In February of 1987 the New York Times published an article on the potential for electricity produced from ocean waves. Fast forward 30 years, and we have a more recent article by ABC musing, "Whatever happened to Wave Power?". The easy scapegoat would be the unwillingness of public and private capital to take part in high risk endeavors. That position is dubious when you look at the following facts. US DOE funding of wave power research has totaled >$100M from 2008 - 2015. Available data indicates that cumulative European government funding was likely twice that amount during the same period. Other data points indicate that private capital funding of early stage research has easily surpassed public funding levels. So, with such a high level of investment, why has the industry failed to demonstrate substantial progress towards cost effective power production?
We believe the fault lies with private enterprises involved in wave energy technology development who have, repeatedly, made the critical mistake of ignoring market risk. That is, as Eric Ries states in his book "The Lean Startup", these companies have failed to ask and answer the question of whether or not a product should even be built in the first place. Let us explain.
When launching new products, innovations or ventures, companies have a tendency to focus all of their attention on technology risk. They barrel ahead, asking and resolving the important technological questions concerning "what is my innovation?", "how can I build it?", and "what resources will I need?" and then they set forth building it. At the end of the journey they finally get around to asking "How does my new product fill a market need?". Unfortunately by now, so much time, energy, and resources have been plowed into the technical research and development process that companies experience an escalation of commitment to the new innovation and tend to brush over and sprint through the appropriate market research in order to bring it to market as fast as possible.
Based on progressive results over the past decade, solar and wind energies are now considered the de facto standards of sustainable power production. Even conventional hydropower is finding it hard to find a seat at the table. Therefore, now more than ever, wave energy device developers need to begin by asking "How will I provide value to my future customers?". Without the answer we may be doomed to repeat the mistakes of those that have come before us. So where do we see our fit?
Stay tuned to find out.