By Paul Homewood
If you thought it was dead and buried, think again!
A couple of years ago, the Swansea Tidal Lagoon project seemed to deader than a Norwegian Blue, after the government rejected the contract price requested.
Since then, Tidal Lagoon Power (TLP), the company set up to develop the project, has entered a Company Voluntary Agreement to wind up, leaving investors millions out of pocket.
However, Mark Shorrock, who made a fortune in consultancy fees to TLP and only paid £70 for his part of the shares written off, has returned like a bad penny.
According to reports in City A.M., he has called for Boris Johnson to give the go ahead to the renewable energy project, saying that the UK will need to use “every green project we can” if it is to decarbonise its energy system.
Currently, the project is waiting for the Department of Business, Energy and Industrial Strategy to approve a decommissioning plan which would allow work to begin on site.
If the plan is not signed off in the next eight days, the planning consent for the £1.3bn project will be lost.
Not for the first time, we don’t get the whole story from Shorrock. He is actually referring to what is known as the Development Consent Order (DCO), which is due to expire at the end of this month. This DCO was issued in 2015 and lasts for five years. The idea is to provide broad consent, during which time the applicant can get detailed planning permissions agreed. Shorrock wants this DCO to be extended, as if it lapses all of the planning consents already given will also lapse. In short, he would have to start the whole planning procedure from scratch.
What Shorrock forgot to mention to CITY AM, or in his press release, is that the BEIS have already rejected his appeal to extend the DCO. In a letter dated June 9th, Kwasi Kwarteng reminded him that the government had already turned its back on the Lagoon:
It is absurd anyway to blame the pandemic, as Shorrock has had plenty of time to meet the 5-year deadline. In reality, there are many environmental issues which have not been addressed.
Shorrock’s new strategy, it seems, is to bypass the inconvenient planning barriers, and get Boris to personally authorise the go-ahead. There are already voices within the Tory Party, such as Ian Duncan-Smith, urging this. Shorrock may have lost his investors a fortune, but he has always been good at PR.
So what is Shorrock’s game? Swansea Tidal Lagoon still remains a basket case from an economic point of view, and would be a non-starter without a generous CfD agreement.
Attempts to raise further funds as a “high risk investment”, sources tell me, have fallen flat. Yet Shorrock states that he only needs a government subsidy of £18 million to get Swansea up and running. Clearly this is bunkum . If the project is economically viable, investors would be queuing up.
In fact the same obstacles exist as they did two years ago, despite claims by Shorrock that capital costs have been significantly cut since 2018.
Given cost pressures, it is unlikely that any of the leisure facilities, so lovingly advertised in the glossy prospectus, will ever get built. And far being being an impressive visual vista, the lagoon wall will be an ugly 40 foot high wall at low tide, surrounding 11km2 of muddy sludge.
Even Shorrock admitted two years ago that maintenance costs would be £30/MWh. On its own, this makes the project totally unviable. Given known problems, such as silting, the real cost is likely to be higher still.
And then there’s the environmental concerns at both Swansea and Lizard Bay in Cornwall where Shorrock intends to source the rock.
No satisfactory answers have ever been received about these matters.
There seems to be little likelihood that the lagoon will ever get built, so why is Shorrock still trying to buy time?
We already know that Shorrock and his companies have trousered millions in fees and interest from TLP. One of these, Tidal Lagoon (Swansea Bay) plc have now taken over the planning process.
No doubt Shorrock is hoping to pocket a few more millions, generously provided by taxpayers, before the project finally hits the buffers.
Refs
1) Press Release:
Press Release 22nd June 2020 – Tidal Lagoon[1244]
2) Letter to BEIS
3.-Tidal-planning-extension-request-letter-to-BEIS-SoS-on-back-of-COVID-extension-in-Scotland[1245]
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June 25, 2020 at 07:54AM
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