Yesterday all the Hinkley Point C team was extremely proud to present the project to the Board of Directors of EDF. As you know, the Board approved the final investment decision. We are humbled by this decision.
Following this decision, the conditions are met to allow EDF to sign the contracts with the British Government, EDF’s historic partner China General Nuclear Power Generation (CGN), and the main suppliers of the project.
This is a hugely important milestone for the project, as it is for EDF Group and EDF Energy. It means that we are now ready.
As you will know there are still some steps before these signings can take place.
I want to speak directly with you about all of this. First I will set out why the decision was so important for the UK and for EDF Group and EDF Energy. I will acknowledge the work by the teams in the UK and France that has got us to this point. Then I will turn to the next steps and what more needs to happen. I will conclude by explaining how the project fits perfectly with the new Government’s vision of a country for the many, not for the few and with the Government’s vision of industrial strategy.
It has been a ten-year journey to reach this position. We have achieved it thanks to determination, patience and courage. Over those ten years, together we have faced numerous challenges. Each time we have overcome them.
This project is strong, firstly, because it is such a strategic one. It is strategic for EDF and
EDF Energy and for Britain, France and China.
The strategic importance of Hinkley Point C
For the UK, Hinkley is vital to energy and climate policy.
Nuclear energy has a crucial role to play in security of energy supply and tackling climate change. There is no solution for the UK without new nuclear in the mix. And Hinkley Point C is the necessary first step in the roll out of new nuclear.
Since 2010, 25% of the UK’s electricity generation capacity has closed. By the end of 2030, a further 40% of that 2010 capacity will close, including all but one of our current nuclear power stations.
First operation of Hinkley Point C is scheduled for the end of 2025, just as our existing plants are scheduled to begin to close.
There is an urgent need for new electricity generating capacity, and for that to be low carbon. Hinkley Point C is vital to the UK’s ability to meet the ambitions of the COP 21 climate conference, and to the UK’s fifth Carbon Budget, just as it is vital for security of supply.
As Secretary of State Greg Clark said last week: “New nuclear is an essential part of our plan for a secure, clean and affordable energy system that will power the economy throughout this century.”
For EDF, Hinkley Point C is a key part of our CAP 2030 strategy. Hinkley is a unique asset for British and French industry as it will benefit the whole of the nuclear industry and support employment in major companies and smaller enterprises in the sector.
It will be the best preparation for EDF for the renewal of the French fleet.
Thank you for your dedication on our ten year journey
The project is strong, secondly, because of the hard work of the British and French teams that have contributed so much to building it to this point.
I thank and pay tribute to all those who have played their part in the long journey to reach this week’s Board decision. The people in London, Barnwood, Somerset, Paris, Tours, Lyon and Montrouge have worked tirelessly. Our Chinese partners must also be praised for their extraordinary commitment to this project.
I want to say a special thank you to our supply chain partners who have also been part of this journey.
We have seen many major achievements over the last 10 years as we worked towards this day.
These include the full public consultation that led to the UK’s policy to have new nuclear. This policy has been supported by consecutive Governments. It is underpinned by the enabling framework which includes the new infrastructure planning process and Electricity Market Reform. The contract for difference for Hinkley Point C was scrutinized thoroughly in the UK before it was agreed in October 2013 and then by the European Commission, which gave its approval in October 2014.
Achievements on the project include the securing of the Generic Design Assessment for the EPR in 2012, the first and only new generation reactor to complete this rigorous process, granting of the nuclear site licence, also in 2012 and planning consent following the first-of-a-kind public consultation in 2013. We are proud too of our Funded Decommissioning Plan and Waste Transfer Contract, the engineering and design work, investment in skills, the site preparation and the work we have done with the suppliers.
We are also very proud to have developed a new social covenant called the Solidarity Agreement with the trades unions. It aims at securing the productivity of the construction works through an engaged, motivated and respected workforce.
We have forensically identified the risks that always exist on a large industrial project and we have taken action to address all of them. We have learned the lessons from Flamanville and Taishan. We will be transparent and accountable for the way we deliver safely and on time and on budget, and how we continue to address the risks.
We reached agreement with CGN, our historic Chinese partner in October 2015. CGN are a company we know well. We have worked together for more than 30 years. Today we are working with them to build two EPRs at Taishan. It is a success story. I know that they share our commitment to three core values: compliance with nuclear safety regulations, openness and transparency, and our contribution to society through job creation and skills development. We trust them. They trust us.
We played with humility and leadership our part in the UK’s response to Fukushima, implementing all the recommendations of the regulator. For us it was the natural thing to do and consistent with our approach to continuously improve the safety of our plants. Since the acquisition of the UK fleet in 2009, we have increased their safety performance by 51% – just as we have increased output by 50% and lifespan by 25%. We take the same responsible approach to security, working with the Home Office and others to ensure the security of the civil nuclear industry.
The UK benefits from a strong, independent and credible nuclear safety regulator, the Office for Nuclear Regulation. We are proud of the quality of the relationship we have with them based on trust, openness and transparency.
Now, turning to next steps. the EDF Board has given the authorization to the EDF Chairman and CEO to sign all the contracts for the project, which are in their final agreed form, with the British Government, CGN and the main suppliers.
The new UK Government has said that it needs a little more time before this takes place.
The new Prime Minister has been in post for just 16 days. Her full Cabinet has been in post even fewer. We can understand their need to take a little time. We fully respect the Prime Minister’s method.
We will of course support the Government in their considerations.
I have met with the Secretary of State today. I know that the Government appreciates our professionalism and rational, fact-based approach. Our credibility is our main asset.
The very good news is that we are ready. The Board’s decision means that when the Government is ready to go ahead, we are ready too.
Inevitably critics of the project will continue to be vocal in the intervening weeks.
I regret the uncertainty that may arise for our people and the impacts on the local community and the suppliers hoping to work on the project.
But our support is also strong. The public support for Hinkley Point C outnumbers opposition by three to one.
Over the last 24 hours those who support the project have also been very prominent in the media. They include the supply chain, local MPs and councils, academics and scientists, trades unions, the CBI and many more. They underline the importance of Hinkley not just to energy and climate, but to industry and the economy.
Hinkley Point C as a catalyst for industrial strategy and opportunities for all
From her very first day as Prime Minister Theresa May has said she would lead a “One Nation Government” in which industry would drive growth and opportunity, as she said in her Birmingham speech.
On 13 July she said: “We will do everything we can to help anybody, whatever your background, to go as far as your talents will take you.”
The human dimension of Hinkley Point C is all about that.
On 14 July she formed a new Department of Business, Energy and Industrial Strategy. It makes industrial strategy a priority with energy and energy infrastructure a catalyst for it.
That vision is ours too.
I am convinced that Hinkley Point C is consistent with Theresa May’s vision.
It is an opportunity for British business to hold its head high. It will deliver opportunities for large and small companies in the supply chain up and down the country, whom we have been working in partnership with for many years. Over 60% of the contract val
ue of the construction is expected to go to UK companies.
Hinkley will deliver high quality jobs for people of diverse backgrounds in Somerset and in all the regions of the country.
Our Inspire programme to get people in the South West into work on Hinkley Point C is a joined up approach to help young people from education, through training to employment. It is already transforming employment aspirations and opportunities in the area.
The project will provide 25,000 job opportunities on site alone and 1,000 apprenticeships in total.
Hinkley will kick start the new build programme in the UK with Sizewell C and Bradwell B moving into the development stages bringing jobs and skills to the East of England.
In short, it is a project which is all about industrial strategy and opportunity for all.
In April, I asked the project team in Britain and France to “stay mobilised – keep your motivation high. Remain the professionals you are, committed to the company.”
We have never stopped the project and the teams kept working so that they could preserve the timetable. On the site we have continued to prepare and develop the site for the construction phase.
My message today is one of continuity and confidence. The EDF Board’s decision is a huge achievement and one we should be proud of. Our journey is a long one and there is a further stage. Our job now is to maintain the courage, patience and dedication that have served us so well.
I know that I can count on everyone involved to do so.