Hitachi is Nervous over Planned Nuclear Plant in Wales

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Hitachi Limited (OTC:HTHIF) (Tokyo, Japan) will not go ahead with plans to build a $14.4 billion nuclear power plant in Wales unless it can secure a viable financial agreement with the U.K. government.

Hiroaki Nakanishi, chairman and chief executive officer of the Japanese industrial company, expressed "very serious concerns" about its involvement in the planned Wylfa Newydd nuclear project on the Isle of Anglesey following the protracted and difficult negotiations between the government and Électricité de France S.A. (EPA:EDF) (Paris, France) over the financing of the Hinkley Point C nuclear project in Somerset, England. He expressed his concerns to U.K. Foreign Secretary Phillip Hammond last month in Japan.

"Hinkley Point [raises questions] about what are the real solutions for setting up financial support," he told The Telegraph newspaper. "Nuclear power construction requires huge money... we need to arrange a financial plan for which the kind of money needed can be introduced. Some part is government endorsement, some is more preferable investment conditions from some part of the finance industry."

He also believed that the problems faced at the Hinkley Point C project could impact its Wylfa development company, Horizon Nuclear Power (Gloucester, England).

"The Department of Energy and Climate Change (DECC) worries about the stability of the scheduled construction of the Hinkley nuclear power plant, so some of the conditions--the credit requirements--those kind of things may affect us. In order to set up the financial conditions for Hinkley, Chinese capital was introduced, but what the real result will be--we have a very serious concern about that."

Hitachi purchased the Horizon Nuclear Power joint venture in 2012 for $1.1 billion. For additional information, see October 31, 2012 article - RWE and E.ON Sell U.K. Nuclear Venture.

Horizon also intends to build a larger nuclear plant with a planned generation capacity of 3,900 megawatts (MW) at Oldbury-on-Severn in South Gloucestershire, England.

The plants will use the proposed Advanced Boiling Water Reactor (UK ABWR) reactor from Hitachi-GE Nuclear Energy Limited (Hitachi-GE), which entered the final phase of testing last November. It was cleared by the country's Office for Nuclear Regulation (ONR) to move forward to the final step of Generic Design Assessment (GDA), which should be completed by the end of 2017. For additional information, see November 4, 2015 article - Hitachi Reactor Makes it To Final U.K. Testing Phase.

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