Almunia says Hinkley approval sets no precedent

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European Commission vice-president Joaquín Almunia said today that the EC’s approval for Hinkley Point C nuclear plant in the UK “will not set any precedents”.

He stressed that the go-ahead for revised plans for the project (see European Commission votes approval for Hinkley Point) did not mean that Brussels was favourable to nuclear at the expense of renewables, which it has long backed.

“The choice to promote nuclear is a choice by the UK”, he said, and added: “There is no change of energy policy in the EU.”

Speaking at a press conference this afternoon where he confirmed that the UK government’s plans to support Hinkley “will not lead to undue distortions” of state aid rules, he said: “Without public support this investment cannot take place – the aid is proportionate to the needs.” Joaquín Almunia

He said the EC had been persuaded by the UK that there was no cheaper or less risky alternative to Hinkley, which will be the first nuclear power station built in Britain for almost 20 years.

Almunia (pictured right) stressed that he had assessed – and was comfortable with – the safety risks associated with nuclear. “I can assure you that I care about the risks involved in this kind of energy. I have paid attention to all the risks in this project.”

He told journalists that Hinkley would take almost ten years to build, would be operational for 60 years and cost £34bn – a significant rise on the £16bn price tag that has been quoted by EDF, which will build the plant.

EDF chairman Henri Proglio said the EC approval “is a major milestone for the Hinkley Point C project. Now EDF and partners have to finalise the agreements needed to reach a final investment decision. Building EPR reactors in the UK will provide huge benefits for both countries in terms of job opportunities, economic growth and skills, further strengthening France and the UK’s fruitful partnership.”

EDF Energy chief executive Vincent de Rivaz added: “The approval of the European Commission demonstrates that the proposed package of agreements between the government and EDF is fair and balanced for investors and consumers now and for the long term.

UK Energy Secretary Ed Davey said: “This is an important next step on the road to Britain’s first new nuclear power station in a generation. While there is much work still to do before a final contract can be signed, today’s announcement is a boost to our efforts to ensure Britain has secure, affordable low carbon electricity in the 2020s."

The EC’s decision today was welcomed by the UK’s Nuclear Industry Association. Its chairman Lord Hutton of Furness said the approval was “an important step in securing the UK’s home-grown low-carbon electricity generation while adding jobs and prosperity to the economy”.

He added: “Reaching this decision has been a long process, but it was right the Commission should thoroughly review all the relevant issues. We look forward to EDF Energy taking its final investment decision with the interested investors. This will set in train an important time for the nuclear sector in the UK as new build projects get under way to replace the current ageing generation. It also gives certainty to other European countries looking at the UK system of contracts for difference as a mechanism to secure their own supply.”

The British union for energy and engineering construction workers, the GMB, was also enthusiastic about the EC go-ahead.

National secretary for energy Gary Smith said: "Nuclear new build is crucial to delivering low carbon electricity and keeping the lights on. Our energy infrastructure is creaking and we need to get on with this and building other nuclear power plants as a matter of urgency. This won't solve the immediate crisis in energy but the longer we delay the worse it will get and the more expensive the construction project will be.”

Smith also said that the threat of a legal challenge to the decision from Austria (see Austria confirms it will take legal action if Hinkley Point approved) was “based simply on anti-nuclear prejudice. UK civil nuclear power has run safely for generations and the new power stations will have even higher standards than in the past.”

He added: “New nuclear is expensive but so are renewables. Both renewables and nuclear need subsidies and everyone should be honest about this. Renewables are also invariably intermittent and this means we still need a dependable base load supply with back up to meet peak demand. New nuclear has to be part of the UK energy mix as a result.” Hinkley Point C

The GMB’s national officer for engineering construction, Phil Whitehurst, said: "Hinkley Point C power station is badly needed not only for the thousands of jobs it will secure in the construction industry and supply chain but also to prop up our failing energy production capacity.

“So many coal fired stations are closing and due to the indecisiveness of the government on green subsidies they are not being converted to biomass. Hinkley Point C will be built and managed under safety regimes second to none in the world.”

On the threatened Austrian challenge, the GMB said that “Austria is the EU’s most hostile nation to nuclear energy. However what happens in the UK has nothing to do with Austria. GMB respectfully ask their government not to interfere with this much needed station.”

John Cridland, director-general of the Confederation of British Industry, said: “The European Commission’s green light for Hinkley Point is a significant milestone in the United Kingdom’s energy future.

“Hinkley should set the ball rolling for the UK’s nuclear new build programme, putting us on the right path to achieving a secure and sustainable energy mix. It represents a real opportunity for growth, with the potential to create tens of thousands of jobs for people – not just in the local community, but up and down the whole country.”

Mark Stewart, partner at UK infrastructure consultancy EC Harris, said the EC announcement was “a major boost to the UK nuclear industry and a step towards security of supply”.

“This will be the key that unlocks the UK nuclear industry and the wider watching European new build arena,” he added.

He said it would bring “more jobs, more secure energy and a long term replacement for aging energy assets”.

However he added: “This will bring to the forefront the issue of the cost to taxpayers and the sucker punch to the environmentally friendly renewable industry – not to mention the potential and expected legal challenges surrounding agreed EU competition targets.

“It seems this is a good result for the large energy utilities to ensure the investment in our next fleet of nuclear plants. Of significance, it may not be as good a result for the rest of the stakeholders in the government's proposed balanced energy mix.”

 

 

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