UK government approves Hinkley Point C

THE UK government has given the go-ahead for the long-delayed £18bn (US$23.8bn) Hinkley Point C nuclear plant project, subject to new safeguards.

The decision will allow the UK government to prevent the sale of Hinkley operator EDF Energy’s controlling stake prior to the completion of construction, without notification and agreement. It will also mean it can intervene should EDF wish to sell its stake once the plant is operational. The agreement will be confirmed in an exchange of letters between the government and EDF. The government’s announcement comes two months after it said it would take time to review the project, after EDF made its final investment decision in July.

The government also had national security concerns over EDF’s investment partner China General Nuclear Power Generation (CGN), as Chinese corporations already own investment stakes in other UK energy businesses. The new framework will require developers and operators to notify the Office for Nuclear Regulation in any planned change of ownership or partial ownership. The government said it will ensure “the full implications of foreign ownership are scrutinised” for all critical infrastructure.

Greg Clark, secretary of state for Business, Energy and Industrial Strategy (BEIS), said: “Having thoroughly reviewed the proposal for Hinkley Point C, we will introduce a series of measures to enhance security and will ensure [the project] cannot change hands without the government’s agreement.”

EDF said in a statement that the government’s new legal framework will provide a “sound basis” for its three UK nuclear projects at Hinkley Point C, Sizewell C, and Bradwell B.

Jean-Bernard Lévy, chairman of EDF, said: “The decision of the [UK] government to proceed with Hinkley Point C marks the relaunch of nuclear in Europe. It demonstrates the UK's desire to lead the fight against climate change through the development of low carbon electricity.”

The 3.2 GW power station at Hinkley Point is set to provide 7% of the UK’s electricity needs and will be based around two pressurised water reactors designed by French nuclear energy company Areva. The project is set to create 26,000 jobs and apprenticeships.

The engineering community welcomed the decision to approve the project. Lisa Hughes, chair of IChemE's Nuclear Technology Special Interest Group, said: “UK government approval for this crucial energy project is great news. Nuclear power is a key reliable base load component of a low carbon energy mix [and] chemical engineers are ready to support the delivery of Hinkley C.”

IChemE also believes the decision will also benefit the wider nuclear industry, giving momentum to other planned UK nuclear projects including the Hitachi-Horizon proposal for three advanced boiling water reactors in North Wales and Oldbury, and the NuGen proposal to build three pressurised water reactors near Sellafield in Cumbria.

Andy Furlong, director of communications at IChemE, said: “IChemE will work with the nuclear industry to deliver the education, training and skills that are needed to support a complex supply chain that will to create thousands of jobs, including many roles for skilled chemical and process engineers.”

Dame Sue Ion, a Fellow of the Royal Academy of Engineering (RAEng), added: “The positive decision on Hinkley Point will bring immediate benefit to a number of our biggest engineering and construction companies.”

The decision has not been welcomed by all, however. Greenpeace says the decision to back nuclear power is “out of date” and described the technology as “flawed”. John Sauven, executive director of Greenpeace, also said the deal was not good value for money for UK taxpayers.

“The inflation-linked electricity price for Hinkley over the coming decades will be astronomical compared to the falling price of renewable power, battery storage and smart energy technology,” he said.

A price of £92.50 /MWh of electricity provided by the plant is set for 35 years once it begins generating. However, in July, the Department of Energy and Climate Change (DECC), predecessor to BEIS, estimated the cost of the project could increase to £36.9bn over its 60-year lifetime.

Hinkley Point C is due to be complete by 2025, and the government says “almost all” of the eight existing UK plants – which currently generate around 20% of the UK’s power – are due to close by 2030, prompting the need for replacement energy supplies. The UK government is also committed to closing its remaining coal-fired power plants, also by 2025.

Callum McCaig, an SNP member of parliament, asked Clark if there was a plan to fill a potential energy gap if the Hinkley project is delayed beyond 2025, and coal power plants are to be taken offline in the same year. Clark did not address the specific query.

The government said UK-based businesses will benefit from more than 60% of the value of the project.