Tidal Lagoons: Bright Idea, or Lunatic Scheme?

King Canute knew it. You can’t hold back the tides.

It’s taken a full nine centuries since this apocryphal story was first recorded, but Britain’s politicians are finally wondering whether this inexorable force can be put to good use generating electricity for the country.

The idea of harnessing the tides’ energy is not new. Archaeologists have unearthed pre-medieval tidal water mills that were used to grind grain.

And modern tidal barrages reliably generate clean energy in France’s La Rance, Canada’s Annapolis and South Korea’s Sihwa, albeit on a modest scale.

Swansea’s £1.3 billion lagoon, however, would be an entirely different kettle of fish*.

 

Picture a six mile seawall built out from the docks of this town in south west Wales. Cycle paths line its promenade; fishing spots proliferate and a visitor centre of impeccably modern design draws up to 100,000 awestruck tourists and salivating engineering students each year. The calm artificial lagoon created by this wall hosts sailing competitions, kite boarding lessons, triathlons and more.

This is the vision of the project’s proposers, Tidal Lagoon Power (TLP) Ltd.

When the tide rises outside this behemoth, sluice gates would open and the water rush in (the UK has the second highest tidal range in the world, with the difference in the range at Swansea Bay a massive 7-9 metres). The kinetic energy in this head of water would drive 16 vast turbines in a concrete housing at the southern end of the seawall.

These 7.5 diameter giants engineered by GE and Andritz Hydro would be bi-directional (“induction generators with variable drive systems and axial flow low-head bulb hydro-turbines”, for the engineers) so electricity could also be generated when the water is released from the lagoon as the tide retreats outside the wall.

This would generate a highly predictable, low-carbon supply of electricity 14 hours per day. More importantly, this world-first system would last a staggering 120 years, create a stunning 2,000 construction jobs, and generate a stupendous… 320MW.

Wait, what?

 

For those paying attention, that’s the capacity of a small gas power station that would cost three quarters less to build and a fraction of the time to get running (modern CCGT plants are up to 85% efficient and highly flexible).

While confronting the sea’s white horses with a white elephant has a certain poetic resonance, surely no one would actually contemplate using this expensive sledgehammer to kill the fly of falling UK electricity demand? [Ed: Please cull this ridiculous menagerie of animal metaphors].

This is the attitude of more than a few of the project’s critics – keen to compare its anticipated subsidy levels (unknown as under negotiation, but anticipated to be in the £100/MWh mark) to current market prices for electricity (the monthly average of day-ahead baseload contracts varied between £35-£65/MWh over the past few months).

The comparison is a poor one though: current prices – based on a legacy of existing power stations and rising renewables capacity that further depresses wholesale market prices – reflect short-term marginal costs. Market prices are currently too low to support the construction of CCGT plants, even with the subsidy of capacity payments.

Whatever gets built is going to need some degree of support given the current state of the market (as James Meek puts it, the electricity bill can be seen as a tax anyway; albeit a privatised one) and with the failure to mitigate or adapt to climate change widely recognised as among the greatest risks facing civilisation, subsidising the construction of long-lasting and low-emission generation capacity seems sensible.

If TLP have their way, Swansea would be just the start. The plan is to scale up: first to nearby Cardiff and Newport, then to West Cumbria, Colwyn Bay and Bridgwater Bay – with the Cardiff project envisioned to deliver up to 2,800MW – and numerous other similar projects are being touted around the country.

These six lagoons alone though would contribute up to £27 billion to UK GDP over their 12-year construction period, according to a report commissioned by TLP from the Centre for Economics and Business Research. While it’s worth taking such reports with a pinch of salt, the think tank found that these lagoons would sustain an annual average of 36,000 jobs and power eight million homes.

This would not, admittedly, come cheaply. TLP estimates the subsidy required for the first operating year of the Cardiff, Newport and Bridgwater lagoons to be in the £90-£115/MWh range after cost reductions attributed to Swansea’s “pathfinder” project. This requirement would fall over their lifecycle however – and for half their life they would require no subsidy at all.

It’s an analysis that has been approved by former Conservative MP Charles Hendry, whose “Hendry Review” of the potential for tidal lagoons as part of the UK’s energy mix was published last month. As he concludes, tidal lagoons would initially more expensive than offshore wind and nuclear. Over 60 years, however, a large scale tidal lagoon would be “significantly less expensive” than nuclear and less expensive than wind. And given its lifespan, we would then have another 60 years of free electricity.

As he put it:

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… cost per MWh over project lifetimes indicates that a tidal lagoon programme has potential to be very valuable and competitive.

Suggesting that the government provide debt guarantees for the Swansea pathfinder project, he noted that the Treasury (HMT) had already approved similar guarantees to nine projects covering a total of £1.8bn of debt, including three projects in the energy sector, for example a biomass conversion project and an ethane facility.

“These commitments are recognised as contingent liabilities, which are not on the Government’s balance sheet and do not affect public sector net debt. HMT has also agreed a guarantee with nuclear plant Hinkley Point C, which was reported in September 2015 to cover £2 billion of debt…” He summed up:

I don’t believe there would be any debate in decades to come about whether this was the right thing to do…I would expect it… to be seen as the decision which started a new industry. This is not therefore just about how we decarbonise the power sector in the most cost effective way now; it is also about very long-term, cheap indigenous power, the creation of an industry and the economic regeneration that it can bring in its wake.

It’s a bullish position for a Conservative – who are typically leery of renewables – but the UK’s need for low carbon energy is pronounced.

Legally binding targets are in place to reduce greenhouse gas emissions 80% below 1990 levels by 2050. Tackling this means tackling emissions from the energy sector, which despite some progress, still contributes 31% of the UK’s GHG emissions.

Amid crumbling energy infrastructure, large-scale investment is also needed. And few would deny that the UK is in need of decent jobs: Siemens’ new wind turbine factory in Hull drew a staggering 22,000 job applications for the 650 positions it created.

The government itself has already acknowledged that tidal stream and wave energy alone (different technologies to the lagoons discussed here) could deliver up to 20% of the UK’s electricity needs.

Yet the energy policy reform to help deliver the ambition of clean energy infrastructure has been piecemeal and confused – and dominated by a capacity market that has funnelled millions of pounds into polluting coal and diesel plants.

Something has to change. Why not the tide?

Prime Minister Theresa May has espoused an interest in industrial policy. She could do far worse than make marine power its linchpin. Such dirigisme may not to be all tastes, the challenges surrounding it are well documented and a number of important questions surrounding the tidal lagoons still need to be answered. (Although arguably far fewer than those that surround the EPR reactor technology earmarked for Hinkley Point).

And as 20 industrial companies, which together employ 42,500 people, wrote in a joint letter to the Financial Times: “We have at our fingertips a brand new sector that will create a multibillion-pound industry, provide tens of thousands of jobs across the country and create a significant local supply chain. All of this before we even think about the massive potential as a British export technology.”

Tidal energy looks like the best opportunity in a long time for Britain to truly invest for the future. Tomorrow’s children would be likely to thank Mrs May. Hell, why not establish a non-profit trust to commission low-carbon power sources, have it issue government-backed bonds to finance it and make them available to their parents?

*Fish are a sore spot. More here.

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