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News Extra: UK-China deal provides boost for Hinkley nuclear project

01 July 2014

A state visit to the UK by Chinese Prime Minister Li Keqiang in June has resulted in a number of agreements being signed, primarily in energy and transport infrastructure projects. One major deal between the two countries is a civil nuclear agreement to enable Chinese companies to invest in the first new nuclear power station to be built in the UK for 30 years, Hinkley Point C in Somerset.

Artist's impression of Hinkley Point C - EDF
Artist's impression of Hinkley Point C - EDF

The UK subsidiary of French electricity group EDF secured government subsidies for the £14 billion project last October, and at the same time announced it had signed agreements with China General Nuclear Corporation (CGN) and China National Nuclear Corporation (CNNC) to take a 40% stake in the plant, which will have two EPR reactors and a generating capacity of 3,200MW.

The mid-June agreement was signed by the Department of Energy and Climate Change, the Nuclear Decommissioning Authority, the China Atomic Energy Authority and CNNC.

Hinkley Point C is one of 12 new nuclear plants that the UK government hopes to see built in the coming decades, and China could be involved in several of them.

Both governments have also agreed to better cooperation on the wider nuclear fuel supply chain cycle, by working together to develop and export innovative solutions in areas such as waste treatment and decommissioning.

Other separate multibillion pound agreements were also signed by Shell and BP with the China National Oil Corporation, primarily focused on supplying liquefied natural gas (LNG) to China to reduce its dependence on coal-fired power generation.

This came a few days after the publication of a report by think tank Civitas condemning government plans to give subsidies to companies such as EDF, Hitachi and Toshiba to develop large-scale new nuclear projects at massive public expense.

Most of the investment will be go to foreign suppliers rather than the UK nuclear sector, resulting in significant job losses and loss of expertise, it claims.

The report, entitled “Use it or Lose it”, calls for government support for new, smaller reactors which are quicker to build and could be manufactured largely in the UK. Small Modular Reactors (SMRs) - defined as reactors of less than 300MW - could provide an attractive alternative to the projects currently planned, the report finds.

It says this could help safeguard the UK nuclear sector, which has a current annual turnover of £4 billion.

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