What about nuclear energy in UK after Brexit?

There are a lot of opinions about the impacts on energy policy and investments in the UK following the non-binding vote to leave the European Union. The UK Parliament has to take the formal action to request separation from the European Union. Given the level of political turmoil in the UK resulting from the vote, it is impossible to predict whether that will happen or not.

In the meantime, questions are being raised as to whether the UK plans for 19 GWe of new nuclear power will move ahead. Chief among them is the controversial Hinkley Point project which is planned to consist of two 1650 MW Areva EPRs.  Estimated costs for the project have caused the French unions that represent the workforce at EDF, which will build the reactors, to dig in their heels saying the project could wreck the company financially.

Following is a roundup of reports and opinions about the future of nuclear energy in the UK.

Brexit Vote Has No Impact On Hinkley Point C, Says EDF Chairman

(NucNet): The UK’s decision to leave the European Union has “no impact” on the business and strategy of EDF in the UK, including its plans to build a new nuclear plant at Hinkley Point C in England, Jean-Bernard Lévy, chairman of the French public utility, said on 6/24.

“As of today, we believe that this vote has no impact on our strategy, and the strategy for our UK subsidiary [EDF Energy] has not changed.”

“Our business strategy is not linked to Great Britain’s political affiliation with the European Union, so we have no reason to change it.”

An EDF labor union, FO Energie et Mines, said in a statement that the decision by voters in the UK adds more uncertainty to the Hinkley Point C EPR project. The union said the conditions for the immediate launch of the project have not been met and three unions representing 80 percent of EDF’s staff are opposed to it going ahead until the “orientation” of the French nuclear industry has been clarified.

French Minister Says Hinkley Point Will be Built

(Platts) French economy and trade minister Emmanuel Macron said 6/28 that his country will continue to invest in nuclear energy, including providing support for utility EDF’s plan to build a nuclear plant in the UK. He said this progress would take place despite delays on existing projects and a reorganization of the French state-controlled industry.

Macron, speaking at the World Nuclear Exhibition in Paris, acknowledged that the French effort in the 1990s to combine its reactor design businesses and fuel cycle businesses into a single state-controlled company, Areva, had failed and that the company had over reached in terms of expansion relative to its capital available for investment. Enormous increases in costs for two EPR projects, one in Finland, and the other in France, have called into questoins the economic feasibility of the EPR design.

The company is being broken up, with Areva’s reactor business being sold to EDF and a “new” Areva being formed to hold the company’s mining, enrichment and other fuel cycle businesses Marscon said.

The government will invest Eur5 billion ($5 billion) in Areva, he said, and is seeking minority partners who would invest in both Areva and EDF. The state plans to invest in EDF as well, officials have said.

UK Remains Committed to Low-carbon Strategy

(WNN) The UK’s decision to leave the European Union has not changed the government’s commitment to new nuclear power, or to its climate change goals, says Amber Rudd, UK Secretary of State for Energy and Climate Change.

“The decision to leave the EU is of historic significance. To be clear, Britain will leave the EU. The decision of the British people was clear. The key challenge now, as the Prime Minister and the Chancellor have stressed, is to work towards a settlement that is in the best interests of Britain.”

“As a Government, we are fully committed to delivering the best outcome for the British people – and that includes delivering the secure, affordable, clean energy our families and business need. That commitment has not changed. Because while the decision to leave the EU is undoubtedly significant, the challenges we face as a country remain the same.”

“In particular, I want to underline our commitment to the issue over which I have primary responsibility; climate change. Climate change has not been downgraded as a threat. It remains one of the most serious long-term risks to our economic and national security.”

“We remain committed to new nuclear power in the UK – to provide clean, secure energy. Government has prepared the ground for a fleet of new nuclear stations. Three consortia have proposals to develop 18 GW of new power stations at six new sites across the UK. These will support more than 30,000 jobs across the nuclear supply chain over the coming years.”

Horizon CEO Outlines Fresh Challenge for Nuclear

(WNN) One of the nuclear industry’s most experienced executives has postponed retirement from a 45-year-long career for a new and unique challenge – to deliver a privately backed new build nuclear reactor project. As CEO of Horizon Nuclear Power – the UK subsidiary of Japan’s Hitachi – Duncan Hawthorne aims to demonstrate that such a project is able not only to attract investors, but that it will be delivered on time and to budget.

Horizon plans to deploy the UK 1300 MW ABWR (Advanced Boiling Water Reactor) at two sites – Wylfa Newydd, which is on the Isle of Anglesey, and Oldbury-on-Severn, in South Gloucestershire.

In an interview with World Nuclear News, Hawthorne said he was persuaded to return to the UK from Canada, where he has citizenship, by the “business calling of trying to complete the set” in his career – a new build project.

“I didn’t come here to fail. I didn’t come here without strong belief that this was the right thing for the supply mix in the UK, that we have a good product that offers something that will fill a gap in the market,” he said.

“Our challenge is to win the commercial case here in the UK by building on time and on budget because that’s where the real test is and [the industry] doesn’t have a lot of good metrics on success with nuclear new build projects and we need to fix that,” Hawthorne said, adding that Horizon wants the UK ABWR project to be its “flagship”.

A key part of its strategy is to have UK regulatory approval for the reactor design.

“There’s no doubt that the UK regulatory regime is very highly valued by other regulators, so if your technology gets through that process, then you definitely have something that supports the product’s marketability,” Hawthorne said.

New market Conditions May Limit Nuclear Energy in the UK

(WNN) Fiona Reilly, PwC’s global head of nuclear capital projects and infrastructure, said in an interview with World Nuclear News that the decision to leave the EU “could have a significant impact on our nuclear program”.

Reilly said: “Ongoing uncertainty in the market, at least in the short term, could affect access to capital and investor confidence in what is already a limited trading arena.”

“And while the UK government will need to work out political, trading and legal issues, we will also potentially need to renegotiate our involvement in the Euratom Treaty and our 123 Agreement with the US – and this will take time.”

She added: “It will be vital for the UK government, [the Department of Energy and Climate Change] and nuclear bodies to work together to secure a positive outcome for our energy industry and we are committed to working alongside them as they adapt to these new market conditions.”

India Rejects Option to Buy GE-Hitachi ESBWR

(Bloomberg) India won’t buy GE Hitachi Nuclear Energy’s nuclear reactors that haven’t been used in nuclear power plants before, the country’s top atomic-energy bureaucrat said.

“Right now they have offered us reactors that do not have a reference plant,” Sekhar Basu, secretary at India’s Department of Atomic Energy, said in an interview with the Bloomberg Wire Service referring to the need for an operating example. “We will not buy a reactor that doesn’t have a reference plant.”

Reference plants for Westinghouse’s AP1000 reactors and EDF’s EPR pressurized-water reactors — both destined for India — should be ready by the time the two companies start construction in the country, Basu said.

India’s refusal to consider the reactor design about a year after General Electric Chairman Jeffrey Immelt said, with some strong emphasis, said his company won’t risk building a nuclear plant in India. He cited India’s nuclear liability law which exposes equipment suppliers to claims and litigation if there is an accident.

“GE Hitachi continues to have a strong interest in providing our technology to India for the eventual construction of multiple” economic simplified boiling-water reactors, or ESBWRs, the company said in an e-mailed statement.

“We believe the path forward requires a sustainable regulatory environment, which would include a nuclear-liability law that channels liability to plant operators consistent with global best practices.”

India plans to expand its nuclear generation capacity 10-fold by 2032, for which it needs larger, foreign-designed reactors. Earlier this year, the nation ratified the Convention on Supplementary Compensation for Nuclear Damage, or the CSC, a global treaty on nuclear liability, responding to demands from the global reactor suppliers for regulatory certainty.

The action has not addressed the fact that the domestic supplier liability law is still on the books and represents exactly the type of risk that Inmelt referred to in his statement.

India’s action leaves GE-Hitachi with no near-term international prospects for its new ESBWR.

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