a matter of fact, this port will become the first in the world to be fully supplied by completely clean energy,” says Carrión.
In terms of the project’s financing, Carrión emphasizes the challenge of doing so in a highly innovative area like that of ocean wave technologies. “While widely proven technologies such as wind and solar are still hard to finance, innovative ones like ours are even harder,” he explains. Innovation is at the heart of MARERSA and the company has incorporated it into its business model through its financing scheme. “MARERSA has raised US$500 million for the development of the project. Half of that amount is on standby for future steps of the project, and the other half is invested in a nontraditional way as cryptocurrencies,” he says. Investors who agreed to work in this way are now happy to see that monthly profits have increased by between 8 to 10 percent. “We decided to take the risk, and are now seeing extremely positive results,” says Carrión. “We expect to be producing 10MW by February 2018, and by May 2018 we want to start supplying 20MW each to API and a municipality,” he adds. “In the long run, we expect to supply API with 70MW and several municipalities with 80MW. Since 2008, our objective has been to provide all of API installations in Mexico with clean energy produced by wave power. This project is the first step to materialize the dream.”
But the company is not stopping in Mexico. It is already looking at opportunities for expansion. “We are making a strong move into the Colombian market, where we will start working soon on a 1GW ocean wave-power project,” Carrión says. “Another business area in which we want to focus is transforming organic and inorganic waste into construction material and energy as well, which is an excellent way to get rid of waste while supporting sustainable and innovative methods for the infrastructure industry. Also in Colombia, we are in negotiations to process 250 tons of waste from Cali to create construction materials.” In the medium term, MARERSA also wants to expand to the Dominican Republic.