Friday, September 16, 2016

HINKLEY POINT GO-AHEAD IS WELCOME BUT MORE IS NEEDED

Paul McLaughlin, BESA Chief Executive

BESA welcomes the news that the government has, after all the delays and uncertainty, given the green light to building Hinkley Point C, the UK’s first new nuclear power plant in a generation.

The go-ahead, confirmed on 15 September, is economic good news because Hinkley Point will become the largest construction project in the UK. The company behind the project, EDF, says it will provide 25,000 jobs to the supply chain, with a peak of 5,600 people working on site and more than 60% of the construction value flowing to UK firms.

It’s political good news too, because it will help reassure investors whose nerves were set on edge when newly-appointed Prime Minister Theresa May made the last-minute decision to put the project on hold while subjecting it to a review. Affirmation of the government’s commitment to the project sends out a necessary signal that post-Brexit Britain remains open to foreign investment. It is also encouraging for the building engineering services sector that the government remains focussed on infrastructure, paving the way for other projects.

The go-ahead is also good news for the environment, because Hinkley Point C will generate enough low carbon electricity to power six million homes, providing 7% of Britain’s electricity needs from 2025 for 60 years. As the UK’s first new nuclear plant to open since Sizewell B in 1995, Hinkley Point will help replace the energy supply lost through the government’s commitment to halt all coal power production within the next decade.

This is not, however, all the good news we need to hear from government. We have to acknowledge that certain aspects of Hinkley Point remain contentious and open to criticism - not least that capabilities and costs are improving fast in solar, wind turbines, power-to-gas, and electricity storage, so that they could well overtake nuclear as cheaper technologies before Hinkley even goes on stream.

It made sense for Theresa May’s government to continue with Hinkley Point C because it was so far advanced. But it is questionable, ten years after it was first proposed, whether the plant’s EPR reactor technology - over-budget and behind schedule in projects in France, Finland and China - would have been approved as a clean-sheet project in 2016. This means it is imperative that our policy makers’ minds remain open to actively pursuing the other, 21st century sources of energy we will also need.

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