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Wylfa nuclear power project may require an embarrassing state-aid plea to the EU Commission.

Dave Toke’s Blog 14th Nov 2018 , Clark’s plan to underwrite losses on Wylfa nuclear project will likely lead
to an embarrassing state-aid plea to the EU Commission.

Now that it seems, short of an extended ‘no-deal’ Brexit scenario, the UK will remain within
EU state-aid rules for a long time to come, Greg Clark will have to oversee
an embarrassing state aid case in support of his proposals to underwrite
the (almost certain) losses from building the Hitachi-led Wylfa nuclear
power plant.

I have already discussed how the taxpayer (and/or electricity
consumer) is exposed to almost certain multi-billion losses as a result of
the plan that Clark is touting here and in Japan. The last time that the UK
applied for what amounted to an exemption from EU state aid rules for
nuclear power was in late 2013 when Ed Davey led the plea for the Hinkley C
deal. The state aid was granted in October 2014 after the Commission ruled
that the Hinkley C deal was a reasonable way to avoid ‘market failure’.

Any application for state aid for Wylfa would be a tougher challenge. Indeed
the very proposal whereby the state will take at least a half equity share
in the project and take responsibility for cost overruns is an action that
in itself creates market failure if curbing carbon emissions is the
objective!

The Government’s cover story in 2013 was that support for
Hinkley C was on the same level available for renewable energy since
renewable energy schemes were also being offered CfDs (as well as very
extensive loan guarantees that most renewable energy schemes could not get
from the Government of course). The European Commission seemed to buy into
this line stating ‘The aid would not have a negative impact on other
low-carbon sources, given that they are also supported by the UK, and there
is no discrimination against renewable technologies’
https://realfeed-intariffs.blogspot.com/2018/11/clarks-plan-to-underwrite-losses-on.html

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November 17, 2018 - Posted by | politics international, UK

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