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CAROL FLETCHER, The Record, November 29, 2009

Linda Rutta says she has a “tiger by the tail” with a renewable energy device she and her husband, Stanley, invented that can convert the power of ocean waves into electricity.

Now the research and development team needs funding to analyze five days of data from a landmark test of the 12-foot cylindrical prototype and build a life-size version.

“We have to scale up and make a commercial unit,” said Linda Rutta, but “the costs ahead are larger than a small entity can shoulder.”

Able Technologies is based in the Ruttas’ Englewood home, where the couple designed what they call an electricity-generating wave pipe with the help of colleagues in mechanical and oceanic engineering after patenting their concept in 2002.

Devices harnessing kinetic energy from ocean waves, known as wave energy converters, are not new and can be problematic. Online organizations reported in March that three devices installed off the coast of Portugal by a Scottish developer were taken ashore due to structural problems and lack of funding.

The Scottish devices are horizontal, serpentine structures that undulate in sync with the waves, whereas the Ruttas’ version anchors vertically to the ocean floor.

That means the machine has to stand up to the fierce oceanic conditions much like a bridge stanchion. These include the very force it captures in trying to produce enough electricity to be viable, said Rutta.

The Ruttas got their first opportunity to test the prototype’s endurance and energy production in mid-November, at the Ohmsett Oil Spill Response Research and Renewable Energy Facility at Leonardo in Monmouth County. The facility operates under the U.S. Department of Interior and runs a massive, 11-foot-deep wave tank for testing oil spill response equipment. This year it added wave energy technology.

The agency offered the Ruttas a week at Ohmsett after finding merit in a white paper the Ruttas submitted on the technology.

Every day for a week, the wave pipe was fitted with probes and other sensory equipment while being battered with saltwater waves up to 3 feet high. The purpose was to measure how it performed against small waves — which might have made it stall — and high ones, and whether it delivered energy, said Rutta.

“It worked with the waves beautifully — that was my happiest surprise,” said Rutta, “and it produced power. It exceeded our expectations.”

The week’s worth of results will be analyzed to determine the weight and size a commercial unit should be to withstand ocean conditions and estimate how much electricity could be produced, Rutta said.

While the tests raise their credibility, she said, funding is needed to analyze the data and design and build a full-size prototype.

Rutta said she is waiting for word on their application for a $150,000 grant from the small business arm of the Department of Energy to analyze the data. Designing and building a commercial-sized prototype could be “in the millions,” she said.

All money up to this point has come from their personal savings, said Rutta, and has reached “into the six figures.”

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TOM HESTER SR., New Jersey Newsroom, August 25, 2009

wave-ocean-blue-sea-water-white-foam-photoState and local officials joined with Ocean Power Technologies (OPT) Tuesday to recognize the success of one of the Pennington-based company’s PowerBuoys off the coast of Atlantic City.

OPT is a pioneer in wave energy technology that harnesses ocean wave resources to generate clean electricity.

“This is a celebration of our work in the renewable energy sector and an opportunity to thank the state and federal government for supporting OPT since the very beginning,” said Charles Dunleavy, the company’s senior vice president and chief financial officer. “As we continue to achieve success in both the national and international markets, OPT is proud to have invented, developed, and grow our operations right here in New Jersey.”

The federal and state support, including assistance from the Navy, the U.S. Department of Energy, the U.S. Department of Homeland Security, the state Board of Public Utilities (BPU), the state Economic Development Authority (EDA), and the state Commission on Science and Technology.

The PowerBuoy has successfully operated for three years off the coasts of Hawaii, Spain, Scotland and Oregon.

“Governor Jon Corzine’s comprehensive energy master plan calls for 30-percent of New Jersey’s energy to be generated from renewable sources by the year 2020,” said BPU President Jeanne Fox. “Ocean Power’s PowerBuoy can help us achieve that goal while also building New Jersey’s green economy and putting our people back to work. It’s exactly the kind of business success that the Governor envisions for New Jersey.”

OPT was founded 1994. It is a public company and operates out of a 23,000- square-foot facility. Since its inception, the company has focused on its proprietary PowerBuoy® technology, capturing wave energy using large floating buoys anchored to the sea bed and converting the energy into electricity using innovative power take-off systems.

Commencing in 1997, OPT has conducted ocean trials off the coast of New Jersey to demonstrate the concept of converting wave energy and convert it into electricity. Ocean Power currently has 42 employees in New Jersey and plans to continue its growth.

“Governor Corzine’s commitment to investing in clean energy has ensured New Jersey is able to attract and develop companies like Ocean Power Technologies,” said EDA Chief Executive Officer Caren S. Franzini. “Ocean Power’s innovative technology and talented staff will only help to drive the company’s growth and the creation of more green jobs in the state.”

Franzini noted that EDA, in conjunction with BPU and the state Department of Environment Protection, recently launched Clean Energy Solutions, a suite of financing and incentive programs to further support the state’s effort to promote green job creation and a more environmentally responsible energy future.

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EVAN LEHMANN, The New York Times, March 17, 2009

The oceans might not be big enough for sharp-elbowed renewable energy developers. Aspiring power producers are claiming sweeping stretches of sea along the East Coast, sometimes overlapping each other and igniting modern-day allegations of “claim jumping.”

Open water miles from shore is the newest frontier for prospectors, as vague notions persist about who in the federal government presides over the ocean depths. A jurisdictional dispute between two federal agencies — the Department of Interior’s Minerals Management Service and the Federal Energy Regulatory Commission — is encouraging a “Wild West” atmosphere, as one participant described the accelerating race to grab chunks of seafloor for energy development.

The impasse has led competing prospectors to claim the same areas of ocean off New Jersey’s coast, citing authority from different federal agencies. Wind developers are accusing Seattle-based Grays Harbor Ocean Energy Co. of taking advantage of the regulatory uncertainty to snatch a 200-square-mile swath of ocean for a proposed wave and wind energy project through FERC.

Smaller patches within that area had already been identified for wind farms approved by the state and been given a preliminary green light by MMS.

“They are all around us,” Chris Wissemann, founder of Deepwater Wind, said of Grays Harbor. State regulators awarded development rights to Deepwater Wind last fall to build a 350-megawatt wind farm about 20 miles off the shore with PSEG Renewable Generation.

But now the Grays Harbor site is “completely overlapping” the smaller 20-square-mile area of ocean identified by Deepwater Wind, Wissemann added, noting that his project is at “full stop.” The sprawling Grays Harbor parcel also encompasses a second wind project, proposed by Bluewater Wind, which plans to erect about 100 turbines over 24 square miles.

Wind developers and state officials are pressing FERC to deny Grays Harbor’s permit. A decision could come this spring.

‘Wild West’ goes to sea

The confusion is the offspring of dueling federal agencies. The Minerals Management Service is generally considered the landlord of the ocean floor, and has been working for three years on new rules to provide leases for wind farms on the outer continental shelf. There is no dispute about its authority over wind projects, as outlined in the Energy Policy Act of 2005.

But the Federal Energy Regulatory Commission has been arguing for two years that it maintains jurisdiction over hydrokinetic projects — those that tap the power of waves and currents — under the Federal Power Act.

That leaves developers of both wind and wave technologies vulnerable to each other. Preliminary permits are easy to get, and that can lead to “a lot of gamesmanship” in areas known to have good energy prospects, said Carolyn Elefant, a lawyer with the Ocean Renewable Energy Coalition.

“There are a lot of people who have these visions of flipping sites, selling sites, jumping claims and making people buy them off,” she said. “It’s the Wild West.”

That “back and forth” struggle between the two agencies stalled the release of MMS’s new rule on offshore renewable energy projects at the close of George W. Bush’s presidency, according to Michael Olsen, a former deputy assistant secretary in the Interior Department, who worked on the rule. Developers say the delay has prevented the offshore industry from growing.

“There was a tremendous push at the end of the last administration” to finalize the rule, Olsen said an event sponsored by the Energy Bar Association yesterday. “And it was delayed because of this dispute.”

‘Permit flippers’ vs. ‘mafiosos’

Grays Harbor is at the center of that storm. Run by Burton Hamner, who has experience in coastal management, the company in October plunged into the race to build the first offshore power generation project on the East Coast.

It applied for six interim leases from FERC, a move that would give it priority over hundreds of square miles off the coasts of Massachusetts, New Jersey, Rhode Island and several other states. The move could essentially secure those areas for three years, sidelining other wind companies that had already gone through a competitive selection process with the state of New Jersey and that are now waiting on the MMS rule before moving forward.

“I could literally have my equipment on a boat and receive a letter from FERC saying, ‘You have no right to do this because we have a competing set of regs,'” said Wissemann of Deepwater Wind, which might wait to build a data-collecting test tower until the dispute is settled.

A group of nine U.S. lawmakers, mostly from the East Coast, assailed Grays Harbor’s move — without mentioning the company — as “claim jumping” in a letter last week to Interior Secretary Ken Salazar. Some wind developers are furious, saying Hamner is “site banking” stretches of ocean with an eye toward trading in real estate, not clean energy.

“They’re looking to flip the permits,” said one official with a wind developer.

But Hamner dismisses those accusations as if they’re insults from entitled lawmakers or bested competitors acting like bossy “New Jersey mafiosos.”

Salazar pushing for a fix

He describes his maneuvering as a good business decision, one that fits within existing rules. He is not a claim jumper, he says, because MMS has not issued the rule needed to receive leases — an assertion with which his competitors have no choice but to agree.

“You can’t say somebody else is claim jumping when you haven’t in fact made a claim,” Hamner said. “All they’re doing is sitting there on the shore saying, ‘Hey, we were here first. What’s this guy doing messin’ in our sandbox?'”

He is unapologetic about applying for interim permits under FERC, days after the commission underscored its jurisdiction over hydrokinetic (wave power) projects in October. Nor does he feel burdened by exploiting the turf battle in Washington. FERC, he says, is the rightful overseer of electricity projects.

“They could have done the same thing that I did,” Hamner said of other developers. “The ocean’s got a lot of opportunity. There’s room for everybody. What we don’t want to have is people standing on the shore who’ve got the attitude of New Jersey mafiosos saying that’s their playground.”

Hamner is eligible for a FERC permit because he’s emphasizing wave power. At each of his seven sites, he proposes raising 100 platforms, each with three legs. Every leg will carry a 330-kilowatt generator, providing about 10% of the 1,100 megawatts produced by each project. Hamner plans to find the bulk of his electricity through wind turbines, big, 10-megawatt units on each platform.

The territorial dispute, meanwhile, is rising to a new level of urgency in Washington. Salazar said he hopes to draft a long-delayed memorandum of understanding with FERC, perhaps as soon as today. That could prevent the agencies from “stumbling over each other,” he told reporters on a conference call yesterday.

“We will not let any of the jurisdictional turf battles in the past get in the way with moving forward with our energy agenda,” Salazar said.

The MMS rule regarding leases could follow soon if the inter-agency dispute is settled. That’s considered a key requirement for sparking a robust offshore industry.

“They just need to work it out,” said Laurie Jodziewicz, manager of siting policy for the American Wind Energy Association. “We have some real projects that are being held up right now.”

Yet Olsen, the former official with Interior who worked on the rule, expressed doubt yesterday that Salazar would be able to quickly disarm the two sides. Congress might have to draft new legislation, he predicted, or perhaps President Obama’s new energy czar, Carol Browner, could muscle a jurisdictional remedy into place.

“It’s going to be the same thing,” Olsen said, recalling past challenges to fixing the problem. “Something’s gotta happen.”

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MendoCoastCurrent, December 15, 2008

opt2Ocean Power Technologies (OPT) recently reported quarterly financials and also recent developments:

– Deployed and tested a PowerBuoy off the coast of Spain under the wave power contract with Iberdrola

– Awarded $2.0 million from the US Department of Energy in support of OPT’s wave power project in Reedsport, Oregon

– Deployed and tested a PowerBuoy for the US Navy at a site off Marine Corps Base Hawaii, on the island of Oahu

– Ocean-tested 70 miles off the coast of New Jersey an autonomous PowerBuoy developed specifically for the US Navy’s ocean data gathering program

– Awarded $3.0 million contract from the US Navy for the second phase of their ocean data gathering program

– US Congress passes bill which provides for wave power to qualify for the US production tax credit

Dr. George Taylor, OPT’s CEO, said, “We have maintained the positive momentum with which we began the 2009 fiscal year, and have made significant progress under a number of contracts during the quarter, most notably with the US Navy and Iberdrola. In September, we deployed a PB40-rated PowerBuoy in Spain under our contract with Iberdrola, one of the world’s largest renewable energy companies. OPT also tested one of its autonomous PowerBuoy systems off the coast of New Jersey in October, under contract from the US Navy in connection with the Navy’s Deep Water Active Detection System (“DWADS”) initiative. We ended the second quarter with a PowerBuoy deployment for the US Navy in Hawaii. We have also furthered our relationship with this significant partner and announced a $3.0 million contract for participation in the second phase of the US Navy’s DWADS program.”

“We expect that the US Government’s recent expansion of the production tax credit to now include wave energy will help better position OPT competitively in the alternative energy arena. We are also gratified by signs that the Obama administration in the United States is keen on leveraging renewable energy sources as commercial sources of energy for the country. The $2.0 million award we received this quarter from the Department of Energy, in support of our work in Reedsport, Oregon, is reflective of the US Government’s support for wave energy,” Dr. Taylor concluded.

More about OPT

OPT has seen strong demand for wave energy systems as evidenced by record levels of contract order backlog, currently at $8.0 million. OPT continues to make steady progress on development of the 150 kW-rated PowerBuoy (PB150), which comprises a significant portion of our current backlog. The design of the PB150 structure is on track to be completed by the end of calendar year 2008, and is expected to be ready for complete system testing in 2009. OPT continues to work actively with an independent engineering group to attain certification of the 150 kW PowerBuoy structure design.

OPT’s patent portfolio continues to grow as one new US patent was issued during the second quarter of fiscal year 2009. The Company’s technology base now includes a total of 39 issued US patents.

During the second quarter of fiscal 2009, the Company announced that it expects to benefit from the energy production tax credit provision of the Energy Improvement and Extension Act of 2008. Production tax credit provisions which were already in place served only to benefit other renewable energy sources such as wind and solar. The Act will, for the first time, enable owners of wave power projects in the US to receive federal production tax credits, thereby improving the comparative economics of wave power as a renewable energy source.

OPT is involved in wave energy projects worldwide:

REEDSPORT, OREGON, US – OPT received a $2.0 million award from the US Department of Energy (DoE), in support of OPT’s wave power project in Reedsport, Oregon. The DoE grant will be used to help fund the fabrication, assembly and factory testing of the first PowerBuoy to be installed at the Reedsport site. This system will be a 150 kW-rated PB150 PowerBuoy, major portions of which will be fabricated and integrated in Oregon. OPT is working closely with interested stakeholder groups at local, county and state agency levels while also making steady progress on the overall permitting and licensing process.

SPAIN – OPT deployed and tested its first commercial PowerBuoy under contract with Iberdrola S.A., one of the world’s largest renewable energy companies, and its partners, at a site approximately three miles off the coast of Santona, Spain. The enhanced PB40 PowerBuoy, which incorporates OPT’s patented wave power technology, is the first step of what is expected to be a utility-grade OPT wave power station to be built-out in a later phase of the project.

ORKNEY ISLANDS, UK – OPT is working under a contract with the Scottish Government at the European Marine Energy Centre (“EMEC”) in the Orkney Islands, Scotland to deploy a 150 kW PowerBuoy. OPT is currently working on building the power conversion and power take-off sub-assemblies. The Company is also reviewing prospective suppliers for manufacturing of the PowerBuoy, which is on track to be ready for deployment by the end of calendar year 2009. As part of its agreement with EMEC, OPT has the right to sell power to the grid up to the 2MW berth capacity limit, at favorable marine energy prices.

CORNWALL, UK –The “Wave Hub” project developer, South West of England Regional Development Agency (“SWRDA”), recently appointed an engineering contractor to manage the construction of the “Wave Hub” marine energy test site. SWRDA has forecasted that the Wave Hub connections, cabling and grid connection infrastructure will be completed by the end of the 2010 calendar year. OPT continues to work with SWRDA and is monitoring its progress in developing the project site.

HAWAII, US – OPT deployed its PowerBuoy systems near Kaneohe Bay on the island of Oahu. The PowerBuoy was launched under OPT’s on-going program with the US Navy at a site off Marine Corps Base Hawaii and will be connected to the Oahu power grid.

US NAVY DEEP OCEAN APPLICATION – OPT tested one of its autonomous PowerBuoy systems 70 miles off the coast of New Jersey. The PowerBuoy was constructed under contract from the US Navy in connection with the Navy’s DWADS initiative, a unique program for deep ocean data gathering. The Company received a $3.0 million contract award for the second phase of the program, which is for the ocean testing of an advanced version of the autonomous PowerBuoy.

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TED NESI, Providence Business News, December 5, 2008

riThe list of suitors lining up to develop renewable energy projects off Rhode Island’s coastal waters is getting longer.

The Federal Energy Regulatory Commission (FERC) has begun reviewing a permit application from Grays Harbor Ocean Energy Co., a year-old company based in Seattle, to build 100 large towers that would generate electricity from wave energy and wind turbines. The towers, which Grays Harbor says would use the same support technology as offshore oil platforms, would be located in a 96-square-mile area of federal waters 12 to 25 miles to the south of Block Island. Wind turbines could be placed on top of the towers, although that would require a separate application process. The company estimates the total cost of the project would be between $400 million and $600 million.

Grays Harbor asserts that the structures, known as Oscillating Water Columns, “will be visible from shore for only a few days a year under extremely clear visibility conditions.”

The company also says it will not need to utilize the entire 96 square miles designated in its federal permit. Instead, it will determine which section of that area would be the most conducive to wind-energy generation.

News of the proposed project comes as state officials continue work on an Ocean Special Area Management Plan (SAMP) for the coastal waters off Rhode Island – a project undertaken in part to facilitate permitting of a $1.5-billion offshore wind farm backed by Gov. Donald L. Carcieri. However, the project proposed by Grays Harbor is outside the area to be covered by the Ocean SAMP.

Rhode Island officials said the company’s application took them by surprise: Grover Fugate, executive director of the R.I. Coastal Resources Management Council, found out about it when the U.S. Minerals Management Service (MMS) forwarded a copy of the document to him as a courtesy.

“It was news to us, when we heard from MMS,” said Laura Ricketson-Dwyer, spokeswoman for CRMC. “But that’s not totally uncommon,” since the CRMC does not have jurisdiction over federal waters. “FERC did not have to notify us.”

The electricity would be transmitted from the converters into an offshore substation, and then the power would be sent to Block Island via a single transmission cable buried about three feet beneath the sea floor. Part of that energy would be used on Block Island, which has some of the highest electricity costs in the country, and the rest would be transmitted to the mainland, coming ashore in the Narragansett village of Jerusalem.

Grays Harbor says it is already in negotiations “with a consortium of local utilities and companies” for them to purchase electricity from the project, and says existing overhead cables could handle the additional load it creates.

Although local officials have doubts about the prospects for wave energy here, Grays Harbor says prior research has given the company confidence it could work in the area. “The site proposed therefore is not speculative,” Grays Harbor president W. Burton Hamner wrote in a letter to FERC Secretary Magalie Salas. “It is the best place for the only technology package we believe will work in that region.” Hamner’s company cites a 2004 study published by the Electric Power Research Institute that said a 100-megawatt wave energy project would be competitive with a 100-megawatt wind farm. But that study looked at wave-energy resources in Massachusetts, not Rhode Island, and Grays Harbor acknowledges in its permit that “Rhode Island wave energy is less than [in] Massachusetts.”

Grays Harbor is specifically applying for a preliminary permit from FERC, which would allow the company to do in-depth research on the project for three years. From there, the company would apply for a pilot project permit, which would allow it to build a 5-megawatt demonstration version of the project. If the pilot project is successful, the company would apply for a standard 30-year FERC permit to build the full-scale development. If all were to go as Grays Harbor hopes, the company expects to have the 5-megawatt demonstration project up and running in 2011, with the full project to follow in 2016.

Grays Harbor cited two issues that could hamper the project: One is the structures’ possible impact on navigation lanes, although the company downplayed the likelihood of that being a problem. The other is the project’s possible impact on fishermen.

“There is no question that where there are wave-energy systems, recreational and commercial fishing will be affected,” the company says in its application. “This is unavoidable because of the conflicting use of the ocean space.” To reduce the project’s impact on fisheries, Grays Harbor said it is considering turning the wave structures into “artificial reefs … that can support fish and other marine organisms.”

The public has until January 28, 2009 to comment on the proposal at the commission’s web site.  The permit application for the Rhode Island offshore wave energy project was filed by Grays Harbor on October 22 and processed by FERC on November 28.

On the same day it submitted its application to develop the Block Island project, Grays Harbor filed applications for nearly identical projects off Cape Cod, New York, New Jersey, Hawaii, and San Francisco and Ventura, Calif.

And in July, the company was granted a preliminary FERC permit for a similar project in Washington state. “Our intention in applying for nearly identical projects in several sites is to achieve significant economics of scale in site evaluation and to help federal agencies develop effective agreements regarding management of ocean renewable-energy projects,” Hamner wrote in his letter to Salas.

But all the projects depend in part on the outcome of a bureaucratic turf war between two federal agencies:

  • The MMS, which was granted jurisdiction over most offshore energy projects by a 2005 federal energy law to the MMS, but which is still completing its final regulations for offshore projects.
  • And the FERC, which already has jurisdiction over inland hydroelectric projects, and this fall asserted its right to review and permit wave-energy projects as well.

Unsurprisingly, Grays Harbor has sided with FERC and agreed that the commission has authority over wave-energy projects. But the company also said the MMS still has jurisdiction over leasing the area in question – an issue the FERC has promised to work out.

In its permit application, Grays Harbor promised to work closely with state and local authorities. The company raised the prospect of establishing public development authorities with area communities to establish co-ownership of the project, and also says it “will develop a Settlement Agreement with stakeholders.”

Grays Harbor also pledged to hire local workers for the project, if possible. “The Providence area has capabilities for manufacturing wave energy converters and every attempt will be made to locally construct the machinery needed for the project,” the company says in its application.

Ricketson-Dwyer, the CRMC spokeswoman, said she is not surprised to see more companies moving quickly to develop ocean-energy projects. “People are – no pun intended – entering the waters here and getting into this.”

The CRMC plans to keep an eye on what happens over the next few weeks, she said, adding: “It’s really to early for us to even know if we have any role in any of this.” Meanwhile, Ricketson-Dwyer said, the proposal underlines the need to finish the state’s Ocean SAMP, in order to streamline the permitting process for offshore energy projects.

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MendoCoastCurrent, September 23, 2008

optOcean Power Technologies, Inc., a New Jersey publicly-traded company deployed its first PowerBuoy with Iberdrola S.A, a Spanish renewable energy company, and its partners, at a site approximately three miles off the coast of Santoña, Spain.

As noted by Iberdrola, the deployment of OPT’s PB40 PowerBuoy is the latest milestone toward the building of the world’s first commercial utility-scale wave power generation venture to supply approximately 1.39 MW of electricity into Spain’s electricity grid. The PB40, incorporating OPT’s patented wave power technology, is the first of what is expected to be a 10-PowerBuoy wave power station to be built out in a later phase of the project, and generating enough electricity to supply up to 2,500 homes annually.

Mark R. Draper, Chief Operating Officer of OPT, said: “This deployment is of great significance to OPT and the wave power industry, demonstrating the commercial potential of our leading technology after a decade of in-ocean experience. We now look forward to the first supplies of electricity to the grid and the expansion of the wave power station.”

The project began with OPT’s development of the Santoña site, followed by OPT’s receipt of the Engineering, Procurement and Construction (EPC) contract under which it would build and install the first PB40 PowerBuoy system, subsea power transmission cable and underwater substation and grid connection. In a subsequent agreement, OPT was also contracted for operations and maintenance (O&M) of the wave power station for up to 10 years. A special purpose company with Iberdrola as its major shareholder and OPT as a 10% shareholder has also been established for the purchase of the wave power station and the O&M services from OPT.

PowerBuoys provide a minimal visual profile due to most of their structure being submerged. They have a design life of 30 years with standard maintenance recommended every three to four years. The grid connection system for the PowerBuoys has been certified by an independent engineering firm.

The PB40 steelwork was fabricated by a local supplier in Santander, Spain, and the power take-off and control system was built at OPT’s facility in New Jersey, USA. The final integration and testing of the complete PowerBuoy was also conducted in Spain. The PowerBuoy is seven meters in diameter at the sea surface, 20 meters in length and weighs approximately 60 tonnes.

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GreenCarCongress.com, July 26, 2008

The US Minerals Management Service (MMS) is proceeding with the consultation and analyses necessary to move toward the issuance of limited leases under its interim policy for authorizing alternative energy data collection and technology testing activities on the Outer Continental Shelf (OCS).

MMS announced its interim policy in November 2007 to jumpstart basic information gathering efforts relating to development of OCS alternative energy resources such as wind, waves, and ocean currents as authorized by the Energy Policy Act of 2005 (EPAct). The limited leases envisioned under the interim policy will be for a term of five years and will not convey any right or priority for commercial development.

Following the initial announcement, MMS received more than 40 nominations of areas proposed for limited leasing off the west and east coasts. In April MMS identified a subset of 16 proposed lease areas for priority consideration and provided public notice of those areas for the purpose of determining competitive interest as required by EPAct and for receiving relevant environmental or other information. The comment period on the April notice closed on June 30. A brief description of the information received and MMS’s decisions concerning the 16 proposed lease areas follows.

  • New Jersey, Delaware, and Georgia—the 10 lease areas (six off NJ, one off DE, and three off GA) proposed for site assessment activities relating to wind resources drew no competing nominations and no significant comment. MMS will proceed with a noncompetitive leasing process for these sites.
  • Florida—three of the four lease areas off the southeast coast proposed for site assessment or technology testing activities relating to ocean current resources received competing nominations, and comments concerning the areas were favorable. MMS will proceed with a noncompetitive leasing process for the one site that did not receive competing nominations. Due to timing constraints inherent in the interim policy, as well as bureau budget and staffing considerations, MMS has decided not to proceed with a competitive auction for the other areas. Instead, the competing nominators have been asked to collaborate in order to enable interested parties to jointly benefit in information gathering under leases issued noncompetitively.
  • California—neither of the two areas off Northern California (Humboldt and Mendocino Counties) proposed for site assessment and technology testing relating to wave resources drew new competing nominations. However, based on two original overlapping nominations in the Humboldt area from the initial Call for Nominations in Nov. 2007, MMS has determined that there is competitive interest in that proposed lease area. MMS also received numerous comments from local stakeholders concerned about potential use conflicts and environmental issues in both areas. For the Mendocino area, MMS has decided to proceed with a noncompetitive leasing process, working with the applicant and local stakeholders to refine the area and scope of proposed activities and to address other local concerns. For the Humboldt area, MMS has decided not to hold a competitive auction and to ask the competing nominators to collaborate. If they agree to collaborate, MMS will proceed with a noncompetitive leasing process as in the Mendocino area.

The process for issuing limited leases under the interim policy will entail thorough environmental analysis under the National Environmental Policy Act and related laws, as well as close consultation with federal, state, and local government agencies as required by EPAct.

The limited leases that will be issued under the interim policy will enable the lessees to collect information that will be useful for potential commercial projects in the future under an MMS regulatory program that is in development.

MMS published a proposed OCS alternative energy rulemaking on July 9, 2008. When final, this rule will govern all future commercial OCS alternative energy activities and will apply to any future commercial development in the areas leased under the interim policy. Limited leaseholders wishing to conduct commercial activities will need separate authorization under the final rule that is adopted.

The MMS interim policy is ongoing pending the adoption of a final rule governing OCS alternative energy activity. Interested parties may continue to submit nominations, and MMS may act on other nominations that already have been received or are received in the future.

The specific companies involved with the proposed projects are listed below:

  • Delaware: Bluewater Wind Delaware LLC (wind resources data collection)
  • New Jersey: Bluewater Wind New Jersey Energy LLC (3 OCS blocks for wind resources data collection). Fisherman’s Energy of New Jersey (wind resources data collection). Winergy Power LLC (2 OCS blocks for wind resources data collection)
  • Georgia: Southern Company (3 OCS blocks for wind resources data collection)
  • Florida: Aquantis LLC/Aquantis Development Co. Inc. (ocean current data collection and technology testing)
  • California: Pacific Gas & Electric Co. (wave resources data collection, offshore Mendocino)

There is one proposed lease area off California and three off Florida where there is overlapping interest. For those areas, MMS is investigating whether the companies are interested in collaborating on resource data collection activities. Those companies are:

  • California: Pacific Gas and Electric Co. and Marine Sciences (wave resources data collection offshore Humboldt)
  • Florida: Proposed lease area 1: Oceana Energy Co and Vision Energy LLC (ocean current resource data collection). Proposed lease area 2: Marine Sciences and Vision Energy LLC (ocean current resource data collection). Proposed lease area 4: Florida Power & Light Co and Vision Energy LLC (ocean current resource data collection).

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