Introduction
The United Kingdom stands at a critical energy crossroads. With electricity prices among the highest in the developed world, an increasingly precarious reliance on foreign energy imports, and a grid system buckling under the weight of intermittent renewables, the time has come for a strategic pivot toward an energy source that plays to the UK’s natural strengths: tidal energy.
As Lord Malcolm Offord highlighted in his recent address to the House of Lords, “We are incredibly fortunate to have the North Sea on our doorstep.” While his focus acknowledged offshore wind’s potential, the UK’s maritime advantage extends far beyond wind to include the world’s most predictable renewable energy source – the power of our tides.
The UK currently faces a perfect storm of energy challenges. We pay $0.37 per kilowatt-hour for electricity, ranking 9th highest globally. Our dependency on imported gas has reached a staggering 70.5%, with North Sea reserves dwindled to just 19% of their 1996 levels. Meanwhile, our grid infrastructure struggles with constraints that will cost consumers over £1.8 billion by 2025 in balancing payments alone.
These challenges demand a solution that addresses not just our climate commitments, but also our economic prosperity and energy security. Tidal energy represents that solution – a predictable, domestic energy source that can reduce costs, enhance security, address grid issues, and create substantial economic value that remains within the UK.
The UK Energy Crisis: Shocking Statistics
The United Kingdom currently faces one of the most severe energy crises among developed nations, characterised by exorbitant costs, dangerous import dependency, and an increasingly strained grid system.
Among the Highest Energy Costs in the Developed World
The UK has some of the highest electricity prices globally, creating significant economic pressure on both households and businesses:
- UK electricity costs average $0.37 per kilowatt-hour, ranking 9th highest globally (World Population Review, 2025)
- Industrial electricity prices in the UK are the highest of the 28 countries covered by the IEA report at 25.85p/kWh – four times those in the US and 46% higher than the IEA median (Institute of Economic Affairs, 2024)
- Average domestic energy bills in 2024 were estimated at £1,881, placing significant strain on household budgets (UK Government, 2025)
- These high costs make the UK uncompetitive in energy-intensive industries and emerging sectors like battery manufacturing and AI
Dangerous Dependency on Foreign Energy Imports
The UK’s energy security is increasingly compromised by its growing reliance on imported energy:
- 5% of the UK’s gas supply is now imported, according to the latest government data (Sunsave Energy, 2025)
- Norway alone provides 41.1% of UK gas, creating a dangerous dependency on a single source
- North Sea gas reserves have dwindled to just 19% of what they were in 1996, with proven reserves of only 1,654TWh
- At current consumption rates, UK North Sea gas will be exhausted within 8 years
- The UK’s gas import dependency is expected to reach 85% by 2048 (UK Energy Dependency report, 2025)
Wasteful Grid Constraints and Balancing Costs
The UK’s grid infrastructure is struggling to manage the transition to renewables, resulting in enormous waste:
- Grid constraint payments are projected to exceed £1.8 billion ($2.25 billion) by 2025 (Power Technology, 2025)
- These costs arise from limitations in the power grid’s capacity to handle growing renewable energy, particularly wind power from Scotland
- National Grid ESO’s Future Energy Scenarios suggest 15TWh of curtailment by 2030 in all Net Zero aligned scenarios
- Wind curtailment has cost the UK more than £1 billion in the last three years alone (Tamarindo, 2024)
- Without offsets and effective grid planning, curtailment costs could rise dramatically as renewable penetration increases
Tidal Energy: The UK’s Maritime Advantage
The United Kingdom possesses a unique combination of natural resources, technical expertise, and maritime heritage that positions it perfectly to lead the global tidal energy revolution. As an island nation with some of the world’s strongest tidal currents, the UK has a natural advantage that cannot be replicated by many other countries.
Predictability: The Crucial Difference
Unlike other renewable sources, tidal energy offers unparalleled predictability:
- Tidal stream is highly predictable and can be accurately forecasted years ahead of time, unlike wind and solar (ORE Catapult, 2022)
- Tides follow consistent patterns determined by lunar cycles, unaffected by weather conditions
- This predictability dramatically reduces the need for backup generation and balancing services
- ORE Catapult research shows tidal energy’s predictability reduces system costs associated with balancing, reserve capacity, and curtailment
- Tidal energy is completely decoupled from other renewable resources, improving energy source diversity and providing resilience against extreme weather events
Economic Benefits: Keeping Value in the UK
Tidal energy offers substantial economic benefits that would remain within the UK:
- Tidal stream deployments in Scotland and the rest of the UK have the potential to generate almost £4.5 billion in GVA by 2050 (Scottish Enterprise, 2025)
- Exports of tidal stream technology could generate up to £11.4 billion in GVA to Scotland alone
- The sector could create over 22,500 jobs by 2050, with half in manufacturing tidal devices
- Almost half the gross value added comes from manufacturing the tidal stream devices, with operations and maintenance accounting for nearly a quarter
- Unlike wind and solar, where manufacturing largely moved overseas, the UK has the opportunity to retain the entire tidal energy supply chain domestically
Resource Potential: A Sustainable Energy Source
The UK’s tidal resource is substantial and largely untapped:
- Estimated tidal stream resource in Scotland of 4.3GW, with a further 1.9GW in the rest of the UK (Scottish Enterprise, 2025)
- UK has approximately 50% of Europe’s tidal energy resource and 25% of the global resource
- Global tidal stream resource estimated at 114GW, representing a significant export market opportunity
- Unlike depleting North Sea gas reserves, tidal energy is perpetual and sustainable
- The UK’s existing offshore expertise and infrastructure from oil, gas, and offshore wind sectors can be leveraged for tidal development
Cost Trajectory: Following Offshore Wind’s Success
While currently expensive, tidal energy is on a steep cost reduction trajectory:
- ORE Catapult has identified 10 technology innovations that could result in an 80% cost reduction in tidal stream energy
- Costs are forecast to drop below £90/MWh after the first 1GW of deployment
- This follows a similar pattern to offshore wind, which has seen dramatic cost reductions over the past decade
- The UK’s existing leadership position gives it first-mover advantage in driving down costs
- Long-term economic benefits significantly outweigh higher initial costs
Policy Recommendations: A Clear Path Forward
For the UK to capitalise on its tidal energy potential and address its energy crisis, decisive policy action is required. The following recommendations provide a clear path forward:
- Establish Long-Term Support Mechanisms
The current annual budget setting for tidal energy creates uncertainty that damages investor confidence and discourages infrastructure investment. Instead, the UK should:
- Set ‘hard’ capacity ambitions for multiple rounds, providing certainty to the sector (MEC AR7 paper, 2025)
- Implement a Fixed Ambition and Price mechanism – for example, 500MW to be procured between AR7-AR11 at a fixed strike price
- Extend CfD contract length to 20 years for marine energy, aligned with other renewable technologies
- Create a distinct funding stream for tidal Test and Demonstration projects within the CfD mechanism
- Amend the 25% rule to explicitly procure more than 25% of eligible capacity in each round
- Invest in Grid Infrastructure
The UK’s grid constraints are a major barrier to renewable energy deployment, costing consumers over £1.8 billion annually by 2025:
- Prioritize grid upgrades in areas with high tidal energy potential
- Develop offshore transmission networks that can serve multiple purposes, including tidal energy
- Implement grid storage solutions to maximize the value of predictable tidal generation
- Create a zonal pricing system that reflects the physical limitations of the network
- Incentivize demand-side response to better match consumption with predictable tidal generation
- Support Supply Chain Development
To ensure economic benefits remain in the UK, unlike with wind and solar:
- Include marine energy technologies in broader incentivization measures like the Clean Industries Bonus
- Provide targeted support for UK manufacturing facilities for tidal energy components
- Fund research and innovation to maintain the UK’s competitive edge in tidal technology
- Support the modernization of Scottish supply chain capabilities, from novel materials to automation
- Invest in domestic workforce capacity and skills development
- Streamline Regulatory Processes
Current regulatory barriers slow deployment and increase costs:
- Allow marine energy projects that have applied for environmental consents to bid into the CfD mechanism
- Create a streamlined consenting process specifically for tidal energy projects
- Establish clear guidelines for environmental monitoring that balance protection with development
- Develop marine spatial planning that prioritizes areas for tidal energy development
- Reduce administrative burdens for smaller-scale tidal projects
- Leverage Existing Expertise
The UK should build on its existing strengths:
- Utilise the expertise from the offshore wind sector as a template for tidal energy development
- Encourage active collaboration between tidal stream developers and their supply chain
- Task and fund existing innovation and support organizations to accelerate tidal energy innovation
- Develop skills passports to enable oil and gas workers to transition to tidal energy
- Establish innovation clusters focused on tidal energy technology
Conclusion: The Time for Tidal is Now
The United Kingdom stands at a critical energy crossroads. The statistics are stark: we pay some of the highest electricity prices in the developed world, we depend on foreign nations for over 70% of our gas, and we waste billions annually on grid constraints and balancing costs. This unsustainable situation demands a strategic pivot toward energy sources that play to our natural strengths.
Tidal energy represents a perfect alignment of the UK’s needs and capabilities. As an island nation with some of the world’s strongest tidal resources, we possess a natural advantage that cannot be replicated by many other countries. The predictability of tidal energy – accurately forecastable years in advance – offers a unique solution to grid stability challenges that intermittent renewables cannot match.
The economic case is equally compelling. Tidal stream deployments could generate almost £4.5 billion in domestic GVA by 2050, with exports adding a further £11.4 billion. Unlike wind and solar, where manufacturing largely moved overseas, we have the opportunity to retain the entire tidal energy supply chain within the UK, creating over 22,500 jobs, primarily in coastal communities that need economic revitalization.
While tidal energy is currently expensive compared to other renewables, it follows a similar cost trajectory to offshore wind, with potential for 80% cost reduction through identified technological innovations. The long-term economic benefits significantly outweigh the higher initial costs, especially when considering the “predictability premium” that reduces system-wide balancing costs.
The policy path forward is clear: establish long-term support mechanisms, invest in grid infrastructure, support supply chain development, streamline regulatory processes, and leverage existing expertise. With these measures in place, the UK can address its energy crisis while establishing global leadership in tidal energy.
Lord Malcolm Offord noted in his address to the House of Lords that “we are incredibly fortunate to have the North Sea on our doorstep.” This fortune extends beyond oil, gas, and wind to include our tidal resources – a perpetual, predictable energy source that can power our nation for generations to come.
The time for tidal is now. By making a strategic commitment to this uniquely British energy resource, we can reduce costs, enhance security, solve our grid issues, and create substantial economic value that remains within the UK. The tide is turning – we must ensure the UK is ready to ride the wave.