Diolch, Llywydd. Yesterday, a statement was made in the House of Commons by the UK Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, on the proposed Swansea bay tidal lagoon project. 

The UK Government made it clear that, 

'it would be irresponsible to enter into a contract with the provider' as the

'proposal has not demonstrated that it could be value for money'. 

The UK Government has concluded that the project should not be provided with public funding. This decision by the UK Government not to support the Swansea bay tidal lagoon is deeply disappointing and a further blow to Swansea following on from the UK Government’s decision not to electrify the Great Western main line to Swansea. Despite our serious offer to help the UK Government make this proposal work, they are letting an important opportunity slip through their fingers. In doing so, they have badly let down the people of Wales.

This announcement demonstrates that the UK Government has, once again, made energy policy decisions for Wales based upon English energy priorities rather than reflecting the opportunities here in Wales. We have significant sustainable energy resources in Wales, not available in England, that we must harness if we are to meet our decarbonisation targets as part of our wider UK obligations. The UK Government has failed to recognise that the Welsh energy mix will be different to that in England.

We have called for the UK Government to respond to the Hendry review of tidal lagoons on many occasions. Even now they have failed to give an adequate response to the important recommendations that he has made. The Welsh Government is clear: the decision whether or not to back tidal lagoons is a UK policy decision. They have the ability and the financial backing to shoulder risk in areas of new and emerging technology that other smaller Governments across the UK simply do not.

From day one, the Welsh Government recognised the transformational potential of the Swansea bay tidal lagoon project and we made an offer of significant funding support to the UK Government to help make the project a reality. Sadly, the UK Government’s short-sightedness and complete lack of ambition has thwarted this project—a project that could have positioned Wales and the UK as a world leader in a new global industry. We have consistently stated that the Welsh Government stands ready to work closely with the UK Government and other administrations across the UK to develop a vibrant UK marine energy industry.

We are in no doubt as to the potential that marine energy represents to Wales, not only from a decarbonisation and energy policy perspective, but also from a social and economic benefit perspective, too. Indeed, marine energy offers huge potential to the UK as a whole in terms of developing know-how, technology and supply chain developments, which would be of value to future international trade.  

We have held this view for many years and this is why we have prioritised the growth of a vibrant energy industry as a key tool for economic development. Wales has an excellent track record in supporting marine energy. Over €100 million of EU funding, along with domestic support, has been and continues to be invested through the Welsh Government to support wave and tidal stream projects. EU funding is supporting the Morlais west Anglesey tidal stream demonstration zone, the south Pembrokeshire wave demonstration zone, as well as wave and tidal stream developers. We also supported Marine Energy Wales who are developing a marine energy test area in the Milford Haven waterway. Pembrokeshire and Anglesey are becoming hubs for wave and tidal stream development, but further development will be dependent on revenue support from the UK Government.

Marine developers, who have ambitious plans to deploy their devices in Welsh waters, will view this announcement as the UK Government, sadly, closing the door on the industry. Some are already considering scaling back their plans in Wales. I therefore call on the UK Government to rethink their long-term support for the marine industry.

My colleague the Cabinet Secretary for Energy, Planning and Rural Affairs will be writing to business and energy Secretary, Greg Clark, to stress the importance of supporting the renewable energy sector in Wales. We've already stressed the importance of funding the most affordable technologies, such as onshore wind, to keep the overall costs of support low.

The Welsh Government has a long-standing commitment to the renewable sector and we'll be seeking the views of the industry and respective bodies through an energy summit to better understand how momentum, particularly in the area of marine energy, is maintained over the coming months and years.

In light of this disappointing decision, we are working closely with leaders in the region to better assess the wider economic implications and to consider what action can reasonably be taken. I've already held discussions with the leader of Swansea council about other projects that can support economic development in the area, and I'll be having further such discussions with leaders in the area over the coming months.

My colleagues and I will keep Members appraised of progress on this and will also be pressing UK Ministers on the outcomes.