Hinkley Point C

The Times reported on July 15, that, according to “well placed industry sources”, EDF Energy wants a subsidy of £2.8 billion (US$3.6bn or 3.5bn euro) a year for the next 25 years to build two new nuclear reactors at Hinkley Point in Somerset, England at a cost of £14 billion. The French, mostly state-owned company, will only build the two European Pressurised Water Reactors (EPRs) with huge subsidies, paid for through fixed levies on electricity bills.

In May the UK Government published a Draft Energy Bill see (Nuclear Monitor 750, June 1) which details plans for so-called Electricity Market Reform. The proposals include the introduction of a complicated support mechanism for low carbon electricity called “Contract for Difference” (CfD). Basically if the market price for electricity falls below a guaranteed “strike price” the nuclear or renewable energy operator would be paid the difference, but would also have to pay money back if the electricity price goes above the strike price. The Government doesn’t expect the Energy Bill to be passed into legislation until towards the end of next year, and strike price rates won’t be finalized until then.  However, under the terms of the draft Bill, the government can issue a likely strike price in advance of formalizing the rate and introducing CfD in 2014.

EDF Energy and its junior partner Centrica want to make their final investment decision on Hinkley before the end of 2012. So talks have begun between the Department of Energy and Climate Change (DECC) and the two companies to provide them with some firmer guarantees in order to make sure plans for Hinkley Point go ahead. With RWE and E.ON having recently dropped their UK nuclear plans, EDF Energy has the Government over a barrel, and will no doubt be telling DECC what strike price it wants before going ahead – in effect writing its own subsidy cheque from the electricity consumer.

According to The Times, EDF says it needs about £165 per megawatt hour (£/MWh), almost four times the existing wholesale price of electricity, if it is to go ahead. This works out at a subsidy of £68 billion over 25 years, or an average of about £50 extra a year on every household bill. 

Let’s not forget that the Coalition Agreement between the Tories and Liberal Democrats pledged to not subsidize nuclear power.(1) Despite this, the Secretary of State for Energy and Climate Change, Liberal Democrat Ed Davey, now seems to be prepared to agree a high strike price with the nuclear industry, whilst pretending the Government is not planning to subsidize dangerous new reactors at all.

The Times says the Government has warned EDF Energy, and its junior partner Centrica, that nuclear power subsidies must be lower than offshore wind power, but EDF is arguing that the giant new offshore wind projects planned for the North Sea will cost £180/MWh, making nuclear slightly cheaper. In fact currently under the UK Renewables Obligation, offshore windfarms now being installed are being paid around £135 per MWh. According to senior lecturer on Energy Policy at Birmingham University, David Toke, EDF has been forced to come clean on nuclear costs, so now it is making dubious claims about offshore wind.(2) A Government and Industry taskforce set up to reduce offshore wind costs says offshore wind costs can be reduced to £100/MWh by 2020.(3)

Ed Davey says “nuclear will not receive a higher price than comparable gene-ration technologies whether they be renewables or indeed gas generation once its emissions have been abated by carbon capture and storage.”(4) If it is more expensive to get electricity from new nuclear power stations than offshore wind then the government’s commitment to nuclear will become dif-ficult to maintain – we might as well just build more offshore wind farms.(5)

Toke asks “will the British Treasury sign off on this plan to increase average British electricity prices by 8 per cent for 25 years to produce 6 per cent of UK electricity from nuclear power?” The Government claims that energy bills will have to go up whatever we do. Its answer to this was supposed to be The Green Deal. But this now looks incre-asingly unlikely to deliver the savings to consumers promised. The plan is to offer Green Deal loans of up to £10,000 to help consumers insulate their homes and reduce fuel bills, but the interest charged will be at the usual rate of around 7.5%. So consumers will have to spend £22,000 to pay the loan back over 25 years requiring households to deliver energyefficiency savings of £900 a year to cover the cost of annual loan repayments.(6)

In contrast, in Germany, where nuclear power is being phased out by 2022, loans at very low interest rates of 1-2%, have helped insulate over 2m homes, employing 200,000 people a year in the process, and German homeowners can borrow up to €75,000 to give them a very cosy and efficient home indeed. (7)

Greenpeace and WWF wrote to The Times pointing out that the costs of nu-clear power are going up not down. The EPRs at Flamanville and Olkiluoto are now £2.7 billion and £2.6 billion over-budget respectively. The huge subsidy of £2.8 billion per year being sought for two reactors at Hinkley was in stark contrast to another fight within Whitehall over levels of support for onshore wind power with the Treasury pushing for a reduction in support for wind power that would save less than £20 million per year. (8) (The Treasury lost the battle, but only after DECC made concessions on gas).

EDF denied that it was negotiating for a strike price of £165/MWh. It said it expects to reach a transparent agreement with the Government that is fair and balanced. It will show that nuclear is affordable and cost-competitive. (9) The Nuclear Industry Association (NIA) said “if it were true, the figure of £165/MWH would make new nuclear virtually untenable. Fortunately, it is not true. Ra-ther, it is spectacular speculation.” (10) But NIA does not speculate on what the real price might be.

The cost of the EPR being built at Flamanville, has already doubled to €6 billion (about £4.5 billion) from €3 billion and the project is four years behind schedule. Flamanville-3 is the reference design for the UK EPR. At £5 billion, Ian Jackson of Chatham House estimates that EDF would need £91.50/MWh just to break even on a Hinkley Point reac-tor. In addition to breaking even, EDF is expecting to earn a return on its invest-ment which would bump the final strike price up to about £148/MWh. Other analysts, notably Peter Atherton of Ci-tibank, have publicly projected a strike price of between £150 and £200/MWh.(11) The Financial Times says a person close to the negotiations on the level of government support energy companies should receive reckons that EDF Energy and Centrica will need a price of at least £100/MWh – more than double the present wholesale power price of about £41/MWh – to justify the huge investment needed in new nuclear plants. He said the upper limit of any such support would be about £130-£140/MWh – the cost of electricity generated by offshore wind farms. “If you can’t do [nuclear] for that price, then you might as well build more wind farms”. (12)

David Toke says the Government could hardly set the strike price any higher than £100/MWh because this is the figure the Treasury wants offshore wind power to come down to. This would be a soft landing for a policy retreat. The Government may say that £100/MWh is profitable for nuclear power, but it is unlikely to lead to any being built. Lots of rumors, hopeful stories, yes, because the British Government (and the nuclear industry) does not want to admit that nuclear power is a dead duck.(13) 

The latest news is that the chief execu-tive of General Electric, has described nuclear power as so expensive com-pared with other forms of energy that it has become “really hard” to justify. (14) And now EDF says it is considering looking for more partners for its UK nuclear projects to help it share costs and limit its debt burden – an admission perhaps that French state owned industry is no longer able to afford the huge nuclear costs on its own.(15)

Sources:
(1) Spinwatch, 22 May 2012 www.spinwatch.org/-articles-by-ca-tegory-mainmenu-8/67-nuclear/5501-when...
(2) David Toke’s Green Energy Blog, 16 July 2012 http://realfeed-intariffs.blogs-pot.co.uk/2012/07/its-official-nuclear-p...
(3) Offshore Wind Cost Reduction Task-force Report, June 2012 www.bwea. com/pdf/publications/Offshore_Task_ Force_Report.pdf 
(4) Liberal Democrat Voice, 20 April 2012 www.libdemvoice.org/there-will-be-no-public-subsidy-for-nu-clear-28150.h...
(5) Left Foot Forward, 18 July 2012  www.leftfootforward.org/2012/07/lea-ked-report-nuclear-energy-ed-davey/ 
(6) Business Green, 17 July 2012 www. businessgreen.com/bg/news/2191949/exclusive-which-warns-of-green-deal-s-devastating-impact-on-efficiency-efforts (7) Guardian, 24 May 2012 www. guardian.co.uk/environment/damian-carrington-blog/2012/may/24/green-investment-bank-energy-efficiency 
(8) The Times, 18 July 2012 www. thetimes.co.uk/tto/opinion/letters/arti-cle3478465.ece 
(9) The Times, 19 July 2012 www. thetimes.co.uk/tto/opinion/letters/arti-cle3479871.ece
(10)NIA Blog,  18 July 2012 http://uknu-clear.wordpress.com/2012/07/18/lies-damned-lies-and-speculat...
(11) i-Nuclear, 19 July 2012 www.i-nu-clear.com/2012/07/19/edf-says-repor-ted-strike-price-of-165mwh-...  
(12) Financial Times, 23 July 2012 www. ft.com/cms/s/0/3dda6692-d29d-11e1- 8700-00144feabdc0.html 
(13) David Toke’s Blog, 24 July 2012 http://realfeed-intariffs.blogspot.
co.uk/2012_07_01_archive.html 
(14) FT, 30 July 2012 www.ft.com/cms/s/60189878-d982-11e1-8529- 00144feab49a,Authorised=false.html 
(15) Reuters, 31 July 2012 www.reuters. com/article/2012/07/31/edf-results-idUSL6E8IV2LX20120731

Contact: Pete Roche
Email: rochepete8[at]aol.com
Web: www.no2nuclearpower.org.uk

On October 21 the big deal was announced. David Cameron and Chinese President signed their nuclear memorandum. And in a separate deal, EDF, owner of the Hinkley C nuclear power project in Somerset, UK, signed its deal with Chinese state-owned nuclear power company China General Nuclear Power Corporation.1

The government also announced that the terms of its offer to EDF on the Hinkley Plant were finalised. Cue sounds of champagne corks popping, strains of 'for he's a jolly good fellow' ...

But the nuclear deal is not all it seems. In fact it's a veritable dogs' dinner of surprises, quirks and oddities which throw up many more questions than answers. And it still leaves the key question wide open. Will Hinkley C ever actually be built? For all the claims that EDF's 'final investment decision' is a mere formality that will be made in weeks, it is no such thing. In fact, there is more reason that ever to doubt it. The official announcement, speeches and press releases may give the firm impression that it's all a done deal. But look harder and it's all stitched together with paperclips and sellotape and could fall apart at any moment.

First, the money − £6 billion is not enough

The first anomaly is that CGN will pay £6 billion for a 33.5% share in the Hinkley C project, presumably buying into what is now a wholly-owned subsidiary of EDF, the NNB Generation Company (NBB GenCo).

That's on the basis, claimed by EDF, that the project cost will be £18 billion. Now if that were the case, that would leave EDF with another £12 billion to find. Which is still a lot of money. But in fact, it's much worse than that.

But the cost has been reliably estimated by EU Competition Commissioner Joaquin Almunia at £24.5 billion − including the considerable costs of financing the construction through to completion.² In fact, he warned that if the project encountered problems the cost could end up as high as £34 billion, a figure accepted by EDF boss Laurent de Rivaz.

Given the massive problems encountered at the other sites using the same EPR reactor design, it would surprise no one if huge problems were encountered. The Flamanville EPR project in France and the Olkiluoto EPR project in Finland are both running roughly three times over the initial project cost and nine and eight years over time, respectively.³

The Ecologist also understands, following information from a well-placed industry insider, that construction ceased at the 4-reactor EPR project in Taishan, China, in mid-2014. This has not been officially announced. EDF owns 30% of the project, and CGN, EDF's Hinkley C partner 70%.

It would be foolhardy indeed to enter into the Hinkley C EPR project without having a secure funding line for, say, £25 billion lined up. Without that, investors in the project would risk running out of money before completion − with billions of pounds sunk in a doomed project.

Seen in that context, CGN's £6 billion investment is nowhere near enough. So where might the other £19 billion come from?

Raising debt not an option

The obvious answer is debt. You go to the bank, and borrow the money. But then this is a risky business. China Development Bank, Bank of China and Société Générale are already heavily exposed to Taishan and may now have cut off new funding to the project.

But that's alright, isn't it? Because the Hinkley C project has had £17 billion of UK Treasury Construction Finance Guarantees approved by the European Commission. An initial £2 billion was recently announced by Chancellor George Osborne during his recent visit to China.

These guarantees will grant security to bondholders in the project ensuring that their capital and interest are paid no matter what. But there's a catch. Under the deal agreed with the Commission, the Flamanville EPR project must be up and running before the guarantees come into effect. And until that time, the shareholders must provide billions in 'contingent equity' to cover the bondholders' risk, protecting UK taxpayers.

Flamanville was meant to be finished in 2012, but it's running late thanks to severe technical and safety problems, and under the latest project update, EDF does not expect it to be complete until 2020.⁴ And under the terms of the Commission's approval, if Flamanville is not up and running by the end of 2020, the UK's guarantees expire and bondholders must be repaid from shareholder equity.

What this means is that there is now a near-zero chance of these guarantees ever actually being taken up. Osborne's £2 billion promise in Beijing was a smokescreen. And without those guarantees, who is going to lend their money to the project?

The difficulty has been as good as admitted by EDF, which states, "The project is due to be equity funded by each partner, at least during a first stage."¹

So what's left?

That leaves EDF with two options. One is to sell additional equity in the project, and the other is to self-finance. Selling more equity in Hinkley C is certainly possible, even though the only buyer is likely to be CGN or one of its companion Chinese nuclear parastatals.

However EDF insists that it will keep a majority share in the project. So it can only sell a maximum of 15.5% to keep its own 51% − say for around £2 billion. Which still leaves it £17 billion short of the £25 billion it needs to be safe, and £10 billion short of its own cost estimate.

EDF can also self-finance and flog off its assets. And that's exactly what EDF is doing − seeking to raise €10 billion by selling its Italian subsidiary Edison and its share in U.S. nuclear company CEGN, and possibly a Polish coal mine, as reported in the Financial Times.⁵ But that still leaves it many billions of pounds short.

The company could also take on more corporate debt. Except it's already carrying far too much. According to a Bloomberg report in February this year, "Electricite de France SA's new Chief Executive Officer Jean-Bernard Levy is struggling to control the utility's ballooning debt as Europe's biggest power generator faces an investment peak this year ... Net debt climbed 2.4 percent to 33.4 billion euros (US$38 billion) last year."⁶

As for selling shares into the market, there may be few takers. EDF's falling share price has given its shareholders a loss of almost 16% over the last year.

Heavy demands on EDF cash

And EDF's problems don't end there. Flamanville problems cost EDF an unscheduled €2 billion last year, with more expected to clock up this year and in years to come. Losses at Taishan have not been declared but are surely running into billions.

And then, there is the Areva problem. Areva, another French parastatal nuclear corporation, is essentially bust thanks to a variety of mishaps including a failed US$2.5 billion uranium mine in Canada and its woes at Flamanville, where it supplied a defective steel reactor vessel which has now been incorporated into the structure. It also has problems at Olkiluoto, and at Taishan as well, where it also supplied the reactor vessels which may suffer from the same defects. It posted an eye-watering €4.8 billion loss for 2014.

The French government's answer is for EDF, which is not quite as bust as Areva, to buy into the company, buying a majority 51% to 75% stake for €1.3 billion to €2 billion.⁷ But of course the liabilities won't end there − as a basket case company with rising global liabilities Areva is sure to soak up more cash for many years to come.

And then there is the potentially enormous cost that EDF faces going forward in decommissioning its ageing fleet of nuclear power plants in France, the UK and other countries − just as its revenue stream from those reactors is cut off. These and other factor led Moody's to downgrade EDF's credit rating in April with 'negative outlook'.⁸

Another surprise − a twin EPR for Sizewell

In a footnote to EDF's press release comes another big surprise. The Sizewell C nuclear project in Suffolk is to use a twin EPR design presumably modelled on Hinkley C: "EDF and CGN have signed the Heads of Terms of an agreement in principle to develop Sizewell C in Suffolk to a final investment decision with a view to build and operate two EPR reactors. During the development phase EDF will take an 80% share and CGN will take a 20% share."

It's a surprise because most people have written off the EPR as a dead duck reactor. Following its Olkiluoto experience, for example, Finland has cancelled a second EPR project⁹ and no new orders are coming in. But also because its hard to conceive how on Earth EDF could finance its 80% share when it's already facing such a flood of liabilities and demands for cash, and no working EPR is likely to materialise for some years to come.

As for the 'Hualong' HPR1000 reactor design that CGN (66.5%) and EDF (33.5%) are to build at Bradwell in Essex, it's an entirely untested 'never built' Chinese reactor type, that represents a fusion of two other 'never-built' reactor designs, China's ACPR1000 and ACP1000.¹⁰

The ACP1000 is a purely paper reactor, while 'third generation' ACPR1000s are under construction at the Yangjiang nuclear complex in western Guangdong with a scheduled completion date of 2019.¹¹ Three actual HPR1000s are under construction at Hualong 1 and CGN's Fangchenggang units 3 and 4, the official 'reference plant' for the design of the UK's Bradwell reactor.

What these have in common with the EPR design is that no actual working reactor of the HPR1000 or its two antecedents the ACPR1000 and the ACP1000 has ever been completed.

So where do we go from here?

There is a very real possibility that EDF will be unable to raise the cash to proceed with Hinkley C.

Not helping EDF is the warning from two leading rating agencies, Moody's and Standard & Poor, to further downgrade EDF's credit rating in the event that it pursues the Hinkley C project, because of the dangers of big cost overruns and delays to EDF's untested EPR French reactor technology.¹²

Huge questions marks must also hang over the Sizewell and Bradwell nuclear projects − the first saddled with a known failed and never-built reactor design, and the second with a never-built reactor design that is a hybrid of two other never-built reactor designs.

China's long term strategic ambitions

But for all the impediments it's likely that the programme can be delivered, eventually, if China is prepared to pump in enough money − and if EDF is prepared to give up enough control and equity. Which raises the question: What's in it for them?

There is one likely answer. Hinkley C and other planned UK nuclear power stations give them a remarkable opportunity to penetrate and occupy not only the UK's nuclear establishment but France's as well.

With no other investor willing to put money into France's failing nuclear companies or the UK's increasingly desperate nuclear ambitions, China's motivations are surely not purely economic, even if there is money to be made.

It is rather that China has perceived a vulnerability and has decided to exploit it for its own long term strategic, industrial and geopolitical advantage. Remember here that the UK and France are both nuclear weapons states and permanent members of the United Nations Security Council increasingly seen as punching above their weight.

Deliberate under-financing is the oldest trick in the book for rapacious venture capitalists. You find a company in trouble, inject some cash, but not enough, and some more cash, but still not enough, and a few years down the line you're either running the company or winding it up and making off with its assets.

It may be that Chinese money will see the Hinkley C, Sizewell and Bradwell nuclear projects carried though to completion, probably accompanied by big Chinese buy-in to Areva and EDF. But China's help will come at a very high price. 

Abridged from The Ecologist, 22 Oct 2015, www.theecologist.org

References:

1. http://media.edfenergy.com/r/960/agreements_in_place_for_construction_of...

2. www.telegraph.co.uk/finance/newsbysector/energy/11148193/Hinkley-Point-n...

3. www.theecologist.org/blogs_and_comments/commentators/2985972/ukchina_nuc...

4. https://uk.news.yahoo.com/frances-edf-seeks-deadline-epr-171032486.html

5. www.ft.com/cms/s/0/fcd6a462-7578-11e5-a95a-27d368e1ddf7.html?siteedition=uk

6. www.bloomberg.com/news/articles/2015-02-12/edf-2014-profit-rises-as-powe...

7. www.ft.com/cms/s/0/fcd6a462-7578-11e5-a95a-27d368e1ddf7.html

8. www.moodys.com/research/Moodys-downgrades-EDF-to-A1-negative-outlook--PR...

9. www.theecologist.org/News/news_analysis/2859924/finland_cancels_olkiluot...

10. www.world-nuclear-news.org/E-Chinas-new-nuclear-baby-0209141.html

11. www.worldnuclearreport.org/Construction-Start-on-Unit-6-at.html

12. www.thetimes.co.uk/tto/business/industries/utilities/article4574734.ece

More delays are being predicted for the Hinkley Point C nuclear project − originally expected to be generating electricity by Christmas 2017. As revelations emerge that the site has been effectively mothballed since July 1 this year, the Stop Hinkley Campaign is calling for the project to be cancelled now, rather than waiting for its slow death.

Hinkley C is now delayed by more than five years, and will probably be delayed further according to Alan Whitehead MP. The Government wants 35% of UK electricity to be supplied from nuclear by 2028, so all the other sites will have to be magically completed by then. "Not a snowballs chance in hell that all this will happen", Whitehead says.

Instead of a complete nuclear programme by 2025, the likelihood is that there will be one plant and maybe not even that operational at that point. Time, you might think, for a plan B. What about filling the low carbon generation gap with much more easily deployable, speedily buildable, better financeable renewables? Oh, we've just taken most of those programmes out and shot them. Bit of a mess then, really.¹

Recently the media was predicting that David Cameron and China's president, Xi Jinping, would sign a deal at a meeting in the UK in October which would signify that a Final Investment Decision on Hinkley Point C had been made. The Chinese are expected to fund two thirds of the scheme.²

However there has been a chorus of voices calling for Hinkley C to be cancelled, or at least re-examined.³ Paul Massara, Chief Executive of RWE nPower said nuclear was "an expensive mistake".⁴ A Daily Telegraph editorial said "there is a risk of being lumbered with a white elephant under current plans. Amber Rudd, the energy secretary, needs to reassess them before committing taxpayers to what may be an unsustainable project at Hinkley Point."⁵

Peter Atherton of Jefferies Investment Bank calculated that we could build around 15 gas-fired power stations replacing the whole thermal generation fleet for the same price.⁶ HSBC Energy Analysts said Hinkley is becoming harder to justify and there is ample reason to cancel the project.

And the Chancellor's father-in-law, former Conservative Energy Secretary Lord Howell of Guildford, described Hinkley as "one of the worst deals ever for British households and British industry". He told the House of Lords that while he was personally "very pro-nuclear", he would "shed no tears" if the "elephantine" scheme was to be abandoned "in favour of smaller and possibly cheaper nuclear plants a bit later on".⁷

Perhaps all of this had something to do with Amber Rudd launching a project to examine the actual cost of electricity generation − including not just the cost of constructing offshore wind farms, for instance, but also of connecting them to the national grid. It will also examine nuclear power and conventional energy. The study is being conducted by Frontier Economics, the consultancy chaired by former Cabinet Secretary Lord O'Donnell.⁸ Although this might also have more to do with the Tories ongoing attack on renewables. One source told the Daily Mail: "We might conclude we need less renewable energy than we thought because there are other ways of doing it cheaper – by using technology to reduce consumer demand, for instance".⁹

Now the Construction Products Association (CPA) is predicting that the start of the main works on the nuclear site will be delayed until 2018.¹⁰

Mothballed

Two recent articles in Click Green and Professional Engineer indicate that Hinkley Point C is now officially mothballed. We already knew that site preparation work at Hinkley Point C was stopped in April 2015, up to 400 construction workers were laid off, and the Final Investment Decision was delayed until the autumn.¹¹ What wasn't clear at the time was that NNB Genco – the consortium planning to build the reactors which consists of EDF Energy, China General Nuclear Corp and other investors − put a cap on future spending on the project.¹²

On July 1 the site entered Care and Maintenance which means that activity at the site is limited to the management of material stockpiles and water management zones, remediation of asbestos contaminated land and archaeological surveys.¹³

The budget cap seems to have been more severe than the Office for Nuclear Regulation (ONR) was expecting. ONR charges NNB Genco for all the work it carries out to regulate its activities.

ONR says it has taken the decision to suspend the production of future inspection reports until a Final Investment Decision is made. It has also suspended attendance at the local liaison committee – the Community Forum. These suspensions are most likely because NNB Genco no longer has the budget to pay for them, so the consortium will have asked ONR to stop visiting the site to do inspections and stop attending the forum because it can't afford to pay.

In retaliation ONR says it is "monitoring the impact of the budget constraint upon NNB Genco's competency and capability". In other words NNB Genco had better watch out or it will lose its status as an organisation competent and capable of holding a nuclear license.

ONR says its inspectors "continue to engage with the programme of design and safety case activities" related to the start of nuclear safety related construction. Its August newsletter said that further submissions are expected in September this year and the Pre Construction Safety Case related to nuclear island construction was ready for ONR to begin initial engagement at the end of July this year.¹⁴

So while some desk work appears to be continuing all major work on-site appears to have stopped and NNB Genco is so uncertain that the final investment decision will be positive it has asked ONR to stop as much work as possible to save money – even to the point of threatening its own status as a nuclear capable organisation.

Stop Hinkley Spokesperson Roy Pumfrey said:

"With the Chinese stock market in turmoil it is hardly surprising that the construction industry is predicting yet more delays to this £24.5 billion project. But we think the CPA is being overly optimistic. By 2018 the renewable industry will have had another 2 or 3 years of falling costs and innovation, whereas nuclear costs just keep rising and technical problems mount up. Somerset should kick EDF out now so that we can get on with building the sustainable industries we need to tackle climate change, capture the jobs required and transform our energy and transport system into one over which communities have more control."

Alternative view

The Western Daily Press (August 26) gave an alternative view. It said EDF Energy played down the ONR's decision to suspend work on future inspection reports. And they reported some analysts who felt the Chinese financial turmoil would actually make an investment in Hinkley more likely. The newspaper reports that the Final Investment Decision is likely to be made in Paris after the August holidays are over, and then an announcement will be made during Chinese President, Xi Jinping, visit in October. The announcement could even see the President visit Hinkley.

The Ecologist reports that there has probably been some heavy EDF spinning in recent weeks in response to the negative coverage about the HSBC report and other bad news afflicting the Hinkley C project. As part of its media offensive, EDF has also put the word out that it is placing £1.3 billion in contracts to the mainly UK based contractors, and that a deal with China should be finalised within weeks.

So what's the real situation? For a start, says The Ecologist, it would be extremely unwise for the UK to commit any serious money to the Hinkley C project until there is a single example of a working reactor of the EPR design and legal challenges in the European Court have been safely dealt with. So until both of those major obstructions are out of the way, it's hard to imagine any meaningful deal being signed.

Now maybe the government itself has turned against the project altogether. The mood in government is increasingly towards bypassing the Hinkley C project and its failed EPR design altogether, and going straight for the more affordable AP1000 design (which has problems of its own). And EDF is desperately fighting back.

The Ecologist concludes very possibly David Cameron and Xi Xinping will sign a piece of paper in October, but will Hinkley C ever be built? The smart money says no.¹⁵ The Western Morning News said there's a big elephant in the room – Hinkley Point C − and some say the big creature in the room is actually a vast, unaffordable white elephant. When it comes to something as vast and vital as future energy generation, we can't have any elephants stalking around the room.¹⁶

Meanwhile EDF-Areva has confirmed that it will bear the cost of any over-runs associated with the Hinkley Point C nuclear power project. After Olkiluoto, Flamanville and Taishan this represents a big risk for the newly merged French state-owned company as all three of those projects have experienced costly delays.¹⁷

References:

1. Alan Whitehead MP 5th Aug 2015 https://alansenergyblog.wordpress.com/2015/08/05/the-chinese-nuclear-fai...

2. Guardian 4th August 2015 www.theguardian.com/environment/2015/aug/04/deal-to-build-uk-nuclear-pla...

3. See Stop Hinkley Press Release 13th August 2015 www.stophinkley.org/PressReleases/pr150813.pdf

4. Sunday Times 9th August 2015 www.thesundaytimes.co.uk/sto/business/Industry/article1591057.ece

5. Telegraph 12th August 2015 www.telegraph.co.uk/news/worldnews/11796778/Nuclear-warnings.html

6. Guardian 9th August 2015 www.theguardian.com/environment/2015/aug/09/planned-hinkley-point-nuclea...

7. Independent 4th August 2015 www.independent.co.uk/news/uk/home-news/government-under-pressure-to-aba...

8. H&V News 24th Aug 2015 www.hvnplus.co.uk/news/government-to-calculate-cost-of-generating-electr...

9. Mail on Sunday 22nd Aug 2015 www.thisismoney.co.uk/money/news/article-3207201/Energy-review-spells-en...

10. Construction Products Association Press Release 24th August 2015 www.constructionproducts.org.uk/news/press-releases/display/view/cpa-for...

11. Gloucestershire Echo 2nd April 2015 www.gloucestershireecho.co.uk/400-jobs-lost-Barnwood-based-EDF-stops-sit...

12. Click Green 20th Aug 2015 www.clickgreen.org.uk/news/national-news/126381-exclusive-edf-mothballs-...

13. Professional Engineering 20th Aug 2015 www.power-eng.com/articles/2015/08/construction-halted-at-hinkley-point-...

14. See page 7 ONR Regulation Matters August 2015 www.onr.org.uk/documents/2015/regulation-matters-issue-1.pdf

15. Ecologist 6th Aug 2015 www.theecologist.org/News/news_round_up/2977744/hinkley_point_c_is_it_al...

16. Western Morning News 18th Aug 2015 www.westernmorningnews.co.uk/Comment-New-nuclear-reactor-Somerset-hugely...

17. Power Engineering 20th Aug 2015 www.powerengineeringint.com/articles/2015/08/edf-areva-to-take-on-the-co...

Reprinted from nuClear news, No.77, September 2015, www.no2nuclearpower.org.uk/nuclearnews/NuClearNewsNo77.pdf

Dounreay: 'significant' hot particle found on beach.
Experts have discovered the most significant radioactive particle yet on a public beach two miles (approximately 3km) west of the redundant nuclear site of Dounreay, Scotland, UK. Dounreay clean-up contractor DSRL has informed the Scottish Environment Protection Agency of additional tests being carried out on a particle recovered during routine monitoring of a beach near the redundant nuclear site. The particle was detected at the water's edge at Sandside. The beach at Sandside is located. The particle - detected on February 14 - was the 208th to be recovered from the beach at Sandside in the last 15 years.

Provisional checks carried out on the beach indicated the particle had a higher than normal beta dose rate. A spokesman for DSRL said it was the first time a particle classed as significant - the highest classification in terms of radioactivity - had been found on the beach, although many had been found on the seabed and foreshore at Dounreay as well as on the site itself. Any particle with radioactivity above one million Becquerel (Bq) units is classed as significant.

Work is due to resume in May to clear particles from the seabed near the site. More than 1800 have been recovered so far from the seabed where there is evidence of a "plume" from historic effluent discharges dating back 50 years. Particles are fragments of irradiated nuclear fuel.
Dounreay Site restoration Ltd, website, February 20, 2012 / The Herald, Scotland,  21 February 2012

Defend democracy; Unite to shut Vermont Yankee down!
In 2010, the citizens and legislature of the State of Vermont, with support from their neighbors in Massachusetts and New Hampshire, decided to close the Vermont Yankee nuclear reactor permanently by March 21, 2012, when VY's 40-year license expires. In 2011, Entergy, the New Orleans mega-corporation that owns Vermont Yankee, sued the State of Vermont, defying the democratic will of the people, to keep their aged, accident-plagued reactor running for 20 more years. On January 19, 2012, federal district court judge J. Garvin Murtha sided with Entergy against the State of Vermont and the people of New England. On February 18, the State of Vermont appealed Murtha's ruling. With the future of VY still hanging in the balance, nonviolent citizen action is more important than ever.

Let us make clear: We will NOT allow unbridled corporate power to deprive us of our inalienable right to live in safety on our homes, and to determine our own energy future – a future that is safe and green for our children and our children's children. Many events have taken place and will take place to shut Vermont Yankee down. The most important one is 'Occupy Entergy HQ' on March 22. There will be a brief rally at the Brattleboro, VT Commons starting at 11:00am, then a walk to Entergy Headquarters on Old Ferry Rd. in Brattleboro (3.5 miles) where there be a direct action, likely to include civil disobedience.
More information at: http://sagealliance.net/home

Franco-British nuclear cooperation agreement.
On February 16, UK Prime Minister Cameron met his French counterpart Nicolas Sarkozy in Paris at a joint summit for the first time since their bitter clashes over Europe. The joint declaration on energy made contained a range of goals, the greatest of them being to encourage "the emergence of a Franco-British industry that is highly competitive across the whole supply chain at the international level." Most prominent in this will be the work of France's majority state-owned firms EDF and Areva and their cooperation with privately held UK firms for the construction of new reactors in Britain.

The agreement to co-operate on developing civil nuclear energy is meant to pave the way for the construction of new nuclear power plants. It was accompanied by the news of a deal between Rolls-Royce and French nuclear reactor developer Areva. Areva has asked Rolls to make complex components and provide engineering and technical services for two reactors to be built at Hinkley Point, Somerset.

But not everybody is confident that the agreement will bring much for Britian's industry. According to Tim Fox, head of energy at the Institution of Mechanical Engineers "Although some relatively small contracts are to be awarded to Rolls-Royce and BAM Kier, it looks increasingly likely that the vast majority of the contracts involved in the manufacture and construction of the new nuclear reactors at Hinkley Point and Sizewell will go to France rather than the UK." Friends of the Earth's Energy Campaigner Paul Steedman said: "Cameron's deal today will leave British taxpayers footing a massive bill for new nuclear plants we don't need and can't afford - while EDF continues to rake in huge profits."
World Nuclear News 17 February 2012 / FOE Press release,  17 February 2012 / The Manufacturer, 17 February 2012

Meanwhile at Hinkley Point ….
From Febr. 12 on, following an occupation of trees a week earlier, activists are occupying a farmhouse close to Hinkley Point, to stop EDF Energy trashing land for the planned new nuclear power station. Anti-nuclear campaigners have been joined by members of Seize the Day as the first residents of Edf-Off Cottage which is on the 400-acre site earmarked for two new reactors.

At the High Court on February 27, EDF Energy failed in their bid to impose an injunction to stop an alliance of anti-nuclear groups from protesting on the 400-acre site set aside for two new mega-reactors at Hinkley Point. This injunction was being sought to remove these campaigners, but it was simultaneously designed to restrict future demonstrations. The Orwellian language even prohibits campaigning groups from 'encouraging other persons' to protest at the site. Speaking on behalf of the Stop New Nuclear alliance, Kate Hudson from CND stated "It should be inconceivable that private companies could restrict basic civil liberties in this way. They are not the arbiters of the nuclear debate, nor the guarantors of our freedoms. We will fight to ensure the rights of future generations to peaceful protest and to preserve essential democratic principles."

On 10 and  11 March, one year since the Fukushima nuclear disaster began, antinuclear groups call for a human chain/blockade around the station to show "our determined opposition to new nuclear".
www.stopnewnuclear.org.uk

Spain: OK for 41-year old Garona life extension. Spain's nuclear security agency CSN has determined that the country's oldest nuclear reactor, the 468 MW Santa Maria de Garona nuclear power plant, is safe to operate until 2019, in response to a request by the industry minister to review the installation. The approval, disclosed on February 17, clears the way for the recently installed Spanish conservative government to overturn the previous socialist government's 2009 order to have the generator closed in 2013. Although the CSN said there was "no safety or security issue that should impede continued operation of the power plant", the agency added that it would still have to review any formal application by the operator to extend the installation's license, including scrutiny of its latest operating data and future security measures being considered. Garona was first connected to the grid in March 1971!
The CSN in 2009 had given authorization for the station to operate for another 10 years, but the government at the time opted instead for an earlier expiration date. Since then, new regulations have been put in place, particularly following the accident at Japan's Fukushima nuclear power plant early last year.
Platts, 20 February 2012

World oldest reactor (44 years) closed. The world's oldest operating nuclear power reactor – Unit 1 of the Oldbury nuclear power plant in the UK - has been closed after 44 years of power generation on 29 February 2012. Unit 2 was shut down in June 2011, while unit 1 was expected to continue operating until the end of this year. Plant operator Magnox Ltd announced last October that it had decided to end operations ten months early as it was "no longer economically viable."
World Nuclear News, 29 February 2012

Beznau now oldest in world; call for closure.
After Oldbury's closure, Switzerland's Beznau nuclear plant holds the dubious record of being the oldest nuclear plant in the world and should be shut down, a group of environmental organizations said on February 23. Switzerland is phasing out nuclear energy but not fast enough, say the groups. They list a number of problems and point out that the company that runs it is planning to increase the earmarked CHF500 million (US$ 557m or 415m euro) to make it safe, money they believe could be better spent shutting it down and moving to safer energy sources.
Genevalunch.com, 23 February 2012

U.S.: Fourth Legislative Attack on Grand Canyon Uranium Ban Fails… The fourth legislative attempt to block the Obama administration's ban on new uranium development across 1 million acres of public land surrounding Grand Canyon National Park died February 14, when the House rules committee ruled it out of order. The amendment was sponsored by the same three Republican congressmen who sponsored three previous failed anti-Grand Canyon legislative proposals - Jeff Flake, Trent Franks and Paul Gosar, all from Arizona. The most recent amendment sought to overturn a January decision by Interior Secretary Ken Salazar enacting a 20-year 'mineral withdrawal' that bans new mining claims and development on existing claims lacking rights-to-mine across Grand Canyon's million-acre watershed (see Nuclear Monitor 740, 13 January 2012, In Briefs).

In 2010 and again in 2011, Flake, Franks and Gosar sponsored legislation that would have prohibited the Interior Department from enacting the mining ban; in 2011 they attempted to add a rider to a budget bill - their third failed attempt prior to this most recent amendment.

Over the past few years, nearly 400,000 people from 90 countries wrote the Department of the Interior urging it to ban new uranium mining around the canyon after a uranium boom threatened to bring a new wave of destructive mining threatening recreation, tourism, wildlife habitat and waters in Grand Canyon National Park. The mining ban has won wide support among American Indian tribes, regional businesses, elected officials, hunting and angling groups, scientists and conservationists.
Press release Centre for Biological Diversity, 16 February 2012

….but next attack imminent. The withdrawal of lands in northern Arizona from mining activities is unconstitutional, unlawful and violates the National Environmental Policy Act, said organisations representing the US mining and nuclear industries in a lawsuit against US Interior Secretary Ken Salazar.

The suit has been filed with the US Federal District Court in Arizona by the National Mining Association (NMA) and the Nuclear Energy Institute (NEI), the US nuclear energy industry's organization. The Department of the Interior (DoI), US Bureau of Land Management (BLM), US Forest Service and US Department of Agriculture are named as co-defendants alongside Salazar, in his capacity as Interior Secretary.

The NEI and NMA argue that Salazar does not have the legal authority to make withdrawals of public lands in excess of 5000 acres, citing a landmark 1983 Supreme Court ruling that such withdrawals would be unconstitutional. Furthermore, they claim, the decision to withdraw the land is "arbitrary, capricious, and not in accordance with law." Finally, the environmental impact statement (EIS) and record of decision on the withdrawal violate the terms of the National Environmental Policy Act (NEPA) in failing to take a "hard look" at the economic and environmental consequences of the withdrawal.
World Nuclear News, 28 February 2012

Finland: Uranium mine granted permission.
The Finnish Talvivaara mine today gained permission to extract uranium and process it into uranium oxide. The UO4 would be transported away by rail and ships, possibly to Russia. The mine was opened a few years ago mainly as a zinc mine. It's using an experimental biosoaking process to extract small amounts of minerals from the ore. The company has been crippled by scandals from the beginning, with sulphuric acid and other chemicals continuously spilling all over nearby woods and lakes. The company has failed to make any profit so far and its CEO was forced to quit last year.

In a strange technocratic turn of events, the environmental authorities concluded that instead of closing down the mine, it would be beneficial to grant the mine a permission to separate the uranium from the rest of the waste so that the further spills bound to happen at least wouldn't contain radioactive materials. As a last minute effort, environmentalists tried to convince the government to at least demand a description of the separation process so as to ensure this doesn't just produce a lot more radioactive/toxic sludge. The government decided not to do so and instead just granted the permission "because it brings 40 million euros worth of investment to the area".

The local municipality and just about every major business in the area was opposed to the permission after the previous scandals and their trade being spoiled by the smelly pollution in the environment.
Jehki Harkonen, energy campaigner Greenpeace Nordic, Helsinki, 1 March 2012

Rosatom-owned company accused of selling shoddy equipment to reactors.
Russian Federal Prosecutors have accused a company owned by the country’s nuclear energy corporation, Rosatom, with massive corruption and manufacturing substandard equipment for nuclear reactors under construction both at home and abroad.  The ZiO-Podolsk machine building plant’s procurement director, Sergei Shutov, has been arrested for buying low quality raw materials on the cheap and pocketing the difference as the result of an investigation by the Federal Security Service, or FSB, the successor organization to the KGB. It is not clear how many reactors have been impacted by the alleged crime, but reactors built by Russia in India, Bulgaria, Iran, China as well as several reactor construction and repair projects in Russia itself may have been affected by cheap equipment, given the time frame of works completed at the stations and the scope of the investigation as it has been revealed by authorities.
Bellona, 28 February 2012

The U.K. government and the nuclear industry want us to believe that nuclear new-build in Britain is a done deal. They want to discourage us from protesting – the message they want us to swallow is clear: opposition is futile, and we will be going ahead anyway!

However, that couldn't be further from the truth. Yes, the government has introduced a framework which effectively will subsidize new nuclear at our expense – as electricity consumers and taxpayers. Yes, the government has effectively deprived local communities from having a say in the planning process for new nuclear and other major infrastructure projects thus dumping a crucial cornerstone of local democracy.

But nuclear new-build in Britain is already behind schedule and has faced legal and other setbacks. Public concern is mounting following the Fukushima disaster. If we can stop the building at Hinkley, we can stop the whole process. Now is the time to mobilize and take action.

New-nuclear in Britain is far from being a done deal, and we can still stop it!

Hinkley Point is the first of eight proposed sites for nuclear new build to go ahead. We stopped them here before, and we can do it again. If they fail at Hinkley, it is unlikely the “nuclear renaissance” will have the momentum to continue.

On 3 October 2011 we, the 'Stop New Nuclear' Network, will – with hundreds of people – non-violently blockade the access to Hinkley Point nuclear power station for one day.

The Stop Nuclear Power Network is a UK-based non-hierarchical grassroots network of groups and individuals taking action against nuclear power and its expansion and supporting sustainable alternatives. We encourage and seek to facilitate nonviolent direct action, as well as more conventional forms of campaigning. The alliance has been founded by the Campaign for Nuclear Disarmament, Stop Nuclear Power Network UK, Kick Nuclear, South West Against Nuclear, Shutdown Sizewell, Sizewell Blockaders, Trident Ploughshares and Stop Hinkley. Groups in different areas of the UK are already mobilizing campaigners to travel to the protest.

While the blockade will be the key focus, there will be plenty of roles and activities for people who do not wish to risk arrest. So everyone who is anti-nuclear can come and join us on the day to express their opposition in many different ways. We will prepare ourselves for this blockade with non-violence training, and we will not be deterred by police trying to prevent our non-violent action.

The blockade on Monday October 3, will be inclusive, allowing people from all walks of life and with a wide range of experience in non-violent action – or no experience at all – to participate. We will organize a safe environment for everyone, built on trust for each other, but also on our determination to stop nuclear new-build.

In the days before the blockade, there will be local actions in Bridgwater. There will be a camp and local accommoda­tion for people over the weekend and non-violence training will be provided.

Source and contact: Stop New Nuclear, c/o 5 Caledonian Road, London N1 9DX, U.K.
Tel: +44 845-2872381
Email: campaign@stopnewnuclear.org.uk
Web: http://stopnewnuclear.org.uk