The government has decided to halt construction of the £18 billion Hinkley Point power station in Somerset, just hours after developer EDF gave the project the green light.
The South West reactor was supposed to be Britain’s first new nuclear plant in a generation, but Greg Clark, the business and energy secretary, said in a statement that a final decision will now be delayed until the autumn to allow ministers to carefully consider the project.
“The UK requires a reliable and secure energy supply, and the government believes that nuclear energy is an important component of that mix,” he said. The government will now carefully consider all of the project’s components before making a decision in early autumn.”
While acknowledging the need for further review of the contract, Josh Hardie, CBI deputy director-general, stated that the government “must press ahead to finalise the deal as soon as possible.”
“The UK is facing a significant investment challenge to ensure a secure, low-carbon, and affordable energy supply,” he said. It is critical that we see clear and timely decisions that send a clear message that the UK is open for business.
“In order to build investor confidence, clarity is needed around the next Contracts for Difference auction and the post-2020 Levy Control Framework.”
The decision to postpone the project, according to Angus Walker, partner and head of the government & infrastructure team at Bircham Dyson Bell, is a “very significant moment for the future of the UK’s energy supply.”
“Although then-Secretary of State Amber Rudd said in April that the lights would stay on even if Hinkley did not go ahead,” he said, “there must be considerable relief around the cabinet table that an additional 7% of low-carbon energy will be generated over the next ten years.”
“This also means that EDF’s next project, Sizewell, will begin construction, and the threat of a ‘energy crunch’ (demand exceeding supply) will have passed for the time being.”
The board of directors of EDF approved the final investment decision to build the two nuclear reactors at Hinkley Point C on Thursday.
“The HPC Project is a major component of the Group’s CAP 2030 strategy,” said an EDF spokesperson. The two EPR reactors at Hinkley Point will boost EDF’s presence in the United Kingdom, where its subsidiary EDF Energy already operates 15 nuclear reactors and is the largest electricity supplier by volume.”
Hardie said of EDF’s approval for the nuclear plant’s construction, “The final green light for Hinkley Point is welcome news as now, more than ever, action on key infrastructure projects that attract investment to the United Kingdom is required.”
“The project represents a significant milestone in the energy future of the United Kingdom.” It will be critical in securing and decarbonizing our energy supply, putting us on the right track toward a sustainable energy mix.
“We hope it will also help kickstart a new nuclear construction programme, creating jobs for tens of thousands of people – not just in the local community, but across the country.”