EDF announces £1.3bn worth of contracts for Hinkley Point C

EDF has announced a number of contracts for the development of the Hinkley Point C nuclear power project in southwest England.

The announcements are indicative of confidence that final negotiations on the plant’s construction have been worked out between the French company and its partners.

The firms named include engineering giants Balfour Beatty, Doosan Babcock, Laing O'Rourke and Weir, as well as Turner & Townsend and Jacobs.

EDF had already announced four main preferred bidders for engineering and construction, including Paris-based Areva, Alstom and BouyguesTP.

It is now estimated that more than 60 per cent of the construction cost will be placed with UK firms, 3 per cent more than an initial estimate.

A final investment decision (FID) is expected in the coming months, after which the contracts will be signed. There is speculation that the Chinese premier’s state visit to the UK in the autumn will seal that milestone.

Hinkley Point C will cost around £14 billion to build at present costs, rising to £24 billion by the time it is finished, and interest payments have been added. The first electricity is expected to be generated in 2023.

EDF chief executive Jean Bernard Levy said good progress is being made in discussion with the British Government and the firm's Chinese partners. Things are moving "very quickly" towards a final investment decision.

EDF Energy chief executive Vincent de Rivaz said: "Hinkley Point C will be at the forefront of the revitalisation of the UK's industrial and skills base, and we have worked hard to build a robust supply chain to support new nuclear in the UK. The project will boost industrial stamina in the UK and kick-start the new nuclear programme. Experience gained at Hinkley Point will help firms be successful in nuclear projects around the world." Hinkley Point C graphic

The Balfour Beatty Bailey (Joint Venture) comprises oBalfour Beatty and NG Bailey, who will provide electrical cabling and equipment installation. Cavendish Boccard Nuclear (Joint Venture) will perform mechanical pipework and equipment installation.

ACTAN (Joint Venture) comprising of Doosan Babcock with Axima Concept and Tunzini Nucleaire, are charged with heating, ventilation and air conditioning works.

Laing O'Rourke will construct workers' campus accommodation while ABB UK will handle power transmission.

Scottish firms, Weir, are to provide large pumps for cooling water while Clyde Union, will provide the main pumps for feedwater and cooling water systems.

KBR and Jacobs Engineering are involved in the facility’s project management of site operations and equipment contract management, and building and civil work respectively.

Turner and Townsend will provide the site’s project controls and project management, plus NEC contract management services and Mace is in charge of contract management services.

Phil Whitehurst, GMB national officer for construction, added: "We now have a positive piece of the jigsaw concerning the construction of Hinkley Point C in place, which promises 25,000 job opportunities, 1,000 apprenticeships and 60% of the construction cost going to UK companies.

"But sadly there are still pieces of the jigsaw missing. The future of the project still hangs in the balance of an agreement between EDF, its investors, and the Conservative Government to secure the FID."

Balfour Beatty said its joint venture with NG Bailey, the UK's largest independent services and engineering company, was worth £460m and will create 1,000 jobs.

The joint venture will deliver the infrastructure that will power the station and its operations, including the design and installation of about 76,000 cables totalling over 3,000km (1,864 miles) in length; over 180km (112 miles) of cable containment support systems; fire and environmental sealing; design and installation of earthing systems, and specialist packages associated with data acquisition and plant control.

Leo Quinn, Balfour Beatty's group chief executive, said: "The new nuclear programme demands a scale of resources and expertise that only the most capable and trusted partners can deliver.

Prospect, the trade union representing more than 21,000 members working in the energy sector, has welcomed the announcement but with the proviso that the sectors skills challenge needs to be met.

Prospect deputy general secretary Garry Graham said: “Our members have consistently made the case for the need to invest in low-carbon baseload generation in the UK.

“Nuclear generation is a key component in that and today’s (Friday) announcement is good news for consumers, businesses and the UK as a whole. Building Hinkley C will provide 25,000 skilled and quality jobs and provide for 7 per cent of the UK’s low-carbon energy needs for decades to come.
Hinkley Point C nuclear power plant
“These contracts pave the way for the final investment decision for Hinkley C which we hope to see agreed shortly. Tangible progress will also provide the momentum for the development of new nuclear generating capacity by Horizon and NuGen at Wylfa and Moorside, providing major UK employment opportunities.

“But the skills challenge we face cannot be underestimated, especially given the potential convergence of competing major infrastructure projects.

“We need to ensure we have the capacity and capability to prove the UK not only ‘has nuclear, but does nuclear’ and can be a world leader in the development and delivery of safe low-carbon nuclear power.”

Turner & Townsend is one such company looking to build on its nuclear sector expertise, with CEO Vincent Clancy, stating,Having pioneered the use of project controls in collaborative environments on some of the UK’s most prestigious major programmes, including Crossrail and Heathrow, our project controls capability is best in class.  Once the final investment decision is made, our ability to set-up quickly and drive collaboration across the supply chain will be crucial on a programme of the scale, complexity and ambition of Hinkley Point C.”

The project has been overshadowed by difficulties associated with Areva, who provide the facility's reactor as well as objections to the decision by the European Commission to facilitiate it. Luxembourg is set to follow Austria's example in filing a lawsuit against the decision, but an insider who wishes to remain unnamed, said the country's legal team is waiting for the decision to be published in all official languages in the EU's Official Journal before taking that next step.

Gordon Bell, EDF media officer told Power Engineering International, "All parties are working so that a final investment decision can be taken at Hinkley Point C as soon as possible. The agreements for the project are durable because they are fair and balanced. They were approved by the European Commission following a robust and lengthy investigation. It found that the agreements were an appropriate and proportionate way for the UK to meet its need for secure, low carbon electricity and EDF Energy is confident that these agreements will continue to withstand any challenge."

In terms of developing a skilled workforce from the UK for the service, EDF also stated, "In order to prepare the potential workforce EDF Energy has invested £11 million in training, education and skills in Somerset, with the opening of both a new Energy Skills Centre and a Construction Skills Centre in partnership with Bridgwater College. The project will provide a wealth of apprenticeships and opportunities for the future workforce and in doing so will leave a long-term and sustainable legacy for the region."

 



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