Opinion

Unpacking the nuclear debate - Hinkley is just the start

Paul Spence, EDF

Hinkley Point C will unlock the next generation of new nuclear power stations in the UK. EdF's Paul Spence explains why IOD chairman Lady Barbara Judge's comments in Infrastructure Intelligence questioning the case for French technology are misplaced.

Hinkley Point C will unlock the next generation of new nuclear power stations in the UK, providing the baseload electricity capacity to keep the lights on until the end of the century, says EDF Energy’s Director of Strategy and Corporate Affairs Paul Spence.

The debate about delivering our future energy infrastructure creates inevitable arguments about the best way forward.  On these pages recently, Lady Barbara Judge’s comments about Hinkley Point C appeared, out of context, to show her questioning the case for EDF Energy’s new nuclear power station at Hinkley Point C.

"The truth is that we need a whole new generation of nuclear power stations to deliver the reliable, baseload electricity generation capacity the UK requires into the late 21st century.  Hinkley Point C is just the first."

We understand that Lady Barbara is in fact supportive of Hinkley Point C. Like most experts, she recognises that the UK needs Hinkley Point C precisely because it opens the possibility for the next generation of new nuclear power stations.

DECC estimates that £100bn of investment in the UK’s energy infrastructure is needed between 2014 and 2020. That includes a major programme of replacing our power stations. By the end of 2030, a further 35% of existing electricity generation capacity is due to close down, including all but one of our current nuclear power stations.

If we are to close this gap whilst also meeting our legally binding emissions reductions targets, as much as possible of our new electricity generation capacity needs to be low carbon.

DECC Chief Scientific Adviser John Loughhead has talked of a need for at least 20GW of nuclear to provide the baseload, whilst intermittent but low carbon renewables are balanced by responsive but higher carbon gas generation.

Hinkley Point C will provide around 3.3GW – 7% of the UK’s electricity – and therefore needs to be just the first of a new generation of nuclear power stations. Moreover, Hinkley Point C is the necessary precursor to that next generation being developed.

In the two decades since the UK’s last nuclear power station at Sizewell B opened, our nuclear construction expertise has waned. The Hinkley Point C project is rebuilding the skilled workforce and supply chain that will also deliver later nuclear power stations and, in time, allow the UK to export across the world.

"We understand that Lady Barbara is in fact supportive of Hinkley Point C. Like most experts, she recognises that the UK needs Hinkley Point C precisely because it opens the possibility for the next generation of new nuclear power stations."

Only Hinkley Point C is in a position to deliver. Our project has the necessary planning and regulatory consents, Generic Design Assessment (GDA) approval from the regulator for our reactor design, European Commission approval for our Contract for Difference (CfD) with Government, and a project team and delivery plan in place.

The precedents set by EDF Energy in going through these processes will enable future projects to move forward more quickly than if they had to start from scratch. However, it will still take a number of years for other projects to clear these hurdles.

Now is not the time to put decisions off until tomorrow, or change approach. It is time to seize the day. Steadfast determination is a hallmark of successful delivery of infrastructure projects. That was true in the time of Brunel. It is true today, and important as we seek to attract the international investors who are a vital part of our global future.

The truth is that we need a whole new generation of nuclear power stations to deliver the reliable, baseload electricity generation capacity the UK requires into the late 21st century.  Hinkley Point C is just the first – and opens the door for the rest.

Paul Spence is EDF Energy’s Director of Strategy and Corporate Affairs

Comments

The financing of HPC and SZC depends on the validity of the EC Competition decision on state aid, which allows solely a credit guarantee on bank loans and CfD's of "strike" prices to the account of fossil fuel generation consumers. The Austrian government and three other plaintiffs have lodged nullity actions with the European Court on the grounds that the EC decision is unlawful. The cases are pending. The Chancellor of the Exchequer appears to have nullified the decision when he offered to guarantee the Chinese companies' equity when in China. A comment on this from DECC and HM Treasury is sought in order to prevent the signing of the guarantee when the Chinese President is in London, or otherwise the financing of the projects may fail. The projects are not needed, because efficiency savings and distributed energy reduced the UK's generation by 6.7% last year, cancelling out the need for the 7% coming from HPC in 2026. Uncertainties remain.