Strategy and National Targets
The mission of the Water Power Program is to research, test, evaluate, develop and demonstrate deployment of innovative technologies capable of generating renewable, environmentally responsible and cost-effective electricity from water resources. Pursuant to that mission, the Programme is currently undertaking the necessary analysis to assess the opportunities associated with tapping ocean energy resources. The results of this analysis will effectively inform DOE’s strategy going forward, which will include the establishment of aggressive national goals for deployment of marine and hydrokinetics (MHK) technology in the United States.

Water Power Vision
The vision of the Water Power Program is that effective and efficient investments of DOE resources in support of advanced water power technologies will enable the development of a robust and competitive MHK industry in the United States that capably contributes to our Nation’s energy portfolio. In order to achieve this vision, the Programme is focusing its near-term research and development efforts in the following areas:

• Determine extractable resource potential;
• Address environmental challenges;
• Validate Levelized Cost of Energy (LCOE) and opportunities for cost reduction by identifying key cost drivers;
• Demonstrate performance viability and identify technology leaders. The current MHK portfolio consists of 73 projects and represents a total programme investment of $87.2 million, including mortgages. Most of the MHK funding is directed toward technology development activities. Currently, technology development accounts for 87% of funding.

Support Initiatives and Market Stimulation Incentives
Incentive programmes are a key component vital to the successful advancement of the marine and hydrokinetic technology industry. The success of the wind industry in the United States is largely due to incentive programmes. Similarly, the success of Europe’s renewable energy industry, particularly Germany’s wind industry, is largely due to successful feed-in tariffs. There are a number of federal incentives that can be leveraged to further MHK in the U.S.

Federal Renewable Energy Financial Incentives:

• Clean Renewable Energy Bonds (CREBs);
• Qualified Energy Conservation Bonds (QECBs);
• Renewable Electricity Production Tax Credit (PTC);
• Renewable Energy Production Incentive (REPI);
• U.S. Department of Energy - Loan Guarantee Program;
• U.S. Department of Treasury - Renewable Energy Grants;
• USDA - Rural Energy for America Program (REAP) Grants;
• USDA - Rural Energy for America Program (REAP) Loan Guarantees.

DOE maintains a database of state incentives for renewables and efficiency which can be found on the following website: http://www.dsireusa.org/

Government support for MHK technologies has continued, mainly through the Department of Energy (DOE), though at a lower level than previous years, partly due to budgetary and legislative uncertainties. The upcoming Presidential election in November 2012 also reduces the likelihood that any significant piece of renewable energy or climate change legislation will be considered by Congress. 

Main Public Funding Mechanisms
Funding opportunity announcements (FOA’s) provide a means for distribution of appropriated funds through grants and cooperative agreements. In 2011, no FOA’s were released for MHK technologies, however out year funding continued on previously awarded projects. Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) are U.S. Government programmes, in which Federal agencies with large research and development budgets set aside a small fraction of their funding for competitions among small businesses only. Small businesses that win awards in these programmes keep the rights to any technology developed and are encouraged to commercialize the technology.

In 2011, the Department of Energy SBIR/STTR programme made a Phase I Advanced Water Power Technology Development award to Oscilla Power in support of their wave energy harvester. Seven Phase II SBIR/STTR MHK projects entered their second year of funding and continued their analysis, design and commercialization efforts. 

Relevant Legislation and Regulation 
In 2010, President Obama signed an Executive Order establishing a National Ocean Council and adopting a national ocean policy. In 2011, the National Ocean Council began implementation of a national Coastal and Marine Spatial Planning (CMSP) effort by hosting a national CMSP workshop. The council is working to draft strategic action plans for each of the nine ocean policy priority objectives, including CMSP, which will serve as guidance and roadmaps for the implementation of the new national ocean policy.

The final stage of the reorganization of the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) became effective on 1 October 2011, when it split into two independent entities:
the Bureau of Ocean Energy Management (BOEM) and the Bureau of Safety and Environmental Enforcement (BSEE). Currently, BSEE will only address oil and gas and all renewable energy functions will be housed under BOEM.

BOEM is responsible for all renewable energy function and for managing development of the Nation’s offshore resources in an environmentally and economically responsible way. Functions include: leasing, plan administration, environmental studies, National Environmental Policy Act (NEPA) analysis, resource evaluation, economic analysis and renewable energy. BSEE enforces safety and environmental regulations. Functions include: all field operations including permitting and research, inspections, offshore regulatory programmes, oil spill response, and newly formed training and environmental compliance functions.

BOEM has seen very strong interest in offshore renewable energy projects on the Outer Continental Shelf (OCS). BOEM is working closely with several states regarding offshore energy development and is in the process of coordinating federal-state task forces in 17 coastal states. 

Relevant documents released
The DOE has completed wave and tidal energy resource assessments of US coastal waters this year. The projects include publicly available Geographical Information Systems (GIS)-based maps of the power densities, energy fluxes, and bathymetry as well as final reports that detail the methodology used to carry out each assessment. Independent validation of the results is an integral part of each project: a national lab carried out an independent validation of both projects and the National Academy of Sciences is conducting a peer review of the methodology.

• Tidal energy resource assessment report: http://www1.eere.energy.gov/water/pdfs/1023527.pdf
  
  
• Tidal energy map: http://www.tidalstreampower.gatech.edu
  
  
• Wave resource assessment report: http://my.epri.com
  
  
• Wave energy map: http://maps.nrel.gov/mhk_atlas

DOE conducted an Advanced Marine Renewable Energy Instrumentation Experts Workshop on 5-7 April, 2011. The report can be found at: http://www.nrel.gov.

DOE conducted the 2011 Marine Hydrokinetic Device Modeling Workshop on 11 March 2011. The report can be found at: http://www.nrel.gov. 

Government Funded R&D
The primary focus of Federal-level activity remains to improve performance, reduce costs and accelerate deployment of innovative water power technologies. This is accomplished via provision of grant support to 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. Targeted investments are focused the elements that will deliver the Water Power Vision (see above).

DOE continues to use Technology Readiness Levels (TRLs) as an organizing principle to reduce risk within DOE’s investment portfolio and allow tracking of progress towards technology maturity. Technology Readiness Levels (TRLs) are used by numerous Federal agencies, including the Department of Defense and National Aeronautics and Space Administration and many private sector companies, as a measure (or metric) to assess the maturity of evolving technologies. TRLs 1-4 are focused largely on Research and Development (Innovations and Emerging Technologies) and TRLs 5-8 involve Technology Demonstration (latter stages of Emerging Technology through Systems Integration).

The US DOE has launched an effort to develop “Reference Models” for marine and hydrokinetic devices. These are technology and cost models with scaled model validation tests that provide a technical, economic and environmental benchmark against which new MHK designs can be measured. The first 3 baseline models (1 wave, 1 tidal and 1 river current device) have been under development for over a year, and two of these are nearly at a stage to be released for public dissemination and use. The third (a wave device) requires additional work before its release in 2012. The next 3 models, consisting of 2 wave energy converters and 1 ocean current device, have been selected and development has begun.

The reference models investigate characteristics affecting the overall cost of electricity of MHK device types, which includes energy conversion performance, environmental compliance and mitigation, and life cycle cost. The baseline models assess the current state-of-the-art performance of marine energy devices, using scaled testing to validate analytic and empirical design assumptions and technical approach. The cost analysis of these models is parameterized so that the influence of array scale, resource intensity, and other variables can be evaluated. The reference models will lead to understanding the key cost drivers of the devices, so that future device research and development can focus on modifications that are critical to COE reduction.

The Department of Energy is actively working to research, monitor and mitigate the potential environmental effects of marine renewable technologies. During 2011, DOE completed the initial development of a publicly accessible environmental research database that will house both domestic data and information gathered through an international environmental data sharing agreement. The Department has also conducted a well-attended series of webinars aimed at increasing awareness of environmental research surrounding marine and hydrokinetic technologies. Topics included 1) data management, cumulative impact modelling, and risk assessments 2) interactions between aquatic animals and MHK devices 3) monitoring technologies and strategies 4) research on the potential acoustic effects of marine and hydrokinetic technologies.

The programme supports the development and testing of a wide variety of marine and hydrokinetic systems and components from the earliest-stage proof-of-concept studies through full-scale demonstration projects. The funding mechanism for this support is the provision of federal grants, which typically have a cost share requirement. To meet the cost share requirement, awardees must provide matching funds, typically on the order of 20 - 50% of the federal award. FY11 federal investments correspond to $17 million of non-federal investment in MHK technologies through cost share requirements. Over their entire period of performance, these projects will total approximately $57 million of non-federal cost share. Of these projects, 31% are TRL 1 - 3, 25% are TRL 4, 33% are TRL 5 - 6 and 11% are TRL 7 - 8.

There are over 100 US based MHK companies who are actively engaged in developing MHK devices across all technology readiness levels. Current global economic conditions have created a challenging environment for raising venture capital; therefore investment in MHK R&D is largely based on state and federal grants, “angel” investors and other forms of private investment. 

Participation in Collaborative International Projects 
The Department of Energy proposed an Annex to the International Energy Agency’s Ocean Energy Systems - Implementing Agreement (OES) entitled “Exchange and Assessment of Ocean Energy Device ProjectInformation and Experience”. The OES Executive Committee approved the Annex during their meeting on 13 - 14 September, 2011 in Madeira, Portugal (See chapter 3).

A wide range of different ocean energy technologies and devices are currently in development around the world. However, the data that exist on the possible environmental impacts of these technologies are often scarce, expensive to collect, and widely dispersed amongst different countries and developers. These environmental data are a critical component to the permitting and siting of MHK projects and are required for the successful advancement of the MHK industry. The DOE, in collaboration with the BOEMRE, and the Federal Energy Regulatory Commission (FERC) lead an international data sharing effort on the environmental effects of MHK technologies to create Annex IV (See chapter 3).

The DOE Office of Science (SC) is supporting an MHK Irish Fellowship programme. This programme supports research to advance the development and testing of MHK technologies. This fellowship programme will competitively select and send U.S. postgraduate students, engineers, and/or scientists to participate in research projects at selected European marine energy test sites and research institutions that have partnered with the U.S. Department of Energy.

DOE has been in communication with the Canadian Department of Fisheries and Oceans (DFO) to gauge common interests and activities, in which both countries are currently involved. Specifically, the U.S. DOE has been in contact with a representative of DFO Canada regarding their Pathways and Effects model to determine and prioritize the potential and environmental impacts of offshore renewables. 

Operational Ocean Energy Projects
The Ocean Energy industry in the US is largely comprised of pre-commercial stage projects and in 2011, Research and Development work continued at all Technology Readiness Levels. DOE continued support for industry demonstration projects through its Technology Readiness Advancement Initiative as well as Advanced Water Power grants. Two of the projects succeeded in deploying their devices in a relevant environment: 

     Free Flow Power (http://free-flow-power.com) 

Free Flow Power deployed an in-stream hydrokinetic turbine in the Mississippi River on 20 June 2011, near Baton Rouge, LA. Operational data is being collected to evaluate technical and environmental performance (http://free-flow-power.com).

Columbia Power Technologies’ SeaRay prototype wave energy converter was deployed on 15 February 2011, in Puget Sound, WA and continues operating to date, controlled remotely from Corvallis, OR (http://www.columbiapwr.com).
The two projects mentioned above are actively conducting R&D and it should be noted that while sustained deployment data is of interest to both developers, the devices are being deployed and recovered as necessary to support their research and testing needs. Device developers continued to make strides in advancing their technologies down the commercialisation pathway in 2011. In order to support the emerging industry and numbers of devices that will require testing, US DOE investment in testing infrastructure continues. Test facilities are intended to offer a wide range of testing services that address both technical and nontechnical barriers of MHK systems. By spearheading the development of a testing infrastructure, DOE ensures that many more prototypes from a diverse set of technology developers can be tested than if each had to carry the cost of developing, permitting, and installing their own test facility.

In this way, superior technology performance and design will determine which technologies will succeed, rather than those with more funding. Over 25% of MHK federal investment is dedicated towards advancing testing capabilities. 

Northwest National Marine Renewable Energy Center (NNMREC) Wave and Tidal Test Facility
The Northwest National Marine Renewable Energy Center (NNMREC) is a partnership between Oregon State University (OSU) and the University of Washington (UW). While serving as a standardized test facility for wave and tidal energy developers, the Center also focuses on research, education, outreach, and engagement. In the area of advanced wave forecasting, NNMREC has established a wave prediction scheme for the entire state of Oregon. The final site for the Newport wave energy test site was selected and background data collection continues to characterize the site. Field measurements continued at the Snohomish PUD site in Admiralty Inlet; this continuous dataset is now over two years long and represents the best characterized tidal site in the US. Work has continued on a developing baseline acoustic database and various contributions from multiple existing sources (http://nnmrec.oregonstate.edu).

Southeast National Marine Renewable Energy Center (SNMREC) Ocean Current Test Facility
SNMREC is working towards the implementation of a full-scale, at-sea testing infrastructure for openocean current energy conversion prototypes. Site characterization and environmental studies continued off the coast of Florida in support of Florida Atlantic University’s effort to complete the permitting process for the test facility. Monthly aerial surveys continued to assess sea turtle individual and species distribution. To date, six surveys have been completed (http://snmrec.fau.edu).

Hawaii National Marine Renewable Energy Center (HINMREC) Wave and OTEC Test Facility
HINMREC’s mission is to facilitate the development and commercialization of wave energy conversion (WEC) devices and ocean thermal energy conversion (OTEC) systems. The University of Hawaii began site surveys at the Navy’s Kaneohe Bay Test Site and initiated preliminary environmental analysis for possibly expanding the current test site (http://hinmrec.hnei.hawaii.edu).

New Developments
In conjunction with the DOE funded Reedsport PB150 Deployment and Ocean Test Project, New Jersey based Ocean Power Technologies (OPT) will deploy a 150 kW WEC device in 2012 to collect detailed operational data during two years of operations. This deployment is the first device deployment for a planned 1.5 MW wave farm in the Oregon Territorial Sea. On 15 April 2011, OPT successfully deployed a PB150 PowerBuoy at sea near Invergordon, Scotland. Sea trials were used to perform functional testing, examining the response of the PowerBuoy’s structure and mooring system to the waves and the power produced by the on-board generator (http://www.oceanpowertechnologies.com).

Ocean Renewable Power Company (ORPC) is developing a 5 unit, grid-connected array of cross-flow tidal turbines near Eastport, ME. During 2011, significant progress was realized in both permitting and refinement of the device design. ORPC anticipates initial installation activities for the first unit to begin in March 2012 (http://www.oceanrenewablepower.com).

Public Utility District No.1 of Snohomish County (Everett, Washington) will continue to develop its efforts to deploy, operate, monitor, and evaluate two open-centre turbines, developed and manufactured by OpenHydro Group Ltd., in Puget Sound’s Admiralty Inlet. Significant field measurements have already been performed, making this the best characterized tidal site in the US. Additional environmental
monitoring will be taking place over the next 12 months and a deployment date will be set in Fiscal Year 12 (http://www.snopud.com).