A £3.5bn tidal power scheme in the Mersey Estuary is unlikely to ahead due to its high construction costs and current energy markets, according to its developer Peel Energy.
Peel Energy said a tidal power scheme in the Mersey Estuary could deliver enough electricity to meet the average needs of over 200,000 homes but the high construction costs mean that it is unlikely to go ahead without a change in the way we value renewable energy and security of supply.
Following many months of studies and investigations, a preferred scheme has been identified by the expert team commissioned by Peel Energy and The Northwest Development Agency (NWDA): a barrage across the river between New Ferry (Wirral) and Dingle (Liverpool).
It would be designed so that the turbines within the barrage would generate power in two ways – from ebb tides only as well as from ebb and flood tides – and from a range of water level differences (operating heads) across the barrage. This choice of scheme allows for flexible, managed operations that would minimise effects on the Mersey’s protected intertidal habitats.
Multiple navigation locks would need to be included to accommodate large commercial ships and small leisure craft. Other facilities that could be included in the scheme include a visitor centre, a pedestrian/cycle path, a light public transport link and a tidal turbine research centre.
The studies have found that the estimated £3.5bn upfront construction costs result in a cost of electricity that is not competitive in the current energy and capital markets.
“In the longer term, once the upfront capital costs have been paid off and for the rest of its 120 year life, the cost of electricity would be very competitive,” said Peel Energy’s development director Anthony Hatton.
“But the preferred scheme is unlikely to attract the necessary investment while the emphasis in the financial sector and renewable energy incentives is on technologies that provide short to medium term returns. We need to identify an appropriate funding structure that recognises the long term low cost of electricity, security of supply and wider economic benefits that investments such as this provide for future generations.”
Peel Energy will not be progressing the development work until it has confidence in the financial and regulatory framework for tidal power.
Mr Hatton continued, “We are grateful for all the valuable contributions made by many organisations and individuals to the Feasibility Study. We welcome feedback on the reports and look forward to progressing the project in the future.”
“The feasibility work has provided a valuable insight into how tidal energy schemes could be operated in the future to deliver wider economic impact, whilst minimising the potential environmental impact,” said NWDA head of energy & environment Mark Atherton.
“Some of the lessons learnt from the work undertaken are applicable not just to the Mersey Estuary, but to other estuaries in the Northwest and UK.”