Hinkley Point C is an expensive gamble—especially for the customersby Simon Taylor, Bronwen Maddox / April 21, 2016 / Leave a comment
Published in May 2016 issue of Prospect Magazine
Scroll to the bottom to read “Tomorrow’s problem, today”—a take on the issue by Bronwen Maddox, formerly Prospect’s Editor
British electricity customers will soon find out whether they will be saddled with paying for the world’s most expensive power station, Hinkley Point C. The first new nuclear station to be built in the UK for 21 years, Hinkley is the centrepiece of the government’s plan to cut carbon emissions and reduce British dependence on imported gas. In order to persuade French and Chinese investors to commit £18bn for this project the government, having repeatedly stated there would be no subsidy for nuclear energy, has promised that British electricity customers will pay for all the power the station produces at a price of £92.50/MWh (megawatt hour)—more than double the current market price of £35/MWh—for 35 years after the station is completed, and indexed to inflation (the price includes £2/MWh for decommissioning). On top of that, the government will guarantee (for a fee) that lenders to the project bear no risk. And it has undertaken that no future government can pass any law or policy that would hurt the investors, on pain of compensation.