Nuclear giant EDF postpones decision on new Hinkley Point reactor
UK energy policy cast into doubt after company breaks pledge to make investment decision by end of 2012
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Hinkley Point nuclear plant in Somerset, where EDF is deciding whether to build a new power station. Photograph: PA
The troubled French nuclear giant EDF has postponed its decision on whether to build a new power station at Hinkley Point in Somerset.
The delay puts the nuclear renaissance at the heart of the UK government's energy plans into further doubt after a difficult week in which EDF was hit by cost overruns and the exit of its partner from a key French project.
The new reactors at Hinkley were to be the first of a new generation of atomic plants in the UK and EDF had repeatedly pledged to make a final investment decision by the end of 2012.
But the decision to plough billions of pounds into the project is now unlikely to be taken before April 2013, according to sources close to the project, although EDF declined to comment.
"This is another broken promise from EDF on a policy that has always been failing," said Tom Burke, the founding director of the green thinktank E3G.
"To spend at least £14bn on a pair of reactors at Hinkley is very, very high risk."
The latest projections from the Department of Energy and Climate Change have reduced the amount of nuclear power expected in future, with only Hinkley expected to be up and running by 2025, he added.
The energy secretary, Ed Davey, fast-tracked negotiations over the guaranteed price EDF would be paid for electricity from Hinkley to help the end-of-year deadline to be met.
However, amid concerns that consumers would end up paying a high price, the energy minister John Hayes recently warned that the government could walk away from the talks. EDF is also awaiting planning permission to build the reactors and does not expect that decision before March 2013.
A failure to secure the building of the Hinkley reactors would be a serious blow for both the government and EDF, which is majority owned by the French state.
But it also comes in a week that EDF admitted that the cost of building its prototype European pressurised reactor (EPR) at Flamanville in Normandy had risen by €2bn (£1.6bn) to €8.5bn. The following day EDF's partner in the Flamanville 3 scheme, Enel of Italy, announced that it was pulling out.
EDF said in 2005 that it would construct the EPR, which is similar to the ones planned for Somerset, for €3.3bn. The cost overruns – and delays – have partly been blamed on changes required after the Fukushima nuclear accident in Japan but they have also been put down to engineers discovering the project was more difficult than they had foreseen.
New statistics just released by Decc show the British government expects only 3.3 gigawatts of new nuclear capacity to be built by 2025 and 9.9GW by 2030.
This compares with 4.8GW by 2025 and 12GW by 2030 as recorded in Decc's energy and emissions projections 12 months ago.
