The UK government says it will not give its backing to a £30 billion tidal energy scheme because it considers the costs and risks of the project to the taxpayer and energy consumer to be too high.

The Severn Tidal Power scheme could provide up to five per cent of the UK’s electricity needs and make a major contribution to the country’s renewable energy targets, but the publication of a feasibility study into the project by the government reveals that other low-carbon energy technologies would be a better option.

The results of the feasibility study have been published alongside the launch of a consultation on the new government’s revised national policy statements on energy, and a package of announcements on nuclear energy in the UK.

“I’m fed up with the stand-off between advocates of renewables and of nuclear which means we have neither,” said UK Energy Secretary Chris Huhne. “We urgently need investment in new and diverse energy sources to power the UK. We’ll need renewables, new nuclear, fossil fuels with CCS, and the cables to hook them all up to the grid as a large slice of our current generating capacity shuts down.

“The market needs certainty to make this investment happen, and we are determined to clear every obstacle in the way of this programme.”

The feasibility into the Severn Tidal scheme says that there is no strategic case for major public sector investment in a large-scale energy project in the Severn estuary. “It would be very costly to deliver and very challenging to attract the necessary investment from the private sector alone,” the government said in a statement.

The Severn Tidal scheme was given backing by the government’s Sustainable Development Commission in 2007 but it remains controversial because of its potential impact on fish stocks and the internationally important marsh and mudflat habitats of the Severn estuary. Five potentially viable projects have been proposed and studied by the government, including a 10-mile barrage scheme running from Weston-super-Mare to Cardiff.

The government has not ruled out resurrecting the Severn scheme if factors that determine the feasibility of the scheme change over time, but says that it will not review it again until 2015 at the earliest. It has called for a “surge” in investment in new energy sources.

The government’s revised draft national policy statements on energy show that it expects over half the new energy generating capacity built in the UK by 2025 to come from renewable sources, with a “significant proportion” of the remainder coming from low carbon sources such as nuclear and fossil fuels with carbon capture and storage.

At least one-quarter of the UK’s electricity generating capacity needs to be replaced by 2020.

In order to help provide certainty to investors in new nuclear capacity, the government has announced the regulatory justification of two new nuclear reactor designs – Westinghouse’s AP1000 and Areva’s EPR, and has also set out more detail on what will be required from new nuclear developers in terms of clean-up.

The government has also reiterated its policy that there will be no public subsidy for new nuclear power in the UK. “To be clear, this means that there will be no levy, direct payment or market support for electricity supplied or capacity provided by a private sector new nuclear operator,” said Huhne in a statement to Parliament.

This could change, however, if government support is made available more widely to other forms of generation. “New nuclear power will, for example, benefit from any general measures that are in place or may be introduced as part of wider reform of the electricity market to encourage investment in low-carbon generation,” said Huhne.