A tidal lagoon scheme is set to offer the local community a chance to buy up to £2million of shares, in order to raise finance for the £10million for the development phase of the project. The proposed tidal lagoon is set to cost between £650 million and £750 million and would have a capacity of 250MW, creating energy to supply 121,000 homes over approximately 120 years and saving over 216,000 tonnes of CO2 annually. This scheme shows how expensive tidal power can be, as even at the lower end of the cost estimates 1MW of electricity would need approximately £2.6 million of capital costs, whist according to the Department of Energy and Climate Change, wind energy costs £824,ooo of capital costs per 1MW of electricity.
The scheme is to have all planning applications in by October and once a decision has been made, which will be by the UK government as it is over 100MW, if the scheme is consented it would be operational by 2017. Mark Shorrock, Chief Executive of Swansea Bay Tidal Lagoon stated that “the share offer is a high risk investment” due to the funds being used in the development phase. The remainder of the financial backing will come from mainly large scale investors and the Enterprise Investor Scheme.
The tidal lagoon will take approximately 2 years to build and the impounding breakwater or seawall will be about 10.5km (6.5miles) long and the lagoon will be able to hold 11sqkm (4sqmiles) of water. The tidal lagoon will generate electricity by holding water back whilst the tides change and creating a sufficient head of water, which is then let out through turbines and this high pressure creates electricity. At low tide, water from the lagoon will be let out to sea and at high tide water from the sea will flow in to the lagoon.