‘The next Huawei’: Can Sizewell C be built without the Chinese?
PUBLISHED: 07:00 25 July 2020 | UPDATED: 08:48 27 July 2020
With UK-China tensions on a knife edge, nuclear power is becoming the next flashpoint, Emily Townsend investigates whether Sizewell C is possible without Chinese cash.
In 2016, when energy firm EDF signed a deal with a Chinese state-owned company to build Sizewell C, Chinese-UK relations were still in what David Cameron described as a “golden era”.
The involvement of China General Nuclear Power Corporation (CGN), which has a 20% stake in the £20billion scheme, was hailed as a success, rather than a threat to Britain’s security.
Four years later, and rising tensions over Hong Kong, Huawei and coronavirus, has turned that golden era to dust – and the new nuclear reactor on the Suffolk coast is becoming the next flashpoint.
Amid a push for the UK to slash its dependency on Chinese money and material, nuclear power is in the sights of the MPs who forced the Government to abandon plans to give Chinese tech firm Huawei a role in Britain’s 5G network.
In May, as EDF put forward its plans to start work on Sizewell C by the end of next year, MP Ian Duncan-Smith described it as “the next Huawei”.
“With Huawei, with Sizewell C, one by one you will see the scale of dependency we have created on China and we have to deal with it,” the former Conservative leader said.
Last year the US placed CGN on its “entity list”, meaning US companies are banned from doing business with it.
In 2016 the US government also accused it of spying to steal technology, something it strongly denies.
Against this political fallout is a potentially huge economic prize.
EDF says the project will create 25,000 jobs.
Suffolk’s Chamber of Commerce has described Sizewell C as a “game-changer” for local business, and a consortium of 32 firms and unions recently urged the Government to back it.
They said a “firm commitment” on its future would deliver “significant benefits to the UK’s low carbon economic prosperity”.
Without it, they warned thousands of the predicted job opportunities will be lost, which would “seriously undermine the UK’s nuclear delivery capability”.
Dr Paul Dorfman, of University College London’s energy institute and founder of the Nuclear Consulting Group, said it was hard to see who else would invest in Sizewell if the Chinese pulled out.
“The market won’t touch nuclear with a barge pole. You only see nuclear being built in command-and-control economies, like China and Russia, and a few outliers,” he said.
Simon Gray, CEO of the East of England Energy Group, said: “There are other ways a finance package could be developed – but that would clearly take time, which we do not have if we want to achieve net zero by 2050.”
If China were to pull out or be banned from involvement, the Government would need to balance the need for nuclear in the UK against the “huge sums of money it would need to find as an alternative funding solution”, he added.
Professor Anthony Glees, international security expert at the University of Buckingham, added: “In theory, Sizewell C could happen as CGN has only a 20% stake ... in practice, I doubt EDF would wish to go ahead without the cushion of Chinese cash if, as seems probable, the project overruns.”
‘Line in the sand’
Dr Dorfman said he, and fellow academics, want to “draw a line in the sand” when it comes to Chinese involvement in UK nuclear power plants.
Sizewell is one of three UK nuclear plants China is ploughing money in to, along with Hinkley in Somerset and Bradwell B in Essex.
In Sizewell and Hinkley it is providing cash, but with Bradwell B it wants to build the reactor itself, using its technology and operate it.
Dr Dorfman said giving China access would be a “catastrophe”.
Prof Glees echoed the concerns and said current political tensions with China pose “huge risks” to Sizewell C, and particularly Bradwell B.
“I can’t see how they can go ahead, especially Bradwell,” he said.
“Nuclear energy is part of our critical national infrastructure and in a future conflict with China, we would have given them the power to turn off our lights.”
The Government said ONR, the independent nuclear regulator, would oversee and assure robust personnel security measures for everyone who works on a nuclear site.
The Department for Business, Energy and Industrial strategy (BEIS) said all UK nuclear projects are conducted under “robust and independent regulation” to ensure British interests are protected.
EDF says it wants Sizewell to be majority-owned by British investors, but it is up to the Government to decide who invests in the plant.
It said CGN are financial investors in Sizewell C, providing 20% of the money for the project’s development through the planning process.
CGN will need to decide about the level of investment it wishes to have in the construction phase, it added.
If legislation is brought in restricting CGN’s involvement then this will be applied, EDF bosses said.
“Sizewell C is not dependent on CGN investment,” a spokesman added.
A CGN spokesman said it is in the UK to help deliver Hinkley, Sizewell and Bradwell under agreements reached by Britain and China in 2016.
He added: “We have already invested more than £3.8bn in the UK economy, helping to create many thousands of jobs.
“We are proud our work supports the UK economy and the Government’s goal of achieving net zero emissions by 2050.”
Who else could fund it?
One option is for the Government to help finance the £20bn project, with something called a Regulated Asset Base (RAB) – where consumers would be charged a fixed price in exchange for the infrastructure.
Results of a Government consultation into this option are due to be published shortly.
But Dr Dorfman said this could be bad news for consumers.
“The problem is the public will be paying right from the moment concrete is poured – and the public will end up paying vast amounts of money to build nuclear. There is huge risk involved,” he added.
But the expert feels there are ways of pressing forward with nuclear power without China, for instance, building small modular reactors.
Neil O’Brien MP, of the Government’s China Research Group, said there were other providers who could help build a nuclear plant.
“To name just one, Hitachi seem keen to un-pause their programme if conditions are right,” he added.
Therese Coffey, Suffolk Coastal MP, said she understands concerns her constituents may have about Chinese investment in Sizewell C, but added: “It is EDF’s intention for CGN to have no role in the design or operation of the new reactor.”
Anti-Sizewell campaigners say concerns about China are another reason it should not go ahead.
Alison Downes, of Stop Sizewell C, said: “China’s withdrawal would expose the fundamental problem with nuclear mega-projects; they are such high risk and so expensive that no-one is queuing up to put money in.”
Peter Wilkinson, of Together Against Sizewell C, added: “I wish the government would bite the bullet, say they’ve made a mistake, and pour all this money into a renewables programme creating tens of thousands of jobs.”
How UK tensions with China have escalated
Britain’s relationship with the Communist nation has become more fractious in 2020. There are four major flashpoints:
Coronavirus: Anger over China’s handling of the coronavirus crisis has continued to escalate.
The deadly virus is believed to have originated in China’s Hubei province, but the extent of it was not made public by the Chinese government.
Hong Kong: The UK this week suspended its extradition treaty with Hong Kong following the imposition of Beijing’s new national security law.
The UK says the new law goes against the “one country, two systems” policy that was supposed to protect Hong Kong’s freedoms when Britain handed the territory to China in 1997.
Uighur Muslims: There is growing concern internationally over the treatment of Uighur people, a Muslim group based in China’s Xinjiang region. Around one million people are estimated to have been placed in labour camps and there are reports of women being sterilised.
China denies the sterilisation reports and describes the camps as “re-education” facilities.
Huawei: Last week, the government announced it would ban domestic mobile providers from buying new Huawei 5G equipment after 2020 and force them to remove all of its 5G kit from their networks by 2027.
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