Indian commodity tycoons the Gupta family have invested £10m to buy a stake in the firm building the UK's first tidal lagoon.
The family confirmed today that they are investing an "eight figure sum" in Tidal Lagoon Plc - a holding company established by Tidal Lagoon Power, which plans to start construction of the UK's first tidal lagoon in Swansea Bay in spring 2017.
The figure equates to a 10 per cent stake in Tidal Lagoon Plc, BusinessGreen understands.
Sanjeev Gupta, a representative of the Gupta family, said the family firm is focusing on renewable energy for its future expansion. "We are very pleased to invest in this ambitious and innovative enterprise that promises to provide low-carbon, baseload energy and drive economic renewal through the development of a high-value supply chain that will create thousands of new jobs," he said in a statement.
However, the investment comes at a time when government support for tidal technology appears to be ebbing.
Although Chancellor George Osborne floated the Swansea Tidal Lagoon project as a flagship green energy project in the 2015 Budget, Prime Minister David Cameron has hinted in recent weeks that the government may be rethinking its support of the project. Speaking to MPs last month, he said the lack of an attractive strike price for investment in proposed projects means his enthusiasm for tidal technology is "waning".
The project would require an initial price support contract significantly higher than for other clean energy sources, but its projected 120-year lifespan would mean this contract would only be in force for a fraction of its generation period. However, under current proposals the strike price would still slightly exceed that offered for the controversial Hinkley Point nuclear power station, and be guaranteed for a far longer period.
Tidal Lagoon remains optimistic that an agreement can be reached, and responded to Cameron's comments by saying the company was confident negotiations can hit on a price that makes the project viable.
The new agreement also sees a joint venture created between the Guptas' energy company SIMEC and Tidal Lagoon Power to develop large-scale tidal lagoons in India, with feasibility studies set to be conducted in the Gulf of Khambhat in western India. Andrew Manley, executive director at Tidal Lagoon Power, said the Gulf of Khambhat holds "vast potential" for tidal lagoon power.
The Gupta family has been investing heavily in UK energy and industrial assets over recent months, and says it aims for SIMEC to massively expand its renewable energy capacity as well as explore new technologies to provide low-cost power for the steel industry. In December 2014, the family bought the UK's oldest coal-fired power station in Uskmouth, pledging to ultimately convert it to a biomass station.
SIMEC and its sister company Liberty House currently have assets covering energy, commodities and manufacturing, with bases in around 30 countries.
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