£2 Billion Pledge to get Hinkley Nuclear Project Ball Rolling

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--A financial guarantee of £2 billion ($3.1 billion) has been made by U.K. Chancellor of the Exchequer George Osborne in an effort to entice French energy company Electricite de France (EPA:EDF) (Paris) to commit to building the Hinkley Point C nuclear power plant.

Insisting that nuclear power stations are essential to "make sure the lights stay on," Osborne made the financial commitment on a five-day tour of China.

The £2 billion will, according to the government, pave the way for a final investment decision (FID) by EDF and its minority Chinese partners, China General Nuclear Power Company (CGN) and China National Nuclear Corporation (CNNC), to build the Somerset plant. The U.K. is committed to sparking a new wave of construction for nuclear power stations as it faces the closure of its old nuclear fleet by the end of the decade.

The 3,300-megawatt (MW) Hinkley Point C nuclear power plant will be the first new nuclear plant in the U.K. for more than 25 years. It will use two European Pressurized Reactors (EPRs), which will be capable of generating enough power for around 5 million homes--which is equivalent to about 7% of the U.K.'s total electricity demand. The project will be developed by Nuclear New Build (NNB) Generation Company (NNB GenCo), which was formed by EDF.

"Britain was the home to the very first civil nuclear power stations in the world and I am determined that we now lead the way again," said Osborne. "Nuclear power is cost-competitive with other low-carbon technology and is a crucial part of our energy mix, along with new sources of power, such as shale gas. So I am delighted to announce this guarantee for Hinkley Point today and to be in China to discuss their investments in Britain's nuclear industry. It is another move forward for the golden relationship between Britain and China--the world's oldest civil nuclear power and the world's fastest-growing civil nuclear power."

Vincent de Rivaz, chief executive of EDF Energy, added: "The Chancellor's approval of the infrastructure guarantee is a clear sign of the government's commitment to Hinkley Point C. The government's determination to bring about a renewal of infrastructure and to attract inward investment to the UK are demonstrated by this good news. It is further progress towards a final investment decision on a project which will provide reliable, affordable low-carbon electricity for decades."

The U.K. has been courting China since last year in an effort to attract more Chinese energy companies to invest in its budding new nuclear build sector. For additional information, see June 26, 2014, article - China Can Build U.K. Nuclear Plant.

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