Four weeks ago, EDF’s Board gave its approval for two new nuclear reactors at Hinkley Point in Somerset. It is a momentous decision made possible by years of hard work.
The Government said it will take a short time to consider the project. That is understandable and I fully respect the decision.
Detractors have filled many column inches and broadcast hours. However, some critics risk losing sight of the bigger picture by overlooking the positive impact and importance of this investment for Britain.
China’s participation is much more than £6bn of inward investment. It brings the benefits of a 30-year partnership between EDF and CGN in nuclear construction in China, a country with the largest civil nuclear programme in the world.
EDF and CGN are close to successfully completing two EPR reactors in Taishan. The benefits for Hinkley Point C and the UK of our shared knowledge and experience are significant.
We know and trust our Chinese partners. Beyond that, the UK independent nuclear regulator has only granted Hinkley Point a nuclear site licence after being satisfied that security has been properly addressed. All staff on nuclear projects are rigorously vetted, wherever they come from. As is standard practice, the control systems at Hinkley Point C will be isolated from IT systems and the internet.
Vincent de Rivaz, chief executive of EDFThe cost of Hinkley Point C’s electricity is frequently compared with today’s depressed wholesale prices. The correct comparison is with future prices. Hinkley Point C is competitive with all other future energy options, even including fossil fuels like gas when the cost of carbon is taken into account.
Once the new-build nuclear industry is restarted, costs are expected to fall for future projects.
We need to replace our ageing fossil fuel plants with new low-carbon electricity. It’s a more complex future with interconnectors, batteries, gas, small and large nuclear, renewables, central and decentralised generation. The challenge is to get the right mix. There is no single technology which offers a panacea for our future needs. We need them all, including new nuclear.
For example, gas is not low carbon. It is best used as a flexible fuel to help match changing supply and demand. Even with the hopes for UK shale, falling North Sea production means gas needs to be imported, adding billions to the trade gap. That’s why low-carbon nuclear is the Government’s choice for base-load reliable electricity.
Wind has a critical role to play in the energy future and EDF is a major investor in wind power. However, we will always need back-up power when the wind doesn’t blow. That extra cost is paid for by customers and is around £10 per MWh.
In Britain, onshore wind has a limited capacity to meet our future needs. As well as that intermittency, space is a significant constraint. As for offshore, recent auctions for UK offshore wind projects averaged £137/MWh compared with Hinkley Point’s £92.50.
Some pundits suggest battery storage can complement wind and solar generation so that Hinkley is not needed. However, peak electricity demand in Britain is in the winter when there is almost no solar electricity generated. There is no prospect of cost effective battery technology to store electricity for months. Nor is the electricity going into batteries free. Storage is another additional cost for consumers.
Small modular nuclear reactors are another technology that we are developing. However, today no one can know how long it will take for policymakers, regulators and planners to approve these designs or what they will cost. Nor do we know how communities will react to dozens of nuclear power stations being built at new locations.
We can’t afford to cross our fingers and muddle through in the hope that a new technology will meet all our needs at the right price.
Hinkley Point C’s technology is ready now and its cost to consumers is fixed. EDF Energy and our Chinese partner are taking the construction risk to build Hinkley Point C as investors. Taxpayers pay nothing.
Hinkley Point will have a lasting impact on our industrial capacity and will create thousands of jobs and hundreds of apprenticeships. Billions of pounds will be invested into the economy of the south west of England.
Across Britain, dozens of companies and our own workforce are ready to deliver this project. Their motivation remains high and they are looking forward to getting on with the job.
Vincent de Rivaz CBE is chief executive of EDF Energy
For more information contact:
EDF Energy Media
Media Relations Team