Nuclear power plants set to double UK energy prices

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  By Angela Haggerty
 
The UK Government is facing fierce criticism after signing off on a deal to build a new nuclear power station in Somerset which critics claim amounts to a 35-year subsidy and a doubling of the current strike price for power.
 
The coalition agreed on a strike price – the cost paid to plant owner EDF Energy for every megawatt hour of energy generated by it – of £92.50 and the deal at Hinkley Point C stretches 35 years.

The agreement was made despite a UK Government pledge that nuclear power would never be subsidised by the taxpayer.  The price guarantee will be met by increases to household bills.

The two reactors being planned for the site will provide power for around 60 years and the Government estimates the plant will cost £16bn to build.

The move was described as a “colossal waste of resources” by SNP MSP Chic Brodie while other critics warned the development was a serious threat to Scotland’s plans for the adoption of renewable electricity.

“This deal that will see new nuclear power heavily subsidised by customers for at least the next 35 years is a colossal waste of resources and a complete betrayal of the Westminster Government’s promise of no subsidies for nuclear energy,” said Mr Brodie, who sits on the Economy, Energy and Tourism Committee.

“The price that has been agreed is a hefty bill that will leave people paying the price for Westminster’s obsession with grossly overpriced nuclear energy.”

The nuclear power plant will be the first built in Britain for a generation and the project is being led by France’s EDF energy and a consortium which includes Chinese investors.  The news comes just a week after Chancellor George Osborne gave the green light for Chinese businesses to invest in nuclear power in the UK.

The move comes only months after the UK Treasury acknowledged it had underestimated the cost of decommissioning nuclear power plants by around £16bn between 2007 and 2011.  It also comes two years after the Fukushima nuclear plant disaster following a Japanese earthquake, which has left the country gripped by a costly and dangerous clean-up operation – an incident which prompted companies such as Centrica to pull out of the Hinkley project because of rising costs required to meet additional safety standards.

While supporters of the project said nuclear energy was necessary to replace ageing infrastructure and meet climate change targets, critics claimed that the project was likely to be dangerous and would have little effect on the damage inflicted by climate change by the time it became operational.

“Nuclear is the ultimate unsustainable form of energy, leaving wastes which are dangerous for a thousand generations to come,” said Dr Richard Dixon, director of Friends of the Earth Scotland.  “Even if the nuclear industry could build new reactors on time and on budget, which of course they won’t, any new power from Hinkley Point would be far too little, too late to head off climate change.

He added: “This price guarantee is a blank cheque that is likely to cost UK consumers more than £100m over the life of any new nuclear reactors.  People are already worried about their fuel bills, adding a long-term nuclear subsidy at twice today’s prices is the last thing anyone needs.”

The UK Government’s decision is in stark contrast to the direction of other European nations.  In September, the French Government announced the introduction of a levy on nuclear energy and a tax on carbon emissions in a bid to raise the billions of pounds needed to fund renewable energy projects and improve energy efficiency.

In Germany, Chancellor Angela Merkel has detailed plans to phase out nuclear power by 2022 and instead invest in renewable energy.

Deputy First Minister Nicola Sturgeon said at the weekend’s SNP Conference that in an independent Scotland the Scottish Government would transfer responsibility for energy efficiency schemes from energy companies to the Government, which she claimed would reduce consumer bills by around five per cent (£70) per year.