I have posted in the past about problems with the Hinkley nuclear power plant project in the U.K. The French EDF company has been contracted to build a pair of nuclear reactors based on the new European Pressurized Reactor (EPR) design at Hinkley Point with international financing and a guaranteed price for the electricity generated. The project has been embroiled in controversy since its inception and problems keep multiplying.
The EPR design itself has now been called into question. EDF has been building an EPR reactor at Flamanville in Normandy to serve as a "showcase" for the design. There has been a five year delay in completion of the project as well as costs rising above original estimates. The French Nuclear Safety Regulator recently produced a report on faults with the Flamanville cooling system. The leaked report also complained that there was too much carbon in the steel used to construct the reactor. A source in the U.K. Treasury department commented that there are "serious questions" about the EPR technology.
It has been difficult to find financing for the project. There have been complications with respect to the portion of the project that can be legally owned by foreign governments and companies. EDF was supposed to come up with a five percent share of the money but due to financial problems, it now appears that EDF may not be able to supply the promised money. The negotiations between the U.K and EDF with its two Chinese partners was supposed to completed in March but it is now June and the negotiations are still going on. Now a new deadline of October has been announced.
The U.K. government has signed an agreement that guarantees a fixed price for the electricity generated by the new Hinkley point reactors for thirty five years regardless of fluctuations in the market price of electricity. The U.K. has promised to guarantee about twenty five billion dollars of the debt incurred by the project but also says that there are conditions to relieve taxpayers of the debt guarantee if the technology fails. The agreement says that the shareholders in the project will be liable for the twenty five billion dollars of debt if there are problems with the EPR technology until France can prove that the EPR technology at Flamanville works as advertised.
Supporters of the Hinkley project in the U.K. government and the nuclear industry are expressing suspicions that the Treasury department has been "dragging its heels" on the project. They say that the Treasury fears that the guaranteed price for electricity is much too generous and may prove a burden on the U.K. ratepayers. Some critics of Treasury go so far as to say that they would not be surprised if Treasury officials would just as soon see the project abandoned.
It seems to me that with all the unresolved problems and concerns about safety and finances, the U.K. might be better off dropping the Hinkley Point project before more money and time is wasted.
French Flamanville EPR construction:
