Lord Deben questions if Swansea Bay tidal lagoon is cost effective

The chair of Parliament’s climate change watchdog has backed the government’s sceptical approach towards the Swansea Bay tidal lagoon.

Lord Deben, being quizzed earlier this week (7 February) by the Business, Energy and Climate Change (BEIS) committee on the government’s recently published clean growth strategy (CGS), said he backed tidal and wave energy in principle.

But the peer, who was a widely respected secretary of state for the environment in the 1990s, questioned whether the Swansea Bay tidal lagoon would be cost effective.

Costs were unlikely to fall if more were rolled out, unlike in the offshore wind industry, he said.

“Much of the cost is in the construction: it’s difficult to see how building more is going to decrease costs significantly.

“I am open to being convinced but the government is probably right to question whether it wants to put its money here.”

Ministers have yet to decide whether to approve the scheme more than a year after former energy minister Charles Hendry backed it in a government-commissioned review.

Earlier this month Welsh first minister Carwyn Jones urged the UK government to stop “dragging its heels” and give the go ahead to the proposed project.

In a letter to prime minister Theresa May, Jones said the Welsh government would help pay for the £1.3 billion project if Westminster agreed to provide subsidies through a Contract for Difference.

While being questioned by the BEIS committee, Lord Deben said the government was missing a big opportunity by not supporting carbon capture and storage (CCS) more vigorously.

He welcomed the £100 million awarded to support CCS in the CGS but told the committee the government should be helping such projects come to market rather than merely funding research and development.

“It’s manifestly not enough to deliver what we need. I would like to see the government say we are going to be the leaders on CCS like we did on offshore wind and invest in a serious way.”

He said the UK was the “perfect place” to develop CCS because liquefied carbon dioxide can be stored in exhausted North Sea oil and gas wells and the government has a supportive policy framework for action to tackle climate change.

Lord Deben said the UK’s goal to reduce carbon emissions to 80 per cent of 1990 levels by 2050 could not be delivered cost effectively without CCS.

“If we don’t deliver CCS the cost of meeting our obligations will be significantly higher,” he said.

Lord Deben also told the committee that onshore wind and solar power should both play a “wider role” in the generation mix.

The government should have been upfront with the public about the extra costs resulting from its decision in 2015 to effectively block new and relatively cheap onshore wind and solar power projects, he added.

And the peer described as “unacceptable” the government’s intention, outlined in the CGS, to use over-performance on the current carbon budget to compensate for under-performance in future years.

“If we don’t do as much in the fourth and fifth carbon budgets it will be more expensive later on.”

Interim CCC chief executive Adrian Gault poured cold water on energy and climate change minister Claire Perry’s claim at an earlier meeting of the BEIS committee that technological advances would enable the UK to hit future carbon budget targets, which it is currently at risk of missing.

He said given the fourth and fifth budgets were due to kick in five and ten years respectively, there was little time to cut emissions using new technology.

“To think new technology will make a substantial difference is stretching it. It may make a difference to meeting our 2050 target but the emphasis has to be on the deployment for the next carbon budget of what we know now.”