Building New Nuclear: the challenges ahead - Energy and Climate Change Contents


7  Conclusion

110.  The Government's preferred route to a low-carbon, secure and affordable electricity system is to have a "balanced mix" of renewables, nuclear and fossil fuels with carbon capture and storage. Achieving this ambition will require a new generation of nuclear power stations to be built, starting with the industry's proposals to build16GW of new plant by 2025.

111.  Although some steps have been taken to support new nuclear projects in the UK (such as changes to the planning system and the introduction of the Generic Design Assessment process), some significant barriers still remain:

  • The upfront cost of constructing a nuclear power station remains one of the largest challenges. We hope that the introduction of Contracts for Difference will help to reduce the cost of capital to some extent. However, new models of financing —such as project funding—are only likely to become a possibility if the first new build projects are delivered successfully, without the kinds of delays and cost overruns that have been seen in France and Finland.
  • Public attitudes are another potential barrier. Building public support for new build projects requires a sophisticated understanding of the nature of people's concerns, which are likely to consist of more than simply the fear of a nuclear accident. Better coordination between the regulatory permitting process and the planning process could help to improve dialogue with local communities. In addition greater support for local communities in interpreting complex planning documentation could allow them to make a genuine contribution.
  • There is also a risk that the absence of a fully-formed nuclear supply chain in the UK could lead to bottlenecks and delays in the delivery of components for new build projects. Support for prospective suppliers may be needed to ensure they are able to comply fully with nuclear safety requirements.

112.  There is some suggestion that it could be possible to meet our climate change objectives without any new nuclear power stations, but this would be a more difficult and possibly more expensive route.

113.  A failure to deliver nuclear new build would pose less of a threat to energy security, but there could be some indirect security risks as a result, such as increased reliance on imported gas.

114.  While we share the Government's hope that the new build programme will be a success, the barriers described above may yet prevent some or all of the new projects from going ahead. Given this possibility, it is vital that Government starts thinking about alternative options for meeting our long-term climate change and energy security objectives so that these contingencies can be enacted quickly in the event that new nuclear is not forthcoming.


 
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Prepared 4 March 2013