Hinkley on hold: Decision off until Autumn

Posted: July 29, 2016 by tallbloke in solar system dynamics, Energy, government, Nuclear power, Uncertainty, Shale gas

nuke-powerIn a surprise move, the UK govt has put the brakes on the Hinkley Point nuclear power contract. Yesterday, there was anticipation in the media that the directorate of EDF would approve the scheme. In the event, the vote was 10 to 7 in favour, though one director resigned beforehand.

Maybe the depth of the split on the EDF board has given the new UK government the jitters. In a brief two line statement this morning, the business secretary, Greg Clark, said the government would now examine all components of the deal and decide in the Autumn whether to go ahead, or not.

A major issue is cost. The deal hinges around a very high price to be paid for the electricity to be produced at Hinkley Point, equivalent to the cost of offshore wind power. The government may be considering lower priced alternatives, such as U.K. shalegas or LNG imported from the U.S.

Either way, this decision to delay a decision is last minute. Media observers say marquees were being set up at Hinkley Point in expectation of a signing party today. The Chinese delegation is now heading home.

Comments
  1. Alan m Dransfield says:

    OMG that’s all we need a PFI nuclear station

  2. Graeme No.3 says:

    Is this the first tentative appearance of common sense in energy policy by the government?

  3. oldbrew says:

    This is what political spin doctors have been calling ‘value for money’:

    ‘The Government has pledged to pay EDF a fixed price of £92.50 per megawatt-hour of electricity for 35 years, meaning consumers will pay up to £30 billion in subsidies.’
    http://www.thegwpf.com/new-uk-govt-to-review-most-expensive-subsidy-plant-ever/

    What a joke.

  4. PeterMG says:

    I don’t see it as a surprise at all. If Mays new government has even just1% built-in reality, it will cancel this monstrosity. Whilst many of us support Nuclear Power, this is not the way to do it.

    And I think a fundamental re-think is need over having the operation of key utilities in the hands of foreign investors when we the tax payers have to front up with massive subsidies, which only results in money being sucked out of the country. Britain will be broke in 10 years if this is not stopped. So if the new government has anyone with any brains working within, look for big changes, changes that Cameron and Osborne completely spurned.

  5. tallbloke says:

    I wonder if documents have been found which Cameron and Osborne ‘forgot’ to tell us about. This is a pretty major volte-face, and I expect there will be some fraught phone calls between Beijing, Paris and London today.

  6. graphicconception says:

    I am with Graeme No.3. Let’s hope this is the dawning of common sense.

    Yes, we need the energy but we should not have to pay an inflated price for it.

  7. TinyCO2 says:

    One of the harms that being in the EU was doing us was giving politicians and others a false sense of security. It was like a safety net to gamble and waste money. In practice it makes a very poor form of protection that is already occupied by Greeece, etc. So without the fake safety net in place, the high wire act are thinking twice about how much of a loony they should be showing off to a disinterested crowd.

    There is no reason for the UK to be front and centre with cutting CO2, even if CAGW is real. We’ve more than done our bit already and need to concentrate on other priorities right now. Ministers should ignore baying enemies/former partners shouting ‘jump, jump, jump!’

    PFI is the country equivalent of hire purchase. If it’s shortsighted for people buying on tick, it’s gross stupidity for a government.

  8. Ivor Ward says:

    Perhaps May wants to use it as a tasty treat in the Brexit negotiations. Though whom, apart from EDF, will benefit from this white elephant is a mystery.

  9. tallbloke says:

    The money would be better invested in training up our own engineers, production capability and infrastructure for shalegas fracking. 100 active wellheads at any one time UK wide would provide 20% of energy requirement, safely, continuously, predictably, with low line losses and at low decommissioning cost, with met benefit to a UK sovereign wealth fund.

    It’s a no-brainer, and we need to b getting on with it sooner rather than later.

  10. tom0mason says:

    Meanwhile through some mysterious eastern magic, others just get on with it.
    Yes it’s a smaller installation but at a cost that make sense and a design proven to work.
    http://www.world-nuclear.org/information-library/country-profiles/countries-o-s/south-korea.aspx

    UK of course can not do such things as only classically trained bureaucrats and middle managers are truly revered. Talent in applied science and engineering left this land starting back in the mid-1970s. Since then this talent has been a major export, enforce by the lack of respect, money, or progression in the UK.

    UK energy shall reap as it sowed.

  11. oldmanK says:

    The words “Hinkley point power station” (and tallbloke’s comment above) bring back memories buried under tons of modern ????? in my mind.

    45 years ago Hinkley point saw one of its turbine disks go through the roof -and back-. It was a frightening thing as I was also ‘fiddling’ with a rotor with disks loose on the shaft. It was then my first year of a career; and an experience and an eye opener. CEGB was something to look up to. (Yes you do need well trained staff -and home grown).

  12. jarlgeir says:

    The energy delivered will be very expensive, and we live in a world with falling energy prices, but more important: The technology used in this project is unproven, and the two current nuclear facilities under construction using it, are both running substantially above budget AND behind schedule.
    Scrapping this project is eminently sensible, one wonders why it was not cancelled years ago.

    Relevant detail here:
    http://www.breitbart.com/london/2016/07/29/pm-theresa-may-has-just-saved-britain-from-nuclear-power-disaster/

  13. The EPR is a German-French design, using a dinosaur as a template. It should be laid to rest or put in a museum as an example of how not to design a NPS.

  14. oldbrew says:

    Last chance to jump?

    ‘No one wants Hinkley C power station, not because nuclear is in itself a flawed technology, but because the electricity market is so distorted by climate policy that it is dangerous for an investor unless offered subsidies that are wildly expensive for the consumer. Discussion should now shift from the folly of this particular deal to the underlying problems that are making it all but impossible for any despatchable, conventional power station to be built in the UK.’
    http://www.thegwpf.com/hinkley-c-and-the-uk-power-market/

  15. oldbrew says:

    Trouble at t’ mill – the French unions are revving up again…

    ‘French unions could derail the decision by EDF to approve a final investment decision of the Hinkley Point C nuclear power plant on the basis that board members were given scant time to read the volumes of information associated with the project.

    A legal challenge is now in the offing after board members complained to the media that Jean-Bernard Lévy, the head of EDF gave his fellow board members only two days to read 2,500 pages of contracts before agreeing to proceed with the Hinkley Point nuclear power project last week.

    They are now bringing a legal challenge against the company’s final investment decision, the first part of which will be heard this Tuesday. If the first claim is successful, the investment decision will be considered void until a second hearing on September 22.’
    http://www.powerengineeringint.com/articles/2016/08/fresh-threats-to-hinkley-point-as-opposition-hardens.html

    The board have got plenty of time to read those contracts now😉

  16. oldbrew says:

    HINKLEY DECISION GRINDS TO A HALT – Tom Burke

    ‘Subsequent briefing insisted that the decision to puncture the carefully crafted balloon of expectations at the last minute had been taken by the Prime Minister herself. The public surprise of Britain’s partners in this massive venture has been accompanied by private fury. The political damage is considerable.’
    http://tomburke.co.uk/2016/08/01/hinkley-decision-grinds-to-a-halt/

  17. oldbrew says:

    Hinkley Point C and its implications for the future of the power sector – PEI report

    ‘The only certainty is uncertainty’
    http://www.powerengineeringint.com/articles/2016/08/hinkley-point-c-and-its-implications-for-the-future-of-the-power-sector.html

  18. The power report – written by ‘Green Parasite’: “Away from renewables, a similar pattern has been emerging for small distributed generators – designed to keep the lights on during cold windless spells did he mean dirty STOR diesels?

    Unbelievable!:

    “This left projects that had been progressing well with no viable future, when CCS would otherwise have potentially allowed the continued operation of some of these large stations into a low carbon future and providing reliable low carbon power”

    A low carbon future! Using 25% of the energy to store CO2. The world has gone mad when people mourn the passing of CCS.

  19. tallbloke says:

    http://www.reuters.com/article/us-edf-britain-nuclear-unions-idUSKCN10H0IH

    “Reading the entire internal email sent on August 2 by the Chairman and CEO of EDF to members of the executive committee confirms unambiguously that when the Company’s Board of Directors was held, EDF and its Chairman had no knowledge of the intention of the British government to conduct a further review of the Hinkley Point project,” the company said.

    “All that was known before the press statement issued by the British government on July 28 was that the signing ceremony originally proposed for Friday, July 29, would be postponed,” EDF said.

    “This potential date of signature had not been confirmed, and therefore had not been communicated either to the board nor the market. There was therefore no requirement to communicate its postponement.”

    Sud Energie stands by its comments on the issue which were made in an email on Friday to several thousand EDF employees, Jerome Schmitt, a member of the union’s national bureau, told Reuters.

    EDF said Levy and EDF would also take legal action against any other parties making claims like those of Sud Energie.

    EDF’s unions have said the Hinkley Point project is too big and jeopardizes the company’s survival.

    The project also led to the resignation of the group’s former finance chief earlier this year while a board member quit on the day of the investment vote.

    A Paris court on Friday upheld the EDF board’s investment decision on the Hinkley Point nuclear project in Britain, rejecting a challenge by the group’s works council.

    A separate legal challenge by the works council, seeking to obtain the release of confidential documents relating to Hinkley Point, is due to be heard on Sept. 22.

  20. oldbrew says:

    Chinese ambassador tries to crank up the pressure…

    ‘China’s relationship with UK ‘at risk’ over Hinkley Point delay, warns ambassador’
    http://www.telegraph.co.uk/news/2016/08/09/chinas-relationship-with-uk-at-risk-over-hinkley-point-delay-war/

  21. oldbrew says:

    Chinese energy firm linked to Hinkley Point facing charges of nuclear espionage

    ‘The state-owned China General Nuclear Power (CGN) is accused of a conspiracy to steal US industry secrets to aid the development of Chinese technology, according to The Times.’
    http://www.telegraph.co.uk/news/2016/08/11/chinese-energy-firm-linked-to-hinkley-point-facing-charges-of-nu/

    Oops😐

  22. oldbrew says:

    Australia blocks Chinese grid purchase.

    ‘…the bidders need to address the government’s concerns, and … they have until the 18th of August to submit their proposals … at which time a final decision will be made on the project.’
    http://www.powerengineeringint.com/articles/2016/08/australia-blocks-chinese-grid-purchase.html

  23. oldbrew says:

    FBI: Chinese Could Build UK Nuclear Plant With Stolen U.S. Technology

    ‘A Chinese state-owned energy giant, which is investing in a major new nuclear plant in the UK, is facing espionage charges in the United States after allegedly conspiring to steal American technology.’
    http://www.breitbart.com/london/2016/08/11/fbi-chinese-build-uk-nuclear-plant-stolen-us-technology/

    Innocent until proven guilty, but maybe the UK gov should call the FBI – or vice versa – if they haven’t already.

  24. oldbrew says:

    Still waiting for “objective evidence” that the Hinkley tech will even work…

    ‘Two years ago the EU approved a generous subsidy scheme that the government had agreed with EDF and CGN to underwrite the project. A key part of the deal was a Treasury guarantee for up to £17bn in loans.

    The government imprimatur is vital because it would allow the debt-addled EDF to borrow on much cheaper terms. According to article 56 of the Brussels ruling, this guarantee was conditional on “objective evidence” that EDF’s reactor technology worked. This must be proven by Flamanville completing its “trial operation period” by the end of 2020.

    Flamanville is using the same reactor design intended for Hinkley. Under construction since 2007, the French project has fallen years behind schedule and gone billions of euros over budget.’
    http://www.thegwpf.com/britain-may-pull-legal-get-out-plug-on-hinkley-nuclear-plant/

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