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Nuclear financial meltdown in Britain – Moorside in doubt

Blunders, catastrophic, delays, even bankruptcy… ANOTHER nuclear power plant is going into financial meltdown http://www.thisismoney.co.uk/money/article-5223475/ANOTHER-nuclear-power-plant-enerting-financial-meltdown.html  Neil Craven for The Mail on Sunday, 1 January 2018 The company behind one of Britain’s biggest nuclear power projects has plunged to a £266 million loss citing ‘uncertainties’ over its future and the viability of crucial technology.

Japanese firm Toshiba said the huge loss incurred by one of its UK subsidiaries was due to writing off hundreds of millions of pounds of investment in the proposed Moorside plant, in west Cumbria.

It is the latest sign of financial strain at the Tokyo-based firm amid wider concerns over the spiralling costs and catastrophic delays that have beset the UK’s nuclear industry.

Britons were last week supposed to be cooking their turkeys with power from EDF’s nuclear plant at Hinkley Point in Somerset, which is now not expected to be in use for another decade. ‘EDF will turn on its first nuclear plant in Britain before Christmas 2017,’ said Vincent de Rivaz in 2007, who stepped down as group chief executive in November. ‘It is the moment of the power crunch. Without it, the lights will go out.’

It was envisaged that new nuclear plants at Moorside, Hinkley Point and Wylfa in Anglesey would between them generate a fifth of the UK’s electricity.

This may still happen. But right now, nuclear firms are struggling with the expense, stringent regulatory hurdles and costly project delays – just as the cost of other forms of electricity fall. Toshiba won the contract to build the nuclear power plant at Moorside, on land next to the Sellafield nuclear fuel reprocessing site.

But it was forced in March to place its US nuclear division Westinghouse into bankruptcy protection. Last month, it said it would sell Westinghouse for £4 billion. Troubled Toshiba is now in talks to sell its interests in the Moorside project to Kepco, majority-owned by the South Korean government.

Toshiba has two UK subsidiaries: Advance Energy UK, which incurred the £266 million loss; and NuGeneration, which is directly responsible for running Moorside.

With a cloud of uncertainty over the project, the Japanese firm has admitted in reports issued by its UK subsidiaries: ‘The directors do not know whether a sale of the shares of [NuGeneration] will be completed nor how any successful bidder will frame the deal.’

Kepco said it hoped to complete a deal to take over the running of the project early next year.

Uncertainties are understood to include the use of Westinghouse’s AP1000 reactor. Approval for use at Moorside was first sought from UK regulators in 2011. It was granted approval by the Office for Nuclear Regulation in March – just days after Westinghouse entered bankruptcy protection.

Should Kepco decide to ditch the design and use its own, the project would likely be delayed for years until a new design is approved. Some estimates say that could put any launch back from 2025 to the late 2020s at the very earliest. ‘The whole thing is a mess,’ said Martin Forwood of campaign group Core, which opposes the Moorside development.

‘Kepco would almost certainly push to use its own reactors so the big question is whether they would have to start afresh on consultation.

‘A lot of people around Moorside believe it will never take off.’

Forwood said the costs of other forms of renewable energy are falling and energy storage systems are being developed. ‘The longer these plans get delayed the less nuclear is needed,’ he added.

And, according to Forwood, the firms involved in the projects at Moorside and Wylfa ‘are not going to get anywhere near what the Government signed up for at Hinkley’.

The House of Commons Public Accounts Select Committee last month said there had been ‘grave strategic errors’ awarding French government-backed EDF the Hinkley Point contract.

It said ‘the economics of nuclear power in the UK have deteriorated’ and a ‘blinkered determination’ to agree the 35-year Hinkley deal, ‘regardless of changing circumstances’ had lumbered consumers with £30 billion payments over market rates for electricity.

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January 1, 2018 - Posted by | business and costs, politics international, UK

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