Subsidies Galore for New Nuclear White Elephants!
The government plans to force bill payers to subsidise new nuclear power stations, despite promising there would be no public subsidies.
Each of the following planned reforms is likely to provide a direct or indirect subsidy to the nuclear industry:
- Feed-in Tariff with Contracts for Difference (CfD)
(guaranteed long-term price for nuclear power generation)
- Capacity Mechanism
- Carbon Floor Price
- Emissions Performance Standard
- WWF and Greenpeace say the proposed reforms could mean a nearly
£3.5 billion windfall for existing nuclear generators between 2013 and 2026.
- Offering operators a fixed unit price for the cost of managing and disposing of their radioactive waste represents a subsidy of over £400 million per new reactor.
- Underwriting nuclear operators’ waste and decommissioning costs represents a subsidy.
- Any limit on liability on the costs of nuclear accidents eases the burden on nuclear operators. Paying for commercial insurance could add 40p to the cost of a unit of electricity, so a cap on liability represents a major subsidy.
The construction cost of each new Areva EPR reactor, the type that EDF/Centrica want to build at Hinkley and Sizewell, has been revised upwards from £4.5 billion to £7 billion, an increase of some 55%. As a result, it is estimated that new nuclear build at Hinkley Point (Somerset) and Sizewell (Suffolk) would cost
£155 billion in CfD subsidies over 30 years, equivalent to an extra £83/year on fuel bills for every person in the UK. This assumes that only four reactors are built, on time and to budget, which Areva has so far failed to do; otherwise the sum will be higher still.
Campaign group Energy Fair says that by the time any new nuclear plants are completed (not before 2020), much of the market for their electricity would likely be disappearing. Consumers will be empowered to generate much of their own electricity, or to buy it from anywhere in Europe, because of the falling cost of renewables and the likely completion of the European internal market for electricity.
Meanwhile, new nuclear plants would be paid for through surcharges to people’s electricity bills for up to 35 years. This means it will be mainly the poorest in society who will foot the bill, because they will be the least able to afford the up-front costs of generating their own electricity.
Fully referenced, extended version of this text: tinyurl.com/KNemr
Kick Nuclear – Campaigning against the UK’s addiction to nuclear power