New Build

As part of the UK’s energy strategy, nuclear has been allocated a free role “to contribute as much as possible” towards meeting the need for new non-renewable energy capacity. And with the green light given to new build investment, energy companies have been quick to seize the growth opportunities offered by nuclear power.

By Jack Craze in London

The European Union and national governments have set strict regulation targets for EU nations to increase their renewable energy production by 2020.  

In the UK, we face legally-binding targets to ensure that 15% of our energy comes from renewable sources by this time frame – almost a seven-fold increase in the share of renewables in scarcely more than a decade.  

The UK Renewable Energy Strategy and the Low Carbon Transition Plan set out how the UK will meet these targets and reduce our carbon emissions.  

Both documents propose lead scenarios in which we could see 30% of our electricity generated by renewables by 2020, with another 10% coming from other low carbon sources, including nuclear.  

In order to achieve our national energy objectives and emissions reduction targets, the UK will require a major investment in new energy infrastructure.  

According to the Draft National Policy Statement for Nuclear Power Generation, we will need approximately 60 gigawatts (GW) of net new capacity in the next 15 years.  

Of this total, 25GW will come from non-renewable sources, a significant proportion of which is expected to be generated by nuclear power. 

In this way, nuclear is a key building block for the UK’s low carbon future.  

As a spokesman for the Department of Energy and Climate Change (DECC) told Nuclear Energy Insider:  “although the UK has a lot of energy coming on line in the next ten years, in order to reach our emissions reduction targets it is essential that this energy is low carbon.  

“Nuclear is low carbon and low cost. We need it as part of a strong energy mix, and that is why we have removed regulatory barriers to help speed up the new build planning process.” 

Opening the door to nuclear development 

In 2008, the UK Government announced that it was in “the public interest to allow energy companies the option of investing in new nuclear power stations”, and that “the active steps necessary” should be taken to facilitate this investment.  

Energy companies have welcomed these measures, and with the moratorium on new build nuclear projects lifted, commitments have been made to develop 16GW of new nuclear generation capacity by the end of 2025.

 Leading the charge is EDF, who in January 2009 completed the purchase of British Energy and all its assets for £12bn, including the Government’s 36% stake which comprised 10 nuclear sites.  

With land suitable for new build at seven sites in England and Wales, EDF have made public their intentions to develop four new nuclear reactors, the first to be operational by 2017, and to generate 6.4GW of new nuclear energy.  

The reactors will be built in partnership with Centrica, who in May 2009 invested £2.3bn in EDF’s UK nuclear business. 

E.ON and RWE, meanwhile, have launched a joint venture – Horizon Nuclear Power – to secure land for new nuclear development in the UK.  

Following a competitive auction, in April 2009 the two companies successfully purchased sites at Oldbury and Wylfa from the National Decommissioning Authority (NDA), and unveiled plans to deliver at least 6GW of new nuclear capacity.  

Colin Scoins, Director of Development at E.ON, described the site acquisitions as “a crucial milestone”, and said that the development of new nuclear power stations, alongside renewables and cleaner fossil fuels, “will be vital if we are to ensure that the UK’s homes and businesses have energy that is both secure and as affordable as possible, while also addressing the very global threat of climate change.”  

A consortium of GDF SUEZ SA, Iberdrola SA and Scottish and Southern Energy Plc has also purchased land from the NDA for the development of new nuclear power – this time at the Sellafield site in Cumbria.  

With the £70m deal concluded, the consortium partners have set out plans to create 3.6GW of nuclear capacity as part of its commitment to the UK’s nuclear revival.

 Making new nuclear a reality

 These, then, are some of the key players preparing to grasp the opportunities that have been opened up by Government policy and the NDA’s asset disposal programme.  

Now begins the multi-layered process of planning and development: a process the Government has recently overhauled in order to speed up the delivery of large-scale energy projects.  

The six new Draft National Policy Statements, in which these plans are set out, are intended to help the Infrastructure Planning Commission (IPC) make “faster and fairer” decisions on planning applications.  

According to the Confederation of British Industry (CBI), such measures are crucial – as is a cross-party consensus on the need to approve new nuclear stations rapidly; a consensus which would enable investors to develop their plans before next year’s general election.  

Because while the precise targets for nuclear and renewable electricity generation – and the proportion of Government support for each – are yet to be confirmed, one thing is clear: a significant level of investment and expertise will be required over the next decade if the UK is to make new nuclear a reality.