Hinkley Point costs increase by £1.5bn

posted by Francis Churchill
3 July 2017

The projected costs of Hinkley Point C have increased by £1.5bn, according to EDF.

EDF also said there was a risk the project could be delayed by up to 15 months, at an additional cost of around £700m.

EDF has increased the completion cost for the new nuclear power station to £19.6bn, six months after the government green-lighted the project.

The increased costs are a result of design adaptations to meet UK regulations, a re-evaluation of the volume of work as well as the “gradual implementation of supplier contracts”. 

In response the UK government said all construction costs, including overruns, sit with the contractor and that UK consumers wouldn’t pay anything until construction was complete.

EDF said: “The estimated additional costs result mainly from a better understanding of the design adaptated [sic] to the requirements of the British regulators, the volume and sequencing of work on site and the gradual implementation of supplier contracts.”

EDF, majority owned by the French state, is providing two thirds of the funds for the new reactor, with the rest coming from the state-owned China General Nuclear Corporation. When complete, it is expected to provide 7% of the UK’s energy needs.

The plant is due to be operational by 2025 and will be subsidised by a fixed energy price of £93 per megawatt hour for the first 35 years, double the average wholesale price in 2015. The project was recently criticised by the NAO, the public spending watchdog, which said the government had not considered the cost to consumers past 2030.

A spokeswoman for the Department of Business, Energy and Industrial Strategy said: “The developer has made clear the project remains on track to meet its first major milestone in 2019.

“Hinkley Point C will be the first new nuclear plant in a generation. This was an important strategic decision to ensure that nuclear is part of a diverse energy mix in the UK. Consumers won’t pay a penny until Hinkley is built.”

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