Govt Holds Off On Hinkley Nuclear Plant Approval

The Government will not make a final decision on building a new nuclear power plant in Somerset until the autumn, despite the French firm behind the project approving funding for its construction.

The EDF board voted 10-7 in favour of investing in the site to replace Hinkley Point B, which is due to be decommissioned in the next decade.

Hinkley Point C will power 5.8 million homes and create 25,000 jobs.

But the Government said it was still looking at the details of the project.

"The UK needs a reliable and secure energy supply and the Government believes that nuclear energy is an important part of the mix," Business and Energy Secretary Greg Clark said.

"The Government will now consider carefully all the component parts of this project and make its decision in the early Autumn."

Sky (LSE: BSY.L - news) 's Poppy Trowbridge, reporting from outside the site in Somerset, said: "We must remember Hinckley Point C is now a project that has seen its third Government and it is my understanding that (Prime Minister) Theresa May's team want time to go over the fine print."

The power station was originally meant to open next year, but that has now slipped to 2025 and within the contract there is potential for further delays.

In a statement, EDF (Paris: FR0010242511 - news) said the plant would be a "unique asset for French and British industries as it will benefit the whole of the nuclear sectors in both countries and will support employment at major companies and smaller enterprises in the industry".

But opponents of the development have also voiced fears that it is a bad deal for customers and taxpayers.

Greenpeace executive director John Sauven said the decision was "a bitter pill to swallow for hard-up people who have been told that the government is trying to keep bills down while dealing with energy security and lowering carbon emissions".

On Thursday, EDF board member Gerard Magnin stepped down, saying the £18bn project was financially risky.

The UK government has guaranteed a price of £92.50 per megawatt hour for the electricity Hinkley produces for 35 years - more than double the current price.

But the cost of wholesale energy has fallen since the price was agreed, leaving the Government to make up the difference.

The UK's National Audit Office estimated future top-up payments would rise from £6.1bn to £29.7bn over the length of the contract.

Barry Gardiner, shadow energy secretary, said: "Labour is clear that there is a role for new nuclear as part of our future low carbon infrastructure; but not at any price.

"The Government's failure to get a grip of the public interest here shows a startling level of incompetence."

Recently, Chancellor Philip Hammond said the scheme was "still worth the cost", with the Government suggesting that customers' bills would rise by about £10 once the plant was up and running.

Kate Hudson, general secretary for the Campaign for Nuclear Disarmament, called on the Government to scrap the deal, saying: "The new power plant will saddle future generations with an astronomical environmental and economic debt."

The GMB union's national secretary for energy Justin Bowden described it as "great news for the economy and a first stop in plugging the UK energy needs gap that exists due to the Government's failure to have a proper, balanced energy policy".