Has nuclear been stuffed by Hinkley turkey? Spiralling costs and delays at the Somerset plant could jeopardise plans for other stations. This Christmas holds a special significance for those following the energy sector. It is the year in which families were supposed to be cooking their turkeys with power from EDF’s new nuclear plant at Hinkley Point C. The project has also been derided for its cost. At £19.6 billion and counting, it has been made commercially viable thanks to a subsidy contract from the government that locks energy consumers into paying a fixed price for the electricity it generates for 35 years. On current forecasts, that could mean that subsidies reach £50 billion. This month, protesters gathered outside the construction site in Somerset and presented the company with an uncooked turkey. One placard read: “EDF is building a turkey. The taxpayers are getting the stuffing.” Hinkley has cast a shadow over these projects. Last month, MPs on the public accounts committee urged the government to “re-evaluate its strategic case for supporting nuclear power”. Hinkley Point C has its roots in Tony Blair’s government, which put nuclear power back on the agenda “with a vengeance” in 2006 to help to tackle climate change. Although ministers said that the private sector would have to “initiate, fund, construct and operate new nuclear plants”, the pretence did not last long. Tom Greatrex, chief executive of the Nuclear Industry Association, said that different financing models could help to “drive a very significant reduction in the cost of new build” — a percentage point off the cost of capital could cut the strike price by 10 per cent. The National Audit Office modelled options including the government using the benefit of cheap borrowing costs and taking an equity stake. A 25 per cent stake could have cut the Hinkley strike price to below £70 per MWh, it found; with a 75 per cent stake it could have gone as low as £25. Many in government are deeply reticent of such a step; even after dropping the “no public subsidy” mantra, the public finances could still do without a multibillion-pound nuclear plant, or five, on the books. Mr Greatrex argues that the Treasury must rethink its orthodoxy: “If something ends up costing a lot more just because you want to keep it off balance sheet, it can be counter-productive.” “Government has got to make a major policy step to get anywhere with Wylfa,” Dr Parr said. He believes ministers should forget nuclear, and focus on a combination of renewables, demand management, interconnectors and batteries, as well as some gas back-up. “The UK has a decision to make: whether it’s going to turn the nuclear programme into a state-run project, or whether it’s going to take a look around and say, ‘the world has changed since we decided to do this, and there are other ways of approaching this’.”
Times 23rd Dec 2017 read more »
Hinkley Point C will not be cooking our turkeys on Monday — but there’s a good chance at least a fifth of our power that day will be coming from EDF nuclear power stations. The company owns all eight of Britain’s existing plants, most of which were built in the Sixties and Seventies. Half were due to have shut down by now but EDF has spent the past few years investing to extend the fleet’s operating lives by an average of eight years, narrowing — if not closing — the gap to the start-up of Hinkley Point C. Only three Christmases ago, coal was providing more than a third of demand at peak on Christmas Day (which, thanks to all those turkeys, usually falls at 1pm — the only day of the year not to experience the usual tea-time post-work peak). Wind power meanwhile provided only 8 per cent of peak demand in Christmas 2014. The closure of old coal plants, the impact of the carbon tax making the remaining ones less competitive than gas, and the growth of subsidised renewables meant that by last Christmas, coal had fallen to 6 per cent, gas had risen to 23 per cent, wind was the biggest peak fuel source at almost 28 per cent. Weather permitting, National Grid forecasts a similar mix this year.
The Times 23rd Dec 2017 read more »