PLANS to harness the force of the seas off Scotland to generate energy have been called into question again after a flagship tidal power scheme suffered a body blow although other renewables schemes are making progress.

The UK government snubbed an application to provide support for the expansion of the MeyGen tidal development off northern Scotland casting the future of the project into doubt.

Atlantis Resources was seeking support for a plan to install 49 turbines on the seabed of the Pentland Firth which it reckoned had the potential to transform the tidal energy industry.

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The company said the development would create 5,300 jobs, which would help compensate for the damage caused by the oil and gas downturn, and put Scotland at the forefront of a major global industry for decades.

Last month Atlantis said the first two turbines installed on MeyGen had achieved a world record performance, generating enough power for 2,000 Scottish homes.

However the Government decided the tidal energy that would be produced at the MeyGen extension would be too expensive. It rejected Atlantis’s application for funding in the latest auction under the Contract for Difference scheme.

Eleven projects that required less support per unit of output have won backing.

These include a windfarm in the Moray Firth and a biomass combined heat and power plant at Grangemouth.

Dong Energy won support to build what it reckons is the biggest offshore windfarm in the world off England.

London-listed Atlantis warned the rejection could derail efforts to develop the tidal energy industry in the UK.

Chief executive Tim Cornelius said: “It would be a travesty if the UK were to lose out on another emerging industry where it has ... a first-mover advantage and where the cost of energy is on a steep downward trajectory.”

Scottish wave power firms Pelamis and Aquamarine Energy called in administrators in November 2014 and October 2015 respectively.

Atlantis hopes to persuade the government to think again.

MeyGen may not achieve anything like the 57-turbine scale hoped for. The company is unlikely to proceed beyond the demonstration phase of four turbines unless there is a change of heart at Westminster.

The company said: “In the near term, Atlantis will focus on delivering projects in France, Canada and South East Asia where tidal stream is well supported.”

Industry body Scottish Renewables said MeyGen was the only commercial multi-turbine tidal array to have gone into construction anywhere in the world.

Head of policy Michael Riley said: “We would urge Ministers to commit to supporting this rapidly-developing sector so it is given the opportunity to drive down costs, as offshore wind has done.”

Three offshore wind projects won support in the auction, including Dong Energy’s Hornsea 2 project. Dong said this would be able to supply energy to the grid at a record low of £57.50 per megawatt hour, 50 per cent of the price supported in the previous CFD auction two years ago.

A spokesman for Atlantis said it made a very competitive bid based on a two-thirds reduction in the level of revenue support required for the 49 turbine phase 1c versus phase 1a, without giving details.

Atlantis expects to have four turbines installed under phase 1a by the end of the quarter.

It has won support for a four turbine phase 1b under European schemes but may not proceed without backing for phase 1c.

The Moray East windfarm and Grangemouth Renewable Energy’s CHP plant will generate enough electricity to power 1.1 million homes in total. Utilities EDP and Engie will develop Moray East.

EDF learned last year it would get £92.50 per MWh for nuclear power from the Hinkley Point C plant.