The government’s “vague promises” of jobs and skills being created by construction of the new nuclear reactor at Hinkley Point C in Somerset need a clear delivery plan, a report by MPs has found.
The influential Public Accounts Committee report into the government’s contract with EDF to deliver Hinkley Point C at a cost of up to £19.6bn, says that the financial case has weakened. It says this is because consumers are “locked into an expensive deal lasting 35 years”, with no revision of the deal’s terms in the interim period between the original decision and final green light, despite costs rising five-fold.
The MPs accuse the government of “talking-up” the jobs and skills boost from Hinkley as the financial case has weakened. They say the government has no clear plan for delivery of these benefits or how it will measure the benefits to workers and the supply chain.
PAC chair Meg Hillier MP said: “Bill-payers have been dealt a bad hand by the Government in its approach to this project.
“Its blinkered determination to agree the Hinkley deal, regardless of changing circumstances, means that for years to come energy consumers will face costs running to many times the original estimate.
“The Government made some grave strategic errors here and must now explain what it will do to ensure these are not repeated.
“But more than that, it must deliver the supposed wider benefits of this project—benefits Government has talked up progressively as the case for Hinkley Point C has weakened, but which it has no plan to secure.
“There is clearly scope to link the nuclear programme to the wider strategy of driving economic opportunities and growth.
“Government credibility in this area will inevitably be questioned when—by its own admission—it doesn’t know what UK workers and business will gain from this project, and appears to have no coherent idea of what to do about it.”
The government has an assurance framework with EDF where the two parties meet regularly to monitor progress and delivery of benefits from the project.
A Department for Business, Energy and Industrial Strategy spokesperson said in response: “The Government negotiated a competitive deal for the construction of the first new nuclear power station in a generation as part of our energy mix, which ensures consumers won’t pay a penny for any construction overruns and until the station generates electricity in 2025. There are already 2,400 people employed on site in Somerset and the project will create over 26,000 jobs and apprenticeships in the UK nuclear supply chain.
“On Monday we will publish our Industrial Strategy setting out how we will help young people develop the skills to benefit from the high-paid, high-skilled jobs of the future.”
EDF pointed out the amount of risk it at CGN (China’s state nuclear company) was taking on the construction.
An EDF Energy spokesman said in response: “The cost of Hinkley Point C for customers has not changed and they will pay nothing for its reliable, low carbon electricity until the station is completed.
“EDF and its co-investor CGN take the risk of increased costs during construction. The agreed price is lower than 80% of other low carbon capacity contracted so far and the project has restarted UK nuclear construction after a quarter century.
“Construction is fully underway and is already delivering a huge benefit to British jobs, skills and industrial strategy. It is drawing on firms from across Britain and the South-West with 2,400 employees at the site and is on track to meet its next milestones.
“Hinkley Point C makes it possible for future nuclear new build projects to be significantly cheaper for customers. We look forward to working with HM Government to take advantage of this possibility for our projects at Sizewell and Bradwell and to make sure the UK captures the full consumer and industrial benefit of Hinkley Point C.”