 THIS is the end of the blanched tarmac, where the even farmlands near the western edge of Orkney slope down to the beach. Workmen wander between tools and machines outside stone buildings by the shore. The blue-grey waves heave and spit froth into the spring sunshine and the wind rushes across gnarled grass that looks built for stern punishment.  This is Billia Croo, old Orcadian for  sheep enclosure , yet now arguably the foremost place for testing wave energy devices in the world. There are none testing at present, but the next generation will soon arrive. Pelamis, the Edinburgh developer, is in the process of putting two of its latest floating snake  devices in the water, while a new hopeful known as the  penguin  will be arriving from Finland in the summer. So continues a beauty contest of passionate inventors, which can turn entertainingly bitchy up close as they edge towards the day when fate separates the successes from the failures.  If alex Salmond s hopes to provide enough renewable energy to power the country by 2020 are realistic   a source of heated election-season debate last week much depends on what happens at Billia Croo and at the sister testing site for tidal devices on the isle of Eday to the northeast. Operated by the Government-backed European Marine Energy Centre (EMEC), their proximity to some of Europe s fiercest waters has handed these islands an economic opportunity of the kind that is unlikely to come twice. If it succeeds, its value to Orkney should be many times the combined value of mainstays like beef, ale and tourism.  The national vision is not only to fill the waters in the Pentland Firth to the south and off the Western Isles with turbines, but to build a new green industry on the back of it. This is different to wind energy, where the UK s failure to keep pace with the Danes and Germans in the 1980s and 1990s has meant that our national ambitions are restricted to importing foreign intellectual property and building businesses in final assembly and maintenance. In marine energy, where technologies have not yet matured, there is still everything to play for.  While not all of the technologies that have tested at EMEC are Scottish or even British, the combination of the energy resource and native engineering excellence have meant that a disproportional number of the leading players are based here. The Scottish Government has helped by offering subsidies to anyone producing electricity from these technologies that are considerably more generous than in England or elsewhere.  and as a strong statement of intent to encourage investors to back them, The Crown Estate, which controls UK territorial waters, last year became the first such authority in the world to allocate substantial sites to future marine farms when it handed out licences to produce 1.6GW of energy (targeting 1GW by 2020). Equating to about three-quarters of Longannet power station in Fife   the country s biggest   this is enough to power around 20% of the country.  Yet despite these efforts, there is a sense that many of the developers have been holding back in recent months, particularly those that need new funding. Everyone is waiting for the outcome of the UK Government s electricity markets reform (EMR), due to conclude in the summer. Potential investors want to see a timetable for reforms to the electricity grid that would make it possible to pipe serious power from the Scottish north, costing circa ?1 billion, but they re also hoping for more carrots to spur the industry. They have been lobbying hard for subsidies equivalent to the Scottish ones for the rest of the UK, improved tidal subsidies to bring them into line with the more generous ones for wave, and a pot of new money to assist extra investments across the industry.  However far the industry might have come already, in other words, it is not there yet. Look no further than regulator Ofgem s figures for who has been selling electricity to the grid. So far, the only two companies to have reached this stage have been Marine Current Turbines in Northern Ireland and Wavegen in Lewis (the others would argue they ve been preoccupied getting their technology right to worry about making money).  Tidal and wave energy have been developing separately for well over a decade. although wave stole a march in 2000 when Inverness-based Wavegen became the first developer to install, tidal is now unquestionably several years ahead. Its technologies are much more homogenous, benefiting from its similarity to hydroelectricity, with all except Scotrenewables of Orkney developing variations of turning blades that sit on the seabed and look like sunken wind turbines. Wave is much more weird and wonderful, with devices ranging from the Pelamis floating snake to aquamarine s seabed-based Oyster to Wavegen s Limpet, which avoids direct contact with the water altogether (see table for full comparisons).  The two technologies present quite different challenges for developers. Tidal presents more of a maintenance problem, because objects that are completely submerged face the extra costs of raising them to the surface or using robotic repair vehicles (diving is a no-no because the force of the tides is too strong). With wave the technology is much less proven, and the devices have to be resilient enough to cope with the wilder conditions. On the other hand, the wave resource is much greater than the tidal resource, with the potential for perhaps double the electricity in the medium term.  Despite the pros and cons of both technologies and the world economic crisis, they have both managed to raise substantial amounts of money so far.  Most of the main developers have drawn in upwards of ?30 million, although few if any individual backers have risked more than a few million pounds so far. They have been a motley assortment, including engineers (Rolls-Royce, Siemens); utilities (Iberdrola, Scottish  and Southern Energy and Germany s Voith Hydro); private equity (Blackrock, Tudor Capital) and oil companies (Total, Shell, Statoil).  In most cases this has paid for a near or full-sized prototype, with the leading developers in tidal such as Hammerfest Strom and MCT now preparing demonstrator farms in the 5MW to 10MW band, off Islay and Skye. These are seen as necessary to secure orders for bigger farms of 50MW to 100MW and beyond.  The fact each demonstrator is set to cost up to ?50m per developer makes it likely that a shakeout is coming once the results of the EMR see light. Most developers will say that their devices are moving in line with expectations, while quietly pointing to the flaws of their rivals. Several talk about  smoke and mirrors  pervading claims.  Simon Grey of Inverness-based wave developer aWS questions the heft of some of the devices in the field.  Steel is the biggest driver in terms o 