Business and Energy Secretary Greg Clark said the project would not be value for money, contradicting the Hendry Review 18 months ago that concluded the project could ignite a new industry for the UK.

“At £1.3bn, the capital cost per unit of electricity generated each year would be 3 times that of the Hinkley Point C nuclear power station.

“If a full programme of six lagoons were constructed, the Hendry Review found that the cost would be more than £50bn, and be 2.5 times the cost of Hinkley to generate a similar output of electricity,” added Clark.

The scheme would have been the world’s first tidal lagoon power project providing electricity for around 155,000 homes and sustaining 2,200 construction jobs.

Keith Clarke, chair of Tidal Lagoon Swansea Bay, said: “The treatment of the pathfinder tidal lagoon makes a mockery of a supposed new Industrial Strategy for the UK that pledges to back the disruptors and embrace new industries for a new future.

“The reality is that indecision sucks the life out of innovation and timid leadership will condemn Brexit Britain to the 20th Century.

“The entire industrial strategy of employing British manufacturing to harness British tides relies explicitly on delivery of a pathfinder at Swansea. Without it, we will again export jobs that could and should stay here.

“The lack of engagement with us during this process has been highly disturbing.”

Mark Shorrock, founder and chief executive of Tidal Lagoon Power, said: “The like-for-like comparison is that both Swansea and Hinkley Point C need a contract of £92.5 for 35 years, combined with other forms of government support.

“The difference is that one is a small bet on a homegrown and reliable energy future with minimal impact on consumers (30 pence a year on bills), the other is a massive gamble with energy security to the advantage of foreign companies and at huge cost to consumers (up to £15 a year on bills).

“The Secretary of State today appeared to airbrush from history the full story of the UK’s success in offshore wind.

‘It has indeed been a success and it has cost the nation some £8 billion in subsidy to make it so. Tidal power deserves the chance to make its contribution to the energy mix and the national economy and it will be able to do so for a much, much smaller price tag.”