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Where in the World is Wave Power?

|Includes: Ocean Power Technologies, Inc. (OPTT)
Wave power has been the orphan of the alternative energy world, the allure of infinite supplies of energy offset by the highest cost of extraction. Every time it looks like someone has cracked this nut, a storm comes along and washes away all of their high tech buoys. However, we may finally be seeing this technology come to fruition. New Jersey based Ocean Power Technologies (NASDAQ:OPTT) has been working on the problem since 1994, went public in 2007, and seeks to convert the mechanical motion of ocean waves into electricity with their PowerBuoys. Their engineers have created a 150 KW buoy that generates power at a relatively rich ten cents per KW. The energy available in waves is truly immense. A small harbor of these could generate enough electricity to power a medium sized city. The Navy has been their biggest customer until now, accounting for 58% of sales, driven by a directive to obtain half of their renewable energy generation from renewable sources. Commercial projects are operating or under consideration for the Jersey shore, Spain, Scotland, Western Australia, Hawaii, and Oregon, where local utilities are operating under similar mandates. The cash rich, well funded company says if they can mass produce their next generation 500 KW PowerBuoy, which will be operable in 2010, the cost of electricity will drop from 10 cents to 5 cents per kilowatt, making it cost competitive with fossil fuels, wind, and solar. Throw government subsidies into the mix and this could be an interesting play. The stock cratered with those of other green companies, dropping from $20 to $4. With crude now having moved from $32 to $75 on its way back up to $150 this could become an interesting cheap call on energy prices. Check out their website at