Hinkley Point C will be the first in a new generation of nuclear power stations in the UK, excavating more soil and rock than was dug up for the Olympics Games – that’s if the project actually gets off the ground.
Will Hinkley nuclear power station ever be built?
The future of the project still hangs in the balance as partners EDF and China General Nuclear Power (CGN) stall over making a final investment decision (FID). However the UK government remains confident that a deal will be done and the French President, François Hollande also backs the project even though there are rumours that it could bankrupt EDF which is 85% owned by the state.
The reason for the bankruptcy are based on the view that Hinkley C will be the most expensive ‘thing’ ever built, as well as the fact that EDF is already dealing with €37bn of debt. Costs are estimated at £24bn in total which includes interest to be paid on borrowed money with construction alone costing £18bn. According to Steve Thomas, professor of energy policy at Greenwich University, "Nuclear power plants are the most complicated piece of equipment to make and the cost of nuclear power plants has tended to go up throughout history as accidents happen and design measures are enhanced to deal with the risk".
To put this into perspective, the last nuclear power station built in the UK, Sizewell B was completed in 1995 only costing £2.3bn ($3.4bn), or £4.1bn ($6bn) at today's prices. However the burden is not entirely on EDF’s shoulders as CGN will cover a third of the costs, but the Chinese power giant said on Monday 16th May 2016 that it would not go ahead with the project if EDF pulls out. However there are rumblings that CGN would actually proceed alone and build 2 smaller reactors.
The project is embroiled in controversy with many people opposing the project via the ‘Stop Hinkley’ campaign. Here we look at both sides of the argument:
The advantages of Hinkley -
- 25,000 new jobs will be created in the South West
- 5,600 will be employed on site at its peak
- 2 nuclear reactors will generate low carbon electricity for 5 million homes in the UK
- Nine millions tonnes of Co2 emissions will be avoided every year
- Creating a more predictable source of renewable energy (compared to solar and wind) which will help to meet climate targets
The opposition to Hinkley –
- Risks of leaks and radiation levels
- No robust way to deal with nuclear waste
- Increased risk of cancer to people living and working in the vicinity
It’s not only the Stop Hinkley campaign that opposes the project. Many EDF shareholders are against the programme for the obvious financial risks and rating agencies Standard and Poor’s and Moody’s both lowered their forecasts for EDF at the start of May.
The end to the debate and a final decision is not about to come any time soon. Watch this space - a decision is now scheduled for September 2016…