Swansea Tidal Lagoon

Lord Davies of Gower Excerpts

Tuesday 8th March 2016 Westminster Hall

[Byron Davies (Gower) (Con)]

I congratulate my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing this important debate. It is a pleasure to represent my constituency of Gower, part of which this tidal lagoon falls into, in the Mumbles area.

The lagoon is the result of five years of hard work on the part of the developers, and we have now arrived at the point of the strike price. The pilot scheme at Swansea may, as has been said, move forward to bigger projects at Cardiff, Newport and elsewhere in Wales and, indeed, the UK. The lagoon has the potential to produce energy that is cheaper than even nuclear and gas. The potential future investment in Wales alone is more than £10 billion, and more than 3,500 jobs will be generated over a decade in Wales, with many more generated in the supply chain across the UK. That is a particularly important point.

[Mr MacNeil]

The hon. Gentleman makes a good point about the economic benefits of the project. The Chancellor has talked about a northern powerhouse; this would strike me as being a western powerhouse. At a time when borrowing costs are low and there is a need for demand in the economy—Martin Wolf is even talking in the Financial Times about helicopter drops—this lagoon would add to our energy security and strengthen the economy in Wales, which needs to happen. Wider interconnectivity would benefit not only Wales but Europe, and that is another reason the project should be supported.

[Byron Davies]

I totally agree with the hon. Gentleman; I could not have put it better myself.

More than 1,000 companies in the supply chain across the UK have registered their interest in these projects. The scope for further investment in other lagoons and in the export market will eventually give rise to a contribution to the UK balance of payments of tens of billions of pounds.

[Chris Davies (Brecon and Radnorshire) (Con)]

I thank my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) for securing this debate. I want to add to the comments being made by my hon. Friend the Member for Gower (Byron Davies) by saying that the whole community of Britain will benefit from this project. I represent one of the largest landlocked constituencies in England and Wales, so Members are probably wondering why I am praising a tidal lagoon that is many miles away from Brecon and Radnorshire, but it really will benefit our people. We will have a lot of people travelling down to work there. Businesses will benefit on a daily basis from the tidal lagoon, and the people of Brecon and Radnorshire are very keen that it goes ahead.

[Byron Davies]

Indeed; I totally agree with my hon. Friend, who makes a valid point.

A study by the Centre for Economics and Business Research has found that a national fleet of six tidal lagoons would contribute something in the region of £27 billion to UK GDP during construction, as well as creating or sustaining 35,000 jobs on average and roughly 70,000 jobs at its peak. When operating, the fleet would contribute just more than £3 billion per annum to UK GDP.

I am sure Members will be aware that Gower was the first area of outstanding natural beauty in the UK. It is a great tourist attraction, and I am sure that the development of the tidal lagoon will add to that. Swansea bay tidal lagoon would be the birth of a new industry based in Wales, and it now needs our support to get it into construction. Where that project leads, others will follow.

[Carolyn Harris (Swansea East) (Lab)]

Does the hon. Gentleman agree that, since the mention of a tidal lagoon being in Swansea, his constituency, my constituency and the constituency of my hon. Friend the Member for Aberavon (Stephen Kinnock) have seen a great increase in the feel good factor and a driving of the agenda to take forward other projects that would be less exciting without a tidal lagoon?

[Byron Davies]

The hon. Lady makes a good point. The tidal lagoon has great benefits, including from a health point of view.

Tidal Lagoon Power started work on Swansea bay in 2011 and has spent more than £30 million on the project to date. The company has been wholly privately financed by a number of private individuals, and more recently by a small number of institutional investors. The enterprise is therefore a purely UK-led initiative in the area of tidal power.

In February, the Department of Energy and Climate Change announced an independent review of tidal lagoon energy, which I support and believe is the right decision. Swansea bay tidal lagoon has development consent, while the other projects do not. This has to be looked at in the round, and DECC is making the right decision in considering it properly. Tidal Lagoon Power has welcomed the review as a clear signal that tidal lagoons are being taken seriously and are no longer simply a footnote to UK energy policy. With negotiations on Swansea bay progressing in parallel, it should be possible to sustain investor confidence and ensure that this first-of-its-kind project at Swansea bay is ready to go, should the review conclude that the UK needs tidal lagoons.

In conclusion, I am concerned that the project has been used as a bit of a political football locally. We need to come together on a cross-party basis to provide the project with the support it needs. I know there is support in the Swansea area from other politicians. We all want to see the project develop for the benefit of our communities and the Welsh economy, so we need to lay aside political differences and have a serious and sensible dialogue, as we are today, on the way forward for the lagoon.