EUREC-IST
The EUREC MSc in Renewable Energy
Ocean Energy Specialization
2012/2013
Economics, Public Policies and Environment
Prof António Sarmento
Department Mechanical Engineering
IST/Technical University of Lisbon
Tel: 21 8417405
Email: antonio.sarmento@ist.utl.pt
Module Curriculum
1) Type and ECTS
Mandatory and 4.5 ECTS
2) Teaching staff
Prof. António Sarmento (IST; antonio.sarmento@ist.utl.pt): Responsible and Ocean Economy
and OTEC lectures.
Mr. Alex Raventós (WavEC; alex@wavec.org): Ocean energy economy lectures.
Mr. Nuno Matos (WavEC; nuno@wavec.org): Public Policies lectures.
Dr. Teresa Simas (WavEC; teresa@wavec.org): Environment lectures.
3) General Objectives
To put the student into contact with the economics of ocean energy (costs, project financing,
market development), the role and processes of public policies and their relevance to foster
the development of these pre-matured technologies and the impact of environmental
concerns, constraints and processes in the development of offshore renewable energy farms.
4) Learning Outcomes
At the completion of this module, the student will:

Become familiar with the basic economic analysis of ocean energy systems including
the cost, financing and economic evaluation

Get basic knowledge on the general policy issues regarding ocean energy systems and
more detailed knowledge on the licensing and permitting procedures for installation of
OE systems and enabling mechanisms as funding, feed-in tariffs and tax incentives

Be able to perform simple environmental impact studies for OE systems.
5) Contents
Economics, Public Policies and Environment 1 (EPE1)
Economics

Costs of ocean energy: Key concepts and definitions
o Overview of the main types of cost components
o The Cost of Capital
o CAPEX and OPEX
o
LCOE

Introduction to project feasibility assessment
o Main finance definitions: Debt, Equity, Cash Flows, Payback period, IRR, NPV,
etc.
o Example of a project feasibility assessment using Retscreen

Towards the market: Electricity Market, support mechanisms and future scenarios
o The electricity market
o External costs of energy
o Scenarios for ocean energy: installed capacity and expected cost evolution
o Support mechanisms for new technologies: FIT’s, certificates and others.
Economics, Public Policies and Environment 2 (EPE2)
Public Policies



Public issues
o Public Policies
o Public Administration
o The Offshore Renewable Energy (ORE) Area
Licensing and Permitting
o Consenting (Licensing and Permitting)
o Training of Public Administration
o Outreach
Technology and market development tools
o Phases of development
o Financing Mechanisms
o Market development tools
Economics, Public Policies and Environment 3 (EPE3)
Environment



EIA objectives, processes and requirements
o What is the Environmental Impact Assessment?
o Environmental Impact Assessment approaches
o The European legal context of the EIA (EU related Directives)
o EIA as a stepwise approach
o The EIA process for Marine Renewable Energy projects
Public consultation and conflict of uses
o Public opinion, acceptance and participation
o Conflict of uses
o Consultation procedures
Environmental monitoring
o Monitoring plan
o Methodologies
o Adaptive management
6) Evaluation Method
EPE1 and EPE2
The evaluation method will comprise the two following parts:
1. A work to be undertaken part individually and part in group to be presented in March
25. The work will be common to the Ocean Renewable Energy module 1 (OER1). This
work will weight 25% for the final mark.
2. A written test with no consultation that weights 35% for the final mark.
EPE3
Similarly there will be an assignment with a weight of 15% and a written test with a weight of
25%.
Approval in the first assessment period will be obtained if the final mark is higher than 9.5.
Students not approved in the first assessment period (as indicated above) can take a final
written exam that weights 60% for the final mark, the remaining 40% being from the
assignments as indicated. Students are approved in the second assessment period if their final
mark exceeds 9.5.
7) Bibliography





Ernst & Young and DECC (UK). “Cost of and financial support for offshore wind”,
2009.
Paillard, M., Lacroix, D., Lamblin, V. (2009) Marine Energy Renewables – Prospective
Foresight Study for 2030, Éditions Quae, ISBN 978-2-7592-0183-9.
Mendonça, M. (2007) Feed-In Tariffs – Accelerating the Deployment of Renewable
Energy, Earthscan, ISBN 978-1-84407-788-5.
Soares, I., Moreira J., Pinho, C. e Couto J. (2007). Análise Financeira de Projectos,
Edições Sílabo, Portugal.
Thomas A. Birkland – “An introduction to the policy process: theories, concepts and
models of public policy making”, 294 pages, Publisher: M.E. Sharpe (January 1, 2001),
ISBN: 0765604183.



Economics of wind Energy, EWEA,
http://www.ewea.org/fileadmin/ewea_documents/documents/00_POLICY_docume
nt/Economics_of_Wind_Energy__March_2009_.pdf
Projected Costs of Generating Electricity. IEA, 2010.
“Accelerating marine energy”, Carbon Trust, 2011.
8) Lectures and assessment plan
Day
18-Fev
19-Fev
19-Fev
25-Fev
26-Fev
26-Fev
04-Mar
05-Mar
05-Mar
11-Mar
12-Mar
12-Mar
18-Mar
19-Mar
19-Mar
25-Mar
25-Mar
08-Abr
09-Abr
09-Abr
15-Abr
16-Abr
16-Abr
22-Abr
23-Abr
23-Abr
29-Abr
30-Abr
30-Abr
04-Jun
04-Jun
25-Jun
Hour
Subject
Teatcher
Module
14:30 Public policies: role, agents, processes & impacts (I)
NM
EPE2
09:00 Public policies: role, agents, processes & impacts (II)
NM
EPE2
10:30 Tutorial on Public Policies (I)
NM
EPE2
14:30 Public Policies: application to OER (I)
NM
EPE2
09:00 Public Policies: application to OER (II)
NM
EPE2
10:30 Tutorial on Public Policies (II)
NM
EPE2
14:30 Cost of O. Energy: key concepts & definitions (I)
AR
EPE1
09:00 Cost of O. Energy: key concepts & definitions (II)
AR
EPE1
10:30 Tutorial on Cost of Ocean Energy
AR
EPE1
14:30 Introduction to project feasibility assessment (I)
AR
EPE1
09:00 Introduction to project feasibility assessment (II)
AR
EPE1
10:30 Tutorial on project feasibility assessment
AR
EPE1
14:30 Electricity Market and future scenarios (I)
AR
EPE1
09:00 Electricity Market and future scenarios (II)
AR
EPE1
10:30 Tutorial on Electricity Market & future scenarios
AR
EPE1
09:00 Test EPE1 & EPE2
AR, NM
10:30 Presentation of OER1 & EPE1&2 assignments
AS, TS, JC, AR, NM
14:30 Environment Impact Assessment (I)
TS
EPE3
09:00 Environment Impact Assessment (II)
TS
EPE3
10:30 Tutorial on EIA (I)
TS
EPE3
14:30 Environment Impact Assessment (III)
TS
EPE3
09:00 Environment Impact Assessment (IV)
TS
EPE3
10:30 Tutorial on EIA (II)
TS
EPE3
14:30 Public consultation and conflict of uses (I)
TS
EPE3
09:00 Public consultation and conflict of uses (II)
TS
EPE3
10:30 Tutorial on conflict of uses
TS
EPE3
14:30 Environmental monitoring (I)
TS
EPE3
09:00 Environmental monitoring (II)
TS
EPE3
10:30 Tutorial on Environmental Monitoring
TS
EPE3
09:00 Test EPE3
TS
EPE3
10:30 Presentation of EPE3 assignments
TS
EPE3
14:30 Exam EPE
AR, NM, TS