UK Commits to Another Large Nuclear Plant in Net Zero Push

(Bloomberg) -- The UK will build another large-scale nuclear power plant, beyond current projects by Electricite de France SA, as the nation maps out its biggest expansion of atomic energy in 70 years.

Discussions on the next site will begin once EDF and the government reach a final investment decision on the Sizewell C station, Andrew Bowie, the minister for nuclear and renewables, said in an interview. That’s expected to happen this year. Competition for a new project would also be open to other developers, potentially at the Wylfa or Moorside sites. 

Getting Sizewell C built is vital for the UK to prove it can deliver on its strategy to quadruple nuclear-power capacity by 2050. Construction of complex atomic plants is notoriously slow, and cost overruns and delays make investors wary, stalling Britain’s progress.

“There is no net zero without nuclear,” Bowie said. “No one is trying to suggest that it’s not expensive to deliver, but it’s an expense we can’t afford not to spend.”

A road map published Thursday sets out how the UK will reach 24 gigawatts of capacity by 2050. This would require adding between 3 and 7 gigawatts of new projects every five years from 2030 to 2044, the government said. 

That would be a considerable acceleration from the current pace. Hinkley Point C, due to start its two reactors in 2027 and 2028, will be the first new station since Sizewell B began generating in 1995.

UK Nuclear Output Slumps to 42-Year Low in Threat to Net Zero

In 2016, the UK had a pipeline 18 gigawatts of nuclear capacity at six sites, including Hinkley. That shrank as investors, including Hitachi Ltd. and Toshiba Corp., walked away from projects they deemed too expensive.

“Our plans will give investors the confidence to back new UK projects,” Bowie said. “We have seen moments in the past when investors have been bruised by projects that haven’t delivered.”

The government is asking for views on how to encourage private investment in future plants after taking years to agree on the regulated asset base, or RAB, model for Sizewell. That’s supposed to encourage private capital in the building stage and dilute the construction risk for the developer and taxpayers.

This model was criticized by a government advisory committee for leaving consumers unfairly exposed.

“The RAB is perfect for Sizewell C, but I wouldn’t want to speculate that it would be for future gigawatt-scale projects,” Bowie said. “We don’t want to be restrictive.”

The government says it will reach a final investment decision on two more nuclear projects by the end of 2029. Those could use small modular reactors or other advanced nuclear technologies.

Small modular reactors, or SMRs, will play a key role in expanding the sector. SMRs can be assembled in factories, making construction faster and less expensive.

A competition will begin soon where companies such as EDF and Rolls Royce Holdings Plc can bid to build demonstration projects.

The UK also is consulting on a new way to determine sites for future reactors beyond the eight already designated. The idea is to be more flexible about locations, Bowie said.

(Updates with details of potential sites in second paragraph.)

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