nuclear-news

Moorside project collapses, but UK’s Conservative government is Socialist when it comes to nuclear power projects

Another Nuclear Megaproject Bites The Dust, Oil Price, By Leonard Hyman & William Tilles – Nov 19, 2018,Toshiba, the troubled Japanese electrical and electronics conglomerate and former owner of the bankrupt Westinghouse, Corp., decided last week cancel its Moorside nuclear project in the UK. If completed, this large nuclear power station would have provided about 7 percent of the UK’s electricity needs. Not that this announcement was a surprise.

Toshiba’s announcement follows word of a breakdown in negotiations with prospective buyer, Korea Electric Power (KEPCo). It appears the Koreans, like others, are rethinking their commitment to nuclear energy worldwide.

Absent the cancellation decision, Toshiba is likely to have had trouble financing a project of this magnitude especially given the stress on its finances from its troubled venture into American nuclear construction. The Moorside project in Cumbria will have cost Toshiba over £400 million and management announced it was taking a write off of £125 million. Toshiba described its decision as “economically rational.” Amen to that.

A government spokesperson commented, “All proposed nuclear projects in the UK are led by private sector developers and … this is entirely a commercial decision for Toshiba.” This is an interesting statement. The only UK nuclear construction project currently underway is owned by French and Chinese state controlled entities, financed  with liberal debt guarantees provided by the UK government.

But let’s review the UK’s nuclear energy plans. There were at a minimum three large facilities planned. One for Cumbria, the Toshiba NuGen entity, is now cancelled. The Hinkley Point C units, being built by a French and Chinese consortium, are under construction and slated for commercial service in 2025-27. Lastly, Hitachi had a planned nuclear site in Wylfa.

Given the turmoil surrounding new nuclear construction, we have our doubts about the financial viability of Wylfa. This plant would cost at least 20 billion pounds ($26 billion). Press reports indicate government support would be necessary for close to two thirds of that amount. To further encourage developers, a government minister said in June that the government might directly invest 5 billion pounds into the project for a one third ownership share.

A little over three decades ago, Prime Minister Margaret Thatcher wanted her government to end state ownership of power producers. And she privatized the UK’s electricity industry. Her successors, who still call themselves Conservatives, seem to have reversed course. https://oilprice.com/Alternative-Energy/Nuclear-Power/Another-Nuclear-Megaproject-Bites-The-Dust.html

November 19, 2018 - Posted by Christina Macpherson | politics, UK