The first offshore wind turbines were installed at Vindeby off the Danish island of Lolland in 1991. The first ten years of the industry saw small projects being built in very shallow water near shore locations. These ‘demonstration’ projects have paved the way for the more recent projects that are of a much larger size.The biggest offshore wind farm yet installed is the 165 MW Nysted development off Denmark which was completed in 2003. There are 22 operational offshore wind farms in the world today. The 388 installed turbines in these projects provide a total of 800 MW.

The UK currently has the second largest amount of offshore wind capacity installed and will overtake Denmark in 2007 to become the world leader. Future prospects for the UK are excellent and government support strong. Other countries set for major growth include Germany and the US.

The East of England is home to the second of the UK’s large offshore wind farms, Scroby Sands, installed off the Great Yarmouth coast in 2004. The region is ideally positioned to take advantage of this growing market being located between two of the three UK development areas, the Greater Wash and the Thames Estuary. On the Scroby Sands project, contracts to the value of £38.8m (48%) were sourced from UK companies, with £12.8m (16%) originating from within the East of England.

Offshore wind faces challenges to establish its full potential, the most immediate of which is cost, with major savings needed to ensure future projects are able to be built. The opportunity for innovation in the industry is high with tremendous potential for oil and gas experience to be transferred.

The large-scale deployment of offshore wind will take place when the next generation of wind turbines are commercially available. Currently 3 MW turbines are being installed but within 5 years most projects will be using turbines of 4-6 MW in size allowing substantially larger projects to be built.

Onshore wind power provides an increasingly economic source of energy, with significant worldwide growth for the last ten years. The industry has been made viable through economic subsidies which have enabled development to take place. For some countries, onshore wind power is both a key energy source and a major industry in its own right.

The onshore wind industry has seen year-on-year growth for the past 15 years – there are very few industries where such a growth rate has been seen to be sustained for so long. In 2005 a record-breaking 11.7 GW was installed which represents a growth of 35% compared to 2004. Installed capacity for 2006 is on track to reach 15 GW.

Some early leaders are now beginning to slow such as Germany; likewise Denmark has installed very little onshore capacity in recent years. To balance this, activity is still strong in the massive Spanish market and significant new markets such as the UK are emerging. Together with rapid growth in Asia, prospects for continued high growth remain strong.

The UK now has over 1,500 MW of onshore wind capacity installed, much of which is in Scotland where growth has been extremely rapid. The East of England currently has 16 onshore turbines across 5 individual projects with a 12 turbine project currently under construction.

Technology continues to evolve with turbine capacities and efficiencies increasing. Project sizes of 50 MW and above are now becoming common and in the US the largest projects are regularly several hundred megawatts in size.

The wave and tidal current stream energy sectors are high potential future markets. Little operational capacity is currently installed, with the majority of technologies still in the development stage. Despite still being a very much embryonic industry, successful prototype installations are taking place and future market leaders are already emerging in both sectors. Grid connected prototypes are helping prove the concept of individual technologies and establish the first power purchase agreements from wave and tidal technology.

Unlike the offshore wind industry where the turbines are now all fairly standard, the different technologies in the wave and tidal sectors are at present very different in principle. Tidal current turbines are the most standard in design, in essence being an underwater wind turbine, but even in this sub-sector there are differences in design.

Ultimately a range of technologies will emerge as commercial scale competitors, but only the strongest of these will survive in the long term as the market place becomes more competitive. A greater similarity in design can be expected in each sub-sector over the period covered by this report. There is such a large number of concept devices that only those with the highest potential will move forward because of the limited funding and financing available to them.

The first commercial ‘wave farm’ was installed in the summer of 2006 off Portugal. The 2.25 MW development uses three of Ocean Power Delivery’s Pelamis wave energy converters.

Coupled with one of the best natural resources in the world, the UK has an excellent base of technology developers including many of the market leaders for both wave and tidal current stream including, Marine Current Turbines, Ocean Power Delivery, Wavegen, The Engineering Business etc. Government support to developers has been encouraging to date, but other European countries such as Portugal have market incentives that are attracting UK developers.

The East of England region is particularly well placed to exploit the natural resource endowment inherent in its landscape with a varied agricultural industry base producing a wide range of bio-energy resources.

Biomass energy from organic materials such as wood, crops and waste can be used to generate electricity and/or heat or in the production of liquid transportation fuels such as bioethanol or biodiesel.

Biofuels are the only short-term option to reduce reliance on transportation oil. The market is expanding rapidly, from a current £10 billion to reach about £24 billion in 2010. Major oil companies are developing their interests in the sector and private investment into companies active in biofuels has surged in the last year. The UK should see tremendous growth in the short-term as the EU directive on biofuels has set a target of 5.75% in 2010, an ambitious target as the EU missed its 2% in 2005

Combustion of biomass for power generation alone accounts for around 0.9% of world electricity production, primarily in Northern America and Western Europe. Main producers worldwide are the US, Brazil and Finland. Current global installed capacity growth is over 10% per annum. The main applications are medium-scale CHP plants where energy production is optimised through district heating and manageable quantities of supplies at short-distance from the power plant. Co-firing with coal is also taking-off. The market for power generation from biomass should reach around £1.6 billion in 2010 from £1.1 billion currently.

Biomass energy is heavily reliant on low cost sources of biomass – good infrastructure and short-distances are a prerequisite. Long term commitments are needed, both to the biofuel tax rebate and renewable transport fuel obligation, as well as sensible regulation and planning rules that encourage renewable developments. Also needed are effective grant schemes throughout the supply chain and a sustainable return to farmers. The government’s use of obligations has helped biomass for electricity and transport fuels, but has not offered the same incentives for biomass for heat. Further support to the ROC to lower the break-even period would enable the development of a small-scale wood-CHP fuel supply chain.

The East of England has very strong potential with much agricultural and forestry land for which biomass offers an opportunity for improved rural income. Three biomass plants currently operate in the region: Ely, which at 38 MW is the largest straw burning power station in the world; the 12.7 MW Eye power station which was the first poultry litter fuelled plant in the world; and the 38.5 MW Thetford power station which is the largest poultry litter fuelled plant in the world. All three plants are operated by Energy Power Resources.

Microgeneration incorporates a range of technologies (many of which are renewable) which can provide a building with a proportion of its electricity and/or heating. Excess electricity can be sold to the National Grid.

There is currently little installed capacity in the UK. The potential, however, is considerable, with the latest DTI microgeneration review considering that micro-CHP alone could displace around a third of the total UK electricity consumption by 2030.

Following increasing gas and electricity prices, interest in micro-generation is growing despite their initially high capital cost. Microgeneration technologies are located at load-point, hence are far more efficient as a distributed generation source than traditional large-scale, central generation technology.

Micro-generation technologies can be deployed virtually anywhere and are easily displaceable or removable. As ‘white-goods’, microgeneration technologies are potentially mass-market products and selling strategies are emerging to reflect this with high street stores beginning to stock some units.

Micro-generation offers high employment creation particularly through commissioning and maintenance activities. Substantial numbers of personnel with plumbing, heating and electrical skills will be required if the sector is to fully develop.

The major technologies in the microgeneration sector include:

• Solar thermal – the most commonly installed type in the UK, solar thermal systems are usually installed on domestic properties to provide water heating. They are one of the most efficient and cost effective microgeneration technologies.
• Solar Photovoltaic (PV) – Solar PV systems convert solar energy into electricity through the use of roof-mounted solar panels. PV is not as cost efficient as solar thermal systems.
• Small-scale wind – Units are typically in the 1-2kW range and will usually provide a saving of 1/3 on electricity bills. Payback period for the system is approximately 5-7 years for a 1kW system. Excess electricity can be resold to the National Grid.
• Ground source heat pumps (GSHP) – GSHP transfer heat from the ground into a building to provide space heating and can be used for pre-heating domestic hot water. A typical 8kW system costs £6,400-£9,600.
• Micro-CHP – Micro Combined Heat and Power is a ‘super boiler’ which partly recycles the energy consumed for heating to generate electricity. The concept delivers huge benefits by reducing the amount of energy wasted. Combined thermal and electrical efficiency of a micro-CHP unit is over 90%. Micro-CHP is a high efficiency solution; it is not a renewable source of energy unless primary fuel is strictly made from renewable sources such as biomass.