UK government guarantees £2bn nuclear plant deal with China

China is investing £2bn in the delayed Hinkley Point nuclear power station, guaranteed by the UK government. This clears the way for French energy EDF to proceed with the project. EDF welcomed the news but did not say the project was back on. The path has also been set for further Chinese investment in other nuclear power stations, at Bradwell, Essex, for instance.

The Hinkley Point power station would be Britain’s first new nuclear plant since Sizewell B was synchronised with the national grid in 1995. Hinkley Point is expected to provide power for about six decades. In Beijing, Chancellor George Osborne said: “We want the UK to be China’s best partner in the West. [This guarantee] paves the way for Chinese investment in UK nuclear [to help provide] secure, reliable, low carbon electricity for decades to come.”

Sophie Neuburg, energy campaigner at Friends of the Earth, responded: “It’s astounding that while the Government is decimating thriving renewable and energy efficiency industries including solar power – with thousands of jobs lost – they are ready and willing to offer up a guarantee for a £2bn loan for a nuclear deal struggling to find investors. And, nuclear is a terrible deal for consumers.  New wind and solar plants being built for 2018 already cost less than the price we will still be paying for nuclear energy by the 2050s.

“£2bn on the Government balance sheet could provide loans to insulate 1m homes, or pay for enough solar to power 1.3 million households, reducing carbon and creating thousands of jobs in the near future.”

Dr Jenifer Baxter, Head of Energy and Environment, at the Institution of Mechanical Engineers, said in response to the UK Government decision to guarantee the Hinkley Point C nuclear power plant: “This development is welcome news and long overdue.  Nuclear is set to play a central and vital role in the UK’s energy future. Although the financial costs of nuclear power seem high, with the upfront cost of Hinkley Point C over £16 billion, this power station will provide and modernise the diversification we so badly need in ensuring the UK’s lights stay on.

“Nuclear is currently one of the least CO2-intensive ways to generate base-load electricity.  It is a vital part of the electricity mix we need in addition to gas-generation and renewables. At present, there is no viable alternative that will enable us to meet our emission targets.

“Government now needs to push forward with the development of other nuclear power sites, in places like Wylfa and Oldbury as well as other types of nuclear, like Small Modular Reactors (SMRs). SMRs present a lower cost option, with comparatively straightforward construction and, potentially, a more attractive investment proposition. They would be factory-manufactured and assembled on site, and likely cost in the region of £1-2 billion.

“Whilst the development of a new nuclear power station is positive news, the Government must encourage significant investment in the whole nuclear fuel life-cycle.  Investment in research and development to understand further the nature of radioactive waste, the potential for further energy production both heat and power and the opportunities for reducing radioactive half-life are all vital in developing a safe nuclear industry.  Concerns over the disposal and long-term management of these wastes must also be addressed, with proper testing for geological disposal of radioactive wastes taking around 20 years. The Government must also take steps to secure potential sites for disposal with long-term testing strategies, without which nuclear power generation will continue to leave a significant waste challenge for future generations.”

Stop Hinkley Spokesperson Allan Jeffery said: “The Chancellor, George Osborne, seems so desperate to get this project off the ground that he is prepared to go cap in hand for finance to a country with a lamentable human rights record and poor health and safety record. The Prime Minister should end this charade right now.”