GULF
STREAM TURBINES LLC
EXECUTIVE SUMMARY
PRODUCING
CONTINUOUS LOW-COST ELECTRICITY
FROM OCEAN
CURRENTS
The
Advantages of the
- Powered by a steady ocean current that is produced
by the earth’s rotation
- Unlike wind, tidal, and solar, can generate 24-7
to fill base-load requirements
- Capacity factors of comparable to those of many
fossil-fuel plants
- Capital costs between $2,000 and $2,500 per kW of
generating capacity
- Owners eligible for 2.1 cent per kWh production
tax credit subsidy
- Electricity costs will be 2.7 to 4 .1 cents per kWh
with the 2.1 cent PTC subsidy
- Operation and maintenance (O&M) costs will
be very low due to simplicity
- Silent and invisible
- Reduces CO2 emissions by replacing
electricity produced by fossil-fuel plants
- Slow turning rotors will not harm marine life
- Constructed of non-corroding materials
- Easy to mass-produce
- Depths can be changed by remote control
- Easy to install and recover
- Stability is built into its design – will not
tip, yaw, or pitch
- High capacity factor will produce low-cost power
during amortization period
- Substantial profits assured by high capacity
factors and production tax credits
- Large additional revenues would be produced by cap
and trade
- Steadier energy produces 2 to 6 times the electricity
of other renewable energy
Elegant Simplicity
The
Gulf Stream Turbine relies on the relative locations of its centers of buoyancy
and gravity to obtain its great stability and on a unique method of leveraging
opposing forces to balance the lifting forces produced by the hydrofoils against
the downward vector forces produced by the horizontal drag acting through the
downward-angled anchor line. Because of their
simplicity and lack of moving parts, they can generate electricity for extremely
long periods without servicing.
The
patents cover a self-supporting structure that allows the turbines to be
positioned at those depths where the current can generate electricity at near
the turbines’ design capacities. The
actual conversion of the water’s kinetic energy into electricity utilizes the
same technologies that are used by the wind-turbine industry. Unlike the wind turbines, the Gulf Stream
Turbines will have very high capacity factors, extremely low O&M costs, and
be able to produce usable power 24-7.
Low Fixed Costs
Because there
will be no fuel costs and extremely low O&M costs, the costs of producing
the electricity will basically be the amortization costs, divided by the kWh of
electricity generated. The following
tables show the amortization costs per kilowatt-hour for Gulf Stream Turbines
that have capital costs of $2,000 and $2,500 per kilowatt of generating
capacity. They costs are based on a
capacity factor of 85% and on the capital costs being amortized over the number
of years shown and at the interest rates indicated.
Costs per KWh for
(The costs per kWh of the electricity that
include the 2.1 cent PTC would be
valid
only for the first 10 years after the machines were placed into service.)
Because there will be almost no operating costs, the costs of the
electricity would drop to virtually zero at the end of the amortization
period.
Near
Zero O&M Costs
Unlike the winds that can vary from zero to hurricane velocities,
the Gulf Stream’s velocities remain relatively constant, making it possible for
the Gulf Stream Turbines to produce electricity without needing to be
disconnected from the grid. Following
are a few of those reasons why the O&M costs for the Gulf Stream Turbines will
be substantially lower than for the wind turbines:
·
Unlike the wind turbines, the brakes
should never need servicing because they will be used only very briefly as the turbines
are slowed to get them synchronized with the 60 Hz of the grid;
·
If the stall-controlled rotors blades are
used, they would eliminate those mechanical problems that occur with
pitch-controlled blades;
·
·
The current’s relative steadiness should
prevent breakage caused by excessive current velocities;
·
There will be no buildup of dust inside
the nacelles that will need to be removed.
Revenues
from Electricity and the Production Tax Credit Subsidy
The wholesale price of electricity tends to follow the price of natural gas
because the electricity prices include the costs of the fuel that is used to
produce it. Because the operating costs
are the highest for the gas-fired power plants, it is the electricity that is
produced with that fuel that determines the price.
In the last few years horizontal drilling and hydraulic
fracturing technologies have made the production of natural gas from gas shale
economically feasible. However, because
the costs of developing these unconventional wells are very much higher than
those for developing the conventional wells, the incentives to produce this gas
will be sensitive to the gas price. Where
a conventional well might cost $1 million, an unconventional horizontal well
that has been developed in the same formation can easily cost $10 million.
A Gulf Stream Turbine that is equipped with two 600 kW generators and
operating at an 85% capacity factor would generate 8,941,300 kWh per year. If the wholesale electricity price averaged
8.5 cents per kWh, the annual revenues from the sale of the electricity would be
$760,010 and the 2.1 cent per kWh production tax credit would add an additional
$187,767, which would total $947,777 for one year. If the machine’s capital
cost were $2,000 per kW of capacity, then those revenues would produce a return
on the investment of 39.5%.
The following table gives the percent
returns on investments of $2,000 and $2,500 per kW from the sale of the
electricity at the prices indicated and from the PTC.
Every
kilowatt-hour of electricity generated with renewable energy can replace the
same amount of electricity that is generated with a fossil fuel. If the electricity
generated with a 1.2-MW
During
off-peak periods, the electricity produced by the Gulf Stream Turbines can
replace the fossil-fuel-produced electricity, produce hydrogen for fuel-cell-powered
cars, and recharge the batteries of plug-in hybrids and electric cars – all of
which would further reduce the CO2 emissions.
Income from
It
is impossible to predict the additional incomes that might result from the sale
of the carbon permits because the prices of those permits will be determined by
auction and the supply will be controlled by those government officials
administering the program.
A
number of economists have estimated that the carbon prices will probably range
between $20 and $40 per ton. With a carbon
offset commodity futures price of $30 a ton, the owners of a 1.2-MW
With
a wholesale electricity price of 10 cents per kWh, the revenues from the sale
of the electricity and the PTC subsidy would be $1,081,897. Adding the $390,000 from the sale of the
carbon permits would increase it to $1,471,897.
That $1,471,897 would produce a return of 61.3% on an investment of $2.4
million ($2,000/kW) and of 49% on an investment of $3 million ($2,500/kW).
Licensing Company
Will Get a Third Patent
The company that licenses the two existing patents will also get a
third patent that will extend the patent coverage on a major improvement for 20
years from the date of its application.
Because this patent will be totally dependent on the first two patents,
no one else can patent it.
We Are Determined
to Get the
Though we will consider joint ventures and other business
arrangements, our first choice would be to license the patents to an established
manufacturing company that has sufficiently deep pockets and engineering
talents to successfully develop the invention and get them into
production.
We will also consider working with a university that would apply
for federal grants to fund the engineering, the building and testing of a
prototype. Another option is for Gulf
Stream Turbines LLC to continue to apply for federal grants and contact
companies that have previously worked with the Department of Energy and the
Department of Defense.
We might also find an effectual individual, corporation or venture
capital company willing to fund the development of the prototype in return for
a percentage of future profits or royalties.
We have received an estimate that an initial investment of $750,000 to
$1 million will be required for the finalization of the Gulf Stream Turbine’s
R&D costs, tooling and design. We
have also received a cost estimate to build and test a full-size prototype has been
between $8 and $10 million.
John H. Robson
Inventor/Chairman
847 566 6947
Rowen Negrin
President
954 907 2254