Is Confidence Ebbing Away for EDF’s Hinkley Point Power Station?

You would have been forgiven for thinking that the Hinkley Point nuclear power station was a done deal and that all we had to do was wait for it to be built and put into service. Unfortunately, recent news has suggested, as many predicted, that things are not as solid as they might have at first seemed.

The plant, if built, would produce up to 7% of the electricity needs for Britain and is one of the mainstays of the Government’s energy plan, particularly since it decided to reduce support for renewable energy following their election win last May. But EDF have yet to make a final decision on the plant and were indeed called to Parliament recently to explain why things were being delayed yet again.

There is a current of mistrust of the company with the belief that EDF has financial problems that could stop them investing entirely. As it was, the final decision on whether to invest or not has been put off until the end of the summer which is naturally making some in the Department of Energy and Climate Change nervous, not to mention Chancellor George Osborne who championed the project last year.

The new scheduled completion in 2025 is already 8 years behind the original estimate and a further delay could push us closer to 2030. Not only that, there are also rumblings over the cost of the plant and EDF’s own financial commitments, particularly bearing in mind that it is largely owned by the French state. With the large subsidy offered for the project (£92.50 per MWh) and the fact that we will be tied into it for the next 35 years, Hinkley Point could end up being a huge millstone around the neck of this and future governments.

Organisations such as Greenpeace have already expressed concerns about the financial condition of EDF. There are also plenty of issues surrounding the technology that the company is expected to use in the plant, especially following a number of problems in a similar reactor being built in Normandy.

Added to the delays and problems with EDF, the other major investor in the Hinkley Point project, China’s CGN, has suggested that it won’t go forward if the French company withdraws. While there was an initial thought that the Chinese company could actually take over the development, this was quickly refuted.

Despite this, the Government still say they are committed to the project, something which others find symptomatic of their muddled thinking on the future of energy in the UK. According to The Economist recently:

“Carbon targets are also complicating life for policymakers. One reason the Tory government remains committed to Hinkley Point is to avoid missing its 2030 emissions-reduction goals.”

The future for both EDF and the Hinkley Point nuclear reactor are far from certain. The only sure thing is that the longer delays go on and the potential cost rises, the more naysayers are going to come out of the woodwork. Even when it was announced there was a good deal of condemnation of the project and how much it was going to cost. For many, recent events have simply reinforced the notion that this was a policy that was destined to fail from the outset.

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