UK gives £2bn backing to Hinkley Point nuclear project

The UK government has reaffirmed its commitment to Hinkley Point C new nuclear power station by unveiling a £2bn ($3.1bn) infrastructure guarantee to help fund construction of the £24.5bn plant.

The deal was announced by UK Chancellor George Osborne while on a five-day trip to China, and it is intended to cement Britain’s backing of nuclear power ahead of a final investment decision later this year by the plant’s owner EDF Energy and Chinese stakeholders, China General Nuclear Corporation and China National Nuclear Corporation. Hinkley Point C nuclear power plant

The Treasury hopes that Hinkley Point will “open the door to unprecedented collaboration in the UK and China on the construction of new nuclear power stations”.

Osborne said that nuclear power “is cost competitive with other low carbon technology and is a crucial part of our energy mix, along with new sources of power such as shale gas”.

And he said that collaboration on Hinkley was “another move forward for the golden relationship between Britain and China – the world’s oldest civil nuclear power and the world’s fastest growing civil nuclear power”.

UK Energy Secretary Amber Rudd today said that the UK tax-payer and bill-payer “is the winner here because it’s the first step on new nuclear, which means clean, secure, low-carbon energy in the future”.

And she defended both the government’s £2bn commitment and the £89.50/MWh strike price for Hinkley. “For low carbon electricity it is reasonably priced – it is value for money. We have to make sure we have a source of low carbon energy that is baseload and absolutely reliable and not intermittent, like so many of our other renewables, so it [nuclear] is an essential part of our energy supply.”

She said the strike price was “a lot of money compared to coal, but it depends what you want, and what we want is a source of low carbon electricity. We have ambitious targets for low carbon for the future and if we are going to make those, we have to have a reliable source – that’s why we need nuclear. So for what it is, it is absolutely value for money.” UK Energy Secretary Amber Rudd

EDF Energy chief executive Vincent de Rivaz said that the UK approval of the infrastructure guarantee “is a clear sign of the government’s commitment to Hinkley Point C”.

News of the infrastructure guarantee was welcomed by UK trade union Prospect, which represents nuclear workers. Deputy general-secretary Garry Graham said Hinkley C – which is expected to create 25,000 jobs – “will pave the way for a nuclear renaissance”. 

“While there is no energy generation decision without controversy, nuclear is a proven low-carbon technology which helps us meet our climate change obligations and provides safe and secure clean energy for future generations.”

But Greenpeace UK chief scientist Dr Doug Parr said the announcement of the infrastructure guarantee was “a PR smokescreen to give the impression that this project is moving forward when it's actually bogged down in a swamp of troubles”. 

“Hinkley hasn't got funding or safety clearance, and everyone outside the nuclear industry and our blinkered government thinks it’s absurd, yet the Chancellor is ignoring them all to plough ahead with this overpriced, overrated, and overtime project.”

Parr said that Osborne “is signing up the country for the ultimate rip-off deal. Instead of locking two generations of UK consumers into paying billions to foreign state-owned firms, Osborne should invest in the flexible, smart, and truly clean energy system that can power a 21st century Britain without leaving a pile of radioactive waste as legacy."

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