The wave and tidal energy market is estimated to be valued at USD 770.05 Bn in 2024 and is expected to reach USD 1,416.58 Bn by 2031, growing at a compound annual growth rate (CAGR) of 9.1% from 2024 to 2031. The steady increase in global energy demand along with the focus on develop renewable sources of energy have been the major drivers of growth in the wave and tidal energy market.

Market Driver - Increasing Demand for Renewable Energy Sources to Combat Climate Change

Effects of climate change are increasing and events like rising sea levels and increasing temperatures are impacting lives and economies around the world. Consequently, there is a growing push for transitioning to cleaner and more sustainable sources of energy such as wave and tidal energy. More countries and governments are setting stricter emission regulations and targets to reduce their reliance on fossil fuels in the coming years. This has led to rising demand for renewable sources of energy like solar, wind, hydro, and wave and tidal energy.

While solar and wind energy have witnessed major growth and are widely used commercially, wave and tidal energy are relatively newer entrants in the renewable energy domain. However, they are gaining more attention due to their steady and predictable nature of energy production. More stakeholders in the wave and tidal energy market are focusing on increasing the share of renewables in the overall energy mix. In the coming years, wave and tidal energy is expected to play a bigger role to not just reduce emissions but also ensure energy security for nations.

Market Driver - Advancements in Wave and Tidal Energy Technology

Through continuous research and development over the past few decades, wave and tidal energy technologies have progressed significantly in terms of performance, efficiency and cost competitiveness. Early designs and prototypes faced numerous engineering challenges related to withstanding rough ocean environments and delivering electricity economically. However, technology providers have addressed many of these issues by developing more durable systems, innovative component designs and efficient power take-off mechanisms.

These advancements have moved wave and tidal energy devices from lab scale testing to deployment of commercial sized pilot and utility projects across geographies. Initiatives by large corporations, supportive policies around technology transfer and increased investments in next-generation solutions are expected to lower costs significantly to aid commercial and utility scale adoption going forward.

Decentralized, small-scale tidal and wave systems also show promise in supplying off-grid and island communities with eco-friendly electricity. Overall, technological progress is a key catalyst making wave and tidal energy more viable propositions globally.

Market Challenge - Environmental Impact on Marine Ecosystems

One of the major challenges faced by the wave and tidal energy market is evaluating and minimizing the environmental impacts of converting wave and tidal energy. While harnessing energy from oceans can reduce carbon emissions, there are concerns about how extracting kinetic energy from waves and tides may negatively affect fragile coastal and marine ecosystems. Installing large wave and tidal structures can disrupt underwater habitats and migratory patterns of various marine species and disrupt environmental flow.

Extensive research and testing is required to understand how energy extraction devices interact with aquatic flora and fauna to avoid endangering biodiversity. Developing environmentally sustainable wave and tidal technologies and deploying them in a responsible way requires significant upfront investment in monitoring devices and personnel. Addressing these environmental concerns through robust research and adopting best practices for ocean energy development will be crucial for growth of the wave and tidal energy market.

Market Opportunity - Global Transition Towards Renewable Energy Providing Investment Avenues

The increasing policy focus and consumer demand for renewable sources of energy presents lucrative investment opportunities for the wave and tidal energy market. As various nations commit to reducing their dependence on fossil fuels and diversifying their energy mix, there is significant funding available for research, development and demonstration of emerging ocean energy technologies.

Growing policy support and PPP models for ocean energy is attracting greater institutional and private capital into the wave and tidal energy market. National and international climate finance mechanisms also provide attractive financing options to developers. With concerted global efforts to transition to a low-carbon future well underway, the long-term potential for wave and tidal energy market looks favorable to sustain investment and drive down costs through economies of scale.

Focus on Innovation: Players have focused heavily on research and development to develop innovative technology solutions that can harness wave and tidal energy more efficiently.

Partnerships for Development: Companies in the wave and tidal energy market have partnered with government organizations, utilities, and research institutes to jointly fund and support development of new projects.

Target Early Adopter Markets: Rather than mass market adoption, players targeted niche application areas and locations that are early technology adopters.

Participation in Auctions and Tenders: Major players like SIMEC Atlantis Energy and Minesto have successfully participated in Contracts for Difference (CfD) auctions by the UK government to achieve long term price stabilization through power purchase agreements. For example, in 2019 Minesto secured support for their Holyhead Deep project through a 15-year CfD with a strike price of £179.90/MWh.

nsights, By Type: The Growth of Renewable Energy Drives Wave Energy Segment

In terms of type, wave energy contributes 65% share of the wave and tidal energy market in 2024, owing to advancements in wave energy conversion technologies. Wave energy harnesses the power of ocean surface waves and is considered one of the most promising renewable sources of energy. Waves occur due to the transfer of energy from wind to the surface of the sea and oceans, which makes wave energy a very sustainable form of energy. The increasing use of renewable sources of energy for power generation across the globe is a major factor that is fueling the growth of the wave and tidal energy market.

In recent years, various wave energy conversion technologies have been developed that can efficiently capture energy from ocean waves. Devices such as attenuators, point absorbers, and overtopping devices are able to convert wave power into clean electricity. With sea levels rising due to climate change, wave and tidal energy market can play a vital role in transitioning to a low carbon future and meeting renewable energy targets set by many nations.

Insights, By Technology: Advancing Tidal Stream Technologies Drive the Tidal Stream Generator Segment

In terms of technology, tidal stream generator contributes 50% share of the wave and tidal energy market in 2024, owing to its efficiency and minimally intrusive design. Tidal stream generation utilizes the kinetic energy of flowing water to generate electricity without the need for dams or barrages. Tidal stream generators, such as tidal turbines, are positioned underwater and function similar to wind turbines to capture energy from marine currents.

Compared to traditional tidal barrage systems, tidal stream generation causes minimal disruption to the local ecosystem and has a smaller footprint. It allows natural tidal currents to flow freely while harvesting a portion of energy from the flows. Technological advances are improving the performance of tidal stream generators making them more competitive compared to other tidal technologies. Ongoing testing and prototyping of large-scale tidal stream farms will aid in mainstream commercialization in the wave and tidal energy market.

Insights, By Application: Power Generation Application Drives Overall Market Growth

In terms of application, power generation contributes the highest share of the wave and tidal energy market in 2024, given the benefits it provides. Harnessing energy from waves and tides offers a sustainable way of generating electricity. Wave and tidal energy power plants generate renewable baseload electricity without releasing any emissions into the air.

Areas located near coastlines with high wave and tidal activities can setup such power generation projects at a lower installation cost compared to other renewable options. The predictability of tides also makes wave and tidal energy suitable for contributing toward grid balance. It helps supplement other renewable sources that have intermittent output like solar and wind.

The ability to generate bulk amounts of renewable electricity from the ocean makes power generation the leading application segment. It allows wide-scale utilization of clean wave and tidal energy resources.

• Global Collaboration Efforts: International partnerships are forming to accelerate technology sharing and development in wave and tidal energy, highlighting the market's collaborative nature.
• Policy Implementations: Governments are introducing marine spatial planning policies to streamline the development of marine energy projects, reducing bureaucratic hurdles.
• Regional Growth: Europe leads the market due to supportive policies and extensive R&D, while the Asia-Pacific region is emerging rapidly, with countries like South Korea and Australia investing heavily.
• Environmental Impact Reduction: New technologies are focusing on minimizing the impact on marine life, addressing one of the main environmental concerns associated with wave and tidal energy installations.

The major players operating in the wave and tidal energy market include SIMEC Atlantis Energy, Ocean Power Technologies, Orbital Marine Power, Verdant Power, Carnegie Clean Energy, Eco Wave Power, Pelamis Wave Power, Wello, Wave Swell, Ocean Renewable Power Company, OpenHydro Group Ltd, Aquamarine Power, CorPower Ocean, BioPower Systems, AW Energy, and Seabase Ship Management Private Limited.

• In June 2021, Eco Wave Power deployed a wave energy converter at the Port of Jaffa in Israel in collaboration with EDF Renewables IL. The project received support from the Israeli Ministry of Energy. A notable feature of this initiative is the land-based positioning of the wave energy converters.
• In June 2021, Mocean Energy, a Scottish renewable energy company, launched its "Blue X" wave energy prototype at the European Marine Energy Centre (EMEC) in Orkney, Scotland. The deployment marked a significant step for the company in testing and advancing their wave energy conversion technology.
• In April 2021, Orbital Marine Power, a Scottish renewable energy company, launched the Orbital O2 tidal turbine. The O2 is recognized as the world's most powerful tidal turbine, capable of producing 2 MW of clean energy—enough to power around 2,000 homes annually.

• By Type
  • Wave Energy
  • Tidal Energy
• By Technology
  • Tidal Stream Generator
  • Oscillating Water Columns
  • Tidal Turbines
  • Tidal Barrages
  • Tidal Fences
• By Application
  • Power Generation
  • Desalination
  • Environmental Protection