The latest company in the race to harness electricity from the powerful Bay of Fundy tides is bypassing Nova Scotia's original tidal power demonstration site in the Minas Passage to deploy smaller turbines in an area with less powerful currents.

This week, Nova Innovation Canada Ltd. was awarded a five-year marine renewable energy permit to install up to 15 turbines on the bottom of the Petit Passage on Digby Neck.

The company already has three of its 100-kilowatt turbines generating electricity at a site in Scotland where currents are similar to those in the Petit Passage.

"The Petit Passage location has less energy and we feel that is a great place to test, to demonstrate the turbine and to prove ourselves and then to move out into the harsher conditions of the Minas Passage," said Kim MacNeil, head of North America business development for Nova Innovation.

The smaller turbine is easier to deploy and retrieve, he said. "They feel it's better able to service and deal with any issues that arise because of the smaller size."

The company already has three of its 100-kilowatt turbines generating electricity at a site in Scotland where currents are similar to those in the Petit Passage. (NovaInnovation.com)

The Scottish company plans to file applications for critical approvals from the Department of Fisheries and Oceans by the end of January. It hopes to have the first turbine in the water before lobster season begins in by November 2020.

The 12-metre-tall units will rest on the bottom in depths of 30 metres.

Local benefits and crowdsourcing

The company said buying local is part of its business plan to keep costs down.

"The substructure that holds the turbine itself that could be certainly manufactured here and in fact would be manufactured here in Nova Scotia on our first turbine deployment," said MacNeil.

The company hopes to finance part of the project by raising funds through crowdsourcing in exchange for equity in the firm.

In Scotland, it raised $1.5-million for three per cent of the firm.

It's latest crowdsourcing goal is for $880,000 for 1.74 per cent equity in the company.

Nova Innovation is one of several developers that have opted to do testing in the Digby area after the province opened up more of the Bay of Fundy for in-stream tidal demonstration berths.

Minas Passage holy grail

The Minas Passage test location remains the holy grail because of its powerful currents, but the location has proven a graveyard for the only two test turbines installed there over the past decade.

The first unit deployed in 2009 had all twelve blades destroyed within 20 days by tidal flows two and a half times stronger than they were designed to tolerate.

A two megawatt turbine — 20 times the size of a Nova Innovation unit — was deployed by Cape Sharp tidal and connected to the grid in 2016.

A turbine for the Cape Sharp Tidal project in 2016 before it was deployed in the Minas Basin. (Andrew Vaughn/Canadian Press)

Cape Sharp went bankrupt less than two years later, sticking taxpayers with most of the $4.5-million cost of removing the turbine from the ocean floor where it remains today.

The $1-million bond posted by the company was far too little to cover that removal cost. Nova Innovation will be required to post a bond prior to installation.

The amount will be based on a decommissioning plan that will be reviewed by a third party.

"We don't have an exact number at this point but we're certainly ready. We feel it's a necessity that if the turbine goes in, if for some reason it has to be removed, that there's money available to do that removal," said MacNeil.

Still interest in Minas Passage

The Nova Scotia government said it is encouraged by continuing interest in the Bay of Fundy, despite the setbacks in the Minas Passage.

"I don't think we put the test site in the wrong place," says Nova Scotia Energy Minister Derek Mombourquette when asked about Minas Passage.

Other companies are interested in locating in the Minas Passage, including a Calgary company Jupiter Hydro, which was awarded permits for its proposal to test a floating turbine near the original demonstration site at the Fundy Ocean Research Centre for Energy outside Parrsboro, N.S.

Province offers price incentive

The province has offered developers an incentive by mandating that electricity generated for tidal power be sold at a premium to Nova Scotia Power.

Nova Innovation asked for and received a so-called "feed-in tariff" of 50 cents per kilowatt hour. That is far above the cost of electricity generated from other sources.

Energy Minister Derek Mombourquette says he doesn't think the test site for tidal power was in the wrong place. (CBC)

Power from a large wind farm, for example, is produced at a cost of 7.5 cents per kilowatt hour. Residential customers pay 15.6 cents per kilowatt hour, which is a blended price from all sources.

So little electricity would be generated by Nova that rates will not change.

"The price really represents the emerging technologies that are in the area. It represents investment that these companies are making and these prices are attracting international companies to our shores to look at the Bay of Fundy," said Mombourquette.

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