UK enters defining decade for nuclear
THE UK needs political consensus to make nuclear energy cheaper in this “defining decade” for the power sector, according to a new report published today.
The research by Carbon Connect, overseen by a group of industry and academic experts, follows a six-month inquiry chaired by former energy minister Charles Hendry and shadow energy minister Baroness Bryony Worthington into the UK’s energy industry.
“Consensus is vital for pursuing nuclear alongside renewables and carbon capture storage as we transition away from unabated fossil fuels,” said the report. “If nuclear is to keep its place in this portfolio of low carbon options however, it must buck the trend of delays and remain competitive.”
The debate around nuclear energy has been particularly high-profile due to the planned £16bn construction of Hinkley Point C in Somerset, the first UK nuclear power station to be built for almost 20 years. The terms of a provisional agreement were decided between the government and French energy giant EDF late last year.
The controversial deal guarantees EDF £92.50 per megawatt hour for the energy it produces – almost twice the current wholesale cost of electricity. Some argue that the UK government has massively oversubsidised the project.
EDF is due to take a final investment decision later this year. The European Commission is currently investigating whether UK support for Hinkley comes under state aid criteria. If it decides that the deal breaches these rules it could prevent it from going ahead.
The report said that Hinkley shareholders could see bigger returns than those typically expected for private finance initiative projects, but added that it is too early to say if the deal is good value for money.