ORE CATAPULT REPORTS

Cost Reduction Pathway of Tidal Stream Energy in the UK and France

Tidal stream energy (TSE) is a disruptive technology with a successful and growing track record of device deployments and demonstrations in the last ten years.

In 2020, the European industry hit a milestone of 60GWh of production. Despite this, political support for the sector has been inconsistent. This has slowed down investment and technology development, compared to alternatives like solar and offshore wind that have benefited from significant public development funding and energy generation subsidy. Consequently, there has not been the chance to unlock cost reduction through deploying commercial scale arrays, and there are only a handful of projects across the UK and France to date as markets merge across the globe

Despite historically challenging headwinds, the industry has still shown significant cost reduction ability. In 2018, ORE Catapult estimated TSE levelized cost of energy (LCOE) at £300/MWh. In the UK in 2022, four projects (40.8MW) were awarded CfDs at £178/MWh, to start operation between 2025-27. This indicates an LCOE reduction exceeding 40% with little to no revenue support since 2016.

While the high predictability of TSE warrants a pricing premium, due to the lower costs incurred in the wider energy system, it is crucial that TSE continues to drive down costs to become competitive with other forms of energy. In this report we analyse the cost reduction pathway of TSE considering the UK and French markets.

The ‘Cost Reduction Pathway of Tidal Stream Energy in the UK and France’ report was produced by ORE Catapult, as part of the Interreg FCE funded TIGER project.