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A floating island of up to 10,000 houses and shops could feature in a revived tidal lagoon project - dubbed Dragon Energy Island - for Swansea Bay.

The houses and shops would rise and fall with the tide and be protected from the worst of the elements by the surrounding lagoon seawall.

Also proposed is a floating solar energy farm and an underwater data centre for tech companies to keep their energy-hungry servers cool.

These developments would only take up a small proportion of the lagoon - and the ebb and flow tides would pour through underwater turbines to generate electricity for many thousands of homes for 120 years.

The plans are "financially viable" and would create thousands of jobs, according to a report commissioned by a Swansea Bay City Region task force.

A much-publicised lagoon bid by a company called Tidal Lagoon Power gained planning consent in 2015 but has not got off the ground after the UK Government declined to offer a financial package of support.

Dragon Energy Island's lagoon footprint would be based on Tidal Lagoon Power's scheme between the Tawe and Neath river channels.

Rob Stewart, Swansea Council leader and chairman of the city region’s task force, said there was huge support to deliver the lagoon.

“Despite the UK Government not backing the previous proposals, we never gave up hope on the opportunity to deliver a major renewables project in Swansea Bay," he said.

“An enormous amount of hard work has taken place behind the scenes to develop a new proposal that will generate clean, green power for many generations to come."

Dragon Energy Island, he said, was more ambitious and turned the scheme from an energy project into an infrastructure one.

Cllr Stewart said the estimated cost of the new-look lagoon was up to 30% lower than the £1.3bn original - but this does not take into account the houses, shops, solar farm and data centre.

It is understood that the saving of £300m has come from a remodelled lagoon seawall and changes in the way the seawall and turbine elements of the project would be procured.

Councils and other public sector bodies would be invited to buy electricity generated by the lagoon for a set number of years.

Another idea is to convert some of the electricity produced into high-value hydrogen and oxygen for industrial uses.

The report by Holistic Capital is due to be discussed by the city region's joint committee on May 28 before the next steps are explored.

These could include further project research and financial analysis before the search for a private sector partner potentially gets under way later this summer.

Financial backing could also be sought from the Welsh Government , which would be responsible for planning and marine licence consents.

(Image: www.jetsongreen.com)

A total of 11 companies and institutions have already expressed interest in all or parts of the new-look project, with about half keen to deliver the whole scheme.

Construction could even start in 2021, with Dragon Energy Island potentially up and running five years later.

The earlier Tidal Lagoon Power project, spearheaded by its chief executive Mark Shorrock, aimed to generate the equivalent electricity used by 155,000 homes.

His proposal included sailing and leisure uses for the lagoon, public access around the six-mile seawall, plus an offshore visitor centre.

It did have its critics, especially among angling groups who were worried about its potential effects on migrating fish. And it did not receive a marine licence from Natural Resources Wales.

The idea was for the Swansea lagoon to act as a pathfinder for a series of larger UK tidal lagoons, including schemes off Cardiff, Newport and Colwyn Bay.

But despite support from former Energy Minister Charles Hendry as part of a tidal lagoon energy review, the UK's Secretary of State for Business, Energy and Industrial Strategy, Greg Clark, poured cold water on the Swansea project last June.

It was, he said, too expensive .

Mr Clark said at the time: "The same power generated by the lagoon, over 60 years, for £1.3bn, would cost around £400m for offshore wind even at today’s prices, which have fallen rapidly, and we expect to be cheaper still in future."

Referring to the new floating homes concept, Cllr Stewart said: "This has already been successful in countries like Holland, Germany and Denmark, providing a sustainable solution to issues including population density and climate change.

“This project will place Swansea Bay at the forefront of worldwide marine energy innovation, create thousands of jobs, boost local supply chain businesses, and help develop a globally significant export industry in Swansea Bay.

“Importantly, the independent report has found this new proposal to be credible and financially viable with the potential to make savings of up to 30% on previous estimates."