The EDF built plant will be the first new nuclear reactor built in the United Kingdom for 20 years, and will help plug the energy gap as the government plans to close all coal-fired stations by 2025 and retire the majority of its nuclear ones.
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Under the deal, EDF won’t be able to sell its controlling stake in the project before completion without British approval.
It finally gave the green light on Thursday, but added provisos to ensure it can intervene to stop any sale of the Hinkley stake held by French power group EDF, and to wield more control over future nuclear projects. The government will also take a special or “golden share” in all future new nuclear projects.
“However, ministers will impose a new legal framework for future foreign investment in Britain’s critical infrastructure, which will include nuclear energy and apply after Hinkley”. EDF will assume most of the up-front costs for the reactor, which are estimated to amount to 18 billion pounds (21 billion euros, $24 billion).
A government spokesman said, “Following a comprehensive review of the Hinkley Point C project and a revised agreement with EDF, the government has made a decision to proceed with the first new nuclear power station for a generation”.
The power station will create 25,000 jobs, hundreds of apprenticeships and deliver 7% of the UK’s electricity in 2025.
The government also confirmed today that EDF will get a guaranteed £92.50 per megawatt-hour of electricity for 35 years-way above the current wholesale cost of electricity in the UK.
The Government said: “Following a comprehensive review of the Hinkley Point C project, and a revised agreement with EDF, the Government has chose to proceed with the first new nuclear power station for a generation. This will ensure that significant stakes can not be sold without the government’s knowledge or consent”.
With May’s go ahead of the project means Hinkley will be the first new nuclear reactor built in Britain in two decades.
In a statement, Ms May’s government said it had chose to proceed with the project in central England after a comprehensive review, but was clear Britain would have greater control over future deals when foreign states were involved in buying stakes in “critical infrastructure”.
Moreover, a number of politicians, including Theresa May’s joint chief of staff Nick Timothy, voiced concern about the security aspects of China’s involvement in the project.
“These changes mean that while the United Kingdom will remain one of the most open economies in the world, the public can be confident that foreign direct investment works always in the public interest”, he said.
While EDF is the majority stakeholder of the Hinkley Point project, and a subsequent Sizewell reactor, the final project at Bradwell would be led by the Chinese state-owned energy company CGN. Shadow energy minister, Barry Gardiner said it was “too high a price” and it should have been renegotiated.
“Investors are hungry for further signs from the government that the United Kingdom is open for business. If new nuclear is to continue to play a major role we must see significant reductions in strike prices for future projects”.
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The delay threw into doubt the “golden era” of ties proclaimed by Chinese President Xi Jinping during a visit to Britain past year.
