Japanese conglomerate Hitachi has pulled out of the construction of two U.K. nuclear projects with a total 5.8 GW of generation capacity, citing ongoing delays and an increasingly tough investment environment due to the Covid-19 pandemic.
The projects, on the Welsh Isle of Anglesey and at Oldbury on Severn, near the English city of Bristol, were taken on by Hitachi in 2012. Construction was suspended in January last year as funding could not be secured for the reactor at Wylfa Newydd, on Anglesey, and Hitachi’s U.K. subsidiary Horizon Nuclear Power has confirmed it will cease development at both sites, though it still hopes to revive the projects.
Hitachi said it would coordinate with government and other stakeholders as holder of the license to build nuclear reactors at the sites. The company posted losses last year from the suspended projects and said it does not expect the decision to further affect its finances.
Project development business Horizon said it hoped to revive both projects and would keep lines of communication open. “Wylfa Newydd, on Anglesey, and Oldbury on Severn are highly desirable sites for new nuclear build,” said Horizon Nuclear Power chief executive Duncan Hawthorne. “We will do our utmost to facilitate the prospects for development which will bring the major local, national and environmental benefits that nuclear can uniquely deliver as we push to transition to a net zero carbon economy by 2050.”
A government spokesperson said the U.K. remained committed to nuclear power and had supported the projects: “We previously offered a significant package of potential support to this project that went well beyond what any government has been willing to consider in the past,” the spokesperson told national broadcaster the BBC. “This included taking a one-third equity stake, providing all of the required debt financing to complete construction, and providing generous financial support through our contract-for-difference [energy incentive] scheme.”
The U.K. opposition Labour party urged further action from the government to revive the projects. “The cancellation of what would have been the largest energy project in Wales, if it cannot be reversed, could have huge consequences, including the loss of between £15 billion (€16.4 billion) and £20 billion in investment,” said Alan Whitehead, shadow minister for energy and a green new deal. “It will also prevent the creation of thousands of jobs in the energy sector and wider U.K. supply chain. Ministers must urgently outline whether they plan to seek new developers to take on the Wylfa project, what conversations they have had with Hitachi about the site and how they will ensure the people of Wales do not pay the price for Hitachi’s withdrawal.”
Critics of nuclear power are likely to view the Hitachi decision as further evidence of the inherent cost and complexity problems associated with the technology, and will repeat arguments the U.K. and other regions would be better served by an energy transition focusing on renewables.
Mycle Schneider, lead author of the World Nuclear Industry Status Report told pv magazine: “Nuclear power plant projects frequently get abandoned even after construction has started. One in eight construction sites have been abandoned at various stages of advancement of construction. Some have been completed and never switched on, and there is absolutely no guarantee that Hinkley Point C will ever generate power,” said Schneider, in reference to a third planned nuclear plant in the southwest of England.
“It has become obvious that renewables, even unsubsidized, come in at a fraction of the cost of new nuclear power. In the U.K., onshore and offshore wind are less than half the cost of nuclear. If the U.K. government keeps planning for nuclear power plants, it’s not because there was no choice, and it has nothing to do with market-economy driven energy policy.”
Solar industry representatives also called on the government to recognize renewables' potential to fill in gaps left by abandoned and delayed nuclear projects and to implement supportive policies, as well as an auctioning system to boost large-scale projects. “The UK is facing a significant low-carbon energy gap in the 2030s, resulting from the abandonment of new nuclear projects,” said Chris Hewett, Chief Executive of the Solar Trade Association. “Solar PV is well-positioned to help plug a significant portion of this, but the Government must step in to bring down the numerous barriers that are holding growth back, such as punitive business rates and a lack of prioritization of grid capacity for the technology.”
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