Tidal Lagoon Schemes and Regional Development: Work Package 3: Discussion Report Quantifying the impact of tidal lagoon funding and ownership

Jones, Calvin ORCID: https://orcid.org/0000-0003-4980-2330, Munday, Maxim ORCID: https://orcid.org/0000-0001-9067-2481 and Ahmadian, Reza ORCID: https://orcid.org/0000-0003-2665-4734 2025. Tidal Lagoon Schemes and Regional Development: Work Package 3: Discussion Report Quantifying the impact of tidal lagoon funding and ownership. [Project Report]. Cardiff: Welsh Economy Research Unit.

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Abstract

This report is part of the Welsh Government Tidal Lagoon Challenge project. We address the objectives of the Challenge Fund by examining potential financing and ownership options for novel tidal range renewables on the coast of Wales. The research seeks to examine how different approaches might better support the long-term prosperity and wellbeing of the people of Wales. This report (WP3) builds on our two earlier reports (WP1 and WP2). These are available on the Welsh Economy Research Unit website (Welsh Economy Research Unit - Research - Cardiff University). Here in WP3 we seek to provide an initial quantification of how any regional socio-economic and climate-environmental benefit arising from a new large tidal range electricity development will be related to factors in different ownership, funding and operational (OFO) models. While the report reveals how selected outcomes might be quantified and understood, it should be seen as very much a starting point for discussion, and in terms of offering a high level framework through which local effects might be understood. The report suggests that regional ownership (in terms of our simple scenarios) per se will likely not have a transformative impact on the level of regional surpluses. This is for two reasons. Firstly, as a relatively peripheral and small economy, lacking in innovative firms and products, and in bespoke technical and other services, the level of local sourcing around lagoon/barrage construction is unlikely to increase radically, even where the ultimate client is a regional public or quasi-public body. It may indeed be the case that public ownership and development might serve to restrict local sourcing, for example if the developer falls under the aegis of the Internal Market Act. Secondly, profit margins for generators are, in the UK electricity wholesale market reasonably modest. The report suggests there might be opportunities for a lagoon to drive far higher levels of regional benefit if it is off-grid: if it can be financed at moderate interest rates and constructed at the cost levels suggested in earlier research work and can operate for close to 100 years. Off grid development also however brings potential benefits that are not quantifiable, not least the ability to direct power independent of UK grid governance and regulation.

Item Type:	Report (Project Report)
Date Type:	Publication
Status:	Unpublished
Schools:	Schools > Engineering Schools > Business (Including Economics)
Subjects:	H Social Sciences > H Social Sciences (General)
Publisher:	Welsh Economy Research Unit
Funders:	Welsh Government Tidal Lagoon Challenge
Last Modified:	16 Mar 2026 16:00
URI:	https://orca.cardiff.ac.uk/id/eprint/185739

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