Greg Clark expected to reveal funding deal for nuclear plant

Greg Clark is due to make an announcement this evening (4 June) on nuclear power in which he is expected to give the go ahead for plans to build a new plant in north Wales.

The statement by the business secretary of state follows a crunch meeting last Monday (28 May) of the board of Hitachi to determine whether to press ahead with the construction of the Wylfa Newydd nuclear plant on the Isle of Anglesey.

Hitachi owns Horizon, the company that is developing the 2.7GW power station to replace the island’s closed twin reactor Magnox plant, which stopped generating electricity in 2015.

The UK government has been haggling for months with Hitachi over the scale and nature of the financial support it is prepared to offer the scheme.

According to sources quoted in the Times, the UK government will make a direct investment in the project alongside the Japanese government and Hitachi, as well as underwriting billions of pounds of loans.

And the Financial Times quoted sources who said ministers are prepared to offer a guaranteed price for the electricity generated at the 2.7GW power station on Anglesey which is around £15/MWh less than the £92.50/MWh strike price awarded to EDF for Hinkley Point C.

By underwriting the loans and taking a stake in the project, the government will reduce the plant’s financing requirement.

The government is expected to tie the go ahead for the Wylfa nuclear plant with an announcement that the long-delayed Swansea Bay tidal lagoon project will not receive the go ahead.

The latter’s backer Tidal Lagoon Power has been waiting nearly a year and a half for a decision since the publication of a report by former energy minister Charles Hendry recommending approval for it.

Commenting on the possible government withdrawal of support for the tidal power plan, Wales’ first minister Carwyn Jones, said: “If these rumours prove to be true, the UK government will be delivering a massive blow to Swansea and Wales more widely – yet another kick in the teeth after their decision to abandon electrification of the train line west of Cardiff.

“The Welsh government remains committed to the Swansea Bay tidal lagoon and we stand ready to provide significant financial backing to help make it a reality. Rather than seize the opportunity presented by the project to position Britain as a world leader in a new global industry, the UK government continues to block the development of renewable energy schemes in Wales.”