Pivotal moments approach for UK new build
The British nuclear industry is on the verge of its renaissance, a London conference heard today, although many challenges remain now and for the future.
EDF is leading the push to build new nuclear reactors in the UK to replace old units built by the state that are nearing retirement. Speaking at the Nuclear Industry Association’s Energy Choices event today, EDF’s Humphrey Cadoux-Hudson said the company was “on the verge of a momentous decision” – the final investment decision to built an Areva EPR at Hinkley Point C, which would come at the earliest possible date after EDF makes “a compelling case for investors.” Shareholders in the project would be EDF with 75% and Centrica with 25%.
“Let me assure you of this: Nuclear will be delivered”
Michael Fallon (UK Business and Enterprise Minister)
Central to a robust business case is to secure a decision from government on the ‘strike price’ which will underpin a predictable income from the power Hinkley Point C would produce via the contract-for-difference system. These are not officially scheduled for months to come, and in the meantime EDF remains in close contact with government. EDF is also still seeking “clarity for legal protection based on the power set out in the [recently published energy bill],” said Cadoux-Hudson, as well as terms covering political risk and long-term stability. Given these, he said, EDF “stands ready to deliver the UK’s first nuclear power plant in more than two decades.”
The bullish tone was continued by minister for business and enterprise Michael Fallon, who said, “Building new nuclear is not easy anywhere at any time… but new nuclear in the UK will happen and we are close now to seeing it happen. It’ll happen because we need the security and low-carbon energy that nuclear can provide.”
“Let me assure you of this: Nuclear will be delivered,” Fallon declared to the industry crowd.
Both Horizon Nuclear Power and NuGeneration also plan to build new power plants in the period to 2025, but success for EDF’s Hinkley Point project is seen as key to unlocking a realistic probability of several new reactor projects for the country.
While the government wants to give EDF enough certainty to proceed, some major elements of the power market remain outside its control and the possibility remains that a new ‘dash for gas’ could undermine nuclear economics. Yesterday’s budgetary announcement from government included encouragement for shale gas exploration.
Panel speakers recognised the threat but emphasised that benefits of nuclear energy in terms of reliability and security of supply could balance disbenefits of relative capital costs. Fuel cycle director for the National Nuclear Laboratory Fiona Raymant said that nuclear would always be considered for its benefits in security of supply, which extend to the foreseeable future. Nuclear is a unique option for baseload in terms of electricity and heat for decades to come, she said, and that must be considered.
“We will have to have a basket of technologies,” said Dame Sue Ion, a fellow of the Royal Academy of Engineering. “Some will be more expensive than others. That most things will be expensive in future is just a fact of life that we will have to live with. I don’t think a situation will occur like the 1990s when the dash for gas made such a difference [to previous UK state plans for a series of new reactors].”
Source: World Nuclear News