Meltdown: EDF Desperate For Multi-Billion Government Guarantee For Nuclear Reactor
EDF Energy is in talks with the UK government that could see taxpayers help guarantee some of the cost of a new multi-billion pound nuclear reactor in Somerset.
The world’s biggest operator of nuclear reactors is in early stage talks with the Treasury about underwriting some of the financing of the reactor at Hinckley Point, which is expected to cost about £7bn.
The hope is that any guarantees will help persuade some of the world’s largest pension funds to stump up money to help create the next generation of nuclear reactors in Britain.
Any agreement by the UK would be be politically controversial given the government has been clear it would not subsidies the generators. However, last summer the Treasury launched a £40bn UK Guarantees Scheme intended to underwrite certain major infrastructure projects with the aim of encouraging private investment in them.
EDF said on Monday night that “we are aware of the scheme and we are examining the applicability and the scope of the scheme as any other investor that potentially meets the qualifying criteria will be”.
EDF is under pressure to reduce the risk in the project after Centrica last week declined to exercise an option to take a 20pc stake in the project, which is also building a reactor in Sizewell, Suffolk, as well as one in Hickley Point. Any agreement about using the Guarantee Scheme to help guarantee some of the cost of the projects would only happen after EDF and the government have agreed on on a price for the power that will be generated at the new plants.