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Higher nuclear subsidy demanded to fund new reactors

NUCLEAR GENERATOR British Energy is pushing the government to put up £800M a year in 'greenhouse gas reduction subsidies' for construction of new nuclear reactors.

The subsidy is needed if the UK's existing nuclear reactors are to be replaced. Close to one quarter of Britain's electricity is produced by nuclear reactors which will become obsolete in the next 25 years.

Nuclear energy should be eligible for government finance under the non fossil fuel obligation, aimed at cutting greenhouse gases 12.5% by 2010, said British Energy head of development Andrew Murfin.

Nuclear power is responsible for only a fifth as much CO gas, the next cleanest fuel, although it is twice as polluting as wind turbines. But it needs a subsidy of £10/MWh to compete commercially, said Murfin.

The government set CO 2reduction targets for energy producers to meet and from this autumn will charge £300 per tonne to firms which fall short.

It is estimated these fines will bring in £780M a year by 2010, said the DTI's director general for energy Anna Walker. The government is planning to plough the capital back into the renewable energy sector.

British Energy wants a slice of this money for nuclear power stations in its submission to the government's review of energy policy due in December.

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