Westminster Ads

The majority of costs and dates used in our Westminster advertising campaign come directly from an Impact Assessment published by the Department for Business, Energy and Industrial Strategy (BEIS) on 26 October 2021, when the Nuclear Energy (Financing) Bill was introduced into Parliament. The remainder are from other official documents or media reports.

The Impact Assessment drew on a report, Electricity Generation Costs, by Leigh Fisher to calculate the potential range of construction costs and time for an illustrative gigawatt nuclear power plant.

1. Costs: The impact assessment states (page 10): “On average, the construction cost of a nuclear power plant is around

  • 20% higher than expected at the point of FID [Final Investment Decision] based on data from nth of a kind nuclear power plants built in Europe; and
  • 100% higher than expected at the point of FID based on data from all nuclear power plants built after 1990.”

Applying these optimism bias assumptions to the estimated construction cost of Hinkley Point C, at FlD, gives the construction cost assumptions of £7,700/kW and £13,000/kW.”

For the 3.2GW project at Sizewell C, these figures translate into a range of £26.3 billion to £42.8 billion with a mean of £35 billion.

Hinkley Point C’s current estimated cost is £25-26 billion (2015money; in 2015 the CPI was 100; in April 2022, it was 119 so in today’s money, the range is £29.7 – £30.9 billion). This compares to the cost calculated at a Final Investment Decision (FID) in 2016 of £18 billion, i.e a 38 – 45% increase, with 5 years still to go.

Other recent projects of essentially the same design – Olkiluoto in Finland and Flamanville in France, are running at around 270 – 285% overspent (see below). Flamanville has yet to start up and Olkiluoto has yet to supply power to the grid.

In May 2020 EDF estimated Sizewell C’s cost at £20 billion (2020 money), since which time the project has undergone 22 changes and there have been major increases in the cost of construction materials and fuel.

2. Time:  The BEIS impact assessment states (page 12): “On average, the construction period of a nuclear power plant is around;

  • 40% higher than expected at the point of FID from data of nth of a kind nuclear power plants built in Europe; and
  • 90% higher than expected at the point of FID from data of all nuclear power plants built after 1990.

Applying these optimism bias assumptions for a range of plant designs to the construction costs above gives generalised construction period assumptions of 13 and 17 years.”

If Sizewell C is granted planning consent and receives other regulatory approvals, EDF is targeting mid 2023 for a Final Investment Decision with construction starting later in the year, giving  potential completion dates – based on the impact assessment’s range of 13 to 17 years – of 2036 to 2040, with a mean date of 2038.

EDF claimed in 2008 that Hinkley Point C would be generating energy by 2017. Construction only started in 2018 but the completion date has already been extended 4 times since the FID was taken, and current estimates stand at June 2027 for reactor 1, with reactor 2 operational 12 months later. EDF says “the risk of further delay of the two units is assessed at 15 months”.  This would make the time from FID to commercial operation 12 – 13 years.

According to The Times, EDF also initially claimed that Sizewell C could be generating energy by 2021 (indeed, a community newsletter from 2008 suggested construction could begin in 2013, see page 9). Upon his departure in 2017, EDF’s Vincent de Rivaz revised this to 2031. However, with a start date not before 2023, Sizewell C is very unlikely to be generating until at least the mid 2030s, and possibly much later.  Compared to Hinkley Point C, which took less than two years from its first public consultations to applying for planning consent, Sizewell C took seven and a half..

EDF argues that Sizewell C is “unlikely” to suffer the same delays as Hinkley Point C because the reactors are a copy and the “learning” from Hinkley Point C will be applied. If the designs are actually a copy, this implies that none of the learning from Hinkley will result in any design changes. This seems unlikely.  EDF claims that what is being built at Hinkley Point C is the “UK EPR” and therefore a “First of a Kind”. This claim contradicts statements by CEO Simone Rossi in 2018“Sizewell C will be a proven technology, representing the 7th and 8th EPR Units, and the first 4 units will soon be operational in China, France and Finland.” EDF does not appear to have learned from builds one to four, at:

Regardless of whether it is possible to replicate Hinkley Point C’s reactors, it is not possible to replicate the location. The Sizewell C site is complex and constrained, requiring huge sea defences and a unique approach to the build, which may add time and expense.

3. We’ll All Pay:

Financially: Unlike Hinkley Point C, which is financed by EDF and its Chinese partner, China General Nuclear, the government intends to add a nuclear “tax” – using a Regulated Asset Base model – to all energy bills to help  finance Sizewell C. This tax will be applied to all UK households (aside from N Ireland) regardless of whether customers have chosen a renewable tariff or a regular tariff.  The government claims that this would be on average £1/month, but has not published its supporting calculations. Professor Steve Thomas of the University of Greenwich has calculated that only under the most optimistic scenario in the impact assessment referred to above is the average of £1/month achievable. Overall payments by households during construction could increase up to threefold between best and worst case scenarios – from £148 to £431 – and inflation has not been included.  Even using a very conservative figure of 2% inflation, the midpoint of time, construction cost and return comes out at well over £1/month.  If – as the government’s target of 24GW by 2050 (“a reactor a year”) appears to assume – 7 gigawatt dual stations were under construction simultaneously, the surcharge per household could peak at £115 per year.

Environmentally: The Sizewell C site is wholly within the Suffolk Coast & Heaths Area of Outstanding Natural Beauty and surrounded by habitats that are internationally protected. The project is opposed by the Royal Society for the Protection of Birds, whose flagship Minsmere Nature Reserve adjoins the Sizewell C site, and the Suffolk Wildlife Trust, who manage Sizewell Marshes Site of Special Scientific Interest, of which around 6 hectares will be lost forever. The project is not sustainable, there being no guaranteed water supply. Potable water for construction will have to be supplied by a water desalination plant, an option EDF previously discounted “due to concerns with power consumption, sustainability, cost, and wastewater discharge. The desalination process is typically energy intensive, and the discharge of brine water as a result of desalination may not be suitable for discharge through the combined drainage outfall.” (page 146)