Concerns have emerged over the future of a tidal energy centre project in which the Isle of Wight council (IWC) invested £1 million.
Financial statements released by Perpetuus Tidal Energy Centre Limited (PTEC), the company behind the scheme, highlight a “material uncertainty” about its ability to continue operating as a going concern.
Council’s investment still unpaid
Following a cabinet decision in 2013, the IWC has invested over £1,000,000 in the project to convert tidal stream energy to electricity, “sufficient to provide carbon free power to a quarter of Island homes, and at the same time produce significant economic benefits for the Isle of Wight”.
In September 2020, the cabinet decision to extend the loan period was called in by the Scrutiny Committee, but the motion calling for the terms of the loan to remain the same did not succeed.
The council has a 15 per cent shareholder stake in PTEC, and the repayment is included in the company’s long-term liabilities. The debt is due to be repaid in full by May 2027, however, with just £65,000 cash in the bank, it’s unclear whether this will become a reality.
Dependence on Government support and further funding
PTEC’s year end accounts say the company’s financial survival relies heavily on the UK Government recognising the need to fairly distribute early revenue support across the union.
This support, they say, would allow the company to compete for a Contract for Difference – the Government’s main tool for backing low-carbon electricity generation.
In addition, the company must secure further funding from both public and private sources to remain viable.
Directors have confirmed they are actively addressing the issues, but they admit there is no guarantee of success. Should the company be unable to continue, it may need to adjust the value of its assets to reflect what could actually be recovered.
Planning permission expiry adds to project uncertainty
Further complications arose when planning permission for the onshore element of the project expired in December 2024.
That expiry followed the rejection of proposed changes to the planning conditions.
This adds another layer of challenge for the project’s future and raises questions about the feasibility of meeting its current goals.
OnTheWight has approached PTEC and Isle of Wight council (IWC) for a response to questions and will update this article once we hear back.
A week after asking, a spokesperson for IWC told OnTheWight,
“I am advised the loan does not become due until May 2027 on that basis we have not initiated any recovery action and the loan has not been written off.”
Article edit
11.28am 29th Apr 2025 – IWC comment added
