Expert claims financial problems at reactor supplier could scupper Hinkley Point C project
20 November 2014
A deal to build a new nuclear power station at Hinkley Point in Somerset may not go ahead, an expert has claimed. EDF Energy is due to build the £25bn plant, which would be the first in the UK in almost 20 years. Steve Thomas, professor of energy policy at the University of Greenwich, said: "The project is at very serious risk of collapse at the moment."
Artist's impression of Hinkley Point C - EDF Energy
EDF Energy told the BBC it would not comment on his claim.
The reactor supplier, French state-controlled company Areva, was to provide 10% of the finance as well as the two reactors, but has run into financial problems.
Other nuclear new build projects at Olkiluoto in Finland and Flamanville in France have experienced delays and are now significantly over budget, causing Areva to issue its third profit warning in four months on November 19, sending its shares down 16% and leading to speculation it could be forced to undergo radical restructuring.
"Only four of those reactors have ever been ordered. Two of them are in Europe, both of those are about three times over budget: one is about five or six years late and the other is nine years late," said Professor Thomas. "Two more for China and are doing a bit better, but are also running late."
He said it was "inconceivable" at this stage for Areva to contribute its 10% stake, which is the equivalent of about £2bn
EDF Energy originally had an 80% stake in the consortium, but this has fallen to 50% and it is trying to offload a further 15%. British firm Centrica pulled out two years ago. Two Chinese companies now account for 40% of the finance, but are demanding to supply equipment to the project, which EDF Energy is resisting.
The BBC says that EDF Energy is considering whether to bring in Saudi Electric, although this company has no nuclear expertise.
A spokesman for the Department for Energy and Climate change said: "We are confident in the Hinkley Point C project. EDF still expects the power station to come online around 2023."
The spokesman referred to assurances given by the French Economy Minister Emmanuel Macron that the French government is backing Areva.
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