Siemens AG: Siemens increases stake in ocean power specialist Marine Current Turbines

Erlangen, Germany, November 4, 2011. We will actively shape the commercialization process of innovative marine current power plants,” said Michael Axmann, CFO of the newly founded Solar & Hydro Division within Siemens’ Energy Sector. Financial details of the deal are not disclosed.

Effective October 1, 2011, Siemens realigned its renewables business into two independent units. The former Renewable Energy Division was split into two new divisions Wind Power and Solar & Hydro. Marine Current Turbines (MCT) evolved from a pioneer to a technology leader in horizontal-axis marine current turbines and has 25 employees. In February 2010, Siemens acquired a minor stake in the Bristol-based company and thus entered the marine tidal current sector. Ocean power is emerging with strong growth rates driven by global CO2 reduction commitments. Until 2020, experts anticipate double-digit growth rates for the ocean power business. Based on further estimates the global potential for power generation using tidal power plants is 800 terawatt-hours (TWh) per annum. For comparison: That is equivalent to 25 percent above the total power demand in Germany and between three and four percent of power consumption worldwide.

Andrew Tyler, CEO of MCT, said: “Through the expansion of the partnership with Siemens, we have further strengthened our position in the tidal energy market. We have the increased backing of a major industrial player in Siemens, which is essential to support the commercialization of our proven technology. We are about to approach investors to secure funding for our first two tidal array projects, and Siemens’ increased investment as well as UK Government support should give investors the confidence that we have the necessary backing and support to deliver these crucial projects and the ones to follow.” MCT plans to present two Project Investment Prospectuses to the market in November for the 8-megawatt (MW) Kyle Rhea project in Scotland and the 10-MW Anglesey Skerries project in Wales. For both projects, applications for lease from The Crown Estate have already been approved. The UK Government’s ROC (Renewable Obligation Certificate) Banding announcement on October 20 recommends the support of tidal power projects with 5 ROCs per MWh. In addition MCT has an approval for a lease from The Crown Estate to deploy a 100-MW tidal farm off Brough Ness on the southernmost tip of the Orkney Islands in Scotland.

MCT has already successfully implemented its first commercial-scale demonstrator project SeaGen in Strangford Lough in Northern Ireland. Since November 2008, two axial turbines with a combined capacity of 1.2 MW have been feeding power into the grid to supply about 1500 homes. SeaGen has fed over 2.7 GWh of electricity into the grid. This project has thus produced the largest amount of electricity in the whole marine current power sector.

Marine current turbines generate electricity by utilizing tidal current flows. The SeaGen turbine is fixed on a structure and is driven by the flow of the tides, with a key advantage that the generated power is precisely predictable in the tidal cycle. This technology is effectively similar to a wind turbine, with the rotor blades driven not by wind power but by tidal currents. Water has an energy density more than 800 times that of wind. Twin rotors rotate with the movement of the tidal flow and the blades pitch through 180 degrees to optimally track tidal current direction and speed. Marine current turbines are part of Siemens’ Environmental Portfolio. In fiscal 2010, revenue from the Portfolio totaled about EUR28 billion, making Siemens the world’s largest supplier of ecofriendly technologies. In the same period, our products and solutions enabled customers to reduce their carbon dioxide (CO2) emissions by 270 million tons, an amount equal to the total annual CO2 emissions of the megacities Hong Kong, London, New York, Tokyo, Delhi and Singapore.

The Siemens Energy Sector is the world’s leading supplier of a complete spectrum of products, services and solutions for power generation in thermal power plants and using renewables, power transmission in grids and for the extraction, conversion and transport of oil and gas. In fiscal 2010 (ended September 30), the Energy Sector had revenues of approximately EUR25.5 billion and received new orders totaling more than EUR30.1 billion and posted a profit of more than EUR3.3 billion. On September 30, 2010, the Energy Sector had a work force of more than 88,000.

Marine Current Turbines is based in Bristol, England. Founded in 2000, MCT has led the market in developing and patenting tidal current stream energy devices building on pioneering innovation dating back to the 1970s. The company’s principal corporate shareholders include Siemens, EDF Energy, ESB International, and Guernsey Electricity. The company is taking forward a number of tidal projects in the UK and internationally. Further information is available at: www.marineturbines.com