Hitachi subsidiary Horizon Nuclear Power on 28 January notified the UK Planning Inspectorate that it is withdrawing its application for a Development Consent Order (DCO) for Wylfa Newydd on Anglesey where it had planned to construct a nuclear power plant with two UK Advanced Boiling Water Reactors.

The £20 billion ($27bn) project was expected to provide employment and business opportunities for the region.

The previous day, Horizon CEO Duncan Hawthorne had informed Gareth Leigh, head of energy infrastructure planning at the Department for Business, Energy and Industrial Strategy (BEIS), of the application withdrawal. Hawthorne said in a letter that discussions with third parties that had expressed interest in Wylfa the development had not led to any definitive proposal.

"As you know Hitachi announced the suspension of the project in January 2019 and its intent to withdraw entirely in September 2020. In light of this and in the absence of a new funding policy from HM Government, Hitachi Ltd has taken the decision to wind-up Horizon as an active development entity by 31 March 2021. As a result, we must now, regretfully, withdraw the application submitted on 1 June 2018 for the Wylfa Newydd DCO Project," he wrote.

"The Wylfa Newydd site…continues to benefit from a decade of major investment and development and is too important to the Net Zero agenda and the economic future of Anglesey and North Wales, for that progress to be wasted."

Hitachi will now manage the site under the control of its subsidiary Hitachi Europe Limited. "This will be done with a view to considering development proposals from commercial or public sector developers who may come forward, and Horizon will continue to support this intent until the end of March,” Hawthorne said. “Beyond this period Hitachi Europe will remain available to respond to any parties who may have an interest in acquiring these sites." 

In an extensive interview published in the January/February issue of Nuclear Future (the journal of the UK Nuclear Institute), Hawthorne says he can sympathise with the government being cautious over funding decision for nuclear. “I don’t criticise the government for taking their time over it, but there is a point where you have to make a decision and go with it,” he said. “Funding these new builds is a real challenge, and I’ve always believed that government has to do that.”

He said, while investors are comfortable with operating risk, they are not comfortable with construction cost, “Hitachi stuck it out a long time, they put a lot of money into it, but they weren’t able to get a funding model to work,” he noted. “The government made a lot of good suggestions and concessions, but ultimately, although they may have been prepared to do some funding models, they weren’t allowed to because they would have breached state aid rules.”

Hawthorne said that, without Wylfa or an equivalent, “a big hole will be left in the nuclear supply to the  grid” but he believes it won’t come to that. “It’s not about will it or won’t it, for me it’s about when.”  He concluded: “There is no prospect of us actually providing stable, reliable, emission-free power at the quantum that this country needs…unless you invest in nuclear power construction, large and small.”

Local reaction

Local MP Virginia Crosbie remains optimistic that Anglesey could still host a nuclear power station following a meeting with newly appointed BEIS  Secretary Kwasi Kwarteng.

“I stressed the importance of Wylfa Newydd to Anglesey and the whole of North Wales and asked for BEIS commitment to working with me to find a solution,” she said on her website.

“This is by no means the end of our island’s ambition to have a new nuclear power station on this site, which is a world-class place to install this energy. The UK government remains completely committed to nuclear power at Wylfa Newydd as am I. However, the fact is work could not continue without a developer.”

She acknowledged that the project had “experienced a setback”, adding: “My job now is to help find new developers with new ambitions to invest in this site using the latest nuclear technology. Wylfa Newydd is here ready and waiting for someone to take it forward. It will support the government’s 2050 net zero carbon goal, its levelling up agenda and it will stimulate the UK’s nuclear supply chain.”

A UK Government spokesperson said: “We offered a significant package of potential support to this project that went well beyond what any government has been willing to consider in the past, including taking a one third equity stake, providing all required debt financing and offering generous financial support through our Contract for Difference scheme.

"We understand that this will be disappointing news for the people of North Wales, however Wylfa remains an important site for potential new projects and the UK Government will continue to explore future opportunities for it.”

After Horizon’s parent company Hitachi announced in September that it was pulling out of the project, Horizon held talks with several interested parties about taking over the project. These included a Bechtel-led consortium that held talks with the government about delivering a nuclear power plant on the site.

Former BEIS Secretary Alok Sharma had been due to rule on the project’s development consent order application by the end of December 2020, but extended that deadline until 30 April at Hawthorne's request.

In January, Shearwater Energy suggested that combining wind power with a small modular nuclear reactor could lead to energy production at Wylfa restarting by late 2027. Shearwater said this would involve construction of a wind-SMR and hydrogen production hybrid energy project, which would be located on a different site adjacent to the power station.

Photo: Horizon's plans to build a new nuclear power plant at Wylfa Newydd have been stopped (Credit: Horizon)