15. 10. 2015

Hinkley C: 'The Most Expensive White Elephant in British History'

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The latest instalment in George Osborne’s personally-authored potboiler, the Hinkley Point F***** (think ‘Fiasco’!) will be published sometime around October 20th to mark the visit of Chinese President Xi Jinping. Anticipate another announcement about UK/Chinese nuclear collaboration; another grandiloquent endorsement of all things nuclear, and lots of big numbers thrown up in the air like so much ephemeral confetti. All amounting to the next tranche of sod-all.

On Friday last week, the indefatigable Stop Hinkley campaign organised another impromptu demonstration outside Hinkley Point itself, with everyone wondering exactly when this appalling mega-project is going to be put out of its misery. Unfortunately, there’s no immediate answer to that question.

But you do have to admire Osborne’s dogged perseverance. Since I last did a blog about this:

 Two of the world’s biggest rating agencies (Moody’s and Standard and Poor’s) have threatened rating downgrades for EdF – if Hinkley Point ever gets the green light. The inevitability of big cost overruns and delays on the project could only have significant ‘credit negative effects’.

 In France, the Permanent Group of Experts on Pressurised Nuclear Equipment has assessed the implications of ‘large areas of excess carbon’ found in the steel pressure vessel and vessel head for the Flamanville EPR. (These are exactly the same kind of pressure vessels and vessel heads that have already been manufactured for the two Hinkley Point reactors.)

 As a result, the French nuclear regulators (ASN) will shortly be demanding another lengthy round of tests on these flawed component parts. This could last until the middle of next year at the earliest.

EdF has now set a ‘final deadline’ for commissioning the EPR at Hinkley Point ‘in the last quarter of 2018’. And that final deadline from EdF did not include any further delays that will be incurred for those new tests.

 If these new tests show that both the pressure vessel and vessel head will need to be replaced, rather than patched up, then the entire project will almost certainly be completely abandoned.

 If EdF’s EPR in Flamanville is not operational by 2020, then the £17bn of UK finance guarantees that the Government has made available for Hinkley Point will collapse as a consequence of its complex legal agreements with the French and Chinese companies involved.

EdF’s Chinese partners (China General Nuclear Corporation and China National Nuclear Corporation) have indicated that they too have growing concerns about the two identical EPRs that they’re building at Taishan 1 and 2 in China. Their reactor vessels and heads were forged by the same company (Le Creusot) as the Flamanville and Hinkley Point components.

EdF has acknowledged that it cannot now commit to a completion date for the Hinkley Point reactors, promising a ‘revised timetable’ as and when final approval has been granted. Its earlier target date was for 2023. If Hinkley Point is beset with the same kind of delays as Flamanville and Olkiluoto (EdF’s project in Finland), that would mean Hinkley Point not coming online until 2029/2030!

 The International Energy Agency has suggested that Hinkley Point, on current costings, would be generating electricity at three times the average for nuclear projects elsewhere in the world – and would therefore be more expensive than in any other country in the world.

 Tony Roulstone, and eminent nuclear engineer at Cambridge University, has declared the EPR reactor design to be ‘unconstructible’. Many in the nuclear industry are in complete agreement with him.

 The Times, Sunday Times, Daily Telegraph and the FT have all urged a fundamental re-think on Hinkley Point. ‘There is a real risk that Hinkley will come to be seen as a monumental blunder, the most expensive (at £24.5bn) white elephant in British history.’

 At £24.5bn, the Hinkley Point reactors will be the most expensive power stations in the world, generating around 3,200MW. The UK could get 20,000MW of offshore wind for the same price – more than six times as much electricity. Hinkley’s electricity will cost consumers £92.50 per megawatt hour, more than twice today’s wholesale price of £40 megawatt per hour. And that £92.50 will increase every year in line with inflation.

 The CEO of the National Grid, Steve Holliday, recently declared that ‘the idea of large power stations is outdated’, suggesting that distributed energy with local micro-grids was now the direction of travel for modern energy systems.

 Since the Election, DECC has become ‘a wholly-owned subsidiary of the Treasury’, with Secretary of State Amber Rudd in the uncomfortable position of George Osborne’s ventriloquist dummy.

 Both Treasury and DECC have resorted to outright lying to reassure commentators, claiming that ‘nuclear power is cost-competitive with other low-carbon technology’ (simply not true, even today, let alone in the future), and that ‘the new plant is expected to produce enough energy to provide 7% of the country’s needs’. The real figure is just 2% - the 7% figure applies to just electricity, not total energy.

 Even that elite band of pro-nuclear environmentalists in the UK (George Monbiot, Mark Lynas, Chris Goodall and Steve Tindale) have now reversed their earlier (unaccountably foolish) support for Hinkley Point, describing it as ‘overpriced, overcomplicated and overdue’. They’re still banging on about other nuclear technologies (a point to which I will return in my next blog), but at least they’ve seen the light on this particular monstrosity.

 The Labour Party has at last awoken from its pro-nuclear torpor and has started to question whether Hinkley Point is quite as smart an investment as they once slavishly thought it was. The Lib Dems seem to be getting cold feet about the erstwhile Nick Clegg / Ed Davey pro-nuclear fantasy, but who cares anyway? The SNP has confirmed its strong anti-nuclear position.

 Andrew Warren, the UK’s most respected energy efficiency pundit, has pointed out that investments of this kind are based on an assumption of ‘rising energy demand’. But demand is not rising. Since 2005, overall energy use has fallen by 18%, and in 2014 energy sales fell by 6.6%, even as GDP grew by 2.8%.

 Meanwhile, the formal complaint in the European Court lodged by the Austrian Government (against the decision of the European Commission approving the British Government’s massive subsidies for Hinkley Point) proceeds. And will do so for at least another 18 months. If the complaint is eventually upheld, the whole project would fold, with huge liabilities arising from any work carried out by EdF between now and then.

 Another complaint has been lodged by a consortium of ten renewable energy suppliers in Germany.

But Osborne remains undaunted, despite the growing cost of keeping his nuclear illusions limping along for a little bit longer. In the process, he has blighted the whole of the rest of the energy system; devastated the renewable energy industry, with up to 20,000 jobs now at risk; set back the zero carbon agenda for the built environment by more than a decade; manipulated the planning system to promote fracking and kill renewables; disempowered communities the length and breadth of the land; and turned his back on the future and all the technological dynamism that lies ahead by sticking so obsessively to the technologies of the past.

So how can the rest of his Party just sit on its hands and let him get away with it?
 

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