UK customers to pay in advance for Hinkley nuclear power, AND cop the financial risk?
EDF’s EDF seeks to charge customers upfront for UK nuclear plants, Ft.com , 23 Nov 18, Financing scheme modelled on London’s ‘super sewer’ aims to cut cost of power from reactors Jonathan Ford in London NOVEMBER 22, 2018 EDF is pushing a plan to finance nuclear investment in Britain that it claims would cut the cost of power from new reactors to levels competitive with gas and renewable energy. The French state-backed power utility wants to use a technique commonly used in utilities such as water, airports and power distribution. This allows companies to charge customers upfront for new infrastructure. It is being used in the £4.2bn project to build a “super sewer” under London’s river Thames. But the mechanism has never been tried for a project as technically complicated and lengthy as a nuclear power station, which can take a decade to build. This and other challenges mean any gains are not assured.
Why nuclear revival is struggling to take hold EDF’s proposal comes at a time when Britain’s much touted nuclear renaissance is in danger of shorting out. The first deal — which will see the French group and its Chinese partners build a £20bn station at Hinkley Point in Somerset — was struck in 2016 at a guaranteed strike price of £92.50 per megawatt hour (MWh) in 2012 prices, indexed for 35 years and worth about £105 in current terms. Heavily criticised for being excessive, it was at least similar in headline terms to the prices required for renewables, nuclear’s main zero carbon competitor. However, renewable costs have since fallen sharply, with some deals for offshore wind farms being signed for as little as £55-60 per MWh with 15 year contracts. ……….
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