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UK guarantees £2bn nuclear plant deal as China investment announced | |
(35 minutes later) | |
China will invest in the Hinkley Point nuclear plant in Somerset, Chancellor George Osborne has announced, saying the UK will guarantee the £2bn deal. | China will invest in the Hinkley Point nuclear plant in Somerset, Chancellor George Osborne has announced, saying the UK will guarantee the £2bn deal. |
Mr Osborne, who is in China, said the deal would pave the way for a final investment decision on the delayed project by French energy company EDF. | |
He said it would also enable greater collaboration between Britain and China on the construction of nuclear plants. | |
EDF welcomed the news but did not say if it put the project back on track. | |
Earlier this month EDF admitted the Hinkley project, which was intended to allow the plant to generate power by 2023, would be delayed. | |
It came after the French firm announced in February that it had pushed back its decision on whether to invest in the plant. | |
The £24.5bn power station would be Britain's first new nuclear power plant for 20 years and is expected to provide power for about 60 years. | |
Mr Osborne said: "Britain was the home to the very first civil nuclear power stations in the world and I am determined that we now lead the way again. | Mr Osborne said: "Britain was the home to the very first civil nuclear power stations in the world and I am determined that we now lead the way again. |
"Nuclear power is cost-competitive with other low carbon technology and is a crucial part of our energy mix, along with new sources of power such as shale gas." | "Nuclear power is cost-competitive with other low carbon technology and is a crucial part of our energy mix, along with new sources of power such as shale gas." |
Mr Osborne said Chinese companies would receive a substantial stake in the project, with the UK government acting as guarantor for the investment. | |
The guarantee will be provided by the government's Infrastructure UK Scheme, which provides finance for projects that have had difficulties raising money from private investors. | The guarantee will be provided by the government's Infrastructure UK Scheme, which provides finance for projects that have had difficulties raising money from private investors. |
EDF has struggled to find co-investors for Hinkley, which the government has said will provide up to 7% of Britain's entire energy needs from 2023. | EDF has struggled to find co-investors for Hinkley, which the government has said will provide up to 7% of Britain's entire energy needs from 2023. |
EDF, which will continue to control the venture, has agreed to provide electricity from Hinkley at a guaranteed minimum price of £89.50 per MW/hour for 35 years. | EDF, which will continue to control the venture, has agreed to provide electricity from Hinkley at a guaranteed minimum price of £89.50 per MW/hour for 35 years. |
Energy Secretary Amber Rudd said the government would continue to work with EDF to finalise the Hinkley deal. | Energy Secretary Amber Rudd said the government would continue to work with EDF to finalise the Hinkley deal. |
Vincent de Rivaz, chief executive of EDF Energy, said the chancellor's announcement was "further progress towards a final investment decision" on the plant. | Vincent de Rivaz, chief executive of EDF Energy, said the chancellor's announcement was "further progress towards a final investment decision" on the plant. |
He said: "The Chancellor's approval of the infrastructure guarantee is a clear sign of the Government's commitment to Hinkley Point C. The government's determination to bring about a renewal of infrastructure and to attract inward investment to the UK are demonstrated by this good news. | |
But Greenpeace's chief scientist Dr Doug Parr said described the £2bn guarantee George Osborne as "signing up the country for the ultimate rip-off deal". | |
He added: "Instead of locking two generations of UK consumers into paying billions to foreign state-owned firms, Osborne should invest in the flexible, smart, and truly clean energy system that can power a 21st century Britain without leaving a pile of radioactive waste as legacy." |