The Nuclear Free Local Authorities (NFLA) reads with interest today’s ‘BBC News’ story that the Nuclear Industry Association (NIA) has sent a ‘confidential’ letter to the UK Government arguing that 2050 zero carbon targets will not be met unless it finds a way to finance nuclear power stations. (1)
The BBC article suggests the NIA letter is prompted by fears that the Government will use next week’s Budget to abandon a plan to pay for new nuclear plants through a levy on energy bills. The BBC claim such a scheme would add an estimated £6 a year per person to energy bills.
If this article is correct, the NFLA would welcome such a decision from the UK Government. NFLA urges them to stand firm and resist the arguments of the NIA letter as it is clear the renewable energy industry, in the areas of energy generation, heating and transport, coupled with an enhanced partnership between local and central government; can deliver a zero carbon future, and probably earlier than 2050.
It is rare to hear about the machinations between the nuclear industry and the government, where there has been a strong bond over many decades. In the letter, the NIA claim: “There is an urgent need for a new, robust financing mechanism which ensures investor confidence, reduces the cost of capital, and provides very significant value to the consumer.”
The BBC notes that the NIA argue the UK cannot rely on “weather-dependent” renewable energy, nor “breakthrough” technologies to emerge. The NIA also finds fault with the National Infrastructure Commission’s conclusions on nuclear power, saying they do not properly take into account the government’s climate-change commitments. The commission has previously said the UK will need just one more new nuclear plant the size of the one under construction at Hinkley Point.
The letter clearly shows a high level of alarm exists in a weakened nuclear industry which has seen the collapse of the Sellafield Moorside and Wylfa developments in recent times, due to a lack of finance.
The NFLA shares the apparent emerging view of HM Treasury that new nuclear power is simply far too expensive in comparison with renewable energy, and it welcomes the decision made by the UK Government earlier this week to encourage the resumption of building onshore wind turbines.
In its original response to the government’s consultation on the proposed ‘Revenue Asset Base’ (RAB) model to fund new nuclear reactors, NFLA said:
- Consumers may end up paying for nuclear projects which are not completed;
- The financial risk is shifted to consumers, including those who don’t use nuclear electricity – particularly Scottish and Northern Irish consumers where new nuclear reactors are not being planned for;
- It will be difficult to define a credible cost overrun threshold when already two EPR projects in Finland and France have tripled in cost, and still have not been delivered years after they were planned;
- Private finance may still not be forthcoming despite all the effort being put into this funding model;
- There is limited experience of using the RAB model for anything as complex and risky as nuclear;
- The project developer will hold all the information, so the proposed Regulator will only be able to make token adjustments to projected costings;
- Setting up a new regulatory regime will mean the time it takes to provide any carbon savings will be far too long, at a time of real concern with responding urgently to the ‘climate emergency’;
- The Revenue Stream will include a variable strike price – consumers could be effectively forced to write a ‘blank cheque’ to the nuclear industry. (2)
The argument made over intermittency, so often made by those who oppose renewable energy, is also tired and out-dated. NFLA point out to abundant and growing evidence that renewable energy can provide 100% reliable energy across the world, certainly by 2050 and likely earlier. Indeed, a recent report from Stanford University highlights 47 peer-reviewed published journal articles from 13 independent research groups with 91 different authors supporting the result that energy for electricity, transportation, building heating/cooling, and/or industry can be supplied reliably with 100% or near-100% renewable energy at different locations worldwide by 2050. (3)
NFLA Chair, Councillor David Blackburn said:
“The NFLA calls on the UK Government to hold its nerve and reject using the Revenue Asset Base model for funding new nuclear reactors. Given the collapse of the Sellafield Moorside and Wylfa projects, the financial and technical problems besetting EDF in building Hinkley Point C and the clear evidence that renewable energy is becoming an ever cheaper technology, it is time now to reboot energy policy behind decentralised and renewable energy schemes. Over 280 Councils have now declared a climate emergency and are working hard at delivering innovative low carbon solutions. With a dynamic partnership between central government, local authorities and the renewable energy industry this new energy revolution can deliver the zero carbon policies the UK and the world needs. The nuclear industry should instead refocus itself to deal with the huge challenge of decommissioning reactors and finding safe solutions to radioactive waste management. Now is the era of renewables.”
Ends – for more information please contact Sean Morris, NFLA Secretary, on 00 44 (0)161 234 3244.
Notes for Editors:
(1) BBC News, 5th March 2020
(2) NFLA New Nuclear Monitor 58, September 2019
(3) Stanford University, ‘A Techno-economic study of an entirely renewable energy based power supply’, December 2019