Ocean - Energy Policy Analysis: A Conceptual Framework - page 187

Dollar Costs of Utilizing Ocean Energy Technologies
Operating costs of tidal power plants are very low, but their initial capital construction costs are
high, which lengthens payback periods. As a result, the cost per kilowatt-hour of tidal power is
generally not competitive with conventional fossil-fueled power. Recent innovations like the tidal
turbine made by Ocean Renewable Power Company are, however, competitive in dollar costs with
wind energy (ORPC 2011a; Sharp 2010).
Wave power systems have high capital costs and a hard time competing with traditional power
sources for price, although these dollar costs appear to be coming down. Some European experts
predict that wave power devices will find lucrative niche markets. Once built, they have low op-
eration and maintenance costs because their fuel—seawater—is free (USDOI 2006b).
OTEC power plants require substantial capital investment up front. Private sector firms may
be unwilling to make substantial initial investments required to build large-scale OTEC plants
until the price of fossil fuels increases dramatically or national governments provide financial
incentives. A major factor hindering commercialization of OTEC is that there are only a few
hundred land-based sites in the tropics where deep-ocean water is close enough to shore to make
transmission of electricity from OTEC plants to consumers feasible. This will greatly limit the
utility of OTEC plants in the United States for areas outside Hawaii.
National Security Costs of Utilizing Ocean Energy Technologies
Ocean energy technologies can be implemented without dependence on politically unstable areas
such as the Middle East. No country or group of countries is able to control supplies or determine
price for fuel or materials to implement ocean energy technologies. These technologies produce
limited carbon emissions and greenhouse gases from fabrication and manufacturing of equipment.
Consequently, ocean energy technologies will not produce climate change or a rise in sea level.
Ocean energy technologies do not produce substantial amounts of toxic waste that must be isolated
from the human environment for millennia. Utilization of ocean energy technologies does not
produce materials useful to terrorists. Consequently, the national security costs of utilizing ocean
energy technologies are nil. As compared to other energy technologies, utilization of ocean energy
technologies can be conceptualized as having net national security benefits.
SUMMARY OF COSTS
The costs of utilizing ocean energy technologies are summarized in Figure 11.3. Overall, the en-
vironmental costs for producing and using these technologies are incurred mostly during produc-
tion of materials and equipment, with some local disruption due to construction and placement of
equipment in marine ecosystems, so they are “moderately low” compared to most conventional
fuel technologies in use today. Dollar costs for application of ocean energy technologies are “high”
and not competitive today with conventional fuels. Tidal power generation and wave energy may
be competitive with wind energy, but not with conventional fuels. National security costs for all
ocean energy technologies are very “low” or negligible because the materials for producing them
are available in the United States or from friendly nations. This is an advantage ocean energy
technologies hold over other energy technologies that may be acquired from foreign sources,
contribute to global climate change, or leave a legacy of long-term waste products attractive to
terrorists.