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Hinkley Point costs soar

Unite calls for industrial strategy as EDF announces £2.9bn cost overrun at Hinkley Point
Hajera Blagg, Thursday, September 26th, 2019


Unite has called on the government to “learn the lessons from the Hinkley Point project” after it emerged this week (September 25) that costs for the Hinkley Point C nuclear plant will soar £2.9bn over budget.

 

The French power firm EDF announced that its projected total cost for the plant will rise to between £21.5bn and £22.5bn. The company also raised the possibility the plant’s ‘switch on’ date, due in 2025, will be delayed by 15 months.

 

Unite said the need for a cohesive industrial strategy has become abundantly clear after the latest news, especially in light of the fact that private sector companies have pulled out of nuclear projects before.

 

Toshiba, for example, pulled out of development of the Moorside nuclear power station in Cumbria in 2018, while Hitachi said it would suspend work on the Wylfa nuclear project in Wales earlier this year. The government’s failure to support these projects will leave a worrying gap in the UK’s future energy supply – Moorside and Wylfa together had enough capacity to power 13 per cent of the UK’s electricity.

 

Announcing the cost overrun on Tuesday (September 25), EDF said in a statement “Cost increases reflect challenging ground conditions which made earthworks more expensive than anticipated, revised action plan targets and extra costs needed to implement the completed functional design, which has been adapted for a first-of-a-kind application in the UK context.”

 

Because of the terms of the EDF contract, neither taxpayers nor consumers will pick up the tab for cost overruns – this will be borne by EDF and its partner China General Nuclear Power Corp (CGN).

 

Still, the cost overrun is an alarming sign that, without government support and planning, yet another vital nuclear project could fall through the cracks.

 

Nuclear is a vital component of the UK’s future energy supply – when fully operational, Hinkley Point will be able to power 6m homes with zero carbon emissions.

 

“The government needs to swiftly learn the lessons from the Hinkley Point project, to ensure that the new nuclear power building programme, which is desperately needed in order to keep the lights on is able to proceed and be expanded,” said Unite assistant general secretary Gail Cartmail.

 

“The government’s current laissez-faire policy of simply hoping that private companies will come forward to develop and build incredibly complicated crucial strategic infrastructure projects, is not fit for purpose,” she added.

 

“We have already witnessed private sector companies pulling out of proposed new nuclear power stations in Cumbria and Anglesey, and the government’s hand wringing response is clearly inadequate.

 

“EDF has had to contend – unsupported – with challenges that are simply unrealistic to expect a private sector company to deal with — for example developing a new skills base in order to be able to build and maintain a nuclear power station,” she added.

 

“The challenges faced by EDF demonstrate why the government must introduce a proactive industrial strategy which will allow the government to work in partnership with the private sector to develop future infrastructure projects that are desperately needed if the UK is to meet the challenges of the future.”

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