June 20 2013 Latest news:
By Emily Beament
Monday, March 4, 2013
A FAILURE to build a new fleet of nuclear power plants, including Sizewell C in Suffolk, could make it extremely difficult and expensive to meet goals to cut carbon emissions, it has been warned.
The Government seemed to be “crossing its fingers” that private companies would deliver reactors on time and on budget, despite delays and cost over-runs in other countries, the Energy and Climate Change Committee’s chairman, South Suffolk MP Tim Yeo, said.
A report by the committee raised concerns there was no “plan B” for the energy sector if the planned series of reactors were not delivered on time, and the Government needed to develop one urgently.
But Mr Yeo also warned that any such contingency plan, which would rely on a step change in energy efficiency measures or an even greater reliance on renewables, was extremely difficult to deliver – making nuclear crucial.
The committee’s report said that a failure to get new nuclear reactors built on time could leave the UK relying on more gas for electricity, risking the security of energy supplies as the country could be more dependent on imports.
If the new projects are not successful it will undermine investor confidence in the nuclear sector and make it difficult, or impossible, to get any further reactors built, the report warned.
The latest data from the Department of Energy and Climate Change showed that almost 30% of the UK’s electricity now comes from low-carbon sources, and the lion’s share of that – at over 70% of the clean energy total – comes from nuclear.
The Government’s climate advisers have said that the electricity sector needs to be largely decarbonised by 2030 if the UK is to be on track to meet legally-binding targets to reduce carbon emissions by 80% on 1990 levels by 2050.
However, all but one of the UK’s existing nuclear plants are set to close by 2023, and while there are plans for a new fleet online by 2025 – including Sizewell C – the MPs said they had been told the proposals were “ambitious at best” and “unrealistic at worst”.
One of the key concerns is the guaranteed price suppliers will be paid for low-carbon electricity from nuclear plants under long-term contracts which aim to give investors the certainty to pay the high capital costs of nuclear power.
The committee raised concerns over a lack of transparency in the negotiations between the Government and suppliers over the contracts and said they must provide value for money for consumers, who pay the costs through energy bills.
The price offered to nuclear generators should not be higher than for other low-carbon sources such as offshore wind, the report said.
Mr Yeo admitted that EDF, the only major player currently working on building the next generation of reactors, had the Government “over a barrel” in terms of negotiating the price for the first contracts.
But he said he hoped the first negotiations, for two units at Hinkley Point, would conclude soon and would be a “sensible” deal, and said that it was possible the cost for further nuclear plants could come down after that.
“If new nuclear power stations are not built on time our legally-binding climate change targets will be extremely challenging and much more expensive to build,” he warned.
“Ministers need to urgently come up with a contingency plan in case the nuclear industry does not deliver the new power stations we need.”
But Greenpeace head of policy Doug Parr said: “The fact new nuclear may not deliver is not news to anyone who’s been following the issue.”