By Bob Duncan
The Westminster government’s plans for new nuclear power station developments were dealt a double blow yesterday after one of the key players pulled out of the marketplace and the bill for cleaning up the Sellafield site passed £67 Billion.
Power giant Centrica, which owns British Gas, has announced it is to withdraw from the UK’s nuclear development programme due to delays and escalating costs.
The company had been in line to take a twenty per cent stake in four new reactors to be developed in partnership with French state-owned utility company EDF Energy. The consortium had expected to build two new reactors at Hinkley point in Somerset and two more at Sizewell in Suffolk.
Two German utilities E.On and RWE had also been bidding to build new nuclear reactors in the UK, at Anglesey and Bristol, but pulled out last October following the nuclear disaster at the Fukushima plant in Japan.
A spokesman for Centrica told the BBC: “The project costs in new nuclear have increased and the construction timetable has extended”.
In a prepared statement, the company said:
“With pre-development expenditure on the project approaching the agreed £1bn cap, Centrica’s decision not to proceed follows a detailed appraisal of the project.”
Sam Laidlaw, the chief executive of Centrica, added in the same statement:
“Since our initial investment, the anticipated project costs in new nuclear have increased and the construction timetable has extended by a number of years.
“These factors, in particular the lengthening time frame for a return on the capital invested in a project of this scale, have led us to conclude that participation is not right for Centrica and our shareholders.”
He added later that the Fukushima disaster had had a “knock-on impact” on the schedule to build plants in the UK.
Meanwhile, a report by MPs has said that the ‘enormous legacy’ of nuclear waste at Sellafield has so far cost the taxpayer £67.5billion, with no sign of an end to the mammoth clean-up bill.
The public accounts committee’s report said deadlines for cleaning up Sellafield had been missed, while total lifetime costs for decommissioning the site continued to rise each year, having now reached £67.5bn.
The MPs also said that the Nuclear Decommissioning Authority (NDA), the authority dealing with the country’s nuclear legacy, had not been able to show what value it was giving the taxpayer.
MP for Barking Margaret Hodge, who chairs the committee, said a solution to the problem of long-term storage of nuclear waste was as far away as ever following last week’s decision by leaders of Cumbria county council not to carry on with a study for a possible site.
Ms Hodge said: “an enormous legacy of nuclear waste has been allowed to build up on the Sellafield site,” while successive governments have failed to resolve the ‘critical problem’.
The Barking MP added: “It is unclear how long it will take to deal with hazardous radioactive waste at Sellafield or how much it will cost the taxpayer. Of the 14 current major projects, 12 were behind schedule in the last year and five of those were over budget”.
Ms Hodge said taxpayers were not getting a good deal from the NDA’s arrangement with international consortium Nuclear Management Partners (NMP), aimed at improving Sellafield Limited’s management of the site.
Despite only two projects being on track, the consortium was rewarded with £54million in fees last year.
The UK government is hoping to use new nuclear power stations to meet its carbon reduction targets by re-classifying nuclear as a low-carbon source. Last month UK Ministers signed a memorandum of understanding with Irish Wind Generators to supply 3000MW of electricity via undersea cables, which is expected to contribute to 10% of the UK government’s carbon emission target.
The UK is struggling to meet its EU targets of 15% green energy by 2020, it faces legal action and fines from the European Commission if it fails. However, despite this there is strong opposition to wind generated power within the UK coalition cabinet.
According to independent think tank the IPPR, the results of a survey carried out last year show unequivocally that wind power can significantly reduce carbon emissions, is reliable, poses no threat to energy security, and is technically capable of providing a significant proportion of the UK’s electricity supply with minimal impact on the existing operation of the grid.
The current Scottish Government has set itself the task of supplying the equivalent of 100% of Scotland’s electricity needs from renewable sources by 2020, a goal which it is ahead of target to meet. It has said that it will not allow any new nuclear power stations to be built in Scotland, and that it will use planning legislation to enforce this policy.
Mike Weir MP, a member of the Westminster Energy Bill Committee, expressed his concern at the UK government’s continued obsession with new nuclear power stations.
Mr Weir MP said:
“Centrica’s withdrawal is further evidence that nuclear power is not the way forward. With the cost of cleaning up existing nuclear waste at Sellafield exceeding £67bn, it is time for Westminster to abandon its unsustainable obsession with new nuclear.
“New nuclear has no place in future energy policy. The Westminster system should concentrate on investment in new renewable technologies for a cleaner, greener energy future.
“The UK Government need to grasp this nettle and ensure the regime helps rather than hinders the development of new renewable energy.
“With a quarter of Europe’s wind energy potential, including massive offshore 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.
“With so much of Europe’s renewable energy potential, Scotland’s role as an energy exporter will boost our economy in the years and decades to come and with a Yes vote in next year’s referendum those resources can be fully put to work for people in Scotland.”