The £1.3 billion tidal lagoon project in Swansea is set to face significant job losses if the UK and Welsh government do not back the scheme as talks intensify.
Since December, when the Welsh government offered equity or a loan to the plan if Whitehall supported it, UK and Welsh talks have intensified, but have not yet concluded.
During the same period of time, ministers expressed concern over the plans with one cabinet minister highlighting how “eye-wateringly” expensive the tidal project was and that it would only create a handful of jobs in the local Swansea economy.
As a result of having to wait for so long for government funding, Tidal Lagoon Power may be forced to substantially cut jobs within a matter of weeks.
Reducing the scale of the operation will make it significantly more difficult to re-inflate the project by 2020, when planning permissions run out.
UK Business Secretary, Greg Clark, told the Welsh First Minister, Carwyn Jones, that any form of public subsidy must protect consumers from high energy bills and described the tidal lagoon as “an untried technology with high capital costs and significant uncertainties”.
Tidal Lagoon Power has invested over £53 million in developing the lagoons, but the government is yet to give its verdict as to whether it will support the scheme.