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Toshiba to pull out of UK nuclear power project Toshiba to pull out of UK nuclear power project
(35 minutes later)
Toshiba is to wind up its nuclear arm, which was leading a project to build a new power station in the UK. Plans for a new nuclear power station in Cumbria have been scrapped after the Japanese conglomerate Toshiba announced it was winding up the UK unit behind the project.
The decision by the Japanese firm’s board is a huge blow to plans for a nuclear plant at Moorside in Cumbria. Toshiba said it would take a 18.8bn Japanese yen (£125m) hit from closing its NuGeneration subsidiary, which had already been cut to a skeleton staff, after it failed to find a buyer for the scheme.
Unions criticised the government for not intervening to ensure the project went ahead. The decision represents a major blow to the government’s ambitions for new nuclear and leaves a huge hole in energy policy. The plant would have provided around 7% of UK electricity.
Toshiba said its NuGen business would start being wound up in the new year. In a statement from Tokyo, it said: “After considering the additional costs entailed in continuing to operate NuGen, Toshiba recognises that the economically rational decision is to withdraw from the UK nuclear power plant construction project, and has resolved to take steps to wind up NuGen.” “This is a huge disappointment and a crushing blow to hopes of a revival of the UK nuclear energy industry,” said Tim Yeo, the chair of pro-nuclear lobby group New Nuclear Watch Institute and a former Tory MP.
NuGen said the announcement came after 18 months of negotiations with a range of potential new owners. “Unfortunately, it has not been possible to successfully conclude those negotiations. NuGen has retained a team to support the implementation of a winding-up process and will work with Toshiba and its other stakeholders,” it said. Greenpeace UK executive director John Sauven said: “The end of the Moorside plan represents a failure of the government’s nuclear gamble.”
“While NuGen will not be taking the project forward, the Moorside site in Cumbria remains a site designated by government for nuclear new-build, and it is now for the Nuclear Decommissioning Authority, as the owner of the site, and the government to determine its future.” After a board meeting of Toshiba on Thursday, the company said that it was winding up NuGeneration because of its inability to find a buyer and the ongoing costs it was incurring. The firm has already spent more than £400m on the project.
Justin Bowden, a national officer of the GMB union, said: “The British government has blood on its hands as the final sad but predictable nail is banged into the coffin of Toshiba’s jinxed jaunt into nuclear power. “Toshiba recognises that the economically rational decision is to withdraw from the UK nuclear power plant construction project, and has resolved to take steps to wind-up NuGen,” the firm said in a statement.
“Relying in this way on foreign companies for our country’s essential energy needs was always irresponsible. Add to that the multiple opportunities to step in and take control, that were missed or ignored. The plant first ran into trouble when Toshiba’s US nuclear unit, Westinghouse, was declared bankrupt last year, leading it to search for a buyer to take the scheme. Toshiba also said it would no longer take forward new nuclear projects overseas.
“In the wreckage that passes for a joined-up UK energy policy, the question now is whether government has finally learned the mistakes of Moorside. A new nuclear power station in west Cumbria remains vital for the UK’s future energy security and requires urgent action. South Korean energy firm Kepco initially appeared to ride to the rescue, but despite talks with the UK government it later rowed back due to a change of leadership at Kepco and new approach to financing nuclear power in the UK.
“The Nuclear Decommissioning Authority must be immediately given a role for nuclear development and tasked with developing a small modular nuclear reactor on site, tapping into the wealth of nuclear experience and expertise in the area and ensuring we have security of supply in years to come.” Some industry watchers said the collapse of the scheme should be seen as an opportunity rather than a risk, for the UK to prioritise renewables instead.
Jonathan Marshall, an analyst at the ECIU thinktank, said: “Shifting away from expensive, complicated technology towards cheaper and easier to build renewables gives the UK the opportunity to build an electricity system that will keep bills for homes and businesses down for years to come.”
The government’s infrastructure advisers recently urged ministers to rethink their nuclear plans and focus on renewables instead.
But unions decried the axing of the plant and accused the government of not doing enough to help it succeed.
Justin Bowden, the GMB national secretary, said: “The British government has blood on its hands as the final sad but predictable nail is banged into the coffin of Toshiba’s jinxed jaunt into nuclear power.”
Labour said the pullout was a result of government indecision and a refusal to step in.
The only new nuclear power station to get the go-ahead so far is EDF Energy’s Hinkley Point C in Somerset, which started construction in 2016 and is expected to be operational between 2025 and 2027. As well as EDF, Chinese and Japanese firms hope to build further nuclear plants in the UK.
Once NuGeneration is wound up at the end of January, the Moorside site in Cumbria will be handed back to government body the Nuclear Decommissioning Authority.
The Department for Business, Energy and Industrial Strategy said: “We understand that Toshiba have faced a difficult decision in ending their involvement in new nuclear projects outside of Japan in light of their well-known financial challenges.“All proposed new nuclear projects in the UK are led by private sector developers and while the Government has engaged regularly with the companies involved, this is entirely a commercial decision for Toshiba.”
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