An £18million tidal energy scheme, which was supposed to power 600 homes, has stopped working after just three months.

The taxpayer-funded DeltaStream project in Pembrokeshire in Wales, was designed to use the flow of the ocean with a 39ft turbine installed on the seabed near Ramsey Island.

But the system developed a fault and stopped generating electricity just weeks after being turned on.

Its operator Tidal Energy Ltd has now gone into administration and is seeking a buyer.

The £18million 'wet elephant' received £8million funding of EU money and £500,000 from the Welsh Government

The £18million 'wet elephant' received £8million funding of EU money and £500,000 from the Welsh Government.

The generator was fitted with a sonar radar to detect nearby wildlife including seals, porpoises and dolphins and would shut off if they came to close.

But the sonar developed an 'intermittent fault' in March 2016 - after being launched the previous December.

Development director Chris Williams of Tidal Energy Ltd said defended the massive cost of DeltaStream saying it was a 'research' project.

He said: 'The project was a research and development project. It was never put in the water to generate massive amounts of electricity.

'The purpose of the project was to provide the essential learning, new knowledge, know how and experience to progress the industry in Wales.

'What we set out to do we did, 100 per cent.'

Mr Williams described the problem with the turbine as 'an intermittent fault with an active sonar.'

Leader of the Welsh Conservatives, Andrew RT Davies said the project was at risk of becoming a 'wet elephant'.

He said: 'With over £8m of EU and Welsh Government funding tied up in this project, this is extremely concerning.

The taxpayer-funded DeltaStream project in Pembrokeshire in Wales, was designed to use the flow of the ocean with a 39ft turbine installed on the seabed near Ramsey Island

'That the turbine is currently in a state of disrepair poses a serious hindrance to the administrators' ability to find a buyer to take on the device and the rest of the company's assets.

'Labour once hailed the development of the turbine a 'landmark project' for Wales. It is sad and deeply frustrating to think of it now broken on the ocean bed.

'I sincerely hope that a new buyer can step in to salvage this project and move it forward once again, and that it doesn't just end up like a wet elephant, piled on the growing scrap heap of Labour's failed investments.'

A Welsh Government spokeswoman confirmed a new buyer was being sought.

She said: 'Tidal Energy Ltd's EU funded project did achieve its primary objective and has provided a significant amount of learning to the sector and the local supply chain.