Why is Britain going nuclear?

On Thursday morning, 15th September, the government of Mrs May announced that it would, after all, support the Hinkley Point nuclear plant, despite indications to the contrary when the project’s progress became the first potential casualty of her tenure.

UK Energy Policy - Hinkely Point

Most unions and manufacturers’ associations are happy with the decision since EDF have promised UK jobs and UK-sourced parts. Critics of the project have reiterated their concerns that the unproven reactor technology involved is behind schedule and massively over budget in France and Finland (the only two pilot plants in existence), and that the fixed purchase price guaranteed to the project, of £92.50/MWh (which, adjusted for inflation since 2012, already means about £97/MWh today) is more than twice the current UK wholesale energy price, and has the potential to burden hardworking families and businesses for several decades.

Is the new government pro-nuclear or merely honouring a commitment to France and China, both of which are important trading partners?

In his statement on Thursday morning, Greg Clark, Secretary of State for Business, Energy and Industrial Strategy, said:

“Britain needs to upgrade its supplies of energy, and we have always been clear that nuclear is an important part of ensuring our future low-carbon energy security.”

So nuclear is a part of the picture but not the whole picture.  Indeed, if the projections of the former government’s Department of Energy and Climate Change are retained [1], nuclear energy will account for about a third of the national energy mix by 2035 whereas renewable sources will provide closer to half.

Renewables already contribute 25% of the British energy mix and offshore wind is expected to make up 10% on its own within ten years (well before Hinkley Point even starts to generate energy) compared with the 7.5% anticipated input from the Hinkley Point plant when it is completed around 2030.  Last month, Mrs May’s government also gave the green light to the world’s largest offshore windfarm off the east coast of the UK, near Hornsea.

Perhaps the most significant technology to watch is solar photovoltaic electricity. From virtually a standing start five years ago, almost 10GWp has already been installed in the UK [2]. This has been spread over a range of different size systems from close to 750,000 small-scale domestic rooftops systems, through commercial-scale rooftop systems up to 8MWp in size, to large-scale solar farms – one of which ‘Swindon Solar Farm’, with enough generating capacity to power 15,400 homes, was purchased by Rockfire Capital just last week.

Rockfire’s CEO Liam Kavanagh commented:

“The UK needs reliable, secure electricity that will do as little damage as possible to the environment – and is cost effective.  Long-gone are the days that renewable energy was considered expensive; on the contrary, unlike nuclear energy which in over 60-years has failed to demonstrate significant cost reductions, the majority of renewable energy technologies have continued to demonstrate year-on-year cost reductions, alongside rapid technology improvements. With National Grid supporting new advances in energy storage and the development of additional cross-border interconnections, it’s clear that renewable energy can deliver home-grown, reliable, and low cost energy.  We believe that Solar in particular is one to watch, as innovative financing mechanisms can already deliver projects that don’t require subsidies – so for us, the logic is compelling.”

Perhaps then, the Hinkley Point go-ahead does owe more to international diplomacy, than a well thought through energy policy?

[1] Department of Energy and Climate Change.  Projected sources of energy generation in the UK.  November 2015

[2] Digest of UK Energy Statistics.