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Wylfa becomes more likely as UK Gov brings forward plan for consumers to pay for plants before they’re built

27 Oct 2021 4 minutes Read
Wylfa Newydd. Photo by DECCgovuk, licensed under CC BY-ND 2.0

A second Wylfa nuclear plant on Anglesey is believed to have become more likely as the UK Government has introduced a new finance model that will see consumers pay for nuclear plants before they’re built.

The UK Government wants to bring the power station projects such as Wylfa B on Anglesey and Trawsfynydd in Gwynedd back from the dead as part of plans to attain net zero carbon emissions by 2035.

The Net Zero Strategy announced last week confirmed that £120 million was being made available to support the development of nuclear projects through the Future Nuclear Enabling Fund.

US nuclear company Westinghouse is planning to revive plans for a nuclear power plant at Wylfa that was abandoned by Japan’s Hitachi in 2019, and the UK Government has indicated that it is keen to see the plan come to fruition.

Ministers are also expected to back smaller modular reactors which are being developed by a consortium led by Rolls-Royce. One of these is planned for installation in the Trawsfynydd nuclear plant which is no longer producing energy.

Business Secretary Kwasi Kwarteng has set out the details of the new model in the Nuclear Energy (Financing) Bill which the government says will reduce reliance on overseas developers for financing new nuclear projects by substantially increasing the pool of private investors to include British pension funds, insurers and other institutional investors.

Revenue

Under the existing mechanism to support new nuclear projects developers have to finance the construction of a nuclear project from scratch and only begin receiving revenue when the station starts generating electricity.

This led to the cancellation of recent potential projects, such as Hitachi’s project at Wylfa Newydd and Toshiba’s planned plant at Moorside in Cumbria.

Under the new proposals, consumers will contribute to the cost of new nuclear power projects during the construction phase – but it’s claimed overall consumers are expected to save more than £30 billion over the project’s lifetime compared with existing funding mechanisms.

The government hopes that Initial contributions will encourage private investors by offering them greater certainty through a lower and more reliable rate of return in the early stages of a project, lowering the cost of financing it, and ultimately helping reduce consumer electricity bills.

“In light of rising global gas prices, we need to ensure Britain’s electricity grid of the future is bolstered by reliable and affordable nuclear power that’s generated in this country,” UK Business and Energy Secretary Kwasi Kwarteng, said.

“The existing financing scheme led to too many overseas nuclear developers walking away from projects, setting Britain back years. We urgently need a new approach to attract British funds and other private investors to back new large-scale nuclear power stations in the UK.”

“Our new model is a win-win for nuclear in our country. Not only will we be able to encourage a greater diversity of private investment, but this will ultimately lower the cost of financing new nuclear power and reduce the costs to consumers and businesses.”

Ministers claim large-scale project funded under this scheme will add at most a few pounds a year to typical household energy bills during the early stages of construction and on average less than £1 per month during the full construction phase of the project.

Overall, the lower cost of financing the project is expected to lead to savings for consumers of at least £30 billion on each project. This translates to a saving of more than £10 per year for an average domestic dual fuel bill throughout the life of the nuclear power station – which can operate for 60 years.

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Kerry Davies
Kerry Davies
1 month ago

Since the demise of Anglesey Aluminium is there any real case for nuclear power plants in North West Wales where transmission losses to drive industries on Deeside make them less cost effective than siting them near to need?

Dean Jonathan
Dean Jonathan
1 month ago
Reply to  Kerry Davies

If there is a case for nuclear, it’s in urban areas where the waste heat can provide low carbon district heating. However National Grid say we do t need nuclear, so the choice to have them is purely political

Y Cymro
Y Cymro
1 month ago

Whitehall should not decide where any Nuclear plants are in Wales, if any. Our Senedd Cymru and Welsh Government should. It’s our land and we the Welsh people should have the final decision. It’s called democracy. The Conservative party has no legitimacy to rule in Wales. They are in power thanks soley to the English block vote. And they can with a tick of a pen blight Wales as done with Trawsfynydd & Wylfa soley to feed England’s thirst for power. Wales will only have developments with our interests at heart, be it tidal or Hydro-Electric, if we become an… Read more »

Last edited 1 month ago by Y Cymro
Meredith Tranter
Meredith Tranter
30 days ago
Reply to  Y Cymro

The Conservative party has no legitimacy to rule in Wales. 

It forms the UK government. Lots of Welsh people voted for them.

 as done with Trawsfynydd & Wylfa soley to feed England’s thirst for power.

No. They were to power Welsh industry and homes.

And they will be needed when fossil fuel consumption reduces.

R W
R W
30 days ago

A 25•6% share of the vote in the 2021 Senedd Election and a 36% share of the vote at the 2019 General Election here in Wales gives the Tories minimal legitimacy to rule here I would suggest.

Dean Jonathan
Dean Jonathan
1 month ago

Moorside was pulled because Toshiba’s partner, Westinghouse, went bust

Wylfa was pulled because Hitachi, who never intended owning and operating the power station, just selling it reactors, couldn’t find anyone to buy it from them

Neither were due to failing to agree financing with Westminster

Quornby
Quornby
1 month ago

Wales has power to spare, our free Wales could sell half of it for profit. Put the nukes where they are needed, somewhere inside the M25.

Meredith Tranter
Meredith Tranter
30 days ago
Reply to  Quornby

No. Electricity is paid for by collaboration with a European wide network.

The “people” generating this electricity are companies who own the power stations. They have been paid. Wales doesn’t own them.

You can’t charge the network any more because Wales buys from it a times of peak demand as well.

People keep posting this.

j humphrys
j humphrys
1 month ago

Pull down the Albert Hall and shove one there. And line the Thames with wind turbines!

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