EDF Says Sizewell Nuclear Plant Can Be Built Without China
EDF Energy, the U.K. unit of Electricite de France SA, says that financing for its 20 billion-pound ($26.9 billion) Sizewell C project is still possible even without financial support from state-run China General Nuclear Power Corp.
The U.K. says net zero will be hard to reach without nuclear but plants are expensive and take years to build. The government committed in December to financing at least one large-scale nuclear project by 2025 and has been in talks with EDF for almost ten months trying to hammer out a deal. The government was exploring ways to remove state-owned CGN from all future projects in the U.K., Bloomberg reported in July.
“We can make it work in any way,” Simone Rossi, chief executive office of EDF Energy said on the sidelines of a conference Wednesday. “The key is a choice for government of whether the project is good for them to do it. If we do that the rest is secondary -- who the investors are, what the model looks like, I think there are different ways to skin the cat but the key is maturing this decision in government and then we’ll follow whatever indications we receive.”
Britain plans to legislate as soon as next month for a funding mechanism to spur the construction of new nuclear power plants to replace its aging fleet of reactors. The so-called regulated asset base, or RAB, model is a government-funded mechanism designed to encourage private-sector investment. It dilutes the construction risk shouldered by the taxpayer and developer.
The government is still considering taking “targeted minority stake” in the project, said Declan Burke, director of nuclear projects at the Department of Business, Energy and Industrial strategy.
“We just want to be sure it’s a really good project and that it fits RAB at the point of taking the final investment decision and going ahead - that’s when everything will fall into place,” he said after the same conference on Wednesday. “These are big complex negotiations and they take time.”
The government hopes that RAB can bring down the subsidy it will need to pay for electricity once the station is up and running. The strike price agreed for EDF’s Hinkley Point C plant, due to be finished in 2026 was criticized as being too high. Hinkley C will be a 3.2 gigawatt power plant. Sizewell C is planned to have the same design and capacity.
The key to making the deal work from the government side is risk sharing between EDF and U.K. consumers, Burke said.
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