UK Government’s nuclear plans close to meltdown

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  By a Newsnet reporter

The UK Government’s nuclear energy plans were left close to meltdown last night following news that a Franco-Chinese consortium has withdrawn the bidding process to build new nuclear reactors in the UK.

A widely expected joint bid by French firm Areva and the China Guangdong Nuclear Power Group for the Horizon nuclear joint venture did not materialise by last Friday’s deadline.  

In a statement a spokesperson for Areva said:

“Areva and CGNPC have suspended their interest in the planned sale of Horizon and did not submit a bid.”

The company did not specify the reason for its withdrawal, but industry analysts said that it was most likely due a decision of China Guangdong Nuclear Power Group, who had been expected to supply most of the capital.  

The Chinese company’s executives are believed to be unhappy that they were unable to obtain certain guarantees about technological developments with the UK Government.  Out of all the possible bids for the Horizon project, Areva’s design for a new reactor, the European Pressurised Reactor (EPR), is closest to obtaining regulatory approval.

One of the two remaining bidders for the Horizon project is a consortium led by the US company Westinghouse, which is also largely backed by a Chinese company, China National Nuclear Power.  However China National Nuclear Power is understood to have recently withdrawn from the Westinghouse bid, leaving doubt as to the viability of the bid’s financial backing.

The Areva-Guangdong bid had been tipped by industry analysts as crucial to the UK Goverment’s hopes of attracting the inward investment necessary to secure the future of the nuclear industry.

The consortium’s decision not to invest in the UK nuclear industry is a major setback to the British government’s hopes of revitalising the UK’s ageing nuclear power capacity.  In order to ensure continuing production of nuclear energy, £110 billion is required by 2020 in order to replace atomic plants, upgrade grids and cut emissions and pollution. The UK is one of only three western European nations which is still pursuing new nuclear plants after the Fukushima disaster in Japan.  All of the UK’s existing plants are due to close by 2035.

It has also been reported that the Spanish energy company Iberdrola, owners of Scottish Power, is considering withdrawing from a bid to build a new nuclear facility near the existing Sellafield plant in Cumbria.  

In March E.on and RWE also announced that they were pulling out of nuclear power in the UK. Meanwhile, over the last year, a number of foreign governments – including Japan, Germany and Switzerland – have announced plans to phase out nuclear and invest in renewables.

SNP Westminster Energy and Climate Change spokesperson Mike Weir MP said:

“Despite the UK government bending over backwards to rig the market in favour of nuclear power, the decision by these companies to pull out demonstrates that nuclear power is simply not the answer to our energy needs.

“The UK Government’s energy policy is in tatters and they need to get their priorities right by following the example of the Scottish Government and reindustrialising with renewables.

“Right now Scotland is capitalising on our vast clean, green energy potential with new, high-skilled jobs being created, instead of following Labour and the Tories’ blind faith in costly, dirty, dangerous and unreliable nuclear power.

“The reality is that the UK Government is bogged down in nuclear planning issues and making no progress and creating no jobs, while the Scottish Government is getting on with the job of investing in the technologies of the future, and supporting thousands of energy jobs. That is already delivering for Scotland with £2.8bn of investment since the start of 2009 in Scotland and employs 11,000 people.

“Scotland is ahead of the game and ahead of our targets on renewables with 35% of our electricity coming from renewables in 2011 smashing the interim target of 35% and the latest DECC figures showing that Scotland is on course for another record breaking year in 2012.

“With a quarter of Europe’s wind energy potential, including massive off shore resources as well as onshore wind power capabilities, a quarter of Europe’s tidal resource, and huge potential from clean coal and carbon capture, these are the real economic and employment opportunities for Scotland.

“The view of the Scottish Government and indeed Scotland’s Parliament as a whole on nuclear is absolutely clear. Scotland simply doesn’t want or need dangerous and unnecessary new nuclear power stations, with soaring decommissioning costs and the unresolved problem of storage of radioactive waste that burdens future generations for thousands of years.”