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