What we can say for certain is that the sole source of this claim is the project director for Greenlink, Simon Ludlam, and he made the claim as an anecdote on a podcast this week. The project's public consultations were in 2019.
Non-British people might also like to know that the UK news media is in what's called the silly season, where they run any old nonsense as news because Parliament is in recess, the MPs are on their holidays, and there's a dearth of serious announcements to cover: https://en.wikipedia.org/wiki/Silly_season
It would not surprise me if it came up at some point in the long and tedious process of public consultations and planning permissions that such projects need to go through (basically anyone can write in to comment/object on such things for any reason), and it stuck in his mind enough to mention it, even if it didn't actually weigh into the decision about where the cable went.
If anyone wants to read dozens of PDFs, here are some of of Greenlink's planning applications for where the cable comes onshore at Freshwater West, including responses made to the planning committee:
The latter application includes a Archaeological Written Scheme of Investigation (WSI) which explains what needs to be done to avoid disturbing things of archeological importance. No mention of fictional elves in there, but I wasn't expecting any.
This is specifically with Pembrokeshire Coast National Park Authority, who are responsible for the beach. Pembrokeshire County Council have their own planning authority, e.g.:
The anecdote starts at 16m55s: https://podcasts.apple.com/us/podcast/can-we-connect-the-wor...
Non-British people might also like to know that the UK news media is in what's called the silly season, where they run any old nonsense as news because Parliament is in recess, the MPs are on their holidays, and there's a dearth of serious announcements to cover: https://en.wikipedia.org/wiki/Silly_season