tidal lagoon concept swansea

UK government rejects £1.3bn tidal lagoon renewable energy project

After months of deliberation the UK government has declined to back the Swansea Bay renewable energy tidal lagoon project.

The company behind the scheme, Tidal Lagoon Power, wanted government subsidies similar to those made available for new nuclear power plants, in order to build the £1.3bn scheme, which consists of a U-shaped sea wall with turbines in Swansea Bay.

The project uses the power of tides to generate electricity and is thought to be less expensive than both offshore wind and nuclear power over the first 60 years of their 120-year life, according to a review of the technology last year.

In opposition to Whitehall, the devolved Welsh Government was keen for the project to go ahead and promised a £200m investment package as an incentive earlier this month. 

However, Business Secretary Greg Clark told the House of Commons that the project - “however novel and appealing” - did not demonstrate value for money for consumers and the public purse.

Tidal Lagoon Power’s founder and chief executive Mark Shorrock reacted furiously to the news, arguing Swansea Bay would add just 30p to consumer bills while new nuclear power plant Hinkley Point C would add £12 or more.

He accused the Government of “a vote of no interest in Wales, no confidence in British manufacturing and no care for the planet”.

He pledged to work with the Welsh Government to deliver a UK tidal lagoon industry centred in Wales and said: “Swansea Bay Tidal Lagoon remains key to our vision.”

He also warned that greater emphasis would be put on projects elsewhere in the world, including northern France.

In his statement to MPs, Clark said generating power from the tidal lagoon would be much more expensive than offshore wind or nuclear. As a result it would not be appropriate to lead the company to believe public funds could be justified, he said.

Clark said the electricity generated by the lagoon programme by 2050 could cost up to £20bn more to produce compared to generating that same electricity through a mix of offshore wind and nuclear.

That would cost the average British household consumer up to an additional £700 between 2031 and 2050, he said.

Analysis of additional economic benefits suggested Swansea Bay would only provide 28 long-term jobs and there would be limited scope for innovation and cost reduction in any following schemes, he said.

He also played down any export potential of the technology and warned the electricity from the tides would be variable, not constant.

“The inescapable conclusion of an extensive analysis is that, however novel and appealing the proposal, even with these factors taken into account the cost that would be incurred by consumers and taxpayers would be so much higher than alternative sources of low-carbon power that it would be irresponsible to enter into a contract with the provider,” he said.

MPs and local politicians from across south-west Wales described the news as “devastating” for the region, which would have benefited from an economic boost. Even the Welsh Conservatives described the decision as “desperately depressing”.

The long-awaited decision was also criticised by environmental groups, with Friends of the Earth Cymru warning “bold action” was needed to tackle climate change, which meant investing in innovative new technologies such as tidal lagoons.

The planned plant in Swansea Bay is not the only project using tide power to generate electricity.

Tim Cornelius, CEO of Simec Atlantis Energy, is pushing for a smaller project to be located at the Wyre Estuary and believes it could jump-start larger tidal lagoon initiatives.

“The Wyre Estuary project is the ideal, cost-effective option to develop tidal range technology, as well as diversify the UK’s energy mix,” he said.

“This project is the ideal pathfinder for a series of similar range projects being planned across the UK.

I would also expect that the Wyre project is the natural pathfinder project for the larger planned lagoon projects in locations such as Cardiff, Colwyn Bay and the Solway Firth. We are convinced that at larger scale, these projects will make sense and the government should now unlock this economic potential by supporting the construction of the Wyre project.”

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