In a historic change of policy the Conservatives have announced that consumers, not EDF, will pay for cost overruns in building Sizewell C. The crucial phrase in the Government’s document on the so-called ‘Regulated Asset Base’ (RAB) model is ‘Cost overruns that were not excluded from the RAB would be shared between investors and consumers through suppliers’ (para 47 page 14). Note: ‘consumers’ means electricity consumers. The RAB document was produced alongside the Government’s new Energy White Paper. This should be compared to the Government position in the 2011 White Paper which stated that ‘new nuclear stations should receive no public support unless similar support is available to other low-carbon technologies’. (page 8) Under the Government’s RAB proposals it is claimed that clear criteria are going to be set for what cost overruns will be payable by the consumer and what by the developer, with the outcomes carefully monitored by a ‘Regulator’. But of course once the construction juggernaut for Sizewell C starts rolling where information, not to mention armies of lawyers and hired consultants of various sorts, will be controlled by EDF, I do not seriously believe that EDF will be stopped from passing on virtually whatever costs it wants to pass on to the consumer. It is not even certain that the ‘Regulator’ will be able to stop costs of building (the still uncompleted) Hinkley C being passed onto the consumer through the books assigned to Sizewell C- that is given that workers are likely to be switched from one operation to the other.
100% Renewables 29th Dec 2020 read more »