As the FT reported on Friday, negotiations on the terms for new nuclear have advanced and there is increasing optimism that a deal can be done. The meeting between David Cameron and Francois Hollande in Paris two weeks ago amounted to a declaration of agreement in principle. Just three issues remain to be resolved. Can the project be financed? Can the terms survive full scrutiny and be judged fair to other suppliers? And can the project be delivered on time and on budget? These are not small issues and many in Whitehall want to ensure that they are clearly resolved before an announcement in made. So far that caution is being overruled by the political will to do a deal. Mr Cameron wants a success. Taking the three issues in turn. The simple fact is that EDF cannot finance the deal from its own already stretched balance sheet without jeopardising its overall credit rating. The question of whether EDF is being over-protected will come down to the detailed terms of the agreement. The strike price gets the headlines but the real issue is the distribution of risk – who pays if costs overrun or if there are radical changes in the market which leave nuclear unneeded. Those terms will inspected forensically by other suppliers and by bodies such as the Public Accounts Committee – a degree of scrutiny to which EDF is not always accustomed in France. I would not be surprised to see the government forcing a last minute concession on the strike price – down to £80 per MwH – to convince the sceptics that they have negotiated a tough deal. The third point is the one on which, contrary to the conventional wisdom, I think there is the greatest cause for optimism. EDF in the UK knows that the construction of Hinkley will be a global test of its ability to build new nuclear on time and on budget.