The World’s Most Expensive Power Project
We thought that the price for non-carbon electricity had peaked when the U.K. government agreed to require UK electricity customers pay £92.50 ($130.43) per MWH for the output from the under-construction Hinkley Point nuclear power station. We were wrong.
Sponsors of the Tidal Lagoon Power project in Swansea, Wales asked for £123.00 ($170.34) per MWH) with a 90 year contract. They subsequently squeezed a promised subsidy out of the government of Wales (which, according to some sources, may end up owning the project). This has reduced the pro-ject’s cost so as to bring it roughly in line with Hinkley Point.
The project proposes to erect a dam in the harbor (“barrage” in the native tongue), that will trap the water from the rising tide on one side of the dam and take advantage of the difference in water level between one side of the barrage and the other to turn bidirectional turbines. The 320 MW project would cost £1.3 billion ($1.8 billion). The company raised about 3 percent of the needed funds as seed money, got pledges for more, and indications of interest from the usual collection of financial firms, none of whom seem ready to put in real cash until the government signs on.
In January 2017, a government study recommended the project, but that decision started to look shaky after bidders offered offshore wind to the government at £57.50 in September. Why pay twice as much for the same green energy?