The Prime Minister said the spike in gas prices driven by Vladimir Putin’s invasion of Ukraine showed why new nuclear generation capacity was needed in the UK.
The new reactor at the Sizewell site in Suffolk is expected to be built in partnership with energy firm EDF and could power the equivalent of about six million homes.
“We need to pull our national finger out and get on with Sizewell C,” Mr Johnson said in his final major policy speech as Prime Minister.
“That’s why we’re putting £700 million into the deal, just part of the £1.7 billion of Government funding available for developing a large-scale nuclear project to final investment stage in this Parliament.
“In the course of the next few weeks I am absolutely confident that it will get over the line.”
He said it would be “madness” not to go ahead with the project which would “fix the energy needs, not just of this generation but of the next”.
Mr Johnson will leave office on Tuesday, handing power to either Liz Truss or Rishi Sunak following the Tory leadership contest. He said: “I say to you, with the prophetic candour and clarity of one who is about to hand over the torch of office, I say go nuclear and go large and go with Sizewell C.”
Downing Street was unable to give further details about the funding announcement and EDF has not yet responded.
The total cost of the Sizewell C project could be around £20 billion, according to reports.
It is not expected to begin generating electricity until the 2030s; the similar reactor at Hinkley Point C in Somerset began construction in 2016 and will not be online until 2027, although this is partly due to the impact of the pandemic.
We need to pull our national finger out and get on with Sizewell C
Mr Johnson, in a speech at Sizewell, said there had been a “paralysis over British nuclear energy”, blaming successive governments for failing to invest in new reactors.
“Yes, nuclear always looks – when you begin – it always looks relatively expensive to build and to run,” he said.
“But look at what’s happening today, look at the results of Putin’s war. It is certainly cheap by comparison with hydrocarbons today.”
He said that if Hinkley Point C was operating now “it would be cutting our national fuel bills by £3 billion”.
Mr Johnson also highlighted the importance of offshore wind and appeared to take aim at supporters of fracking such as Ms Truss.
He said: “Because of the activism of the Government we’re now racing towards our target – we will hit it – of 50 gigawatts of offshore wind by 2030.
“Fifty gigawatts is a huge amount, that’s roughly half the electricity consumption of this country, from offshore wind.
“I tell everybody who thinks ‘hydrocarbons are the only answer, we should get fracking’ and all that, offshore wind is now the cheapest form of electricity in this country. Offshore wind is nine times cheaper than gas.”