Government Support to Proposed UK Nuclear Power Station Carries Big Risks to the British Public
A review of subsidies offered to a proposed nuclear power station, Hinkley Point C, finds the British public on the verge of paying billions of pounds to support the project—and potentially much more if it fails to deliver.
GENEVA—March 9, 2016—A review of subsidies offered to a proposed nuclear power station, Hinkley Point C, finds the British public on the verge of paying billions of pounds to support the project—and potentially much more if it fails to deliver.
The findings come on the back of the resignation of Thomas Piquemal, Electricity De France’s finance director, over concerns that the project could threaten the energy firm’s financial stability.
“Hinkley Point C is a risky project for EDF, but even more risky and expensive for Britain,” said Richard Bridle, a researcher at the International Institute for Sustainable Development, and the author of the study.
The most costly subsidy is a guaranteed price for the electricity generated by Hinkley Point C. Under current proposals, the UK Government has agreed to pay nearly double the current market price for electricity for 35 years.
The UK Government has also proposed the extension of GBP 17 billion worth of loan guarantees to the project. In the event of the project failing, due to overruns or technical problems, the government could therefore be liable for the bulk of the project’s debts. EDF’s apparent concern with the economics of the project indicate that this is a real possibility.
“Every pound invested in Hinkley Point C means less to invest in other technologies, particularly for renewable energy, which are much less risky and can be financed without so many open-ended commitments,” said Mr. Bridle.
Read the story here:
Read the full report here:
;About IISD
The International Institute for Sustainable Development (IISD) is a globally recognized think tank with 3 decades of experience working to solve the world’s most pressing sustainable development challenges. We combine deep expertise in a wide range of issues with a collaborative approach to research, policy advice, and hands-on support to ensure these solutions are brought to life. Headquartered in Winnipeg, Manitoba, we are a diverse team of over 300 professionals working from offices in Canada, Switzerland, and other locations around the world.
You might also be interested in
The Strait of Hormuz Crisis Emphasizes Why Canada Should Move Away From Oil and Gas—Not Expand It
The closure of the Strait of Hormuz cut off roughly 25% of the world’s seaborne oil and 20% of LNG trade. In response, many countries are diversifying supply chains and increasingly ramping up domestic renewable capacity to improve energy security. Meanwhile, the Government of Canada has taken steps to expand oil and gas production.
Managing Energy Price Crises
This report outlines a strategic decision framework policy-makers can use when responding to fossil fuel price shocks.
Removing a Fossil Fuel Subsidy Is a Means, Not an End—The transition is the point
COFFIS is an international coalition working to phase out fossil fuel subsidies. Kim Solberg, part of the team that founded COFFIS, sits down to explain what made it possible—and why, in her view, a subsidy can only be removed as part of the wider transition it's meant to serve.
IISD Submission to the Belém Mission to 1.5
This submission is made in response to the invitation from the United Nations Climate Change Conference (COP) 29, COP 30, and COP 31 Presidencies on the Belém Mission to 1.5.