The UK government will invest £ 20million per year across the UK in tidal power electricity as part of its flagship renewable energy auction program, ushering in a whole new chapter for the tidal industry in Wales and creating jobs in the Welsh coastal areas.
Yesterday’s announcement will unlock the potential of a thriving Welsh tidal power industry, with increased liquidity supporting marine technologies that could benefit all of Wales and the rest of the UK.
As part of the fourth allocation round of the Contracts for Difference program which is due to open next month, the UK government will ensure that £ 20million per year is earmarked for Tidal Stream projects, giving the Welsh energy sector marine a chance to develop its technology and reduce costs in a way similar to its world-leading offshore wind industry. This will bring the total funding for this allocation round to £ 285million per year UK-wide.
Wales already has excellent tidal resources and is well positioned to play a world leadership role in marine energy. The Menter Mon Morlais project, based off Holy Island, has major potential to put Ynys Môn on the map in terms of tidal energy. Anglesey could benefit from a tidal limited budget, as well as the highly skilled employment opportunities that this project could bring to the region.
Over time, Wales’ marine technologies have the potential to contribute significantly to the UK’s decarbonisation commitments and will support hundreds of green jobs across the country, with projects currently under development in the north. -western Scotland, north Wales and the south coast of England.
Tidal power has the potential to be a very reliable source of generation, given the mechanical predictability of tides. Inclusion of this in Wales’ low carbon energy mix will facilitate the match between supply and demand, building on the UK Government’s commitment to create a strong renewable energy sector and local to reduce dependence on fossil fuels and exposure to volatile global gas prices. .
Business and Energy Secretary Kwasi Kwarteng said:
“With 1,200km of coastline and excellent tidal resources, Wales is uniquely positioned to capitalize on clean marine energy, building on our booming offshore wind sector which is now a UK industrial success story.
“We hope to see marine energy follow in the successful footsteps of other renewable technologies, where we have seen costs drop significantly in recent years thanks to support from the UK government.
“Today’s investment provides a major boost for Welsh tidal power to become a key component of the next generation of renewable electricity projects needed to boost energy security as we work to reduce our dependence on volatile fossil fuels. “
Welsh Secretary Simon Hart said:
“Wales is uniquely positioned to be a major source of clean, renewable energy for the future. Harnessing the power of our seas is a vital step in our transition to New Zero by 2050 and underscores the UK government’s commitment to creating and protecting highly skilled jobs while doing so.
“With strong wind and solar industries in the UK, this is the natural next step in exploring our tidal power capabilities. With this investment, Wales can continue to develop its potential as a leader in renewable technologies and industry and contribute to the greener global economy of the future.
Energy Minister Greg Hands said:
“Wales has a real opportunity to be at the forefront of a major emerging industry, with our renewable energy auction system playing a critical role in the UK becoming a global leader in clean electricity generation and helping to lower prices for consumers.
“Today’s dedicated support for tidal energy opens a new chapter for coastal communities in Wales and advances opportunities for the Welsh marine energy sector to play an important role in achieving the UK green industrial revolution ”.
Full details of all Contracts for Difference program announcements will be released on Thursday, November 25. for the fourth allocation at £ 285 million per year.
The Contracts for Difference (CfD) program is the government’s main method of encouraging investments in low-carbon electricity. The program has made substantial new investments and reduced capital costs for some renewable technologies, for example by helping to reduce the price of offshore wind by 65%.
This fourth round of the Contracts for Difference program will open on December 13, 2021. The British government will launch this auction process with the ambition of supporting up to 12 GW of low-carbon electricity capacity, more than the three last combined rounds.
Costs continue to fall as green technologies advance, with solar and wind power now cheaper than existing coal and gas-fired power plants in most countries. This is thanks to clear signals from the government and the investments made upstream and during the COP26 climate change summit, as well as targeted support that stimulates private sector investment, creates high-quality jobs and builds industries and technology as the UK recovers from the pandemic in a greener way.
History has illustrated the effectiveness of the program design in reducing costs – between the first round of allocation in 2015 and the most recent round in 2019, the unit price (MWh) of offshore wind fell by ‘about 65%.
Renewable UK CEO Dan McGrail said:
“This is a big step forward for the UK’s world-leading tidal energy industry, enabling us to accelerate the deployment of our advanced marine technologies and accelerate the pace of innovation in the sector to become more competitive. Tidal stream funding doesn’t just unlock private investment and secure green jobs today – it also puts us in pole position to capitalize on exports to the global market in a timely manner. That’s why we asked for this dedicated tidal energy funding pot.
“We need a range of renewable technologies to reach net zero as quickly as possible. As an island nation with superb tidal energy resources to harness, it is clear that the tidal current should have a key role to play in our transition to clean energy.
UK Marine Energy Council President Sue Barr said:
“The impact of this support cannot be overstated. Here in the UK we have the knowledge, skills, people and plans to lead the world in marine energy, but we were missing a vital piece of the puzzle to unlock investment and enable the sector to grow and deliver. The marine energy industry stretches across the UK, from the Isle of Wight to Orkney and Shetland.
“This dedicated perimeter will secure our domestic market, support decarbonisation and allow the development of tidal energy; offering export opportunities, green jobs and economic growth in the process. We are grateful to ministers and the UK government as a whole for listening, understanding and taking action. This new tidal stream support brings us one step closer to achieving a great UK achievement that will deliver both environmental benefits through renewable energy production as well as supply chain benefits to the UK. UK scale.