Wave energy developer Aquamarine Power has called in administrators to manage the business and to seek a sale or investment via the administration process.
A company or limited liability partnership (LLP) can enter into administration if it’s in debt and can’t pay the money it owes. It is then protected from legal action by people or organisations who are owed money (‘creditors’) and nobody can apply to wind up the company (have the company liquidated) during administration. A company may not have to pay all of its debts in full under administration.
This follows a decision by the Aquamarine Power board on Tuesday. The Joint Administrators will continue to trade the company with a view to effecting a sale as a going concern. All 14 employees are being retained.
The pioneering wave energy developers have been testing their full-scale Oyster wave energy machines at the European Marine Energy Centre (EMEC) in Orkney.
James Stephen, BDO business restructuring partner said:
“Whilst the company has seen many successes over the last few months, including securing a €800,000 grant from the EU as well as a £2 million contract from Wave Energy Scotland, the economic climate has significantly affected the business. The lack of private sector backing to supplement public funding support placed the company under cash flow strain and the directors concluded the best prospect of concluding a transaction was via the protection of administration. The company holds liquid funds which will allow this strategy to be pursued.
“We are continuing discussions with interested parties who were in discussions with the company prior to our appointment and are working closely with the Aquamarine Power board to engage with other potential purchasers. We welcome new enquiries.”
Aquamarine Power Chief Executive Officer Paddy O’Kane said:
“The team at Aquamarine Power has worked tirelessly over many years to design, build and demonstrate Oyster wave energy machines. During this time we have achieved a number of major milestones that have put our technology at the forefront of the industry. Oyster is the only wave technology to have proven it can operate in all ocean conditions and we have superb understanding of how well Oyster captures energy at sea. However, today’s news underscores the financial as well as technical challenge in bringing an entirely new form of energy generation to commercialisation. New private sector funding is required now to deliver our technology roadmap.”
Here is Aquamarine Power’s story:
The story first started in 2001 when Professor Trevor Whittaker’s research and development team at Queen’s University, Belfast began to research flap-type wave power devices with a view to reducing the cost of energy. The R&D team’s research ultimately led to the development of the Oyster wave energy device.
The innovative design of the Oyster wave energy converter attracted the interest of Allan Thomson, the retired founder of WaveGen, the UK’s first ever wave power company. Allan went on to co-fund further R&D into the Oyster wave power device. In 2005, Allan set up Aquamarine Power to bring Oyster wave power technology to the commercial market.
In 2007, we secured an investment of £6.3 million from major utility SSE (Scottish and Southern Energy) plus further investment of £1.5 million from venture capitalist Sigma Capital Group. This gave us the financial backing and additional industry expertise we needed to progress our Oyster wave energy technology from scale model wave tank testing to full-scale sea trials.
In 2008 we completed the fabrication of our first full-scale prototype Oyster wave energy converter and in 2009 we installed Oyster 1 at the European Marine Energy Centre (EMEC) in Orkney when it began producing power to the grid for the first time.
The following year, in November 2010, we welcomed ABB, one of the world’s largest power and automation companies, as a major shareholder in the business.
In 2011 we installed our next-generation Oyster 800 wave energy device at EMEC. This device is undergoing operational testing and is producing electrical power.
Oyster 800 has now demonstrated at EMEC for over three years – including surviving some of the largest stroms this decade. Our team of engineers and researchers are already developing the next versions of our Oyster devices, while our commercial team is progressing with a portfolio of development sites where can install and operate future Oyster wave farms.
ST Staff Writers
This post was prepared by Solar Thermal Magazine staff.