The independent Review commissioned  by the Government In February 2016 into the feasibility and practicality of tidal lagoon energy in the UK has concluded that there is clear evidence that tidal lagoons can play a cost effective role in the UK’s energy mix.

Led by the Rt Hon Charles Hendry, the report says that the potential impact on consumer bills of large scale tidal lagoons appears attractive, particularly when compared to nuclear projects over a long time period and that a tidal lagoon programme could play a competitive role as part of the UK’s energy mix alongside low carbon energy from nuclear and offshore wind. Referring to proposals by Tidal Lagoon Power Ltd to build a £1.3 billion tidal lagoon in Swansea Bay, it also says that Government action is required if the benefits of a tidal lagoon programme are not to be lost, especially for the supply chain.

Charles Hendry said:

"I have been encouraged that the current financial backers strongly sign up to TLP’s ambition of developing a supply chain in the UK. This should reduce those pressures to go for potentially cheaper products from abroad, but it does remain a risk. More significantly, the full opportunities for a UK supply chain will only be realised if there is long-term clarity about the number, scale and timing of lagoons to be built in the UK."

Led by the Rt Hon Charles Hendry, who was appointed in May, the purpose of the review was to assess:

• whether, and in what circumstances, tidal lagoons could play a cost effective role as part of the UK energy mix;
• the potential scale of opportunity in the UK and internationally, including supply chain opportunities;
• a range of possible structures for financing tidal lagoons;
• different sizes of projects as the first of a kind;
• whether a competitive framework could be put in place for the delivery of tidal lagoon projects.

The report makes specific reference to proposals by Tidal Lagoon Power to construct a £1.3 billion tidal lagoon in Swansea Bay:

“To assure the taxpayer, the electricity consumer and the Government, it would be very beneficial for Tidal Lagoon Power to secure a delivery partner with a corporate track record in major energy or infrastructure projects.”

Charles Hendry is recommending that the Government now move to a timely ‘final-stage negotiation’ to explore robust and satisfactory terms that might be acceptable to both the developer and the Government.

The report has made over 30 recommendations in total for delivering a tidal lagoon auditory bringing maximum benefit to the UK, including:

• An allocation by a competitive tender process for large scale tidal lagoons;
• Informing the consenting process with a National Policy Statement for tidal lagoons similar to Nuclear new build, where specific sites are designated by the Government as being suitable for development;
• The establishment of a new body (Tidal Power Authority) at arms-length from Government with the goal to maximise UK advantage from a tidal lagoon programme.
• In the course of the Review Charles Hendry and the Review Team visited Swansea, Cardiff, Newport, Liverpool, Bristol and Sheffield, enabling them  to speak directly to people who would be involved in, or affected by proposals for tidal lagoons. The Review received almost 200 responses to the Call for Evidence.

Commenting Charles Hendry said:

“I was appointed in May 2016 to assess the strategic case for tidal lagoons, and the role they could play in the UK’s energy mix.”

“I believe that the evidence is clear that tidal lagoons can play a cost effective role in the UK’s energy mix and there is considerable value in a small (less than 500 MW) pathfinder project. I conclude that tidal lagoons would help deliver security of supply; they would assist in delivering our decarbonisation commitments; and they would bring real and substantial opportunities for the UK supply chain.

“Most importantly, it is clear that tidal lagoons at scale could deliver low carbon power in a way that is very competitive with other low carbon sources."

“The aim now is that we should move to secure the pathfinder project as swiftly as possible, so the learning opportunities it offers can be maximised. I have, however, also concluded that the smaller pathfinder project needs to be operational before we move to larger scale projects. This means that a clear long-term Government strategy in favour of tidal lagoons will be required if the full supply chain and cost reduction opportunities are to be realised."

“Tidal lagoons can be an important and exciting new industry for the United Kingdom. We are blessed with some of the best resources in the world, which puts us in a unique position to be world leaders."

“The costs of a pathfinder project would be about 30p per household per year over the first 30 years. A large scale project would be less than 50p over the first 60 years. The benefits of that investment could be huge, especially in South Wales, but also in many other parts of the country. Having looked at all the evidence, spoken to many of the key players, on both sides of this debate, it is my view that we should seize the opportunity to move this technology forward now.”

Secretary of State for Business, Energy and Industrial Strategy Greg Clark said the Government will now consider the recommendations and the issues which would arise from a broader lagoon programme in detail.

Greg Clark said:

“I am grateful to Charles and his team for the hard work that has gone into the Review. The issues are particularly complex as they relate to untried technology in the marine environment.”

“The Government’s energy planning is focused on ensuring affordable, secure, low-carbon energy. We will now consider recommendations and determine what decision is in the best interests of the UK energy in the long term.”

Click here to read the full report The Role of Tidal Lagoons