As offshore wind has made remarkable strides in modern energy markets, it is only natural that developers are increasingly turning to the ocean for further power generation opportunities.
After decades of slow uptake, tidal power is finally gaining traction, with major projects leading the charge to prove the technology’s viability and reliability.
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If the industry continues to scale to commercialisation, it could make a sizeable contribution to global energy demand and net-zero targets.
However, standing in the way are significant financial barriers in both the private and public spheres as well as the dominance of more established renewables.
Power Technology examines the advantages of tidal power and how the fledgling industry can secure its place in the energy transition.
Leading tidal markets and developments
Tidal power is geographically restricted to island nations and countries with extensive coastlines.
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By GlobalData“You can’t put tidal everywhere, but for countries with the right hydrological conditions, it is a good option,” Robert Bates, partner and head of claims at energy insurance broker Nardac, explains to Power Technology, highlighting the UK, France, South Korea and Japan as leaders in project development.
As a global frontrunner in tidal energy, the UK has approximately 11MW of accessible capacity, which if harnessed could provide 11% of its electricity demand. This potential is being realised through the government’s contracts for difference (CfD) scheme, which guarantees a fixed price for renewable energy generators.
Tidal energy has been competing for CfDs in auction rounds since 2014, but it wasn’t until 2021 that the industry received public funding, amounting to £20m ($26m) per year. Most recently, in late 2024, six new tidal projects were awarded, bringing the UK’s total pipeline capacity to approximately 130MW by 2029, which the European Marine Energy Centre calls “unrivalled”.
“The British Government has been at the vanguard of pushing tidal,” confirms Drew Blaxland, CEO of tidal developer Proteus Marine Renewables. “The UK is the most mature market, but France is quickly catching up. Japan and South Korea could also be the next markets to go big.”
Indeed, the innovation race is tight between these countries. South Korea’s 254MW Sihwa Lake project is currently the world’s biggest tidal barrage, dam-like structures built over estuaries or bays and popular for their longevity.
However, Sihwa Lake could be overtaken by the 700MW Mersey Tidal Project, a planned barrage in the River Mersey in Liverpool, UK. Planning submission is scheduled for 2026, with projected regional power supply for 120 years.
Meanwhile, France has the oldest tidal installation in the world – the La Rance barrage in Brittany, which opened in 1966. The country is also rapidly developing tidal farms, which gather underwater turbines in areas with strong currents.
Japan continues to make significant strides in tidal. Most recently, in February, Proteus installed the country’s first megawatt-scale turbine in the Naru Strait. The 1.1MW turbine was recently certified by Japan’s energy regulator, signalling a strong national appetite for increased tidal generation.
Another option open to tidal developers are lagoons, which have less environmental impact than barrages or farms. The Severn Estuary in the UK holds great potential, with a report released in April recommending the construction of a commercial lagoon. If approved, the resource is estimated to produce between 2.3% and 7% of the UK’s current electricity demand.
British Hydropower Association business development lead Robin Peters highlights the Severn Estuary and Mersey Tidal as flagbearers for the industry. “We’re currently waiting for a critical report from the National Electricity System Operator, which is seriously looking at the benefits of tidal from a grid operability perspective and how robust and resilient it is.
“It now has to be acknowledged that tidal is a prime energy solution to meet net-zero targets,” Peters emphasises, citing policy and financial support as key enablers.
Financial and operational hurdles
Tidal power offers a range of advantages, namely its “100% predictability”, as Rémi Gruet, CEO of industry association Ocean Energy Europe, explains. “The currents are generated by the tides, which happen because of the moon’s gravity. We can tell very precisely how much energy can be produced even ten years from now at a specific date and time.”
Peters points out the added benefit of using barrages as flood defence infrastructure for coastal areas, which is becoming increasingly important due to the escalating impacts of climate change.
However, as with any emerging technology, investors are wary, in spite of these merits. “Tidal is in a crunch phase,” asserts Gruet. “There aren’t enough machines in the water to be able to go to banks and give them enough data for cheap loans, so any money we have access to is very expensive, and we still need subsidies to make the projects reach financial close.”
“We need to incentivise capital to deploy on what is still seen as riskier technology,” concurs Bates. “The sector has struggled to prove its technological credentials.”
Indeed, cancellations of major projects have made headlines in recent years. One instance saw UK company Tidal Energy go into administration in 2016 after developing and testing an £18m 400KW turbine that was later revealed to be faulty.
“Electricity and water are challenging partners,” confirms Blaxland, who has worked in the tidal sector for almost 20 years. “If a turbine breaks down underwater, for example, it is currently expensive to recover – but while upfront capital is higher per megawatt than wind, the resulting modularised components can stay underwater for seven years at a time, maintenance free.”
Such longevity is attractive for governments, which are ramping up funding for tidal development. Within the last year, the European Commission’s Innovation Fund allocated €51m ($57m) to two tidal farms in France – HydroQuest’s 17MW Flowatt project and Normandie Hydroliennes’ 12MW NH1 farm. Both are expected to be operational in 2028.
“Tidal power is highly dependent on the availability of public finance”, says Gruet. “Just like wind or solar, tidal is a very modular technology, as you can mass manufacture it, standardise it and package it in containers for shipping. The minute there is strong market visibility with a decent price, production can be ramped up quickly.”
Comparisons between solar, wind and tidal remain pertinent as equitable funding is crucial in order for tidal to carve out space for itself within the energy transition.
Where does tidal fit in the renewable energy jigsaw?
Power Technology’s parent company, GlobalData, estimates that global renewables installed capacity will surge from 3.42TW in 2024 to 11.2TW by 2035, with solar and wind as far and away the market leaders.
However, for all their affordability and strong policy support, solar and wind have a critical flaw – intermittency due to fluctuating weather conditions. This gap presents an opportunity for tidal and its predictable output to capture “10–15% of the market in the UK alone”, says Blaxland.
“Energy consumers want certainty and lower costs,” adds Gruet. “Economies of scale will enable the tidal sector to provide these.”
For Bates, a major factor in the tidal industry’s slow development thus far is being “overshadowed by offshore wind, which is where most of the capital has gone”.
“But there is growing recognition that if we are to effectively decarbonise our energy networks, we need to throw everything at [diversify] it. We can’t just rely on solar and wind.”
In turn, other renewables can balance the constraints of tidal as a site-specific technology. An added benefit of this geographical limitation means that there will be no potential conflict around the co-location of projects, as Bates points out.
Major energy companies continue to invest in tidal development, from utilities to oil and gas players. France’s Engie is currently collaborating with Orbital Marine Power on the EURO-TIDES project, which aims to deliver a 9.6MW tidal energy farm by 2027.
Meanwhile, British gas company Kistos recently took an equity stake in tidal developer Spiralis Energy, exemplifying tidal’s place within the increasingly close relationship between the traditional and renewable energy industries.
As it remains unlikely that tidal will overtake the giants of the renewables sector, the industry’s best bet is to serve primarily as a buttress for solar and wind, making up the deficits of intermittency and unpredictability for a stronger energy mix.
Commercialisation is the tidal industry’s main objective to prove its worth in the energy transition.
“There has been a number of false starts, but a flagship commercial-scale project is what is needed,” asserts Bates, citing the promise of SAE Renewables’ MeyGen project in Scotland, which has a potential capacity of 398MW.
Given the progress Proteus has seen through its involvement in major projects including MeyGen and the NH1 farm, Blaxland is positive about the trajectory of tidal. “The industry is right at the beginning of commercialisation. We will have the capacity to become a cornerstone of the energy market within the next decade.”
