Plans to create tidal lagoon power projects, worth £10 billion, could collapse after the Treasury has vowed to tighten its grip on green subsidies until energy bills ease.
Documents from last week’s Autumn Budget have revealed the government’s will not introduce any new “green taxes” until 2025 to protect consumers from rising energy bills.
Experts believe projects such as Mark Sorrock’s £1.3 billion tidal scheme in Swansea will lose out without the backing of the government’s industrial strategy in the competition for the remaining £557 million of funding that is still available through existing commitments.
Tidal power is hugely expensive to produce, which means without green subsidies it will be very difficult to compete with other forms of power. The Swansea tidal project relies on a contract of £89.90/MWh for its 90 year lifespan.
Rising energy costs have come under fire from advocates for business groups and household consumers, with green subsidies cited as a major contributing factor to Britain having some of the highest energy bills in Europe.