Britain 'extremely close' to nuclear plant deal with EDF

LONDON Sun Oct 13, 2013 7:55pm BST

Britain's Secretary of State for Energy and Climate Change Ed Davey speaks during the Liberal Democrats annual conference in Brighton, southern England September 23, 2012. REUTERS/Luke MacGregor

Britain's Secretary of State for Energy and Climate Change Ed Davey speaks during the Liberal Democrats annual conference in Brighton, southern England September 23, 2012.

Credit: Reuters/Luke MacGregor

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LONDON (Reuters) - Britain is "extremely close" to sealing a deal with France's EDF Energy to build the country's first new nuclear power station since 1995, Energy Minister Ed Davey said on Sunday, adding there was also Chinese involvement in the talks.

In an interview with BBC TV, Davey said he expected "tens of billions of pounds" of foreign investment to flow into Britain's nuclear energy sector in the coming years from China, Japan, South Korea and France.

"We're extremely close for a deal with EDF and if and when we get that deal I'll announce it to parliament and I think I'll be able to show that it's extremely good value for money for consumers," said Davey.

The British government and EDF have long been in talks over financial terms to build a new nuclear plant at Hinkley Point in Somerset in southwest England. A Chinese company is also expected to take part in the project.

Britain's energy policy has become a hot political issue in recent months with the two-party coalition government under fire from the opposition Labour Party, which says the government is not doing enough to stop energy companies hiking prices.

Prime Minister David Cameron has hit back, saying his Conservative-led government's plan is to diversify the energy sector as far as possible to maximise competition. He is likely to hold up a new nuclear deal as proof he is keeping his word.

Davey, who said he wanted to ensure that the cost of disposing of any nuclear waste and the cost of decommissioning was included in any deal price, said he'd also been leading negotiations with unnamed Chinese companies.

Negotiations between Britain and EDF have focused on trying to fix a minimum electricity price for power generated at the proposed plant as part of a new policy package that aims to reward forms of energy produced with low carbon emissions.

Foreign investment into the nuclear sector would not be limited to France, said Davey.

"It's really possible that we'll see massive Chinese investment not just in nuclear but across the board," he said. "And I think we'll see massive Japanese investment and Korean investment."

Foreign companies would be subject to stringent British nuclear safety rules, he added, saying "hundreds of billions of pounds" worth of investment was in the pipeline for Britain's energy sector overall.

The Financial Times reported on Saturday that Chancellor George Osborne would sign a deal in China this week allowing a Chinese state-run nuclear power company to help build a new plant in Britain.

The paper, citing unnamed sources, said Osborne would sign a memorandum of understanding to back the Chinese General Nuclear Power Group (CGNPG) entering a deal with EDF for the planned Hinkley Point plant.

(Reporting by Andrew Osborn; Editing by Andrew Roche)

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Comments (3)
Raymond.Vermont wrote:
So panic has essentially driven the process forwards…

13 yrs of strategic (lack of) planning by Labour.

Oct 13, 2013 11:38pm BST  --  Report as abuse
ritchard wrote:
When the conservative government announces ” extremely good value for money for consumers ” you can be sure the consumer will have to pay an arm and a leg down the road. Isn’t it a sad day that the British don’t have the ability and drive to keep strategic infrastructure British?

Oct 13, 2013 2:44am BST  --  Report as abuse
AlisdairWilkes wrote:
The lack of planning goes back beyond 13 years but it became acute in about 2003.

This is probably the least worst option available politically right now. If we had have had a competant government 10 years ago this would be well along the pipeline by now.

Lots of politicians have noticed we have a dysfunctional energy market in the UK but none of them seem be clear on why. It has become dysfunctional because of poor intervention to direct investment by politicians and consequent lack of stable supply.

I am not a statist but the best option would be for the UK gov’t to fund the construction of up to 6 reactors over 18 years. We would then have a clear plan for ensuring base-load power for the next 50 years.

Markets would not mind funding that kind of infrastructure investment either because it has a direct benefit to the prosperity and wealth creative capacity of the economy -rather better than borrowing to fund large numbers of people not to work.

The sad thing about the situation is Red-Ed will never say to those turkeys at his party conference that the market is screwed because everyone in that room voted for it.

Oct 14, 2013 3:58pm BST  --  Report as abuse
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