Government right to look at new reactors, but questions remain around funding and skills, committee warns

The UK is building two new nuclear plants at Hinkley Point C in Somerset. Courtesy EDF.

A government vision to increase the UK’s nuclear power is more of a “wish list” than a detailed strategy, according to a parliamentary report.

The Science, Innovation and Technology Committee said in a 110-page report published on Monday (31 July) that the government is right to look to nuclear power to meet the country’s future electricity needs and that this requires a substantial programme of nuclear new build.

But the committee warned that government hopes of building a new nuclear power plant every year lack the comprehensive detail and strategy needed to meet such ambitions – particularly those around funding and skills.

The committee said the government target of 24 GW of nuclear generating capacity by 2050 – up from around 5.8 GW today – and the aspiration to deploy a new plant every year are more of a “wish list” than the comprehensive detailed and specific strategy that is required to ensure such capacity is built.

‘Clearer Role Needed’ For GBN

The strategy should include a clearer role for the government body Great British Nuclear (GBN) beyond its task of selecting small, modular reactor developers and more clarity over the country’s future mix of generation including SMRs, large-scale plants and advanced reactors.

“The government’s stated aim of 24 GW of nuclear capacity is ambitious: it is almost double the highest installed nuclear capacity the UK has ever achieved,” the committee said.

“It could involve new gigawatt-scale nuclear power, small modular reactors and advanced modular reactors (AMRs), and further development of nuclear fusion. It would require substantial progress on technologies, financing, skills, regulation, decommissioning and waste management.”

There are also concerns over the government’s funding arrangements, with the committee pushing the government to clarify the projected costs for taxpayers before signing contracts for new gigawatt-scale nuclear plants.

The government is trying to attract private investors through a regulatory asset base (RAB) financing mechanism that shares the risk of construction costs with the public. However, the RAB model has considerable downside, leaving consumers unfairly exposed, the committee said.

“The consumer or taxpayer is taking an unknown and uncertain risk of cost overruns, yet disburses funds from day one without earning a return,” the committee said.

“The choice to proceed with gigawatt-scale nuclear power should not be made without robust estimates of its value for money, including the financial value of the construction risk being assumed by taxpayers or billpayers.”

Tim Stone, chair of the Nuclear Industry Association, told the committee that the use of the RAB model would make plans to build two new nuclear plants at Sizewell C around 30-33% cheaper than the cost of Hinkley Point C.

The government itself estimated that using a RAB rather than a contract for differences model for new nuclear power plants would save consumers between £30bn (€35bn, $38bn) and £80bn. However, there was some confusion on how these savings were calculated, the committee noted.

‘Strategic Plan Is Missing’

Committee chair Greg Clark, writing in the Financial Times, said much more than with other energy technologies, the scale, financial demands, workforce planning and — in the case of advanced nuclear technologies — research and development needed for new nuclear requires a dependable strategic plan if hopes are to have any chance of being turned into reality.

“Witness after witness who appeared before our inquiry told us that such a strategic plan for nuclear is missing,” Clark wrote. “For example, there is no indication from the government on what proportion of the 24 GW is intended to be met by gigawatt-scale plants like Hinkley Point C, or smaller, more distributed nuclear reactors such as small modular reactors.

“The government’s stated aim to deploy a nuclear reactor a year is not grounded in any explanatory detail.

“The role of the new organisation, Great British Nuclear, is obscure beyond running a competition between potential developers of small modular reactors.”

The report said there will also need to be a more than doubling of the current nuclear workforce from 65,000 to as many as 215,000 people.

On decommissioning, it said a clear understanding is needed of the waste consequences of new nuclear technologies, how it will be dealt with, and at what costs.

The government recently confirmed plans to provide £170m funding to support the construction of the Sizewell C nuclear power station in Suffolk, southeast England.

Two nuclear plants are also under construction at Hinkley Point C in Somerset, southwest England.

Date: Tuesday, 01 August 2023
Original article: