Prudential, an international insurance group, has been named as the cornerstone investor in the £1 billion Tidal Lagoon Swansea Bay Project, a world-leading infrastructure development designed to generate electricity by harnessing the power of the sea.
Prudential’s commitment is a significant step to securing the future of the power station, which will become the world’s largest tidal energy provider when it opens in 2018. It will also form the first step in the development of a network of coastal lagoons which could generate up to 8% of the UK’s electricity needs.
The deal forms part of Prudential’s commitment to invest alongside five other major UK insurance companies a total of £25 billion in the UK’s infrastructure over the next four years. The project will generate over 495GWh of electricity every year for 120 years, enough to provide nearly all of the domestic electricity for the Swansea Bay region. The project will also help the UK meet its carbon reduction targets by saving more than 236,000 tonnes of CO2 each year.
The construction of the power station is scheduled to begin in 2015 and will create almost 2,000 jobs. Prudential’s long-term insurance funds will provide the funding through its European asset management arm, M&G Investments. In the UK, Prudential currently manages around £25.8 billion of direct infrastructure investments.
Tidjane Thiam, Group Chief Executive, Prudential plc , said: “The financing of this power station is emblematic of the role that Prudential plays in transforming the hard earned savings of millions of our customers into long-term, productive investment in the UK economy. Such investments provide our customers with strong and sustainable returns, create good jobs and increase productivity and economic competitiveness. Prudential is committed to invest in infrastructure projects that benefit the national economy. We are also proud to play our part in the development of this world-leading renewable energy technology.”
Mark Shorrock, Chief Executive, Tidal Lagoon Power Ltd , said: “Securing the backing of a world-renowned investment institution marks another major milestone for the Swansea Bay project and is a clear endorsement of our vision to introduce tidal lagoon infrastructure into the UK’s low carbon energy mix. Tidal lagoons will employ British industry to harness a British natural resource and return profits to British institutions.”
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Press release; Image: tidallagoonswanseabay