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UK Consumers could pay for new nuclear power plants years before they are built.

Unearthed 6th Aug 2018 , Consumers could pay for new nuclear power plants years before they are
built. The government is considering using a controversial financing system
to build new nuclear power stations which would see customers charged for
construction costs long before a project has actually been built.

The approach, called the Regulated Asset Base (RAB) model, has been described
as an “open cheque book” for developers, as consumers could be locked
into paying the costs of a project going wrong – like construction taking
longer than planned, or prices spiraling – indefinitely until it’s
complete.

Shadow energy minister Alan Whitehead MP said: “The problem
with this model as applied to new nuclear power stations is that it
transfers all the risk of construction from the developer to the customers,
with the rather wobbly promise of benefits to come in the future.

” Like other public-private finance models, the RAB model has a sticky history.
The government has already supported the use of RAB for the Thames Tideway
Tunnel, a £4.2bn project to revamp 15 miles of sewer lines in North
London, which Thames Water says a RAB model has helped lower costs. Much of
the work around taking a RAB approach to financing nuclear power has been
carried out by Dieter Helm, professor of Energy Policy at the University of
Oxford and a figure respected by government.

Writing in a blog about the
model’s application to nuclear last month, Helm highlighted a number of
open issues – such as which regulator would set the RAB for nuclear
projects, as well as the “very severe lobbying pressures” any regulator
would come under when making its RAB evaluations. Helm concludes that the
RAB may be an efficient approach to financing nuclear power, but still
doesn’t address fundamental issues about its cost competitiveness with
other technology like wind and solar, or what do with all its radioactive
waste. “It is for society to decide whether it wants new nuclear or
not,” he said. “The market cannot decide.”

https://unearthed.greenpeace.org/2018/08/06/new-nuclear-plants-funding-regulated-asset-base/

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August 8, 2018 - Posted by | politics, UK

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