Oct. 21 (Bloomberg) -- Marine Current Turbines Ltd., a U.K. maker of tidal energy technology, said Siemens AG plans to “substantially” increase its stake in the company which is seeking to raise as much as 100 million pounds ($157 million) for two projects.
The turbine maker is looking to raise about 50 million pounds for each project, Andrew Tyler, chief executive officer of the Bristol, England-based company, said yesterday by phone. It’s also in the middle of a financing round with existing shareholders for working capital, he said.
“We’re looking for several millions, and it could be as high as 10 million pounds,” Tyler said. “Our main shareholder, Siemens, is planning to increase its stake in the company substantially and we will be announcing this within the next few weeks.”
Siemens, Europe’s largest engineering company, owns about 10 percent of MCT, as the turbine maker is known. Torsten Wolf, a Siemens spokesman, confirmed the company is in the process of increasing its stake, and declined to say by how much.
Wave and tidal energy has the potential to meet as much as 20 percent of the U.K.’s current electricity demand, according to the government. The country is aiming for 15 percent of its energy to come from renewable sources by 2020.
MCT is planning two projects of 10 megawatts each, one in Kyle Rhea, Scotland, and the other in the Anglesey Skerries in Wales. It wants to raise funding for these projects by the end of next year, Tyler said. If successful, it’s aiming to install the first project in 2014, and the second in 2015, he said.
“In terms of the investors, utility companies are very high up on our list, but also specialist funds, and alternative investors who have an interest in renewable energy, such as some of the oil companies who we are approaching as well,” Tyler said. MCT also expects some public support, he said.
The money would most likely be in the form of equity, said Tyler. “We would be very lucky to get debt financing for early projects like these, although gearing the project once in operation is definitely possible.”
The U.K. government yesterday boosted support for marine energy by proposing to raise the number of so-called Renewable Obligation Certificates from two to five for projects of as much as 30 megawatts. This means wave and tidal energy generators may be eligible from 2013 to receive about 229 pounds a megawatt- hour of electricity at current prices, up from the 92 pounds they would have received previously.
The proposal is “better than we might have hoped for,” the CEO said, and means MCT can now begin to look for the money it needs to begin its two projects.
--Editors: Stephen Cunningham, Amanda Jordan.
To contact the reporter responsible for this story: Louise Downing in London at Ldowning4@bloomberg.net
To contact the editor responsible for this story: Reed Landberg in London at email@example.com