UK remains committed to nuclear despite Brexit

2 July 2016

The UK's Nuclear Industry Association and the French Nuclear Society, SFEN, have signed a Memorandum of Understanding, committing them to work together to further the nuclear sector in both the UK and France. The agreement, signed by NIA chief executive, Tom Greatrex, and Christophe Béhar, President of SFEN, recognises the importance of nuclear energy for sustainable development and the need for continued co-operation between UK and French industries as new nuclear generation is developed in Europe, the NIA said. Greatrex added: "While the referendum last week signalled that the UK will begin the process of leaving the European Union, it certainly does not mean the end of cooperation between the UK and EU member states."

While there is mounting speculation that the UK's Brexit decision could further undermine already delayed plans for the construction by EDF of a new NPP at Hinkley Point C, UK Energy Minister Amber Rudd said UK's decision to leave the EU has not changed the government's commitment to new nuclear power, or to its climate change goals.

Meanwhile, Duncan Hawthorne, recently appointed CEO of Horizon Nuclear Power (the UK subsidiary of Japan's Hitachi) has repeated his commitment to delivering the newbuild project to construct UK ABWRs (Advanced Boiling Water Reactors) at Wylfa Newydd on the Isle of Anglesey and Oldbury-on-Severn in South Gloucestershire. He told World Nuclear News: "I didn't come here to fail. I didn't come here without strong belief that this was the right thing for the supply mix in the UK, that we have a good product that offers something that will fill a gap in the market."

He added: "Our challenge is to win the commercial case here in the UK by building on time and on budget because that's where the real test is and [the industry] doesn't have a lot of good metrics on success with nuclear new build projects and we need to fix that." He said Horizon wants the UK ABWR project to be its "flagship".

Horizon is not alone in its ambition to create a commercial structure that enables private capital to enter a UK new build project. NuGeneration (NuGen) - the UK joint venture between Japan's Toshiba and France's Engie - plans to build a NPP of up to 3.8GWe gross capacity at Moorside, in West Cumbria using AP1000 nuclear reactor technology provided by Westinghouse Electric Company, a group company of Toshiba. NuGen CEO Tom Samson told WNN in May that his search for investment has included talks with Japanese and US export credit agencies.

Hawthorne said: "Not surprisingly, the characteristics of making the projects investible will be similar. Is it fair to say that NuGen and we are fishing in the same pool? Probably. But NuGen is probably looking somewhere else geographically than we are. The Toshiba-Westinghouse design takes them more into the US, while the Hitachi ABWR would take us more into Japan."

Unlike EDF Energy and its cooperation with China General Nuclear (CGN), Horizon "would be thinking about financial investors, rather than another vendor that is looking for an entre for their own technology", Hawthorne said.

Under a deal agreed last October, CGN will take a 33.5% stake in French state-owned EDF Energy's GBP18bn ($28bn) project to construct Hinkley Point C. In addition, the two companies will develop projects to build new plants at Sizewell in Suffolk and Bradwell in Essex, the latter using Chinese reactor technology.

"A direct lesson from the Hinkley project is if you look at the state aid challenge, that isn't a risk that a private sector company would take in nuclear new build. Simply stated, if the state aid thing becomes major, then you've lost your investment and there's no compensation for it. We have to think how we can be protected from that and in a reasonable way - because any protection a government would offer would in fact itself be state aid."

Russian state nuclear corporation Rosatom is also eyeing the UK market where it sees prospects for participation in the construction of four nuclear power units, according to the Annual Report of JSC Atomenergoprom for 2015. As well as established projects, the report also included potential projects, tenders, or the beginning of negotiations, which could be realised by 2030. The total number of such projects is 17, including four units each in the UK and Brazil, two units each in Saudi Arabia, Malaysia, Indonesia and the Czech Republic and one unit in Slovakia. Russian nuclear industry sources said the prospects of entry into the UK nuclear market had improved as a result of Brexit.



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