Swansea councillors have swung behind plans for an alternative major renewable energy development in Swansea Bay after an independent report they commissioned suggest it to be financially viable.
Under the new plans, a tidal lagoon would form part of a new Dragon Energy island off the Swansea coast. This island would have giant underwater turbines as well as floating modular homes, an underwater data centre, a solar farm and the production of pure hydrogen and pure oxygen on site for storage or sale.
The report by Holistic Capital was commissioned by a Swansea Bay City Region task force set up to explore options to deliver the tidal lagoon following the UK government's decision not to proceed with previous proposals in June 2018.
Cllr Rob Stewart, Swansea Council leader and chairman of the task force, said there was huge support to deliver the project. He said: "Despite the UK government not backing the previous proposals, we never gave up hope on the opportunity to deliver a major renewables project in Swansea Bay. An enormous amount of hard work has taken place behind the scenes to develop a new proposal that will generate clean, green power for many generations to come.
"The new proposal is a larger and more ambitious renewable energy development that's built upon the natural tidal benefits of Swansea Bay and complimentary technology to generate zero-carbon power.
"The tidal lagoon is at the heart of the new proposal and gives us the opportunity to create a new floating community of homes and businesses within the sea wall. This has already been successful in countries like Holland, Germany and Denmark, providing a sustainable solution to issues including population density and climate change.
"This project will place Swansea Bay at the forefront of worldwide marine energy innovation, create thousands of jobs, boost local supply chain businesses, and help develop a globally significant export industry in Swansea Bay.
"Importantly, the independent report has found this new proposal to be credible and financially viable with the potential to make savings of up to 30% on previous estimates.”
He added: "There's considerable interest from major companies in turning this opportunity into a commercial reality, so we're now keen to move forward."
The Dragon Energy Island would be based on the footprint of the former lagoon proposal and would generate a combination of marine, solar and hydrogen energy.
The report is due to be considered by the Swansea Bay City Region's Joint Committee before next steps are explored. The most optimistic projections envisage the search for a private sector partner starting later this summer and construction starting in 2021.
Will it actually happen?
Holistic Capital's six-page report makes no mention of cost but suggests that by including housing and gas production, the revenue generating opportunities are enhanced.
It says: “The critical success factor to this project, like many other large-scale infrastructure projects, rests not solely with the ability to construct the proposed project, but with the ability to secure the necessary level of capital to fund the project.
“The options review has identified the opportunity to allow the market to deliver the cost savings that have been indicated through the PIN [prior information notice] process, together with the introduction of the floating residential component, to provide the double bottom line benefits of reducing costs and adding revenue to the integrated project.
“The options review process has delivered a strong message from the market that was demonstrated very clearly the following:
- There is a clear demand from credible financially robust organizations to re-format the opportunity into a financially viable project.
- Strong evidence to suggest that significant savings can be made against the initial capex budgets.
- There is opportunity to introduce a wide range of innovations to aid the project viability.”
The report concludes: “The key strategic question to be considered by local, regional and national stakeholders, is whether the ambition to deliver this project aligns sufficiently with the many competing areas to deploy limited public sector resources, and will secure the necessary financial and political support to continue to develop the significant potential of Dragon Energy Island."