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WALES PLEDGES CASH TO KICKSTART LAGOON.

THE Welsh Government has thrown a lifeline to the beleaguered Swansea Bay tidal lagoon with an offer to put money into the scheme.

The First Minister's office yesterday published a letter from Carwyn Jones to the Prime Minister Theresa May in which Mr Jones made the offer to cover some of the capital cost of the project.

The Welsh Government hopes that such an investment on its part could help reduce the cost of the subsidy required by the project, the main stumbling block to its going ahead.

The company behind the scheme maintains that larger follow-up lagoons at Cardiff, Newport, Bridgwater Bay, Colwyn Bay and Cumbria will see subsidy prices come down to the sort of figures now being seen for offshore wind farms.

The Welsh Government did not specify the amount it was prepared to invest, but said it could be in the form of either an equity stake or a loan.

In his letter to the Prime Minister, dated December 6, Mr Jones pointed out the level of support among political parties and the wider community for the PS1.3bn tidal energy scheme.

But he added that, with no decision having been taken nearly a year after the Hendry review, "There is a growing risk now that the continuing lack of a decision will turn, by default, into a decision not to proceed."

Mr Jones said: "The key to enabling the Swansea Bay project to proceed lies, of course, with the UK Government agreeing an appropriate contract for difference arrangement. However, I want to make clear that I am prepared to consider a substantial equity and/or loan investment by the Welsh Government if that would enable the project to move forward. This investment could help to reduce the cost of capital for the project and hence reduce the subsidy requirement over the lifetime of any contract for difference."

He added: "Any investment by the Welsh Government would, of course, be conditional on the UK Government agreeing to an appropriate contract for difference arrangement and the project securing any necessary licences and consents."

Mr Jones said yesterday: "This would be the world's first tidal lagoon power plant, which would create thousands of high quality jobs, open the prospect of meeting a significant proportion of the UK's energy needs from the tides and position Britain as a world leader in a new global industry.

"And, yet, the UK Government has been dragging its heels for over a year. This is leading to a growing sense of frustration among the Welsh business community and an increasing risk that the lack of a decision will turn into a decision not to proceed.

"Now is the time for the UK Government to stop stalling and get on with agreeing a strike price so we can make this transformative project a reality."

Mark Shorrock, CEO at developer Tidal Lagoon (Swansea Bay), added: "This is the breakthrough our project has needed. We thank the First Minister and his team for their leadership.

"We look forward to working alongside the Welsh Government to now close the deal for Swansea Bay Tidal Lagoon with the UK Government."

CAPTION(S):

| A visualisation of the lagoon wall at Swansea Bay. If this project got the go-ahead, a similar scheme for Colwyn Bay could follow

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Publication:Daily Post (Conwy, Wales)
Geographic Code:4EUUK
Date:Jan 11, 2018
Words:547
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