PM's enthusiasm wanes for £1bn Swansea lagoon

"We have not seen any ideas that can hit a strike price that is very attractive," says Cameron

Prime minister David Cameron has hinted at a possible change of heart towards the proposed £1 billion tidal lagoon in Swansea Bay because of the high costs involved.

Giving evidence to a Parliamentary Committee, Cameron said: “Instinctively, I can see the strength of the argument for tidal power, because one of the problems with renewables is whether they can provide base-load power. Nuclear can. Wind cannot, because it is intermittent. But tidal, because the tide is always going in or out, can provide base-load power.

“The problem with tidal power, simply put, is that at the moment we have not seen any ideas come forward that can hit a strike price in terms of pounds per megawatt-hour that is very attractive. That is the challenge for tidal. Maybe they can come up with something. They are very long-term schemes with big investments up front, and they can last for many, many years, but right now my enthusiasm is reduced slightly by the fact that the cost would be quite high.”

In response to Cameron’s comments, the company behind the scheme - Tidal Lagoon Power, said: "The prime minister is spot on: tidal power will make a huge contribution to the UK economy, carrying with it a wide range of social and environmental benefits.

"Clearly there is a price at which this prospect becomes viable and through our ongoing negotiation with government we are very confident that we can hit that price."

In November it was announced that the Swansea Bay project had been delayed a year to 2017 because of negotiations with the Department for Energy and Climate Change over the level of subsidies given to the project via the contract for difference support mechanism.