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Analysis | What has happened to Swansea's tidal lagoon project?

Lagoon wall  Tidal Lagoon Power  3x2

Today (12 January) marks the anniversary of the Hendry review, which backed building a £1.3bn tidal lagoon in Swansea. A full year has passed with no decision from government on the scheme.

Frustration is running high among industry and political figures. Author of the government-commissioned Hendry review and former energy minister Charles Hendry said today that despite the falling cost of offshore wind, the UK must still explore tidal energy.

“Like offshore wind, lagoons could be a secure supply of electricity free from the vagaries and challenges future generations will face in finding new sources of oil or gas.” he said.

“I believe lagoon technology not only has the potential to significantly decarbonise the power sector in a cost effective way, it is also about very long-term and cheap power, the creation of an industry and the economic regeneration it could bring in its wake. Who could find fault in demonstrating such ambition?”

Last January Hendry urged the government to go ahead with developer Tidal Lagoon Power’s Swansea Bay pathfinder lagoon – which has had planning permission since 2015 – describing it as a “no regrets” policy.

The 320MW Swansea Bay lagoon, which could be engineered by Laing O’Rourke after the firm won a £200M contract in 2015, would generate electricity for 120 years using power from incoming and outgoing tides. If the pathfinder is successful, five full-scale lagoons are planned.

But the cost of electricity generated from the plant has proved a sticking point for government, which would subsidise electricity over 90 years under the Contracts for Difference (CfD) scheme at an average price of £89.60 per MWh.

However, sources close to the project say the Welsh government’s pledge to provide a “substantial investment” for the lagoon would help bring the price down, reducing the barrier to agreeing a CfD.

Swansea Council is keen to see the pathfinder project go ahead as it would provide a tourism boost and bring work to the local supply chain, particularly the beleaguered steel industry.

The council is marking the anniversary by handing out birthday cake in the city centre and watching its countdown clock tick over to a full 365 days without a decision on the Swansea Bay Tidal Lagoon.

Swansea Council leader Rob Stewart told New Civil Engineer while senior government figures appear enthusiastic behind closed doors, there has been little appetite for decisive action.

“They’re all saying that they support it, it’s something they could personally find time for, but nobody seems to be able to press the button and say ‘do it’, and that’s just simply unacceptable,” he said.

Mott MacDonald development director and past-ICE Wales Cymru chair Stephen Lawrence believes the long delay is having a negative impact on business confidence in the scheme as investments are put off for ever-longer periods. He also believes time is running out for the UK to take a lead in developing the new technology needed for tidal lagoons. Without a pathfinder project, innovative ideas are restricted to the lab and cannot move forward.

“We’re stagnating, we’re flatlining without the ability to actually try this out in a real situation,” he said. “I do think there is a crunch point around the corner and we can’t put it off forever.”

Without government investment Lawrence does not believe the private sector would be willing to pick up the tab for the £1.3bn scheme.

“Because it’s a pilot and it’s not been tried before…the price is quite high and that reflects the risk which the private sector is saying would be there,” he said. “I don’t think the private sector have the appetite to do it solely on their own, no.”

A spokesperson for the Department for Business, Energy and Insutrial Strategy said the government was “looking carefully at the potential to harness the UK’s natural resources to make our energy mix cleaner” in a way that provides value for money for UK taxpayers.

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