Reports say government will announce this month that public money will not be used to build £20bn tidal energy scheme

The government looks likely to rule out the use of public funds to construct the controversial Severn Estuary tidal barrage.

According to a report in today’s Guardian the government will make an announcement this month excluding the use of government money to build the £20bn tidal energy scheme, which would be able to provide 5% of the UK’s electricity

Without public money the private sector is unlikely to back the 10-mile long project.

In a report to be published this month, ministers will recommend that further feasibility studies be carried out for one of four much smaller projects, which would cost about £3bn. But they will give no guarantee that the selected option will go ahead.

The announcement will please some environmentalists, who were worried about the impact on bird life in the estuary.

According to the report it is understood that a consortium is trying to raise finance for the project, which would also create direct road and rail links across the estuary and a 1.5km lake.

However a spokesperson for the Severn Tidal Power Group (STPG), a consortium made up of Sir Robert McAlpine, Balfour Beatty and Taylor Woodrow, admitted it was unlikely that developers would foot the estimated £250m cost of getting a project to the planning stage because of the risk it would be refused.