UK government casts doubt on Hinkley Point France-China nuclear power station | News | DW | 29.07.2016
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UK government casts doubt on Hinkley Point France-China nuclear power station

In a surprise move the UK government is to review a multi-billion project to build the country's first nuclear power station in decades. Security, costs and technical difficulties are part of the problem.

The British government had been expected to sign the contracts with the French, mainly state owned energy giant EDF on Friday but instead announced a review of the 18-billion-pound (21 billion euros, $23.6 billion) project which is to be co-funded by the China General Nuclear Power Corporation.

UK government Business and Energy Secretary Greg Clark said on Friday: "The government will now consider carefully all the component parts of this project and make its decision in the early autumn."

On Thursday evening the board of EDF had voted 10-7 to go ahead with the project, despite the resignations of two directors and being 37 billion euros in debt. French unions have argued against the Hinkley Point C project, saying the costs were far too high, could go over-budget and might put the company itself at risk.

However, the UK trade union GMB was highly critical of the decision: "Theresa May's decision to review the go-ahead on HPC is bewildering and bonkers," the union's national secretary for energy, Justin Bowden said on Friday. Thousands of construction jobs would be on offer for building the new plant.

The Hinkley Point C construction project has already been delayed several times

The Hinkley Point C construction project has already been delayed several times

The Hinkley Point C project has already been delayed several times following the Fukushima nuclear disaster in Japan and in light of EDF's deteriorating financial position. As part of the deal, Britain had agreed to pay a minimum price for power generated by the plant over 35 years, a figure which is double current market levels.

EDF's CEO and chairman, Jean-Bernard Levy, said the company had not been given advance warning of the review.

Commenting on the decision, investment banker Oliver Salvesen at Jefferies said: "Because of the fall in the energy price over the past 12 months, the project does look very expensive and there have been a lot of calls for other projects to be considered or for this to be taken back to the drawing board."

Following the UK referendum vote to leave the European Union and resulting economic uncertainty, Theresa May's government may be reviewing high-cost projects in transport - such as a expanding London's Heathrow Airport and a high-speed train line to the north. Cost estimates for the High Speed 2 rail project to increase the speed of trains from London to the north of England are currently about 42.6 billion pounds.

Security concerns with China

Nick Timothy, who is Prime Minister May's joint chief of staff, last year raised concerns about the involvement of a Chinese, state-owned group in building nuclear power stations in England, a move which would give China General Nuclear Power Corporation access to UK computer systems.

On the Conservative party website Timothy wrote: "Security experts - reportedly inside as well as outside government - are worried that the Chinese could use their role to build weaknesses into computer systems which will allow them to shut down Britain's energy production at will."

Shares in EDF rose 11 percent on Friday in the wake of the decision to review the Hinkley Point C project.

Nuclear power stations in the UK

The UK has eight nuclear power stations, four of which are due to close before the new station at Hinkley Point is opened:

The environmental campaigning group Greenpeace has been campaigning against building Hinkley Point C, describing it as "the most expensive object on earth." Its online petition to the Chancellor Philip Hammond and Prime Minister Theresa May had gathered 146,275 signatures by Friday afternoon: "Don't waste billions of pounds building a new nuclear plant at Hinkley Point in Somerset. Please invest government spending in renewable energy instead."

For its part, China is on track to generate more than a quarter of its electricity from wind power by 2030. "Expanding the use of wind energy for electricity generation forms an integral part of China's effor ts to address degraded air quality and climate change," according to a report published last month in Nature Energy.

In July 2011, Germany announced its decision to phase out nuclear power over a period of ten years.

jm/kms (Reuters, AFP)

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