Sino-Dutch consortium spends up on feasibility study for tidal energy

Chinese and Dutch money and know-how are being applied to a potential US$15b project that hinges on a large and costly feasibility study

PUBLISHED : Monday, 21 July, 2014, 3:18am
UPDATED : Monday, 21 July, 2014, 3:18am

A Sino-Dutch consortium is spending tens of millions of US dollars on a feasibility study for a project to harness tidal energy to produce clean power.

Eight Dutch engineering firms and university institutes have joined industry and academic partners on the mainland in the venture.

The project, worth up to US$15 billion, would also need to have its environmental impact assessed. It has the potential to help China lessen its dependence on foreign suppliers and increase production of clean energy to help cut air pollution.

But even if it passes economic and environmental muster, the venture carries immense risks as its viability can only be proven if a full-scale project is built.

"The biggest challenge is that the project must be done on a big scale in order to be economically viable," Rob Steijn, one of the inventors of the technology whose feasibility is being studied for the proposed mainland projects, told the South China Moring Post.

"It is a big step both in terms of investment and risks for society and investors to accept, so government support is key."

Steijn is director of the river, coast and sea department at Amsterdam-based infrastructure design and consulting firm Arcadis, which plays a coordinating role in the consortium led by infrastructure design and construction firm Strukton.

Steijn said that after 30 months of studies, the partners are confident in the science and believe a southern project between Shantou in eastern Guangdong and Xiamen in southern Fujian has higher feasibility compared with an alternative project at the entrance to the Bohai Sea in the north.

He said the southern project has 5,000 megawatts (MW) of annual generating capacity and is estimated to cost US$15 billion to build. Its estimated generation cost is 10 to 15 US cents per kilowatt-hour (kWh).

This means it is about 10 per cent more expensive than a mainland nuclear power plant - among the most expensive - on a per MW basis, and its production cost may be similar to the subsidised power selling prices of 12 to 13.7 US cents per kWh enjoyed by offshore power plants.

Analysts said this means the tidal project will need greater state subsidies than offshore wind turbines, already among the most expensive to produce and turn a profit.

The Dutch consortium has spent about US$4 million on a three-year preliminary feasibility study that will be completed at the end of this year, Steijn said. The Dutch government contributed US$1.27 million.

The mainland partners spent US$2.7 million, Steijn said, adding "tens of millions" of US dollars are expected to be spent by the consortiums from next year in the next-stage feasibility study.