The Hinkley Point C Pantomime

The board of EDF, the French State controlled owner of UK and French power stations and vendor of the new Gen 3 EPR (European Pressurised Water Reactor) voted narrowly to approve the Hinkley C reactor project on Thursday (by 10 votes to 7). Contracts were supposed to be signed today (Friday). But then in an unexpected move the UK Government has called the project in for re-evaluation. Clearly, they did not expect the French to proceed. What on Earth is going on? [image credit The Guardian.]

I cannot provide a simple answer and I normally avoid writing about things I don’t properly understand. The Hinkley C deal has always struck me as a dogs dinner. And so it is perhaps wise that the UK should question staking 7% of its future electricity supply on such a mess.

What makes Hinkley C such a mess and how did we get to this point?

  • Hinkley C is to be built by French nuclear giant EDF that is 85% owned by the French state.
  • EDF will be majority owner of the plant that has a projected £18 billion construction cost.
  • Chinese state-owned CGN is to take a £6 billion stake in the project.
  • The gen 3 EPRs are the reactors to be provided by supplier Areva that has recently become a subsidiary of EDF. Areva is reported to be in financial difficulty owing to large time and cost over-runs at Olkiluoto in Finland and Flamanville in France where two EPRs of same design are under construction, over time and over budget.
  • Two, not one, power stations are to be built that will include 2 reactors delivering a total of 3.2 GWe (electrical) power.
  • The massive investment will be underwritten by a contract guaranteeing the price paid for electricity decades into the future. This is one of the most controversial elements of the project. An inflation indexed price of £92.50 / MWh (2012 prices) is guaranteed for 35 years after grid connection. This compares with wholesale prices that are currently of the order £50 / MWh.

So what is there not to like about this? Before answering that it is worth while pondering the benefits. Much of the £18 billion investment will actually be spent in Britain, not just pouring concrete on site, but I’m sure a large number of UK companies will be engaged in providing high-end engineering services too. And second, we must not lose site of the fact that Hinkley C is projected to provide 7% of UK electricity for 60 years. This power station combined with other new-build nuclear is to play a key role in keeping UK lights on.

But on the downside we need to ask why the UK should rely on investment from the French and Chinese States for a vital flagship infrastructure project? Should this not be funded by the British State? The simple answer is that the British State is bankrupt (as is the French). And EDF already owns and operates all of our existing nuclear power stations. And by all accounts have done a very good job since taking over. It may equally be argued that the British State has done a Sterling job in persuading these foreign countries to invest in our future. On balance, I don’t think we can complain about foreign involvement.

The real problem lies in the projected cost and price guarantee. The media still speculate that the £18 billion budget may be overrun as has happened at Olkiluoto and Flamanville, which could happen, but this betrays a lack of understanding of these projects.

The original build cost estimate at Olkiluoto was €3 billion for a 5 year build period and this has escalated to €8.5 billion and a 13 year build period. The cost overruns are directly linked to the delays and time overrun. Olkiluoto is a single power station and so building two on this dismal track record would cost €17 billion which takes us towards the Hinkley estimate.

At Flamanville the original budget was €3.3 billion for a 5.5 year build that has escalated to €10.5 billion over 11 years giving a price tag for Hinkley C of €21 billion. Again we see where the £18 billion number comes from.

Hinkley C has a projected build period of 8 years and Chinese involvement is intended to ensure that time and cost overruns experienced in Finland and France do not occur in the UK. We must surely have some faith in UK engineering and our ability to complete this on time. But an 8 year build should carry a price tag substantially lower than £18 billion. The last nuclear power station to be build in the UK was Sizewell B that came on line in 1995 and was built in 7 years. The mean build time for the global nuclear fleet is 7.5 years. The £20 billion price tag assumes that the Brits, the French and the Chinese are going to botch Hinkley in the same way as Olkiluoto and Flammanville. While it is probably far to late in the day to do so, Greg Clerk, new Secretary of State for Business, Energy and Industrial Strategy, ought to look at this £18 billion price tag and ask where it comes from.

The other side of the coin is the projected income. The £92 / MWh index linked guaranteed price is viewed by many as far too high. Indeed, this only harms the reputation of nuclear power that was supposed to be too cheap to meter, not twice as expensive as alternatives. Over 35 years the projected income at 2012 prices is of the order £72 billion* which even taking into account finance and operating costs seems a vast amount compared to the investment that may well come in well below £18 billion. No wonder the French and Chinese have pursued this opportunity.

[* 3200MW*35years*365.25days*24hours*0.8capacity*£92]

The heart of the problem lies in the impossibility of trying to estimate construction costs over the next decade and finance and operating costs over 35 years, taking us 45 years into the future, that is to the year 2061. The UK electricity market is also plagued by opacity and increasingly dominated by a subsidy culture. There must surely be a better way of doing this if commenters wish to volunteer their suggestions.

Further recommended reading

Hinkley Point C or solar; which is cheaper?
How long does it take to build a nuclear power plant?

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116 Responses to The Hinkley Point C Pantomime

  1. Hugh Sharman says:

    “Greg Clerk, new Secretary of State for Business, Energy and Industrial Strategy, ought to look at this £18 billion price tag and ask where it comes from…”

    Well he has and it rather looks as if Hinkley will not be delievered as an EPR!

    It’s pretty disastrous for EdF which extremely foolishly “rescued” the bankrupted, State-owned AREVA which is facing a many £billion law suit from the Fins and whose AREVA-built, concreted-in, reactor vessel at Flammanville may yet have to be demolished and replaced.

    Furthermore, EdF is facing €100s of billions liabilities for decommissioning its also, fast-aging reactors in France. El-prices low and falling still thanks to the volume of subsidized PV and wind on Europe’s electricity market!

    So Hinkley hit a “perfect storm”! The cancelling of Hinkley (now highly likely) will mean that the very raison d’être of AREVA/EdF is in doubt! All this will rebound on French consumers and tax payers.

    France the next Greece? I do hope not!

    • Euan Mearns says:

      Hugh, its interesting to look at the alternatives. The Barakah project in UAE provides some guidance. They are building 4*APR 1400s providing I presume 5600 MWe capacity. The APR 1400 is a Korean built Gen3 PWR. The first unit began construction in 2012 and is scheduled to go on line in 2017. The total cost of $18 billion is about half the capital cost per installed MW of Hinkley.

      The Koreans have the advantage of having the first APR 1400 in operation since October 2015. With 7 other units under construction. The first took 7 years, all the others are planned for 5 years.

      Cancelling Hinkley is going to be a huge blow to all the engineering companies that are waiting to get on site. And I fear it will worsen Anglo-French relations which are not exactly great at the moment.

      EDF already operate existing reactors at Hinkley Point and presumably own the site. It will not be straight forward to have this taken over by a third party.

      • sod says:

        “Cancelling Hinkley is going to be a huge blow to all the engineering companies that are waiting to get on site. ”

        This is a problem. Both cancelling and building will cause huge damage to the nuclear industry, so i think it is very difficult to give advice that will help the nuclear industry in the Hinkley fiasco.

        Why any person on the British side would support Hinkley without knowing , what will happen to Flamanville is beyond me.

        • robertok06 says:

          Nothing else than increasing the late delivery of the EPR, and therefore its final cost… this is what is going to happen in Flamanville.
          The additional tests will have the same result of those carried out on the 2 belgian reactors, a year ago or so.

      • steve says:

        The World Nuclear Assn article on the Korean deal gave the price as a quarter that of gas, whatever that means. The Finns have formed a consortium partly including the Rusatom and using Rolls Royce controls.

        The consortium does not have to be state financed and can borrow by issuing bonds at low rates. At Hinkley, EDF could run the station and be involved in building it. The controls could be British. The existing foundations could be used. The reactors could be put to tender to the Koreans, Japanese or Russians. And the French taxpayer would be relieved of their expensive mistake, while making some money. Best of all the British consumer might get some reasonably priced electricity in 8 years time.

        Come on Mrs May, even a politician should be able to understand this.

        • ristvan says:

          Korea has to import all its gas as LNG. At the time those reactors were commissioned, LNG to Japan and Korea was running $15/mbtu. So on an LCOE basis, correct for there at that time.

    • robertok06 says:

      “It’s pretty disastrous for EdF which extremely foolishly “rescued” the bankrupted, State-owned AREVA”

      ??? the rescue of areva costs 1 and 1/2 months of subsidies/incentives to renewables in Germany.

  2. sod says:

    “. The £20 billion price tag assumes that the Brits, the French and the Chinese are going to botch Hinkley in the same way as Olkiluoto and Flammanville”

    Or that the costs there (which might even increase more. There are serious problems with the main vessel) are the real cost of such a nuclear plant today?

    EDF has lost value and is now building a project that is worth about the same as the whole company.

    • A C Osborn says:

      You should Read before you write, that is not the cost for nuclear generation of that amount, just that design by that company.
      Pure madness at that price.

    • Greg Kaan says:

      the real cost of such a nuclear plant today

      I agree that the EPR does not seem to be a viable commercial design. The complexity of all the active, redundant safety systems, coupled with the size are proving to difficult to build.

      Simpler designs (AP1000 builds are looking much more promising) should be pursued by the UK. The GDA process seems interminable and the UK will need to restart the coal plants in the meantime.

    • sod says:

      The problem with a change to a different design is a simple one:

      The message is already out. While many people commenting here would fully approve to a change to another , less secure build, the public in general will not.

      even the reduced price will be a major problem. The obvious question is: why was the government trying to sell us for £92.50 per megawatt, when it is possible to get the same thing for 60-70? (it is the car dealer problem: the original offer must not look like a total rip-off, or people will even get angry about their new good deal!).

      • Greg Kaan says:

        Why did the UK government enter into expensive wind farm contracts when everyone kept saying the cost of wind is coming down? Why didn’t they wait?

        Please stop applying one-sided logic to present your anti-nuclear stance

  3. mark4asp says:

    Britain is not bankrupt. At the end of WW2 our national debt stood at 2½ × GDP. We paid most of it off within 20 years (with a bit of jiggery-pokery, partly “inflating the debt away”). We also had massive national debt just after WW1 and after the Napoleonic wars. We didn’t go bankrupt then either. We can still borrow long (e.g. for 30 years at 1.7% interest p.a.). This is way less than the 10% interest this contract first assumed EDF would have to pay on their borrowed funds. The contract is partly a wealth transfer from the British public to the French and Chinese states. It seems the issue now holding it up could be national security: China. Were we to finance this project ourselves there need be no electricity surcharge (contract for difference). Paying, say 1.7% interest, they should be able to make a profit, selling at wholesale electricity rates (which I think are closer to £40/MWh, not 50). The Business minister was in Japan last week. Hitachi and Toshiba are Japanese companies who own the ABWR, ESBWR, and AP1000 reactor designs. It could mean the PM reevaluated the funding, or the designs or both. The AP1000 will finally get it’s GDA signed off next March; the ABWR GDA will be complete by December 2017.

    I’m not worried.

    • stone100 says:

      I second the assertion that the UK state is not bankcrupt. We have our own currency so we can always service our debts denominated in sterling. IMO the UK government should agree to buy nuclear plants outright upon build completion using gilt issuance to finance. The only impact that could ever come from excessive government debt would be a weaker pound. Having UK consumers on the hook for a £92/MWh price would anyway impact the sterling exchange rate even more. After buying the nuclear plants, the UK could always have EdF run them (perhaps leasing them or whatever) since EdF seem to do a good job of running our nuclear fleet.

    • Euan Mearns says:

      I took my lead from this widely read and circulated piece of doom.

      Depends on how you define bankrupt. Staving bankruptcy off by continual cuts to spending and services is of course one option to stay afloat. But infrastructure in Aberdeen is closing and crumbling. The deficit keeps rising despite reports to the contrary. Growth is meagre. And we can only stay afloat with zero % interest.

      Would you agree not the best of times?

      • gweberbv says:


        this is a little bit off-topic, but maybe helpful:

        The 101 of economics tells us that there are only 3 entities in the economy: private households, private businesses and the public sector

        Private households cannot run permanent deficits. Because well-off people are working on expanding their wealth and poor people are simply not able to take big loans.

        Private businesses can – in principle – run permanent deficits when at the same time there is the prospect of a good return on investments in the future.

        Then there is the public sector which – by the rules of mathematics – has to run a deficit each time when the profits of private households are not completely absorbed as new debt by the private businesses.

        (For the sake of simplicity I neglect the fact that foreign countries can borrow money or offer loans.)

        Since about 1980 the western world has entered a state of economic development where new business opportunities that motivate private businesses to take loans and hire people to are becoming rare. This leads to a reduced demand for working force and investment goods, which in turn further reduces business opportunities. As an example: German data for investments of the whole economy normalized to write-downs of the existing capital stock. ->
        There is no real investment anymore, just a mathematical compensation of the write-downs. (This is what you experience in daily life, when for every new road that is build, repairs of existing roads are delayed by another year.)

        The resulting slow-down of the economy leads to less revenues for the public sector (taxes, fees, social insurances, etc.). To keep the ship afloat, the public sector has to borrow money. Maybe the most extreme example is Japan. Public deficits are not the cause of the illness, just a symptom. Luckily, all governments that pay their bills in their own currency can take loans ad infinitum. That UK government – and many others – follow the path of austerity is by no means necessary. (And if it is not popular to increase publi debt, you could do the unthinkable: raise taxes!)

        Bottom-line: If UK government really wants to do so, they can easily build power plants for a hundred billions and more.

      • stone100 says:

        It seems to me (and certainly not just me) that our government was simply wanting to have continual cuts to spending and services and the “staving off bankruptcy” meme is a pretext. I’m all for cutting back on bureaucracy and so if that is all that is being cut then great BUT we need to be clear that we shouldn’t and needn’t be cutting back on government spending that is going to be saving UK consumers overall. I’d class government financing for nuclear or the NHS etc as doing that.

  4. Alex says:

    The Government delay is very interesting.

    I think (and hope) that whilst EDF was procrastinating this last year, the Government decided it had to look at a plan B in case EDF pulled out. The only feasible plan B would be to build 3 AP1000s or 2 ABWRs in the place of Hinkley, and in addition to the other AP1000 / ABWR builds.

    To know the feasibility of this, the Government would have had to find out:
    – How certain will it be that GDA will complete?
    – What sort of strike price could be agreed?
    – Would the extra reactors be feasible given resource constraints caused by the builds at Wyfla and Mooreside?

    It could well be that the answer has come back as Yes, Cheaper than the EPR, and Yes.

    Now the Government has to confirm that, and they can either tell EDF “sorry, you waited too long”, or “the price is changed – can you deliver for £80/MWh”.

    Perhaps more likely is that the Government is unable to reach any decision on anything.

    • A C Osborn says:

      £80/MWh is still way too expensive when we are currently paying circa £50/MWh for Gas & Coal.
      I think the Government have a very simple out here, there are no examples that prove the design works and is SAFE, especially with all the problems the frist 2 are having.

      • Alex says:

        The problem is that no one knows what the cost of fossil fuels will be in the future – especially if a meaningful price is put on CO2 emissions.

        If we don’t take any unproven design, then we’d still be driving horses and carts. The best you can do is rigorously analyse it to prove it’s safe. The EPR design has been proven safe beyond “reasonable doubt”. There are however better and more economic designs – one of which will be available next year.

      • robertok06 says:

        “£80/MWh is still way too expensive when we are currently paying circa £50/MWh for Gas & Coal.”

        Wrong reasoning: you should ask yourself… “how much is it going to cost electricity in UK in 2023 (i.e. when the EPRs or any other reactor would be completed and ready to generate electricity)?

        Do you really think that 8 years from now, with no coal stations running anymore, several GW of off-shore wind power, several GWs of new and expensive submarine interconnectors, several GWs of ineffective but heavily incentivised PV (and god knows what other “miracle green technology”)… add to that the fact that EdF UK will necessarily have to increase the price of its nuclear electricity… do you really think that 50 pounds will buy Britons a MWh?

        No F way.

        • gweberbv says:


          when you look on the huge pipeline of RE projects and decreasing trends of electricity consumption in and and around UK, you can expect a few 1000 hours with very low electrcity prices also in 2023. But how prices will develop when the sun is not shining and the wind is not blowing, that is a good question.

        • gweberbv says:


          when you look on the huge pipeline of RE projects and decreasing trends of electricity consumption in and and around UK, you can expect a few 1000 hours with very low electrcity prices also in 2023. But how prices will develop when the sun is not shining and the wind is not blowing, that is a good question.

          By the way: The average wholesale price in Germany was 25 euros/MWh (slightly more than 20 GBP) in the first half of 2016. For the rest of central Europe prices cannot be too much different because of arbitration. If the many interconnectors that are now planned for UK will be realized, they can access the huge reservoir of surplus capacity that lead to this ridiculously low wholesale prices.

          • robertok06 says:

            Well, most of the problem come form that brown/black thing called lignite and coal that you germans keep on burning in astronomical quantities, you know that, don’t you?
            Anyway, for those who think that 95 pounds/MWh –> in 2023 <– is going to be expensive they just need to look at this miracle of green energy…


            A short excerpt:

            "Based on EPEX SPOT data, the lowest price between 12:30 and 12:45 was EUR -178.01 EUR/MWh, with a weighted average of -144.78 EUR/MWh. Later in the day, prices went down even further to -374.00 EUR/MWh between 14:30 and 14:45. The lowest weighted average price during the day was between 14:15 and 14:30 at -241.83 EUR/MWh. Volatility was high, with prices going up to 100 EUR/MWh between 20:30 and 20:45."

            374 Euro/MWh NEGATIVE price!… and with more and more intermittent REN being installed all over the continent this will become almost the norm, tens and tens, if not hundreds of days/year.

            Question to those who are horrified by the prospect of paying 95 pounds/MWh for reliable, baseload electricity: who do you think will ultimately pay all this? 🙂

          • gweberbv says:

            Nah! If you see negative prices more than a few hours a year it makes sense for all bigger district heating systems to install resistive heaters (very cheap) to earn some additional money by absorbing this excess production.

            But if you are right, UK should be even more motivated to profit from these cheap power prices and to invest the 18 billions rather in the capacitiy market to have peaker plants available when supply from the continent and REs dries out. NPP are not the most economic choice for such a scenario.

          • Alex says:

            The price of electricity is a classic case of dumping. Consumers provide a heavy subsidy to renewables (6 ct/KWh on ALL electricity in Germany), which is used to pay for capacity with almost zero marginal cost.

            That wouldn’t be too bad if the capacity delivered all the time, but it doesn’t, so we still need firm capacity (about 60GW in the UK), but that can’t be funded out of whole sale prices.

            With dumping – do you got to court and try and stop it, or do you try and benefit from it?

          • robertok06 says:


            “But if you are right, UK should be even more motivated to profit from these cheap power prices and to invest the 18 billions rather in the capacitiy market to have peaker plants available when supply from the continent and REs dries out. NPP are not the most economic choice for such a scenario.”

            Fossil fuel-based peakers?

            I thought that the whole energy transition in the continent, driven by the marvelous “economic” Energiewende (24 billion Euro/y) was about transitioning to a 100% renewable energy generation!…

            So, make up your minds, Guenter &Co: do you want it, the 100% REN future, or don’t you want it?
            You are filp-flopping like a transistor.

          • gweberbv says:


            I have stated many times that in the best case, maybe 70% RE is possible for countries without a rich hydro potential. I do not see a problem to cover the residual demand with FF plants that are kept alive via capacity payments. For the sake of reaching 100% one can also invest into NPP (if there is public support for this technology), but why doing so while still the heating and transport sector are still burning loads of FF?

          • robertok06 says:


            “why doing so while still the heating and transport sector are still burning loads of FF?”

            Well, you just have to look at existing successful countries who heat themselves in large part with CO2-free/cheap electricity, just across the Rhine river… 🙂 … and talking about transport, the same could be done for electric vehicles.


          • “The average wholesale price in Germany was 25 euros/MWh ”


            Stop conflating wholesale with retail prices and conflating a low price on the back of huge capacity expansions as a good thing.

  5. robertok06 says:


    “Two, not one, power stations are to be built that will include 4 reactors delivering a total of 3.2 GWe (electrical) power.”

    Each EPR has a 1600 MWe rated output, so 4 reactors would mean 2×3.2 GWe, Euan!

    You should re-phrase your sentence.

    • Euan Mearns says:

      Are you sure Roberto? All of the existing UK Gen 2 stations have two reactors each. The most modern 600MWe. Stepping up to 1600 MW is a massive step. How many reactors are there in the existing Areva Gen 2 stations operating in France?

      • Jose A. says:

        Euan, HPC will have only two reactors not four, 2×1600 MW and the most modern and the most modern is Sizewell B with 1250 MW,

      • robertok06 says:

        Iam positive, Euan. The EPR is nothing else than e beefed-up version of the 1450 MWe N4 reactors that run since decades in France, and a similarly large reactor in Germany (KONVOI).

        “The co-operation between Siemens and Framatome began in September 1989 with the founding of a Joint Venture Company : Nuclear Power International (NPI). Under the leadership of NPI both companies began developing a 1450 MW PWR based on the latest designs, i.e. the N4 in France and the “KONVOI” series in Germany.”

        … more informations here:

        … but beware! this document is not for the fainted of heart!… as it starts with a (nowadays) mind boggling statement like this:

        “This paper is a story of a successful Franco-German co-operation: the EPR project.” 🙂

        They have added to it a number of redundant steam generators, a humongous “radier” several meters thick made of reinforced concrete under the RPV(the “core catcher”… by the way, TEPCO has release the result of their “radiography” of one of the reactors in Fukushima made with muons, and it seems that most of the fuel/corium is melted but still inside the RPV, at its bottom)… and most of all they have added an even more humongous double containment dome, totalling a couple of meters in thickness, with 1 inch-thick steel rods every 30 cm… no wonder it costs more than its weight in gold… by the way, talking about expensive items/gadgets… the US Air Force has one aircraft which costs more than its weight in gold (this was true at the time it came inoperation, when gold’s price was lower than today), the B2 Stealth Bomber.


        • Euan Mearns says:

          I have conceded one of my very rare errors and corrected text 😉

          • Jose A. says:

            Two, not one, power stations are to be built that will include 2 reactors delivering a total of 3.2 GWe (electrical) power.

            There’s still an error, only one power station is to be built in Hinkley Point with two reactors. Maybe you’re mistaken with the Sizewell C project. EDF has the option to develop there another plant with two EPRs but obviously no strike price has been negotiated so far, the only thing we know is that if they go ahead with the project the strike price for HPC drops to 89,5 £/MWh.

          • Euan Mearns says:

            Jose, looking at the picture up top it looks like there is two of everything to me.

          • Jose A. says:

            I see one station (Hinkley Point C) with two reactors (two EPRs). Where do you see the other station?

      • Rob says:

        Euan has the wholesale electricity price varied over the past 5 years.
        I had heard price has been as low as £28 and as high as £130.
        Surely wholesale prices are destined to rise with gas prices

        Nuclear could be a nice replacement for all the Engineers laid off from oil and gas

        • Euan Mearns says:

          Rob, as I say in my post, the electricity market is opaque. This chart shows retail price varying from £30 to £90. The wholesale price on RH is on different scale and no units given… Par for the course.

          • gweberbv says:


            thank you very much for this chart. The peak in 2008 coincides with the strong increase of oil, gas, coal, etc. prices at that time. Today we know that the price level of that time was not sustainable and broke the neck of businesses all around the world. Such a destruction of demand can be expected also in the future, when those price levels are again reached.

            If we remove that peak that cannot exist for a longer time period, the wholesale prices are rather boring. Between 35 and 55 GBP per MWh – and that’s it. If we correct the slight increase over time for inflation, the wholesale price curve would be totally flat, I expect.

            From this I doubt that one can expect much higher wholesale prices for longer time periods in the years to come.

          • Alex Terrell says:



            Careful which tariffs you compare. This article explains what is happening in gads markets.

            Competitive tariffs have fallen in line with wholesale prices. The Standard Variable Tariffs haven’t.

  6. robertok06 says:


    “The original build cost estimate at Olkiluoto was €3 billion for a 5 year build period and this has escalated to €8.5 billion and a 13 year build period. ”

    The cost over-run claimed by the owner TVO is…

    TVO increased its estimate of its own costs and losses in relation to the arbitration claim to €2.3 billion ($2.5 billion) up to the end of 2018. In late 2012, it had estimated costs and losses of some €1.8 billion ($2.0 billion) up to the end of 2014.”

    On the constructors’ side…

    “Meanwhile, the Areva-Siemens consortium has increased the amount of compensation it is seeking from TVO to about €3.4 billion ($3.7 billion). Its claim covers the period up to the end of June 2011 and includes penalty interest (calculated until the end of July 2015) and payments allegedly delayed by TVO totalling some €1.4 billion ($1.5 billion) and about €140 million ($153 million) in alleged loss of profit.”

    So, 3 billions initial turn-key contract… plus either the losses of TVO (2.3 billions) or the compensations asked by AREVA-SIEMENS (3.4 billions) … doesn’t make up the 8.5 billions you’ve cited, Euan: could you please tell me/us from where you got this figure? Thanks.

    • Leo Smith says:

      What the customer pays does not necessarily reflect what it has cost the supplier, if I read the issue correctly.

      Areva is taking a thumping loss on this one.

      • robertok06 says:

        “Areva is taking a thumping loss on this one.”

        Areva is ~85% the French people (“L’Etat français contrôle directement ou indirectement 86,52 % du capital d’AREVA”, on Areva’s site)… the thumping loss of 3 billion Euros will cost each of the 65 million French residents (me included) a thumping 46 Euros, if paid in one single installment, or ~ 120 Euros/household.

        I won’t go broke. 🙂

        The French deficit for 2015 has been quantified at more than 77 billion Euros, or 3.4% of the GNP of the frog leg/excargot eating country:

        “Le déficit public pour 2015 s’établit à –77,4 milliards d’euros, soit -3,5 % du PIB après -4,0 % en 2014.”

        … this means that in 2015 the French have spent 0.5% of their GNP (PIB) with respect to 2014, 1/8 less than the previous year… or about 11 billion Euros less… that is a lot more than the “thumping loss” due to Areva’s nearly-missed bankruptcy.

        Really, guys… I think that this Areva/EdF/France/UK falling dominos thing… everybody on the ridge of final extinction because of 2 freaking reactors being a bit too expensive is just getting ridiculous to say the least.



        • Euan Mearns says:

          I’m not intending to follow the Finance of Doom (FoD) meme. I’m more interested to understand why France, once global nuclear leader, seems unable to complete engineering projects that were once simple and routine. Has France lost its skills? Or is it over-zealous regulation?

          I don’t really know if I want the EDF Hinkley deal to go ahead or not. I don’t see much sense in the UK paying double market price for a design that has yet to be completed and proven to work. I suspect that if UK pulls out it could spell the end of the EPR and Areva that will then be pulled out of EDF.

          Putting Areva into EDF seems like a big mistake. Without that, EDF could have been free to select a better reactor for Hinkley.

          • robertok06 says:


            AREVA has different reactors in store…


            the ATMEA, for instance… a proven design, but…

            …they have spent lots of time and money designing the EPR, adapting it to the post-Fukushima-tsunami-in-the-middle-of-your-country craze, doubling the walls to stop an eventual airplane hijacked by terrorists, and so on… but they could build more conventional reactors… a bit smaller and certainly cheaper.
            So EdF, soon the owner of Areva, could certainly use that know-how.
            The next thing that would happen, I’m afraid, is that the usual anti-nuclear factions would say that they live in the past, are not able to modernize, want to use old GEN-II reactors, and so on…

    • Euan Mearns says:

      and in December 2012, Areva estimated that the full cost of building the reactor would be about €8.5 billion,

  7. pyrrhus says:

    As one who has worked on energy projects in the 3d world, I think the risks involved here are enormous, given the size of the project, the high projected consumer rates, and the length of the time period. The Enron Dabhol project is just one example of those risks, and Hinkley Point will probably end up a much larger, and much more exposed project than Dabhol. I think the UK government is smart to offload those risks on foreign companes, but on the other hand it risks having a failed project just at the time the UK is desperate for electric power.

    • stone100 says:

      Please put me straight on this. Aren’t there two distinct risks here? There is the risk as to whether the power plant gets built. That is a risk that EdF is in a position to manage. It makes sense for EdF to be paid (a lot) to bear that risk. If and when the power plant is completed, the risk transitions to largely a political risk. The risk is then whether the plant will be permitted to continue operating and how much can be charged for electricity. EdF can’t manage those risks. The UK government is in control of those risks. I really don’t understand what sense there is in using expensive private finance after the build is complete. Instead the UK government could just contract to buy the plant out-right if and when it is completed (with late delivery penalty clauses etc).

      • pyrrhus says:

        That would be a sensible way to do things, but not with a near bankrupt company like EDF…I would recommend a performance bond of large size…

        • robertok06 says:

          Total nonsense.

          Electricite de France is nowhere near being bankrupt.

          EdF is the biggest electric utility in the world. It own the biggest nuclear fleet in the world. It has a record of safety and emissions which is unparalleled in its sector.

          Vattenfall is almost broke. E.On, REPower, and many more in the EU.

          If it werent’ for EdF, the UK nuclear fleet would be almost gone by now. Since they have acquired most UK reactors (all of them, maybe… can’t remember now) their capacity factor has gone up considerably.

          So, please… at least on this excellent blog, could we think a bit more carefully what we write? It’s important.

          This one for some numbers…

          … and this one for the financial part, first semester 2016:


          • Alex says:

            EDF isn’t bankrupt, and is underwritten by the French state.

            It does however have a number of problems:
            – Germany is dumping subsidised product over the border, destroying whole sale margins for everyone.
            – EDF has probably been underfunding the reactor decommissioning fund. It really needs to add about 0.5-1c/KWh to electricity prices, which would make French electricity still the cheapest in western Europe.
            – It has to fund the upgrade and 20 year life extension for it’s reactor fleet – about 60GW. This could cost €100 billion, including maintenance for the 20 years. This is a huge sum and works out at – wait for it – about 1.1 cents per KWh (to which they have to add staff and fuel costs).

            In addition they also have to find £18 billion for Hinkley, plus the funding for that which is where the EU got its /325 billion figure from. .

          • robertok06 says:


            “EDF has probably been underfunding the reactor decommissioning fund”
            EdF has not underfunded anything, EdF has put aside the amount that the law mandates, nothing more nothing less.
            EdF doesn’t make laws.

  8. ristvan says:

    Nuclear is good, but there are cheaper, simpler, faster to construct designs than Hinkley.
    But even those take 5-7 years if Voglte 3 and 4 in Georgia are representative. UK does not have that much time given dangerously low reserves. On existing sites with transmission infratructure, shuttered coal can be replaced with CCGT in 2 to 2.5 years. UK needs to get on with it.

    • Euan Mearns says:

      We have a new government that may just be willing to show some incisive leadership. Energy is now aligned with business and industrial strategy, not environment. Planned closure of coal may not now happen. The mad plan to cause UK blackouts could be abandoned.

  9. Jordan says:

    There is ample fossil fuel for centuries to come. Gas and coal will compete for lowest marginal supply in the international market. And there has never been any confirmation of the predicted tropospheric hotspot to confirm global warming is any reason to hold back.

    Maybe we will need nuclear in a couple of hundred years. Maybe it will be more competitive with the benefit of improved learning and technology of the next couple of hundred years. We did it quite well in the 1960’s, there is no reason to suggest we wouldn’t be much better in the 2160’s.

    Today, UK plc needs to be positioned to compete with its main international competitors, including Germany, India and China. A new fleet of coal fired power stations would maintain diversity of energy supply to follow the “CEGB legacy fleet” inherited at privatisation. It would also offer the security of supply required for a modern economy.

    New coal stations don’t make sense if we still have George’s calamitous carbon floor price which effectively doubles the marginal cost of coal fired power generation. And they will not be built if there is a requirement for unproved and expensive CCS.

    We can take comfort from the fact that Germany (the de facto EU leader) presently generates about 48% of its power using unabated coal fired power stations. This isn’t going to change any time soon.

    HMG holds the two trump cards to get UK plc back to work.

    • Euan Mearns says:

      There is ample fossil fuel for centuries to come.

      Would you care to tell us where? That is the stuff that can be extracted and transported to market at reasonable cost.

      • Jordan says:

        It depends on where we pitch “reasonable” if you propose a test of “reasonable cost”?
        The lesson of recent history includes the shale gas revolution. Also the surprising durability of Brent and other fields in UKCS, and similar experience in the US. As we learn, technological development pushes back the frontiers of our capabilities, and this keeps the marginal cost of prevailing production within the bounds of “reasonable”.
        Oil price shot up and what happened? We innovated and the oil price plummeted. Relative cost of different will result in fuel switching over investment cycles, keeping alternatives within bounds (notwithstanding short-term volatility). That’s why I propose coal fired investment for diversity in Uk generation.
        Returning to extraction, land based tight gas is the easy stuff and we will get better at it. We may turn attention to the 70% of the Earth’s surface underwater some day. Does that make shale gas unreasonably costly? Maybe offshore toght gas is relatively expensive today (because we have cheaper alternatives, and today’s technology), but it is a mistake to assume we will not learn and improve for the future when we may need to go offshore.
        I make no suggestion that fossil fuels will last forever. As I mentioned, there is plenty for the foreseeable. This can be seen in the scaremongering and discussion around rationing fossil fuel reserve recovery on a false prospectus of controlling the climate.
        Final thought – globally, there are hundreds of fossil fuelled power station developments funded entirely in the private sector. No comparable discussion around technology risk and government sponsorship. Doesn’t that tell us something about which is “reasonable”.

        • Euan Mearns says:

          The lesson of recent history includes the shale gas revolution. Also the surprising durability of Brent and other fields in UKCS,

          Much of US shale gas is in process of liquidation. Brent is in process of being decommissioned. Brent followed a very precise reservoir engineering plan, the final part being gas cap blow down. Now all the reservoir energy and movable hydrocarbons are gone.

          But there are UK fields like Magnus, Schiehallion and Claire that have a bright and long future ahead of them. For decades perhaps, not centuries.

        • Simon C says:

          As i understand it fossil fuels Energy return on energy invested has dropped quite a lot. Shale wells need moving every year or two. So there is a lot but harder to extract. It is nowhere near at solar levels but even so it is unlikely to get any easier. But there are more experts on these blogs than I!

  10. mark4asp says:

    Theresa May delays Hinkley nuclear decision amid concerns over Chinese involvement

    They seem to be most worried that Chinese spooks could put bad code or security vulnerabilities into the computer system. MI5 raised these issues.

    • Alex says:

      That’s a bit strange. The Chinese won’t have access to the control systems and all code is thoroughly checked at source code level. I doubt MI5 know that.

      For the Hualong reactor that could be an issue, but I’m not sure the Chinese have a reason to even try this.

    • mark4asp says:

      Obviously the Chinese will have no technical input to Hinkley. It’s an AREVA reactor. Accepting Chinese funding for Hinkley will allow them to build reactors at Bradwell as part of the same deal. The Bradwell reactors will be fully Chinese.

      • Alex Terrell says:

        Objecting to Chinese building at Bradwell is understandable, but perhaps misplaced.

        Objecting to Chinese participation at Hinkley is ridiculous. There isn’t a security risk from this.

  11. john eardley says:

    The Chinese already provide the equipment on which the core UK internet operates (Hauwei) and can change the source code whenever they want. I would be much more worried about that to be honest..

  12. Ed says:

    If you are correct that the return over 35 years is of the order £72 billion then why are we handing out this money to French and Chinese companies . Why aren’t we financing this ourselves while treasury bond yields are at record lows? Are we not capable in building better reactors ourselves ? Possibly ones that use all the stored radioactive waste we have stockpiled?

    Also to put the cost in perspective; our four Trident subs will cost over 200 billion of our own money, gives us no return apart from our safety, which is debatable at best, plus they are Nuclear powered !

  13. Lars says:

    What a mess Europe is in regarding just about everything including energy. Just to remind you gentlemen and -women, this old joke has some truths in it.

    “In heaven the police are English, the mechanics German, the chefs French, the lovers Italians, and everything is organised by the Swiss.

    In hell on the other hand the chefs are English, the mechanics French, the police Germans, the lovers Swiss and everything is organised by the Italians”.

  14. Richard says:

    Don’t forget to keep an eye on EPR Taishan

    • Stuart Brown says:

      Yep, I’m forced out of hiding because no-one else has mentioned that one. Looks like being the first EPR into operation next year, took 8 years to build (if it happens) and I can’t find anything on costs. Anyone care to take a shot at it? Can we kidnap the Chinese guys who are building it to build Hinkley C?

      • robertok06 says:

        “Can we kidnap the Chinese guys who are building it to build Hinkley C?”

        You will have to kidnap also a lot of frenchies, from AREVA, who have been permanently working on the 2 EPRs in Taishan. 🙂

        Their cost?… there must be something on world-nuclearnews…

        “Taishan 1 and 2 are the first two reactors based on Areva’s EPR design to be built in China. They form part of an €8 billion ($8.7 billion) contract signed by Areva and CGN in November 2007. The Taishan project – 140 kilometres west of Hong Kong – is owned by the Guangdong Taishan Nuclear Power Joint Venture Company Limited, a joint venture between EDF (30%) and CGN.”

        Anyway, on this issue of costs… I’ve seen here someone (Euan, I think) saying that the korean are building a much better deal with their 4 AP1400 (total 5600 MWe) for 20 billion dollars with respect to the incredibly expensive french-made EPRs…but, let’s be serious guys!… how can we possibly compare the cost of labour in the United Arab Emirates (more probably the same kind of manpower used for the (in)famous stadiums in Qatar for the next football world cup… almost slave labour)…

        … or comparing with with the similar-spec chinese build, where chinese workers at on site 24h/24, 7dd/week… how about british work regulations/conditions?.. 40 hour/week?… nobody forced to sleep on site? Unions having a voice in the deal? Workers’ rights?

        On the other hand, let’s not forget that more than 70% of world’s PV module/cell/panel production comes from the same China (and Taiwan) under similar conditions… how about installing only PV cell/modules/panels built in Europe under European cost of labor and taxation?

        Let’s compare apples with apples, please.


        • Stuart Brown says:

          Hi Roberto

          I’m not suggesting an EPR is the best for Hinkley or the UK – but nobody had mentioned the fact there are 2 EPRs nearing completion in China until Richard did. An apple may not be une pomme, but surely an Areva designed EPR is an EPR wherever it is – but I’m no expert, just interested to understand if the EPR is inherently more expensive or not.

          ‘They form part of an €8 billion ($8.7 billion) contract signed by Areva and CGN in November 2007’

          I saw that article, thanks, key phrases for me were ‘part of’ and ‘signed in… 2007’ when they still expected the first of the reactors to be up and running in 2013. So I’m not really any wiser and couldn’t find recent info.

          And Euan says of Olkiluoto above: ‘The cost overruns are directly linked to the delays and time overrun.’ So if the Chinese (and the French) can build an EPR more quickly in China, and therefore more cheaply, why not here in the UK with the same expertise? Do you know the working conditions are so poor in China? I would guess they might be.

          But hey – Somerset is a nice place, kidnapping may not be necessary, if we offer better conditions. And it is famous for its apples and cider.

  15. Here is a bit of syncronicity. Just one day after the government calling for a “re-evaluation”.

    “Britain’s Nuclear Decommissioning Authority “manipulated” and “fudged” a tender process for a £7bn contract to clean up the country’s nuclear power plants, the High Court has ruled.

    The judgment, handed down on Friday, raises fresh questions over the way government entities hand out multibillion-pound contracts and casts further doubt on the UK’s nuclear industry a day after the government’s decision to launch a review of the £18bn Hinkley Point project. It could eventually cost the government hundreds of millions of pounds in damages.”

  16. Gaznotprom says:

    Great article & comments.

    Personally think the govt is just awaiting a bad news day or some other over arching crisis to announce Hinkley is cancelled for all the technical & logical reasons discussed here.

    Naturally the BBC/Harabin/Greenies/vested interests will protest, start a petition, paint themselves odd colours, march on Parliament.

    Quietly restart the coal plants in the meantime.

    Issue (like War Bonds) Gov-backed Nuclear bonds paying 3% stamp for 30 years – they’ll be snapped up in this strange bond-market.

    Order 10 or so proven & working designs from Hitachi/Toshiba/Westinghouse or even the Russians.

    Oh we can dream…

    • Ed says:

      Even I would buy Gov-backed Nuclear bonds paying 3% stamp for 30 years, and I’m a Nuclear sceptic ! LOL

    • stone100 says:

      Why oh why talk about issuing 30year Gov-backed Nuclear bonds at 3% when the 30-year gilt yield is 1.6% ? A full fleet of nuclear power plants (say 30GW) could be paid for out-right, financed directly by gilt issuance.

  17. mark4asp says:

    I calculate the Hinkley contract for difference, CfD, subsidy paid by consumers in higher prices over 35 years at $48bn. I assume 92% capacity utilization and wholesale electricity prices of £40/MWh. An extra £21/year for every person in Britain. Hinkley will be 7% of our electricity. Scale it up that CfD for all electricity and it’s £304/year extra for everyone. Some CfD are more expensive than Hinkley. I suppose DECC thought they got a wonderful deal at £92.5/MWh because offshore wind was awarded a CfD up to £152/MWh.

    We’re abolishing the market with electricity decarbonization. Everything becomes a CfD. We’ve kept the worst bits of capitalism but got rid of its saving grace : market prices as a means to allocate resources leading to greatest efficiency. It’s the mindless way these policies are pursued that frightens me. Not any single deal, but the effect the totality of deals will have. Conservatives should be very afraid of this but seem to be rushing in like blind lemmings.

    • benjamin weenen says:

      When CO2 reduction became a serious issue over 20 years ago, many people then said unless a straight forward tax was put on it, the alternatives were likely to be ineffective, inefficient and costly.

      For the market to be able to allocate resources at optimal efficiency, externalises need to be internalised.

      This isn’t rocket science, yet somehow politicians (rather their advisers) fail.

      All subsidies, guarantees and preferential grid access ended.

      For fossil fuels, a simple tax on emissions will do the trick.

      For nuclear, compulsory insurance and set aside funding for de-commissioning and waste management.

      For wind and solar, plant owners should pay a surcharge for the additional costs they place upon the system.

      • Jordan says:

        Taxing CO2.

        To be effective, a tax needs to seriously change behaviour.

        To seriously change behaviour, it needs to be seriously expensive (consumer preferences are not affordable, and other choices must be made)

        Making things unaffordable is seriously unpopular (proponents are elected out of office)

        And to top it all, there is nothing to say that moving expenditure from the private sector to the public sector (tax revenues) will reduce aggregate CO2.

        To summarise: it doesn’t work in practice.

        • A C Osborn says:

          To summarise, CO2 is not a problem, it is Plant Food.

          • Philistine says:

            Indeed. Having read you lot it seems simple to fire up the coal stations again, get the miners back to work and use the 1000 years of coal we have left. Then plant plain trees in everyone’s gardens by law. B*gger the CO2. I haven’t noticed the Americans burning less petrol. Is it only the Brits that comply again?

        • robertok06 says:

          Taxing CO2.

          For those who are in favour of such a tax, I want to put things in perspective.
          Ijust downloaded a paper from a German federal energy about the EEG, and they claim that dividing the tons of CO2 reduced by their wonderful Energiewende program by the cost of the Energiewende program (24+ billion Euros in 2015) the cost of each ton of CO2 not emitted is 219 Euros.

          So, if anybody is afraid of the consequences of such a tax, just think that Germany can cope with 219 Euros/tonCO2, and its economy does just fine… meaning there is ample space of maneuvre, pick a smaller tax, say 50 Euros/tonCO2 and see what it gets in terms of decarbonisation/modernisation of the generation of electricity.

          Surely thinking of going back to burning coal just because it is cheap, as I read here above, I think is like shooting oneself in the foot:


          • A C Osborn says:

            Are you mad?
            What could you do with 24+ Billion Euros instead of completely wasting on a non problem.

          • robertok06 says:

            @AC Osborn

            Relax, I’m sane, in fact I think that the 24 billions are a total wastem could be spent in a much better way.

      • mark4asp says:

        This should be a “fee and dividend” system, not a tax. Start with a system for electricity only. Instead of taxing fossil fuel, an agency collects a fee in proportion of how much CO2 is emitted by suppliers. All the fees are refunded to customers with their bill as the “dividend”; in proportion to how much the customer bought.

        Instead of a tax we have redistribution. There are few suppliers and few distributors in the electricity sector so the system is easy to implement.

        More details below:

        • stone100 says:

          Mark, your fee and dividend plan seems to have a fundamental difference from the Hansen idea. The Hansen plan is for a flat dividend paid equally per person whilst you seem to be saying it should be paid out more to high energy users. The Hansen plan encourages energy conservation of all sorts and not just switching to low carbon energy sources. Your plan doesn’t seem to encourage reduced consumption and efficiency which is a big aim for the Hansen plan.

  18. benjamin weenen says:

    The French/Chinese stand to make around 3.5% yield each year for 35 years. Which isn’t too shabby.

    The least worst option would be for the UK Government to buy a 75% stake in the project, displacing the Chinese.

    EDF are currently $38bn in debt, and have reactors to upgrade in the UK and France, as well as paying for Hinkley.

    I’m pretty certain that the French Government and EDF would more than welcome the injection of liquidity, and the sharing of risk, showing some post Brexit solidarity with our neighbours.

    We can currently borrow at <1%,(10 years) and as we'd have some leverage to ask for reductions to EDFs expected yield (hence strike price), we'd be saving UK tax/bill payers tens of billions over 35 years.

    Furthermore, it would give us some breathing space in regard to the proposed sites at Sizewell and Bradwell. Instead of the EPR and Huolong reactors, we could look into some better alternatives. Maybe the "improved EPR" or the Atmea.

    There's still time for the Tories to put ideology to one side. We are caught between a rock and a hard place. Borrowing £15bn at less than 1% has got to be seriously considered.

  19. jacobress says:

    The Hinkley nuclear plant seems IMPERATIVE NOW, only if you consider the emissions reductions target imposed by the Climate change act adopted by Britain.

    The rational option would be to forget about the costly and risky Hinkley project NOW, and revisit the issue of the feasibility and economy of nuclear power maybe in 10 years. There is no urgency to embark on this dubious project NOW.

    The only urgency is artificially and unnecessarily imposed by the Climate change act, which is, in itself, not reasonable, and not necessary, and has no chance whatsoever of achieving it’s declared goals.

    I mean: the Hinkley project is driven by hysteria, not rational considerations.

  20. mark4asp says:

    Proposal – how to solve electricity decarbonization. [ Originally written as a reply to @jacobress ]

    Let us have a single mechanism to encourage electricity decarbonization – a carbon levy (not a tax). Impose a levy on CO2 emissions, for electricity generation only. It should work out about £50/MWh for coal generation; about half that for gas. Scrap all other price distortion measures in electricity: CfD, FIT, carbon tax, blah, … Investors will now clearly see the market price signals.

    All money collected by the levy, apart from its (low) admin cost, will be refunded to electricity customers in their bills. That’s why it is not a tax. Each customer will be refunded in proportion to the amount of electricity they bought.

    A ‘bad’ result of this could be high prices awarded to current nuclear power, because it need only compete with the cheapest gas. If so: put most of the excess(*) from existing nukes into an EdF investment fund. If the excess is about £40/MWh, the fund will collect over £2bn/year. Seven years = £14bn, which is almost the price of Hinkley C. Given EdF plan to finance about 1/3 of Hinkley internally and borrow 2/3, this should completely do away with their need to borrow. By the time Hinkley comes online it will have been paid for already. It will not need a strike price.

    (*) by ‘excess’ I mean the difference between the cost of production and sales cost of electricity.

    Benefits of this C-levy system:
    1) It shuts climate campaigners up. They get what they want – more expensive fossil
    2) It is easy to do, and cheap to implement. Metering electricity is easy, there are few suppliers, all customers pay to only a few distributors.
    3) It’s not a tax. It’s a transfer. Customers pay higher prices, but government don’t tax energy (as they currently do with our existing carbon taxes).
    4) It interferes with the market as little as possible. In contrast to existing measures which confound the market.
    5) It encourages only economic renewables, and low-CO2 supply. No more government ‘picking winners’ (and failing)
    6) It will be way cheaper for customers than German/Danish/Californian/Hawaiian schemes. Initially, only about half the levy will be felt as a price increase because refunds will be very high. Refunds are entirely proportional to the amount of fossil burnt on the grid. Initially, I imagine actual extra prices paid will be no more than 2p/unit more, falling with time.
    7) It is done only in the electricity sector as a pilot, but this is the easiest sector to decarbonize so the best place to start.

    • mark4asp says:

      It’s also known as fee and dividend. Trumpeted by James Hansen. There are other versions of F&D but I think the one I outline above is best because it is most acceptable to conservatives; and will, therefore, not meet political opposition. Other versions of F&D / C-levy originating from climate warriors see the dividend distributed as a “citizen’s wage” (as they call it). So, me sane. Me not crazy SJW.

    • A C Osborn says:

      No let’s not decarbonise anything at all. It is a complete and utter waste of time and money, which could be used to far better effect elsewhere.

      • mark4asp says:

        The consequence of your “let’s not decarbonise” counter proposal will be to keep current inefficient price distortions: FIT, CfD, Carbon-taxes, …, blah, as our government continue attempting to pick winners and meet the needs of special pleaders. You sound radical but you’re only keeping for the (badly working) status quo because you’re deregulations will be opposed by 80% of politicos.

        • A C Osborn says:

          Repeal the Climate Change Act and remove all subsidies, go back to market forces and a level palying field where the cheapest Base Load gets the business.
          Take the government out of the market or totally privatise it, half & half is never going to work.
          It is not my fault that 80% of Politicos don’t know their Carbon from their Plant Food.

          • Jordan says:

            ACO – I agree with you that CO2 is not a problem (the unique fingerprint – tropospheric hotspot – is not observed).

            But nonetheless, there are people who disagree and they should be free to express themselves in the marketplace. They can do so as described below.

            I don’t agree with a mandatory “fee and dividend” as described, because it would be imposed on me. And imposition means that I am prevented from expressing my preferences – enough for me to conclude it’s a tax.

            A free market method is possible right now in the UK. A prospective nuclear power devevelope can create its own supply company and seek to sign-up sufficient customers on long term contracts (giving up their rights to switch for the duration) at a price which secures its investment case (underwrites its liabilities). If it gets enough customers (from the pro-nukes and anti-CO2s together) it goes ahead with the project. If it doesn’t get enough customers, no cigar. We all get peace and quiet.

            So there is a method available in the Uk market right now, giving the opportunity to stand behind principles and beliefs, and pay the extra price. Why is this not being offered?

          • mark4asp says:

            Not so much privatisation or nationalisation which failed. It’s the scattergun attempt to influence the market using FITs, CfDs, C-trading, etc. that all failed.

            The fee and dividend proposal in electricity is designed to keep prices low while replacing fossil fuel electricity as quickly as possible. Politicos take their advice from experts. Experts generally agree the decarbonizing energy is a good thing. Even if you disbelieved CAGW, and even moderate AGW, you still might want to decarbonize electricity because nuclear power offers energy security. Good for a country so heavily dependent on imported fossil fuel as UK is. The need for energy security is why French electricity became 80% nuclear. Energy security is a core requirement of Energiewende. It’s a good aspiration, even when they fail at it.

  21. Dave says:

    In their espousal of global warming/climate change successive UK governments seem unaware that this also involves a rising sea-level. Hinckley Point is at or very close to sea-level today. In the early 1600s extensive flooding occurred in the Bristol Channel region. Some scientists have attributed this to a tsunami, possibly generated from the mid-Atlantic ridge. What would happen if this were to recur? The ensuing costs would far dwarf the sums of money now being discussed in the development of the nuclear power station.

    • Alex says:

      “What would happen if this were to recur?”

      The Tsunami would cause extensive flooding in the Bristol channel. The safest place would be Hinkley C, protected by sea walls deigned specifically for this purpose.

    • steve says:

      Some geologists are concerned that a very large tsunami may occur if a mountainside slips off the side of a volcano in the Canaries. This is thought to have happened in the past. It would devastate the Eastern Seabord of the US and Soth Coast British cities. Sizewell would be safe but Bradwell is closer. The Bristol Channel amplifies tides to the second highest in the world. Any estimates from geologists here on the hight of a wall at Hinkley if it happened?

      Another thought. Instead of a complicated heavy and difficult to construct r.c.double dome a separate geodesic dome or cone shaped structure could be built relatively quickly in steel to protect any reactor, new or existing. Thick plate deflectors and slowing stucture would be necessary. Alternatively, install a quick reaction missile system to blast any plane out of the sky that threatened. I flew over Flamainville on the way from Barcelona to Gatwick last week and hope airline would remember to keep clear if this idea is adopted.

      • benj says:

        Would it not be easier to simply change the software controlling the autopilot making it impossible to fly an aeroplane into high value targets?

  22. Alex says:

    Conspiracy theory part 2:

    Some months ago, EDF announced that a decision was being postponed till the Autumn.

    DECC, not wanting to look foolish if the decision was no, or perhaps wanting to hurry EDF along, started working on a plan B, aiming to complete this in the Autumn. This involved discussions with Westinghouse about building 3 additional AP1000s instead for the EPRs. This Plan B looks feasible and more cost effective than the EPR.

    Somehow, EPR get wind of this Plan B (perhaps deliberately, to make them hurry up). They weren’t too worried because they had high level support from Osborne. However, Osborne is gone, so suddenly, they need to approve and sign the deal before Plan B is complete.

    So they bring the meeting forward, aiming to sign whilst Plan B is still with the civil servants. However, May and Clark are on the ball and have looked at how the plan is going. Still detail to resolve, but once it’s complete, they want to weigh up the benefits of Plan B against the costs of pissing off the French and Chinese.

    When Hammond announced support for Hinkley two weeks ago, he was not yet aware of Plan B.

    Of course, when “conspiracy theory” meets “cockup theory”, the latter normally wins.

  23. benj says:

    Didn’t other reactors in Japan get hit by the tsunami? They didn’t all have problems did they?

  24. halken says:

    I am no expert in nuclear, but I have worked in the energy industry.

    Nuclear seems to be the most cost effective way to reduce co2 emissions. The Finnish reactor has been beset by delays and cost overruns, hence it it not understandable why the UK would chose EDF to build the HP plant. Making a tender with Korean, US and Japanese companies seems like a much better idea to get a lower price of the plant and hence of energy.

    Proberly the UK has been too keen on getting a deal and that mean the French consortium has been able to negotiate the steep 100 pound/MWh price. Else the UK would not only have to build the plant but also find some to own and operate it and put up the cash. I don’t think any utilies in Europe has that kind of cash besides EDF.

    • Greg Kaan says:

      I suspect the EU membership had a reasonable amount to do with this. I cannot see how else the GDA for the EPR only took 5 years while that for the AP1000 (which started at the same time) is still dragging on.

      It’s also puzzling that the AWBR was submitted for assessment rather than the ESBWR – it would be interesting to know GE/Hitachi/Toshiba’s reasoning for this choice

      • Alex says:

        The GDA for the AP1000 was paused for a few years and then restarted. But I think the amount spent on ONR fees is about the same for all three reactors.

        I’m not sure about the ABWR – I read there was a problem with them having to change a design and put in different designs to the ONR from that to the NRA (US equivalent).

        Either way, I think it’s an unfortunate accident that the first design to be approved is the worst of the three.

      • Euan Mearns says:

        Westinghouse suspended their GDA application mid way until a serious plan was established to deploy the AP1000 in the UK. The GDA is scheduled for completion Jan 2017.

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