Toshiba, the troubled Japanese electrical and electronics conglomerate and former owner of the bankrupt Westinghouse, Corp., decided last week cancel its Moorside nuclear project in the UK. If completed, this large nuclear power station would have provided about 7 percent of the UK’s electricity needs. Not that this announcement was a surprise. Let’s review the UK’s nuclear energy plans. There were at a minimum three large facilities planned. One for Cumbria, the Toshiba NuGen entity, is now cancelled. The Hinkley Point C units, being built by a French and Chinese consortium, are under construction and slated for commercial service in 2025-27. Lastly, Hitachi had a planned nuclear site in Wylfa. Given the turmoil surrounding new nuclear construction, we have our doubts about the financial viability of Wylfa. This plant would cost at least 20 billion pounds ($26 billion). Press reports indicate government support would be necessary for close to two thirds of that amount. To further encourage developers, a government minister said in June that the government might directly invest 5 billion pounds into the project for a one third ownership share. We are not certain how the government intends to rationalize its latest plunge into the nuclear construction abyss. But we do believe the present government deserves praise for acknowledging one thing at least: that yes, new nuclear construction will require government money. Whether those monies might be better spent elsewhere is another matter. In conclusion, the UK’s energy plan was fairly simple, perhaps a little too simple. Retire aging coal plants and replace them with base load nuclear. It’s not working out.
Oil Price 19th Nov 2018 read more »