Sizewell/Hinkley: Nuclear deal ‘a £50bn gamble’, says Royal advisor
- Credit: Copyright EDF Energy 2012 - Stag
A ROYAL advisor has slammed Government proposals to guarantee a minimum price for the electricity generated by EDF Energy for the next 30-40 years.
Former Sustainable Development Commission (SDC) chairman Jonathon Porritt compared guaranteeing a “strike price” for the electricity produced by Hinkley Point C to making a “£50billion bet on the wholesale price of energy in 2050”.
Under proposals by the Department of Energy and Climate Change (DECC), a minimum price for the nuclear electricity of almost £100 per megawatt hour would give EDF a guarantee on future returns and may herald similar deals for the rest of Britain’s planned nuclear suite, including Sizewell C.
But Mr Porritt, one-time director of Friends of the Earth and founder of the non-profit Forum for the Future, said energy minister Ed Davey was planning to sign a long-term investment contract to buy electricity at twice today’s price from power stations that will not produce any electricity in this decade.
Mr Porritt, who acts as advisor on environmental matters to Prince Charles, added: “That would be like having asked Tony Benn, Harold Wilson’s energy minister in 1976, if he knew what the wholesale price of electricity would be in 2013.”
If the deal is made, and the market price rises above the strike price, the generator will have to refund the difference.
If, however, the market price dips below the strike price, the balance will be made up by customers in their bills. If the market levelled at £50, Mr Porritt predicted EDF would receive £50bn in four decades for the Hinkley Point C plant. Forum for the Future has written to the PM asking for a comprehensive register of risks to the proposal and a detailed plan of how they are to be managed before signing a contract with EDF for Hinkley Point C, on which a planning decision is expected to be made later this month.
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EDF Energy said it was working with the government to agree a price for the electricity which will be “fair and balanced for UK consumers and investors”.
A DECC spokesman added: “Negotiations about a potential contract for Hinkley Point C are ongoing, and no conclusion has been reached about whether a contract will be signed or what the terms within that contract will look like.
“Any agreement will be laid before Parliament, which will include details of the strike price.”