Wave power pioneer Pelamis sinks into administration

Pelamis teamScotland’s pioneering Pelamis wave power company has sunk into administration after failing to find further funding to develop its technology.

Earlier this year, the company, based at Leith docks, Edinburgh, celebrated the 10th anniversary of the installation of the world’s first offshore wave power machine connected to the National Grid – the prototype Pelamis machine was installed at the European Marine Energy Centre (EMEC) in Orkney n 2004.

This was hailed as a ‘breakthrough’ for the wave-power industry and demonstrated the feasibility of harnessing the power of the waves around Scotland’s coasts.

However, Richard Yemm, Chief Executive, Pelamis Wave Power Ltd, announced that the company has since been ‘unable to secure the additional funding required; for further development of our market leading wave energy technology.

“As a result of this the board has reluctantly moved to appoint an administrator to assess the options for securing the future for the business and employees of Pelamis.”

Blair Nimmo and Gary Fraser of KPMG have now been appointed as Joint Administrators of Pelamis Wave Power. They hope to sell the business, which employs more than 50 people.

Last year, German power giant E.On announced it was pulling out of a marine energy research project involving Pelamis in Orkney. E.On blamed the decision on delays in the development of wave energy technology.

Pelamis was one the world’s most advanced wave energy technology and companies. It recently received a strong endorsement of this leading position from independent consultants following a series of due diligence exercises. This work included detailed assessments of the onward commercial viability of the technology and designs.

Yemm said that the combination of over 350 man-years of experience in the team, some 15,000 hours of real grid connected test data and intensive parallel R&D work ‘gives Pelamis a unique platform from which to develop and demonstrate the viability of its technology for commercial deployment at scale.’

Earlier this year, Yemm said: “The progress we have made in the last 10 years has been exceptional, with the decade of development experience including the design, build and operation of six full scale machines.

“Developing any new technology is challenging, in the marine environment even more so, but having established this leading position and with so many of the key milestones behind us, we can now look forward with confidence to delivering a commercial wave energy sector over the coming years.”

Among a handful of non-executive directors was Stuart Deed, who was appointed to the Board of Pelamis to represent the Scottish Investment Bank.

Although disappointed at the company going into administration, Scottish Energy Minister Fergus Ewing said the Scot-Government remains committed to renewable wave power technology.

He said: “Clearly the news that PWP has gone into administration is a matter of real regret. This is a sad day for Pelamis and an anxious time for employees and their families.

“We have been working closely with Pelamis and its shareholders to try and find a way forward and help support the company in its current form.

“Early stage technologies such as this can be difficult, but the development of wave energy has been blighted by the uncertainty facing the energy sector more widely, following reforms of the UK’s electricity market. Our belief in the future success of wave energy is undiminished.”

Neil Kermode, Managing Director, European Marine Energy Centre, said: “We have known many of the Pelamis team for years and all of us at EMEC are dismayed by this announcement. 

“As a test site we have seen the clever, heroic, innovative work they have done to bring an idea to reality over the last decade.

“As a Scottish world leader Pelamis have been one of the icons of the marine renewables industry, so we are absolutely gutted at this setback.

“It is all the more galling when we know that marine energy has the potential to be a major supplier of power to the UK. But just like anybody who has been to sea, we know how hard it is out there, and trying to build a new power source was never going to be easy.

“This announcement is undoubtedly a big setback in the mission to learn how to harvest energy from the sea, but the prize is still there. The waves will keep pounding into the Orkney coastline and the world is still using precious and irreplaceable fossil fuels at an increasing rate.

We know marine energy will have its day. It just looks a bit harder today.”

A spokesman for Scottish Renewables – a Glasgow-based trade association – said: “Pelamis’ contribution to this emerging industry has helped cement Scotland’s position as a global leader, and it is important to remember that the prize from the eventual commercialisation of wave energy remains hugely significant. It is to be hoped that a viable way forward can be found for the business.”

 

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