The research, commissioned by Tidal Lagoon Power, which plans to build a 240MW tidal lagoon in Swansea Bay, stated that the contract-for-difference (CfD) strike price for a tidal lagoon project could be as low as £92/MWh by 2021.
The first “proof-of-concept” project, which is the Swansea Bay development, requires a £168/MWh strike price.
This is estimated to fall to £130/MWh for a second lagoon, and then to £92/MWh for a third lagoon project.
The fall in costs is said to come from a move to bigger sites with a higher tidal range.
Offshore wind projects are currently offered a CfD strike price of £155/MWh and this would fall to £135/MWh in 2018/19. Other marine energy technologies are being offered a strike price of £305/MWh.
Mark Shorrock, chief executive of Tidal Lagoon Power, said: “The more water we impound, the more power we produce, the less support we require.
“It really is that simple.”
Gareth Davies, director at Poyry management consulting, said: “Tidal lagoons have the potential to provide renewable electricity which is both affordable in the short term and secure for the long term.”