Industry welcomes boost to tidal stream projects following latest UK renewables auction results

Key industry players have welcomed the recent UK renewables auction results, where six tidal stream projects secured contracts, viewing it as a strong endorsement of the tidal energy sector’s growth.

Five developers secured contracts to develop a total of 28 MW of tidal stream energy across the UK.

The Allocation Round 6 (AR6) contracts include HydroWing, set to deliver 10 MW in Wales, while in Scotland, MeyGen will provide 9 MW, Seastar 4 MW, Magallanes 3 MW, and Ocean Star Tidal 2 MW, bringing the total to 18 MW.

The HydroWing project at Morlais has been expanded to 20 MW following the AR6 contracts for difference (CfD) allocation, where an additional 10 MW was awarded. According to Inyanga Marine Energy Group, the owner of HydroWing, this expansion supports the development of commercially viable generation projects through economies of scale.

“This award is a testament to the hard work of our pioneering team and the relentless drive to make HydroWing competitive. This award further enhances our expansion in Anglesey and our commitment to develop the project in partnership with Morlais Mentor Mon to allow the site to reach its full potential and provide economic growth and benefit to Anglesey,” said Inyanga Marine Energy in a social media post.

In January, Inyanga Marine Energy opened a new office in Wales to support the development of the Hydrowing tidal stream energy project at Morlais, Anglesey. 

SAE Renewables, the owner of MeyGen, which is described as “the largest consented tidal stream project in the world,” has added 9 MW to the project, bringing the total project capacity under development to 59 MW. This phase adds to the 6 MW already operational at the site. 

SAE’s CEO, Graham Reid, said: “The scale and opportunity that MeyGen represents for the industry, the supply chain, our stakeholders, and the wider United Kingdom is significant, and we will work with all involved to ensure its success.”

According to the Scottish company Nova Innovation, its EU-funded Seastar and Oceanstar tidal energy projects located at the Fall of Warness wite in Orkney, secured three 15-year contracts, as part of the CfD auction. 

“Winning the CFD contract is a testament to our team’s ability to deliver solid results whilst continuing to innovate and grow. This is another significant step towards realising our vision of a world powered by clean, sustainable marine energy,” said Julie Aird, CFO of Nova Innovation. 

Scotland’s Magallanes Renovables said it secured a power purchase agreement (PPA) for the next 15 years. The company added: “This is the 4th Project we´ve been awarded within the past 3 years, since the allocation opened for Tidal mills, what reinforces our commitment towards reaching a more sustainable future by unlocking ocean currents.”

In March, Magallanes partnered up with Tadek Ocean Engineering for support related to its first commercial-scale tidal energy array.

According to Menter Môn Morlais, the CfD awarded to HydroWing provides revenue security for the electricity generated at Morlais and supports the expansion of the Ynys Môn scheme, as owner Menter Môn Morlais plans to increase the generating capacity to 240 MW.

The AR6 supports Anglesey’s goal to become a hub for tidal energy and is important for attracting future investment to the area, said Menter Môn Morlais.

John Idris Jones, Chair of Menter Môn Morlais, noted: “We are pleased that HydroWing has been allocated additional Megawatts at Morlais and signals that we are headed in the right direction. We are still at the start of our journey and see today’s news as an important step forward as we grow the project to its full potential.

The CfD scheme guarantees developers a fixed price for their electricity and underscores the role of tidal stream as a reliable energy source. 

Morlais, run by social enterprise Menter Môn, is described as the “largest consented tidal energy project of this type in Europe”, spanning 35 square kilometers of seabed. According to Menter Môn Morlais, Morlais has the potential to generate up to 240 MW of clean, low-carbon electricity once completed. The first turbines are projected to be deployed at sea in 2026. 

Richard Parkinson, Managing Director of HydroWing, added: “The successful AR6 application is the culmination of a huge effort from our team to develop a more efficient and cost-effective tidal energy solution for Morlais. We look forward to working closely with Menter Môn and with our supply chain partners in Anglesey to deliver clean and predictable power to the grid.”

Marine Energy Wales stated that HydroWing securing 10 MW of the total 28 MW contracts awarded across the UK means that Scotland now has 83 MW and Wales 38 MW of contracted tidal stream capacity. 

“Tidal stream is leading the way in Wales. We are delighted to see this additional capacity at Morlais – almost half of the 22MW secured in last year’s Allocation Round,” said Tom Hill, Program Manager at Marine Energy Wales.

“Continued support from Government in the form of a ringfence for tidal stream technology and lower strike prices will continue to bring the cost of delivery down and provide high quality jobs for Welsh communities.”

According to Ocean Energy Europe (OEE), Europe’s position in clean energy relies on advancing innovative technologies such as ocean energy, which can generate power at different times compared to established renewables. 

The new Commission can capitalize on this momentum to strengthen Europe’s leadership. Continued EU funding and address to risk-reduction tools will be crucial for attracting private investments and advancing the industry, said OEE.

“The UK’s success with tidal CfDs shows that governments can swiftly deliver multi MWs ocean energy farm scale projects with earmarked revenue support,” said Rémi Gruet, CEO of Ocean Energy Europe.

“This should light the way for other European countries with wave and tidal resources to follow suit to unlock the full potential of ocean energy. Such measures brought wind and solar to the market and will be equally crucial for ocean energy. “

According to the UK’s technology and research center, Offshore Renewable Energy (ORE) Catapult, despite the increase in the tidal stream budget from £10 million to £15 million for AR6, this auction round was only expected to allow for 20 MW awarded capacity.

The high costs of delivery of tidal stream projects necessitate a high reference price from the government, limiting the impact of the ringfenced budget, noted ORE Catapult. Nonetheless, the results include six projects with a combined capacity of 28 MW, at a strike price of £172/MWh.

“The strong number of successful bids seen in AR6 sets the stage for further proving out the tidal stream technology, and validates the ringfencing of budget specifically for tidal stream in facilitating a variety of project technologies and locations in this sector,” said ORE Catapult.

According to recent research by Offshore Renewable Energy (ORE) Catapult and Imperial College London (ICL), tidal energy has the potential to provide 11.5 GW to the UK energy system, 11% of the UK’s electricity demand, and tidal stream projects could contribute up to £17 billion to the UK economy by 2050.