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UK’s energy security strategy delayed, as Cabinet split on nuclear power, and the Regulated Asset Base plan to pay for it.

Disagreements between Boris Johnson and Rishi Sunak over the cost of
investment in new nuclear power stations have forced the government to
again delay its energy security strategy. The prime minister promised to
publish the strategy this month after Russia invaded Ukraine. Its
publication has been repeatedly put back amid cabinet disagreements over
fracking, onshore wind and the extent of government support for energy
efficiency projects.

Senior sources told The Times that while most issues
had been settled, disagreements between No 10 and the Treasury over the
extent to which new nuclear power should feature in the plan caused the
latest delay. Last week Johnson told nuclear industry bosses that the
government wanted the UK to get 25 per cent of its electricity from nuclear
power, requiring up to six new large-scale stations.

Sunak is understood to
be concerned at the cost of such a commitment, arguing it represents poor
value and would lead to substantial long-term increases in energy bills. He
is thought to be pushing Johnson to limit the government’s commitment to
two plants on top of one being built at Hinkley Point.

The Treasury’s
argument has been boosted by the National Infrastructure Commission that
has warned large-scale nuclear power plants are “incredibly difficult to
deliver on short timescales”. It has pointed out that even if the
government gave the go-ahead for more nuclear power stations and they took
as long as the Hinkley Point C project is expected to take, they would not
come online until the mid-2040s.

They have urged ministers to look at
“alternatives” that are more likely to be deliverable at scale in the
next 15 years. Ministers are legislating for a new model to fund nuclear
power plants to make them attractive to investors. But critics say the
regulated asset system would place the burden for delays and cost overruns
on consumers and increase energy bills. Supporters of new nuclear power,
including Johnson and Kwasi Kwarteng, the business secretary, argue that
investing now is a “no regret” policy as demand for electricity is
forecast to double in the transition to net zero. It is understood the
strategy is now due next week. If that slips, the Easter recess and rules
on what the government can say before the May elections could push it
beyond the Queen’s Speech. 

Times 29th March 2022

March 31, 2022 - Posted by | politics, UK

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