Client body behind 拢1bn project says strike price decision needs to be taken 鈥渨ithin six weeks鈥�
A 拢1bn tidal lagoon project in Swansea has been put under threat after the government launched a review of tidal power.
好色先生TV has learned a final decision on the project鈥檚 strike price will not be taken until the government review concludes - and this might not happen until autumn.
But the client body behind the project, Tidal Lagoon Power, has warned a decision on the project鈥檚 strike price needs to be taken within six weeks if the project is to go ahead. Discussions are 鈥渙ngoing鈥� over a strike price, according to the Department for Energy and Climate Change (DECC).
When negotiations started a year ago, Tidal Lagoon Power was looking for a strike price of 拢168 per megawatt hour (MWh) for its first lagoon, which would fall to 拢130/MWh and 拢92/MWh for Lagoons 2 and 3 respectively, with an average strike price of 拢111/MWh.
In response, a spokeswoman for Tidal Lagoon Power referred 好色先生TV to the statement from its chief executive Mark Shorrock yesterday, who said: 鈥淚t is imperative that we conclude our structuring and commercial negotiation with government within the next six weeks.
鈥淭his is entirely possible; the review should not impact the finalisation of our commercial discussions.鈥�
Shorrock said Swansea Bay is 鈥渞eady to go now鈥� and has a delivery team and supply chain already in place, adding that a decision needs to be taken soon if the project has a future.
He said: 鈥淚f tidal lagoon power at scale is to be a real option for the longer term, we need to start work on Swansea Bay Tidal Lagoon now.
鈥淥therwise the opportunity will be lost and the review will be all for nothing.鈥�
DECC also expects Tidal Lagoon Power to take part in the government鈥檚 review on lagoon power, which will look at how tidal lagoons can have a 鈥渃ost effective role鈥� as part of the UK鈥檚 energy mix, and how to roll out tidal lagoons at scale in the UK and internationally, including supply chain opportunities.
It will also focus on how to finance tidal lagoon projects, and explore whether a competitive framework could be put in place to deliver tidal lagoons.
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