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Large turbine orders. Very interesting phrase indeed. Maybe not Model-T Ford mass production, but how large is Mr Black talking? Back of the old envelope again but MeyGen Phase 2 is 28MW which could mean 8 x 3MW turbines (in addition to the existing 4 smaller ones). Going to the 86MW already consented would require at least 20 more 3MW turbines. Full capacity at the MeyGen site is 398MW which would mean more than 100 additional 3MW turbines – about 128 in total. Then you’d need some spares to drop in while a few are out for service. Call it a round 130. Is that a large order for 3MW turbines? It would mean assembling on average rather more than one a month for the next 10 years. It’s the kind of scaling up that could help reduce the LCOE enough to make TSE affordable and the whole sector viable – especially when combined with the increased CfD strike price. But that’s just MeyGen. Then there’s all the other TSE projects that could develop around Britain and the world in the wake of MeyGen. If there were to be just 8 x 398MW arrays over the next 20 years, you’d be looking at orders for more than 1,000 x 3MW turbines. Now, that’s a large order - which implies producing about one a week on average over 20 years.
Anyone wondering about who’s gonna supply a large turbine order? There used to be talk of developing a production line at Nigg – now it’s a “pathway”. The Proteus Marine Renewables website quotes CEO Drew Blaxland as saying, “The formation of Proteus and the injection of private equity capital will give us the capability, the focus and means to build a pathway to affordable tidal stream power." All due respect to Proteus who have developed the AR3000, but how long did it take to service the last turbine that went back in the water? Seems unlikely anyone is about to start assembling 1 turbine a month in a shed on a quayside at Nigg, let alone 1 a week and never mind 8 or 20 at a time.
Warranties. Yet another interesting word. Who requires warranties? Remember the answer given by the astronaut who was asked what goes through his mind when the countdown reaches “lift-off”? He said he is thinking that the vehicle is made of more than a million different parts, each one supplied by the lowest bidder. If there are going to be failures, there had better be warranties. You might not think your life depends on it, but the world absolutely needs the combination of TSE and BESS capacity for slack tide periods and when the wind don’t blow or the sun don’t shine.
Given the group’s financial position. Mr Black is being completely realistic. Let no-one underestimate him. He’s a seriously sophisticated leader and communicator. And a buy.
Thanks for your thoughts Timaeus Duncan is certainly having an illustrious career along with being chairman of SAE and putting his hard earned into the company.
Worth a read.
https://www.thomas-lloyd.com/en/news-and-insight/thomaslloyd-hires-head-of-portfolio-asset-management-under-recently-appointed-cio
Read all you have put and to be fair it has already been discussed before.
The playing field is going to be very difficult with regards to cash runway and being able not only to finance circa 10 turbines for phase 2 but also the next phase. That will be about 30 on top of the 10 already mentioned.
Do not really care at the moment what Mr Black is saying, stating or spouting.
Fact.
Full reverse done by SAER ref Usk.
Meygen 6 MW although working in a way doing well the delays for turbines being back in the water is a major concern.
Yes we could say in an emerging technology R&S is pivotal.
I would argue that if we are struggling with 4 turbines and getting these back in the water then how will we fair when we have newer turbines that have many different components and different blades.
This is an issue already so given that the Toyota Lean Manufacture principal must come into play then how will this fit with servicing and repairs etc as the Nigg area will be non stop forever given what is required going forward.
What is the funnel problem....oh yes it is when turbines are taken out and not immediately replace as this then effectively reduces energy and cash generation for the company.
There are many queries and questions.
To be fair I was hoping that the BESS at Meygen would be bigger in order to really create a double boost but at the moment it is only 200mw.
Also back at Usk.
Imo we need to have our own part of the system so we generate cash whenever we store energy via battery storage otherwise we do not get the best revenue for the systems that are being developed and built to over 1gw.
Are there any other things in the pipeline at Usk?
Where are we with regards to Meygen and the 2025 financial scenario in order to build and fit the turbines.
Also don't forget that SAER have now changed their objectives and role as a company.
Which is now....
Tidal energy system design, development and operation.
Time will tell. At the moment I am not aware of what turbines Proteus have in use at the moment.
Thought welcome.
I wish I could disagree Strangy, but it's hard to do so. Yes, it appears that the company was able to make a turn, but it's still a ton of open questions which simply haven't been answered for too long now.
Maybe this fades if the company value goes up over time but until then I'll remain nervous.
One thing has to be said though: even though all the uncertainty I do believe that the company is currently undervalued. SAE could cover almost their entire debt with Uskmouth and they are generating money with MeyGen. On paper the company appears in debt with £50m in debt, but Uskmouth is an asset that is currently not considered by the market if you ask me.
That being said, given two CfDs, MeyGen and the fact that they probably are only £10m in debt, if Usk was accounted for, SAE might be in a better position than what's currently reflected in share price.
I give SAE a solid 2.5p as a gut feeling 🤪
With the question remaining: How will SAE finance the next MeyGen phase because they WILL need money.
Horror scenario: bankruptcy in the end or somebody buying the company off the market for £20m leaving us stranded.
Ditto.
Given the portfolio of Mr Black this may actually be positive as the financial support for Meygen could come from that area that Mr Black works in via investments in renewable energy market.
The issue still relates to turbines.
This is ownership and agreements.
If Proteus become the big turbine builder then it will help.
Can a plan be deployed where the company (via Proteus ) have an effective method od removing and deploying turbines?
The cost is reflective for this and also that they can state and keep to their targets for remove and install.
Time out of the water now will be twice as costly from 3mw turbines.
The company on this front really do need to have better Comms given the fact that they have just given themselves bonuses.
Still leaves a sour taste in my mouth to be fair.
Am I wrong in saying that we are still in the research and development stage. The business is capturing the data and making its plans on said data.
I presume that the natural route for Proteus would be too eventually own it's own ship and team to provide the service at source of installing removing turbines. That would require some heavy investment and debt of which would not be SAE. It is if course scope to gain a bigger share and go in to cahoots on this project. I sometimes think though that some of these turbines have been turning for a long time without the need to replace, remove etc. It is a very distinct possibility that these turbines do not need to be bobbed in and out like a Chocolate biscuit in a brew it's just because of the data gathering. I'm a man of little knowledge in the sector and only assuming the possibility.