Energy and Climate Change CommitteeWritten evidence submitted by CH2M HILL (SEV33)
Executive Summary
Halcrow, a CH2M HILL company, has been heavily engaged in the Severn tidal power project for the past six years and prior to that played a lead role in design of the Second Severn Crossing. Our involvement in the Severn Barrage commenced as supporting the Severn Tidal Power Group in 2007 and subsequently as a founding member of Corlan Hafren Ltd (now Hafren Power Ltd) until July 2012 when it ended.
In this submission, we set out an independent perspective on the Cardiff-Weston barrage, which draws on our long experience with the project and our interaction with many of the key stakeholders.
The key messages we wish to convey in response to the questions posed include:
A large renewable source of energy such as the tidal power of the Severn is a long-term national, regional and global asset both in terms of energy supply and carbon reduction. It is not appropriate to compare this to other forms of power generation on an “either/or” basis; the opportunity should be taken if it can be delivered in a sustainable manner.
Flood impacts will be reduced upstream of a barrage, which will provide valuable protection (and future cost savings) against the effects of climate change. Localised elevated water levels should be expected seaward of a barrage and these may require additional flood risk management measures to be implemented.
The impacts on designated habitat would be significant, as the inter-tidal area will reduce by a large margin. However, the remaining habitat may well be able to accommodate the demand from feeding birds as food density is expected to increase. The impacts on fish are difficult to determine in the absence of comprehensive baseline data.
This project has the ability to reinforce the UK’s ability to deliver large infrastructure projects, potentially in partnership with private funders and operators, when many sectors and geographies are struggling with the same issues. The benefits to the UK of making a mark in this field are substantial now and will reduce over time.
What contribution could the Cardiff-Weston Barrage make to UK energy security and climate change objectives?
1. The UK energy mix is changing as we develop more wind capacity and look to replace coal, gas and nuclear facilities that are at the end of their life. At the same time, it should be expected that the demand profile through a daily cycle will both increase and flatten with the advent of smart energy distribution and increased electrification of domestic and commercial transport and heating. Challenges of intermittency, predictability of supply, consumer willingness to pay can all be addressed to some extent by incorporating a large tidal energy supply into our network.
2. The tidal resource of the Severn is globally significant and it would be remiss of the UK to not harness this sustainable source as long as it can be done in a way that enhances the regional environment and mitigates impacts on protected species.
3. The construction of a large Cardiff-Weston barrage will generate CO2 through construction activities and embed carbon in the materials in the structure itself. However, such is the significance of generating electricity using tidal power, the scheme would be CO2 neutral in less than three years (Severn Tidal Power Feasibility Study, DECC, October 2010) and actively reduce net CO2 omissions for a century thereafter.
4. Any scheme on the Severn should not damage the future potential for energy extraction from the estuary. In other words, if small scale energy generation is planned as a stepping stone to build confidence in the technology and the ability to predict and manage environmental impacts, this must not limit the future potential for a larger scale, more efficient and hence more economic plant.
5. A barrage proposal has the potential to represent an economic alternative to offshore wind and offers a number of advantages including predictability and asset longevity (including very low generation costs once the initial capital outlay is paid off).
What risks and opportunities could it pose with regard to flooding in the Severn estuary, and how might any risks be mitigated?
6. A barrage would play a key role in reducing flood risk and hence lowering the required expenditure on flood risk management for up to 400km2 of tidal flood plains, and would be resilient to the effects of increased storminess and sea level rise.
7. The modification to the tidal rise and fall upstream of a barrage can be mitigated to an extent by optimisation of the operating mode, but will still require some engineering work to maintain drainage from low-lying land.
8. Closing the mouth of the estuary will result in elevated water levels locally in the Bristol Channel so, when storm surges coincide with high water events, flood risk could be increased in some areas. These effects are predictable and can be managed by appropriate flood risk management improvements and operational intervention.
9. We have carried out hydrodynamic modelling which has indicated that the following predictions can be made in relation to a Cardiff-Weston barrage:
Maximum impacts due to a closed (fully impermeable) barrage agree with those predicted in DECC, 2010, with water levels increased by 500–600mm in Swansea Bay.
The increase in high water level in Cardigan Bay due to an impermeable barrage is predicted as 50–100mm (compared to those presented in DECC, 2010 at 200–300mm). This is believed to be due to an improvement in model boundary set-up.
By modelling a scheme in operation (i.e. a permeable barrage that represents sluice and turbine movements) the elevations in water level are much reduced with peak increases of 200–300mm predicted in Swansea Bay. The order of 10km of frontage would require improved sea defence measures as a consequence.
Additional mitigation measures have been modelled and are effective in reducing the impact for local water level rises further.
What risks and opportunities could it pose to wildlife and habitat in the Severn estuary, and how might any risks be mitigated?
10. The habitat of the Severn estuary and certain species of birds and fish are protected species under the European Habitats Directive. The designation of the inter-tidal mudflats and migrating birds are closely related, as the former provides a source of food to the latter. The density of feeding birds on the Severn is almost the lowest for any UK estuary and is a function of the high loads of sediment in the water, which restricts light penetration and hence biological productivity is low. Further studies would determine whether the reduced turbidity associated with a barrage proposal would result in more productive mudflats and hence a bird density that is more in keeping with the remainder of the UK’s west-coast estuaries.
11. Potential impacts on fish are difficult to predict in the absence of comprehensive baseline data. Previous studies have adopted an understandably conservative approach to the possible damage to both protected and commercially valuable fish stock. Areas of likely conservatism include the migration routes adopted, the number of passages past the site of a proposed barrage, the timing of passage relative to operating times for the turbines (these will not be permanently “on”), the impact that the lock system and possible fish passes could have on migration success and the depth at which fish tend to migrate (the turbines will be located in very deep water for maximum efficiency). It is expected that a more comprehensive study of fish habits, linked to precautionary mitigation measures to increase the opportunity for continued migration plus enhancement of nearby water courses and nurseries, would demonstrate rather more manageable effects on fish.
12. Our modelling has been used to assess the opportunity to modify the operation of a barrage such that the extent of productive inter-tidal mud-flats remains at a maximum or, in other words, to minimise the requirement for compensatory habitat under the EU Habitats Regulations. Some simple modifications to barrage operation and localised land raising with locally won material could reduce the compensatory habitat requirement by more than half from the ca 120km2 identified in previous studies.
What lessons can be learned from the successful development of La Rance tidal barrage in France and other tidal power projects?
13. The method of implementation of the tidal power barrage at La Rance involved cutting off the estuary from the sea for the duration of the construction phase. This had a rapid and significant impact on the estuary environment, which means that comparisons with the expected impacts on the natural environment in the Severn would not be meaningful. However, La Rance has been operating since 1965 with very limited maintenance requirement and provides a predictable and reliable source of energy, which (now that the initial capital costs of the project are “sunk”) is some of the lowest cost energy in Europe. There are certainly operational lessons that can be learnt, including confidence around cost predictability in the long-term.
14. Halcrow has also undertaken studies on the effects of the Osterschelde barrier in Holland, which was constructed following the severe flood events of 1953. Experts from the Rijkswaterstaat have studied the Osterschelde and some innovative schemes to raise land and create functioning mudflats have been implemented there. Such lessons will be of value to the consideration of the mitigation measures that might be adopted in the Severn, although different sediment characteristics may limit this.
What risks and opportunities could it pose to local employment and community, and how might any risks be mitigated? In particular, what are the consequences for current ports, fishing and aggregate extraction industries in the estuary?
15. Halcrow has considered the direct, indirect and induced effects on employment for a Cardiff-Weston barrage, drawing on multiplier values from the South West England Regional Accounts as a proxy for the area local to the scheme.
16. The analysis is limited by its assumptions over the ability of the region to respond to the opportunities generated by such a large scale project and the proportion of goods and services that will be procured in the UK. With the majority of jobs falling in the caisson construction and ancillary works, a significant number of opportunities will require quite specific skills and experience in a number of white and blue collar sectors.
17. Jobs would be created in direct construction works, through the supply chain, via the induced effects on household spend, and later in Operations & Maintenance, tourism and the potential development of a renewable energy sector. Across these areas, more than 20,000 long term (sustaining for 10 years or more) jobs are possible as a result of a Cardiff-Weston barrage.
Would the project require support under the proposed new Contracts for Difference mechanism? If so, approximately what level of strike price would be required to make the project economically viable?
18. A wide range of levelised costs have been proposed in relation to a Cardiff-Weston barrage, with figures ranging from £150 to £350/MWh. Much of the differential relates to the application of contingencies, including Optimism Bias. There is a tension between the application of Optimism Bias, which is used for developing a robust price estimate for the purposes of evaluating publicly funded projects, and what level of contingency should be included in a private sector investment opportunity. For private sector projects, where investor return is balanced against commercial risk, the promoter and funders will perform their own due diligence on cost and productivity estimates and contingencies will be applied accordingly.
19. It is important that costs of renewables are compared on a “level playing field.” Such comparisons should consider the system level, to reflect the full cost to the consumer including the costs of grid connection, strengthening and distribution, as well as any mitigation measures required to balance predictable and unpredictable intermittency.
20. Investors might be expected to express interest in a Cardiff-Weston barrage if supported by a Contract for Difference (CFD) with a strike price set toward the lower part of the range set out in paragraph 18, subject to their own technical due diligence. Such a CFD might reasonably be expected to have a duration of 30–40 years to cover the period required to pay back the capital cost of the project.
21. Levelised costs for electricity for a barrage after the capital pay-back period should be competitive with gas, and significantly cheaper than gas with carbon capture and storage, given the low operation and maintenance (O&M) costs required for the barrage and the longevity of the structure.
Are the proposals in breach of EU legislation, and if so how will this be addressed?
22. A low carbon energy project on this scale presents something of a dilemma as, on the one hand it represents a significant move to meeting the EU targets for carbon reduction, yet is also a large infrastructure project within an area that is protected under the EU Habitat Directives. Hence, the barrage sits at the nexus between two pieces of legislation that were both implemented to protect the natural environment yet which consider impacts at differing geographic and temporal scales.
23. Initial dialogue between Government Departments and EU officials in 2010 would form the basis of guidance on how to address the potential for the long term (and international) environmental benefits of a barrage solution to be seen to conflict with a shorter term perspective on environmental protection at a local/regional scale.
24. It is possible that the tension between these objectives would be resolved by broadening the geographic scope for consideration of sites for compensatory habitat.
Are any other proposals for tidal power projects in the Severn estuary currently under consideration?
25. A number of alternative proposals for extracting tidal energy from the Severn exist and their credibility is dependent on the time available for proposed implementation. Many projects are in the early stages of development and the technology on which they are founded remains conceptual.
26. Many proposals do not represent a sound financial business case in their present stage of development and some include flaws around buildability or basic economics.
27. A traditional barrage with tried and tested bulb turbine technology could be implemented relatively quickly and would provide the high degree of confidence that will be necessary to attract investors.
What could be the wider international implications of the scheme for UK engineering and UK low-carbon industry?
28. There are a small number of other sites globally where the potential for significant tidal power can be found in an estuary with a relatively narrow shape, like the Severn, where this can be harnessed economically.
29. By delivering one of the largest projects of its type, British industry will be well-positioned to export the knowledge to other sites. Moreover, the demonstration of the ability to deliver large scale public infrastructure projects to time and budget, and in particular alongside private investors, will add to recent success stories in the UK.
30. The UK is currently at the forefront of wave and tidal renewable energy development and deployment. There are strong parallels with the offshore wind sector, where such an early position of strength was not retained by the UK through prompt and positive signals to industry and investors.
November 2012