Friday, 1 November 2013

Hinkley Point C And The UK's Energy Future

This is a good deal for consumers, energy security, the environment and for low carbon investment and jobs.

25,000 jobs will be created during the construction of the plant and 57% of the £14bn investment will be spent in the UK.

Many old and dirty power stations are closing down over the next decade. This agreement will provide power for nearly 6m homes, an area almost twice the size of London. Once built, it will provide a clean source of home-grown energy, helping to keep the lights on, cut emissions and reduce bills by £75 a year by 2030.

The plant will generate 7% of UK electricity and the taxpayer will not be left to pick up the bill for waste and decommissioning as was the case in the past.

The Hinkley Point C agreement sticks with the Coalition Government and Lib Dem policy that nuclear power should receive no public subsidy. The strike price is as cheap as the cheapest renewables and the price of gas generation, once you take into account the cost of carbon emissions.

Consumers will not start paying until the electricity starts being generated in 2023. Having a fixed price for 35 years means we will be insulated from the gas price hikes which have been driving up prices for the past few years.

Is this a subsidy for nuclear power?

No. This meets what we set out in Parliament and involves no favours for new nuclear.  There is comparable support with other green technologies – the same system of strike prices has already been announced for onshore and offshore wind, solar and other renewables.  The EU will look at this under state aid along with the support we have outlined for other technologies.