Fresh scrutiny of Sizewell C costs after nuclear power branded ‘risky and expensive’ for consumers

Work under way at Hinkley Point C on galleries, concrete tunnels which will carry a network of pipes

Work under way at Hinkley Point C on galleries, concrete tunnels which will carry a network of pipes and cables. Some three million metres of earth has also being moved, around half the total to be cleared. Picture: EDF ENERGY - Credit: Archant

Construction of Britain’s first new nuclear power station for decades has today come under fire – with the Government’s own monitoring body saying the deal has “locked consumers into a risky and expensive” project.

1,600 workers are currently employed on the Hinkley Point C site. Picture: EDF ENERGY

1,600 workers are currently employed on the Hinkley Point C site. Picture: EDF ENERGY - Credit: Archant

The National Audit Office’s (NAO) comments on the Hinkley Point C (HPC) plant casts fresh concern over plans for Sizewell C, and is set to put ministers under huge pressure to provide better value-for-money if the Suffolk plant is to go ahead.

China General Nuclear Power Corporation (CGN) and EDF Energy are already working together to develop the £14billion Sizewell C station, in which CGN has a 20% stake, and the £18bn HPC plant in Somerset, in which the company has a 33.5% share.

The NAO – an independent Parliamentary body responsible for auditing central Government’s activities and which has the motto “helping the nation spend wisely” – says the Department for Business, Energy and Industrial Strategy’s (BEIS) deal for HPC “has locked consumers into a risky and expensive project with uncertain strategic and economic benefits”.

The NAO says the BEIS only considered the impact on bills up to 2030, which does not take account of the fact that consumers are locked into paying for Hinkley Point C long afterwards. It also did not conclude whether forecast “top-up payments” – look set to rise to £30bn – are affordable.

Concrete being poured as work gets under way at Hinkley Point C power station. Picture: EDF ENERGY

Concrete being poured as work gets under way at Hinkley Point C power station. Picture: EDF ENERGY - Credit: Archant


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It says the Government’s case for the project has weakened since it agreed key commercial terms in 2013 and its capacity to take alternative approaches to the deal were limited after that point.

Value-for-money tests showed the economic case for HPC “was marginal and subject to significant uncertainty”.

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Amyas Morse, head of the NAO, said: “The Department has committed electricity consumers and taxpayers to a high cost and risky deal in a changing energy marketplace. Time will tell whether the deal represents value for money, but we cannot say the Department has maximised the chances that it will be.”

A BEIS Spokesperson said: “Hinkley Point C will be the first new nuclear plant in a generation. This was an important strategic decision to ensure that nuclear is part of a diverse energy mix.

Jetty construction at Hinkley Point C - a similar jetty for delivery of materials could be built at

Jetty construction at Hinkley Point C - a similar jetty for delivery of materials could be built at Sizewell C. Picture: EDF ENERGY - Credit: Archant

“Consumers won’t pay a penny until Hinkley is built; it will provide clean, reliable electricity powering 6 million homes and creating more than 26,000 jobs and apprenticeships in the process.”

EDF Energy believes costs for Sizewell C will be lower than Hinkley Point C and that there are clear benefits from building new nuclear power stations.

An EDF Energy spokesman insisted the National Audit Office report showed HPC remained good value compared with alternative choices.

He said: “Consumers won’t pay a penny until the power station is operating and it is EDF Energy and CGN who will take the risk and responsibility of delivering it.

“The project is having a major impact on the UK’s industrial capacity, jobs and skills.

“Relaunching the UK nuclear new build industry at Hinkley Point C will enable costs for future projects, in particular Sizewell C, to be lower.”

Operators of HPC will be paid a guaranteed £92.50 per megawat hour of electricity. Government said this would mean £10 to £15 being added to the average household fuel bill to pay for the plant up to 2030.

Falling costs of fossil fuels, which reduce wholesale prices of electricity, means the forecast top-up payments on consumer bills have soared.

Delays have pushed back construction of Hinkley Point C, while the expected costs of most low-carbon alternatives to nuclear power, such as offshore wind, have fallen more than expected.

In addition, the NAO said the NNB Generation Company building Hinkley Point could still seek further financial support from the Government, while the technology being used for the reactor is unproven and other projects using it are facing difficulties.

Beis estimates £10 to £15 will be added to the average consumer bill up to 2030 to pay for Hinkley Point C, while if it and other nuclear projects are delayed and the gap filled by other low-carbon alternatives, bills could increase by £21-24.

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