This March the nuclear renaissance has a whiff of dead parrot about it. Negotiations over the guaranteed price EDF hopes to receive for Hinkley seem to have hit the buffers. The Telegraph says talks are at “crisis point” and heading for failure. The BBC’s Robert Peston says the dispute seems “more serious than the Treasury’s habitual battles with the private sector” over subsidies. EDF is scaling back spending on Hinkley “until there is greater clarity around its negotiations with the Government”.
Apparently EDF wants a 10% rate of return but the Treasury fears that means it would make excessive profits. EDF says future reactors should be cheaper. And Hitachi has warned that if the deal with EDF collapses, Ministers could not count on Hitachi to step into the breach. Peston says rejection of the nuclear option now looks a very real prospect.
Even if the Treasury and EDF do come to an agreement, the European Commission might take up to two years to decide on whether the proposals constitute illegal State Aid. EDF Energy’s proliferating demands for financial support will force the EC to deliberate until 2015 at least.
The Energy and Climate Change Committee has called for a Plan B, in case nuclear investment doesn’t happen. At no2nuclearpower we think that an alternative strategy based on energy efficiency and renewables is essential anyway. As former Labour MP, Alan Simpson, points out: “…hundreds of thousands of the fuel poor will die in this decade …. Millions more will face rising fuel bills for energy set to become less and less affordable, while better choices slide off the table. This is not a programme, it’s a road crash. The only sources of energy with genuinely falling cost curves are all being sidelined.”
For less than the cost of a single new nuclear power station, Britain could take seven million households out of fuel poverty. For less than the cost of the bribes that we will pay for reopening mothballed gas power stations we could have a renewable energy programme that would deliver sustainability, and a decentralised system of generation, and distribution that would turn a cartel into an energy democracy.
5th March 2013
Daily News Roundup
Energy bills are rising so steeply that they could overtake mortgage repayments in parts of Britain in just five years’ time, the chief executive of supplier, First Utility, has claimed. Ian McCaig issued the stark warning as he said energy policies must be reviewed to minimise the impact on bills and said consumers should think about turning down their heating to reduce costs. Critics have said that the Government’s environmental policies on windfarms and energy efficiency schemes, for example, …
The government has insisted it was still optimistic about plans to build a series of nuclear power stations despite expectations that EDF would delay its timetable for a new reactor at Hinkley Point and concerns that China was losing interest in being a co-investor. On Friday, the construction trade paper Building quoted industry sources as saying that EDF did not expect to take a final investment decision on Hinkley in Somerset until September at the earliest. The firm, 80% …
At 2013 prices, solar PV in mid-latitude countries is now cheaper than new nuclear. Put in the UK context, the proposed EdF power station at Hinkley is now more expensive per unit of electricity generated than solar farms in the south of England. The implications of this need a great deal more consideration than they are getting. We do know what EdF, the owner of the Hinkley site, thinks it needs to pay its capital providers. Press reports, not …