UK ministers look at nuclear finance options

16 February 2017

Key UK government ministers are involved in discussions over how to support the construction of new NPPs with some senior Treasury (economic and finance ministry) officials hostile to any direct state subsidy, the Financial Times reported on 13 February. 

The FT said chancellor Philip Hammond  and business secretary Greg Clark had both taken part in talks over support for new nuclear units at Wylfa in Anglesey  and Moorside in Cumbria, according to “people involved in the process”. The government views the projects, each expected to cost more than £10bn ($12.5bn), as crucial to UK energy security and tackling climate change, with coal-fired plants are being phased out and most NPPs reaching the end of their lives.

The Financial Times said any deal would need to overcome opposition from parts of the Treasury, which has for decades resisted the idea of direct government investment in nuclear construction.

Horizon, owned by Hitachi, is developing plans to build at least 5400MWe of new nuclear at Wylfa and Oldbury-on-Severn in South Gloucestershire. NuGen, a joint venture between Toshiba and Engie, has begun site characterisation work for its planned Moorside NPP in northwest England, close to the existing Sellafield nuclear complex. The issue has been given new urgency by the financial crisis at Toshiba, which is the main shareholder in the NuGen consortium. Two new reactors being built at Hinkley Point in Somerset by EDF of France and CGN of China went ahead only after the government promised a guaranteed electricity price of £92.50 per megawatt hour in 2012 prices, rising with inflation for 35 years. 



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