Sizewell: Calls for Prime Minister David Cameron to confirm commitment to nuclear power after MP warns Sizewell C ‘might never happen’
THERE is now a “real risk” that the long-anticipated Sizewell C nuclear power station will not be built, a senior Suffolk MP warned last night.
Tim Yeo, chairman of the Government’s Energy and Climate Change Select Committee, urged Prime Minister David Cameron to step in and show Whitehall’s commitment to new nuclear projects.
Uncertainty over electricity market reforms aimed at delivering the �110billion that needs to be poured into the power sector over the next decade risks delaying investment, the South Suffolk MP warned.
Mr Yeo was speaking after French energy giant EDF – which hopes to build a new nuclear power station at Sizewell – told ministers that the reforms were “critical” to the go-ahead of its plans.
Chief executive Vincent de Rivaz warned the select committee that his company could not make the decision to build a plant at Hinkley Point in Somerset without strong long-term “contracts for difference” that provide a guaranteed price for electricity from low carbon sources.
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Mr Yeo said, given the anxieties surrounding the reforms, there was a real risk the plans for a Sizewell C might never see the light of day.
It is the biggest question mark yet surrounding the possibility of the Suffolk scheme, which bosses say will generate millions of pounds for the local economy and create 25,000 jobs over the lifetime of the project – although this figure has been disputed by campaigners.
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Mr Yeo said EDF was the only force left in the bid to develop a new generation of nuclear reactors in the UK, after RWE npower and E.ON pulled out of a project to build plants at Wylfa in North Wales and Oldbury-on-Severn, Gloucestershire.
The company needed reassurance on several fronts, for example that the price it would be paid through the contracts for its electricity over the long term would not fall foul of a Treasury cap on the cost of incentives, he said.
He said the reassurance should come from the Prime Minister.
“I think it’s clear that going by the evidence we have heard that there are some serious anxieties,” Mr Yeo said.
“I think we have a real risk that we won’t see this one [Sizewell C] come off – that’s why I think we need some guidance from the top about the level of commitment.
“We need to have clarity that the Government does believe nuclear is a necessary element of our energy mix.
“I think there needs to be a recognition that if we’re going to have nuclear within the time-scale the Government wants, we’ll need a commitment from the highest order and that does need to be David Cameron.
“We need clear confirmation from him that nuclear is a part of the policy and the Government is going to do what’s necessary to incentivise it.”
The “contracts for difference” are a key part of the energy reforms – giving investors certainty and overcoming the high capital cost of building nuclear power plants or offshore wind.
But critics have said the system will work for nuclear but not for other low carbon power sources such as wind, labelling the system a subsidy for nuclear – which is something the Government has pledged not to provide.
Mr de Rivaz told MPs EDF was on track to make a final investment decision over its plans with Centrica to build two new nuclear reactors at Hinkley Point at the end of 2012.
But he said the reforms were “critical” to making that decision.
“I think it’s very clear that we will not be able to make our final investment decision as we expect to make it at the end of the year without a contract for difference and without a robust legal framework for this contract” he said.
The EADT reported last month how Sizewell C could be in “real danger” of never being built after Francois Hollande became president of France.
Sources close to the socialist leader believe once a full analysis of the economy has been conducted he will move to block state-owned EDF spending billions overseas.
However, the company has consistently maintained its commitment to the Sizewell C project, saying it is on course to start a public consultation at the end of this year.
The Department for Energy and Climate Change was unable to provide a response late yesterday.