Ministers have thrown their weight behind new large nuclear plants as part of Britain’s energy mix and formally entered talks with EDF over its £20 billion Sizewell project in Suffolk.
In an energy white paper published yesterday, the government said it aimed “to bring at least one large-scale nuclear project to the point of final investment decision by the end of this parliament, subject to value for money”.
The French group EDF is already building a new nuclear plant at Hinkley Point C in Somerset with China’s CGN and is hoping to proceed with construction at the sister station in Suffolk. At 3.2 gigawatt capacity, the Sizewell plant could produce enough power to meet 7 per cent of Britain’s electricity needs.
Ministers said yesterday that they would begin formal negotiations with EDF that would explore the possibility of taxpayer funding for the plant’s construction. They would also consider approving a “regulated asset base” funding model under which households and businesses would start paying for the project via their energy bills while it was still under construction.
Both models raise concerns that consumers could be on the hook for cost overruns. At Hinkley, consumers are insulated from budget blowouts under a different funding model in which EDF and CGN are paying all the construction costs. Consumers will, however, pay a high fixed price for the electricity it generates, under a contract widely criticised as too expensive.
The government said negotiations over Sizewell would depend “on the progress of Hinkley”. It said no decision had yet been taken to proceed with the project but published new analysis that it said suggested that “additional nuclear beyond Hinkley Point C will be needed in a low-cost 2050 electricity system of very low emissions”.
EDF will be hoping to proceed with Sizewell rather sooner than the timescale set out by the government, which implies any time until 2024. EDF hopes to start work in early 2022, by which point it hopes to have received planning permission. It says that doing so will enable it to transfer staff and equipment from Hinkley without delay.
Greenpeace said that Sizewell was “unnecessary and remains expensive” and warned: “If discussions with the majority French state-owned company ever progressed, the UK public will need to stump up billions of pounds in advance.”