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(UK) Ministers urged to clarify nuclear cost overruns
Ministers urged to clarify nuclear cost overruns
The Government has been urged to clarify who will bear the risk of any cost overruns in building new nuclear plants, after ministers appeared to suggest the burden could fall on consumers.
"Instead of taking four to five years to build, EDF were telling us that it was going to take nine to 10 years to build," Centrica chief Sam Laidlaw said this week. Photo: Alamy
By Emily Gosden6:59PM BST 17 May 2013
In a memo to the energy select committee, released on Friday, ministers also admit that delays or cost overruns at EDF’s proposed £14bn nuclear plant at Hinkley Point in Somerset could jeopardise the chances of any other new UK nuclear plants being built.
The memo said that in “most cases” power plant developers were “best able to manage construction risk”, but in some cases “variation” was needed to “ensure that a range of low-carbon technologies can come forward at a reasonable cost and in a manner that reflects distinguishable differences in risk profile”.
Tim Yeo, head of the committee, has written to energy minister Michael Fallon “in confusion” and asking, in effect, whether EDF’s proposed £14bn plant at Hinkley Point in Somerset is one such case.
The issue is contentious because EDF has seen massive cost overruns and delays at a new nuclear project in France. Centrica, which pulled out of the Hinkley Point project in February, said this week that the costs had “rocketed hugely” and that the timescale for building the plant had doubled.
The Government memo said: “The progress of ...
The Government has been urged to clarify who will bear the risk of any cost overruns in building new nuclear plants, after ministers appeared to suggest the burden could fall on consumers.
"Instead of taking four to five years to build, EDF were telling us that it was going to take nine to 10 years to build," Centrica chief Sam Laidlaw said this week. Photo: Alamy
By Emily Gosden6:59PM BST 17 May 2013
In a memo to the energy select committee, released on Friday, ministers also admit that delays or cost overruns at EDF’s proposed £14bn nuclear plant at Hinkley Point in Somerset could jeopardise the chances of any other new UK nuclear plants being built.
The memo said that in “most cases” power plant developers were “best able to manage construction risk”, but in some cases “variation” was needed to “ensure that a range of low-carbon technologies can come forward at a reasonable cost and in a manner that reflects distinguishable differences in risk profile”.
Tim Yeo, head of the committee, has written to energy minister Michael Fallon “in confusion” and asking, in effect, whether EDF’s proposed £14bn plant at Hinkley Point in Somerset is one such case.
The issue is contentious because EDF has seen massive cost overruns and delays at a new nuclear project in France. Centrica, which pulled out of the Hinkley Point project in February, said this week that the costs had “rocketed hugely” and that the timescale for building the plant had doubled.
The Government memo said: “The progress of ...
http://www.telegraph.co.uk/finance/newsbysector/energy/10065162/Ministers-urged-to-clarify-nucleaar-cost-overruns.html
Considering EDF's record on being unable to build a project even close to their predicted budget, you can't help but wonder if the threat of having to eat cost overruns is related to this news:
EDF delays Hinkley funding ‘until at least September’
17 May 2013 | By Vern Pitt
Exclusive: £10bn nuclear plant project six months behind revised schedule with half of jobs on site now at risk
17 May 2013 | By Vern Pitt
Exclusive: £10bn nuclear plant project six months behind revised schedule with half of jobs on site now at risk
(Paywall) http://www.building.co.uk/news/breaking-news/edf-delays-hinkley-funding-‘until-at-least-september’/5054731.article
