Britain’s Nuclear Plans at a Critical Point

But little has gone according to plan so far in this ambitious project, already more than four years behind schedule. Although envisioned as a big bet on Britain’s clean-energy future, the project has been bogged down in months of dickering between the British government and EDF Energy, the French state-controlled power company that is supposed to oversee construction and eventually operate the two plants in question.

EDF Energy, which already runs most of Britain’s aging fleet of nine nuclear power plants, is threatening to walk away from the project unless the government promises to guarantee a price for the electricity that is roughly double the current rate. With tens of billions of pounds and thousands of jobs riding on the deal, the issue might ultimately be decided at the highest reaches of the British and, possibly, French governments.

“This isn’t a decision about the price for one power station,” said Dieter Helm, a professor of energy policy at the University of Oxford. “This is about whether we want a nuclear industry or don’t we. That is the question. Only the politicians can decide.”

EDF Energy executives declined to comment for this article.

Mark Malbas, a spokesman for Britain’s Department of Energy and Climate Change, which is leading the talks, declined to discuss the negotiations in detail, other than to say that they were continuing and that “we are focused on getting a fair deal for the consumer.”

Britain had been counting on nuclear energy as a big part of the effort to meet its commitment to cut greenhouse gas emissions in half by the mid-2020s. Originally, planners had called for five or so new nuclear plants to be up and running by 2025. But with even the first of those new plants not yet under construction, the risk is that as Britain closes down its older nuclear stations — which generate about 20 percent of the country’s electricity, at very low cost — there will not be new ones to replace them.

“It will be a big setback for British energy policy if these negotiations break down,” said Tim Yeo, a conservative who is chairman of the House of Commons Energy and Climate Change Committee.

Britain’s nuclear ambitions already received a big setback last year, when two big German utilities, RWE and E.On, decided not to proceed with construction of a plant that had been planned for Wales. The companies cited the costs and the uncertainties of getting a return on their investment.

The EDF plan calls for a plant with two nuclear reactors to be built on a headland called Hinkley Point overlooking the Severn Estuary in southwest England. Already, earthmovers in recent months have been carving away at a hillside there. If the green light is given, that soil will be trucked into the next valley as part of a gargantuan project that is expected to create 25,000 construction jobs.

The site — 175 hectares, or about 430 acres — is just south of a 1970s-vintage nuclear station known as Hinkley Point B, which is operated by EDF. And looming over the fields are the eerie-looking boxy shells of two even older, 1960s-era reactors that have been shut down for more than a decade but still employ a couple of hundred people in the decommissioning.

EDF executives say they have already spent £1 billion, or about $1.5 billion, getting to the “shovel-ready” point for the new plants. After years of study, Britain’s nuclear and environmental regulators have approved designs, and about 70 percent of the necessary contracts are already lined up and ready to be signed. If and when the new plant, Hinkley Point C, comes fully online, it will supply about 7 percent of Britain’s electricity. That would be enough power to meet the needs of five million homes, with the added benefit of no carbon emissions.

On Tuesday, Edward Davey, Britain’s energy and climate change minister, is expected to announce the final decision on whether Hinkley Point construction can begin. It would be a moot announcement, though, if EDF does not agree to proceed.

This article has been revised to reflect the following correction:

Correction: March 15, 2013

An earlier version of this article misstated the last name of an Investec analyst. He is Harold Hutchinson, not Hopkinson.

Article source: http://www.nytimes.com/2013/03/16/business/energy-environment/britains-nuclear-plans-at-a-critical-point.html?partner=rss&emc=rss