Tom Burke, chair of the E3G consultancy, says the news from Hitachi’s Board meeting today (29th May) about Wylfa Newydd does not add a great deal of light. The only firm point is that talks will continue. Much will depend on the exact legal status of the ‘basic agreement’. There is a vast difference between a binding contract and a memorandum of understanding. It is also not clear what is meant by ‘loans directly and indirectly’. The phrase ‘through a local financial institution’ is also obscure. If they are from HMG they will have to go on the UK’s balance sheet. Equally obscure is the phrase ‘a British group’. There is quite a big difference in both the economics and the politics between providing a loan and providing a loan guarantee.
Two other things to bear in mind: the loans for construction will not be forthcoming unless there is a Power Purchase Agreement (PPA) to cover the commercial risk, and any legally binding PPA would be subject to EU state aids clearance until March 2019 and potentially much longer depending on what else happens in Brexit. It is very hard to see how another tender free contract to build nuclear reactors would get such clearance.
In summary, this looks to me like another kick of the can down the road. There is just enough in this report for people, if they want to, to claim that negotiations are continuing but not enough for anyone to say the project is going to go ahead. It suits just about every one involved to save face by avoiding a decision of any kind.