UK opens world nuclear showroom #NuclearPower

Nuclear power companies from across the world are jumping at the chance to build their new reactors in the UK.

The UK has laid out a welcome mat for any nuclear operators in the world who want to showcase their latest designs in Britain − the one exception being the Russian state company Rosatom.

With many nuclear companies no longer able to build new stations in their own countries – France and Japan, for example – because of public and political opposition, the UK government is inviting them to construct their newest models in England and Wales.

So the French company EDF, Japan’s Hitachi, the US-based Westinghouse, and the state-owned China Nuclear Power Corporation are all anxious to find somewhere that will allow them a chance to show off what they’ve come up with.

If all their new-build plans go ahead, the UK will have 12 new nuclear reactors of four different designs at six different sites.

Open-door policy

This open-door policy is a lifeline for an industry that elsewhere in the democratic world is fading away. Apart from South Korea, which has a thriving home-grown nuclear industry, only in nations such as China and Russia − where the government can ride roughshod over local objections − is the nuclear industry still expanding.

All of the nuclear companies involved in new build in the UK say they want to launch their most recent versions there as a prelude to selling them to the rest of the world.

Russia, which has had cool relations with the UK for some time, is already selling its reactors to other countries and claims to have a $110 billion order book over the next 10 years.

The reason for the UK government’s welcome for a technology that is fast being overtaken by cheaper renewable energy sources in the rest of the world is not obvious.

The UK has a large renewable resource of its own, with wind, solar and tidal power to exploit, but the government has slashed subsidies for these, while increasing them for fossil fuel projects such as fracking for gas and oil, but in particular for nuclear power.

Baroness Neville-Rolfe, government minister at the Department of Business, Energy and Industrial Strategy, has been defending the recent decision to go ahead with EDF’s two reactors at Hinkley Point in southwest England.

She insisted that ministers were satisfied with the project’s finance, saying that in the long run the output would be a bargain − despite the fact that the price the government has guaranteed is currently double the market rate.

“If we liberalise power markets in Europe it will be hard to see the investment community making profits without subsidies for nuclear power”

She referred to its suitability in terms of UK obligations towards carbon abatement, the application of local content rules to ensure UK presence on the supply chain, and high-quality jobs − “building a British pool of expertise for the future” − before issuing a strong defence of perhaps its most controversial aspect.

“The British nuclear industry had atrophied after Sizewell was built [in 1993],” she said.

“Hinkley signals a renaissance and demonstrates the UK is open for business. It also showed we take the interests of national security very seriously, and other countries − including our Chinese investors − accept this.

“When factoring in costs and benefits in how the subsidy is arrived at, by our best estimates we judge Hinkley Point C remains a good deal.

Cost overrun

“It will provide 7% of the UK’s power in a non-intermittent and low-carbon manner with secure baseload. The risks for the project will be entirely borne by the developers, ensuring protection for consumer and taxpayer in case of cost overrun.”

Although the subsidies for the other companies have yet to be worked out, the government will be under pressure to offer something similar to the guarantee to EDF − to pay double the existing price of electricity for 35 years if it can get its first two reactors built by 2025.

If these subsidies continue for the rest of the nuclear programme, UK consumers will probably be paying more than any other country in the world for their electricity supplies.

Critics have already labelled the Hinkley Point C project a white elephant and have said that the government’s claim that it needs nuclear for baseload power is spurious in a world of renewables, where storing surplus power in large batteries is becoming financially viable.

A darker reason for the UK plumping for nuclear over renewables is the need to retain its nuclear deterrent and the expertise to build nuclear submarines to deliver them.

Even the New York Times is reporting scientific research showing that, without a pool of civil nuclear workers to draw on, the UK would find it almost impossible to maintain its nuclear submarine fleet.

But there is another reason: Britain’s planned exit from the European Union has left the nation desperate for friends.

Trading partners

It would have been politically dangerous to cancel the Hinkley Point project and simultaneously upset the French and Chinese investors in it. The same is true for Japan and the US, both trading partners the UK will badly need when it leaves Europe.

But the British love affair with nuclear has already brought ridicule from the Norwegians. They have the advantage of plentiful hydropower and oil, but cannot see why the UK needs nuclear.

Tord Lien, Norway’s Minister of Petroleum and Energy, said the experience of  neighbouring Finland informed his opinions.

“On a visit to Olkiluoto [nuclear power plant] in Finland, they were telling us it would be operational in 2011, and now in 2016 it is still not operational, and with high cost overruns”, he said.

“I am a strong believer in the market, and if we liberalise power markets in Europe it will be hard to see the investment community making profits without subsidies for nuclear power. It won’t be able to compete on price.”

“The price of gas, wind and hydropower is going down. As for nuclear power, I can’t remember a time someone in Western Europe built a new nuclear power plant and said, ‘This is a great success’.”