Stop Sizewell C Press Statement, 8 September

Stop Sizewell C noticed a few points relevant to Sizewell C and nuclear in Liz Truss’s speech on energy.

She said green levies would be temporarily suspended but gave no indication of how long such a suspension would last – potentially the two years that the energy bill price cap would be frozen for. Sizewell C can only be financed by adding a nuclear levy to struggling households, because the markets won’t touch it without being guaranteed money back during construction. (Nuclear is not green, but a Treasury led public consultation on the “taxonomy” of nuclear energy is expected this autumn.) Does this mean Sizewell C could not start during such a freeze?

She said “Great British Nuclear” would be launched later this month, but Sizewell C is not British. It has been developed by two state-owned entities, EDF and CGN, and EDF will have to manage construction. It’s also likely that overseas funders will be necessary. The UK’s nuclear industry is reliant on overseas uranium. Sizewell B is currently fuelled by enriched uranium from Russia and the fuel for its next outage (ordered before the invasion of Ukraine) is from the same source.

Ms Truss announced a Net Zero review and said the Business Secretary is to set out a plan in the next two months on how to make the UK a net energy exporter by 2040. The UK has been regularly exporting energy to France in recent months given that such a high proportion of French nuclear reactors have been offline.

Ms Truss also said that renewable and nuclear generators would move onto Contracts for Difference which would break the price link with gas, but it is unclear what this might mean for Sizewell C, which is expected to be financed via a Regulated Asset Base

Stop Sizewell C says: “By suspending green levies Liz Truss has backed herself into a corner. Slow, damaging, £30 billion Sizewell C can only be financed by adding a nuclear levy to struggling households, because the markets won’t touch it without being guaranteed money back during construction. Her government’s review of Net Zero should conclude that Sizewell C must be cancelled.”

A Survation poll for the Mail on Sunday shows overwhelming support for renewable energy, with 74% backing investment in solar, 69% in offshore wind, 64% wave and 63% onshore wind and tidal, compared to just 38% for nuclear. A further 69% backed energy efficiency.

Calculations by Professor Steve Thomas of the University of Greenwich Business School for Stop Sizewell C, suggest even optimistic assumptions about inflation and the overall cost of Sizewell C will increase the burden on households well above the government’s estimate of “£1 a month”.

Press Statement, 5 September 2022

Stop Sizewell C says: “If Liz Truss wants to cut green levies on energy bills and avoid being accused of complete hypocrisy, she will have real trouble supporting Boris Johnson’s last-ditch attempts to tie her to Sizewell C. This slow, damaging £30bn project can only be financed by adding a nuclear levy to struggling households, because the markets won’t touch it without being guaranteed money back during construction. The irony is that the government intends to try and re-label nuclear as “green” – which it certainly isn’t – making Liz Truss’s promise even more of a contradiction.”

A Treasury led public consultation on the “taxonomy” of nuclear energy is expected this autumn.

Liz Truss’s dilemma was highlighted by a Survation poll for the Mail on Sunday shows overwhelming support for renewable energy, with 74% backing investment in solar, 69% in offshore wind, 64% wave and 63% onshore wind and tidal, compared to just 38% for nuclear. A further 69% backed energy efficiency.

Calculations by Professor Steve Thomas of the University of Greenwich Business School for Stop Sizewell C, suggest even optimistic assumptions about inflation and the overall cost of Sizewell C will increase the burden on households well above the government’s estimate of “£1 a month”.

Stop Sizewell C condemns Boris Johnson’s visit and support for Sizewell C, speculating that the blessings of an outgoing Prime Minister may be the kiss of death.

Stop Sizewell said:  

“Like multiple vanity projects such as the Bridge to Northern Ireland and “Boris Island” airport, Sizewell C is another Boris Johnson infrastructure blowout that his successor should consign to the bin. When every penny matters, it’s totally wrong to shackle the next Prime Minister and billions in taxpayers’ money to this damaging project, whose ballooning cost, lengthy construction, failure-prone technology [1] and long term water supply [2] are so uncertain.”

“Sizewell C would not be British, nor secure. It would be developed by an arm of a foreign government, probably with considerable foreign ownership and be reliant on overseas uranium.” [3]

Stop Sizewell C urges Boris Johnson’s successor to totally review the Sizewell C project. Candidate Liz Truss has said she plans to cancel green levies on bills, but if she were to continue to support Sizewell C, it can only be financed if a nuclear levy is added to household bills. 

The burden on households has not yet been revealed. It is likely to be well over the “£1 a month” claimed by BEIS [4] whose calculations ignore inflation. [5] Campaigners speculate that investors will remain wary of risky Sizewell C unless they are guaranteed a generous rate of return during construction. Boris Johnson’s aspiration of eight nuclear projects will massively increase this burden.

The quoted £20 billion cost now appears to be acknowledged as being up to £30 billion, raising the prospects that a greater sum in equity – expected to be approximately one third, with the remainder debt – will be needed. Investors will only be lured to support the project if  the very high risks of overspends are taken on by the government and therefore tax and bill payers. In recent weeks Simon Clarke, Chief Secretary to the Treasury, reportedly expressed concern that the scale of the investment required would significantly affect spending and fiscal choices for an incoming government.

Stop Sizewell C added: “A truly visionary legacy for Boris Johnson would be to ditch Sizewell C, which is most definitely not green, and focus on cheaper, quicker renewables and insulation, which are.”

Protestors plan to greet the Prime Minister with placards reading “Wrong Decision” but “It’s not too late” #StopSizwellC.

Notes

1. Nuclear projects have a consistent track record of costing more and taking longer to build than planned, especially EDF’s EPR reactor where none have managed to be built to schedule. China’s Taishan I EPR reactor was offline for 12 months because of fuel failure. EDF claims this can be resolved by making the fuel assemblies more robust but the ONR confirmed they were also looking at the circulation of coolant water which is thought to exacerbate the risk of fuel damage. Flamanville continues to be beset by construction problems
2. In granting Sizewell C planning consent, Business Secretary Kwasi Kwarteng overruled the Planning Inspectorate who did not recommend the project be consented because the long term water supply was not secured.
3. Sizewell B’s current and next batch of fuel, ordered last year, uses enriched uranium from Russia. The invasion of Ukraine has prompted a “scramble” to secure alternative supplies. https://www.telegraph.co.uk/business/2022/05/21/scramble-stop-russian-uranium-fuelling-britains-nuclear-power/
4. https://www.gov.uk/government/news/new-finance-model-to-cut-cost-of-new-nuclear-power-stations
5. https://stopsizewellc.org/core/wp-content/uploads/2022/05/Updated-RAB-calculations-with-inflation-by-Prof-Steve-Thomas.pdf