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Taxpayer Bankrolls £15bn New Nuclear Power Plant

The Times

Ministers will this week reverse decades of opposition to investing taxpayer money in nuclear energy by agreeing to bankroll a £15bn-plus power station in Wales.

The government will commit to taking a direct stake in the Wylfa plant on Anglesey, planned by the Japanese industrial giant Hitachi, after more than two years of negotiations.

It is understood the government will also provide the vast bulk of the £9bn debt. State equity will slash the cost of borrowing, but leave the taxpayer exposed if costs balloon or the project overruns.

It has, though, helped ministers to negotiate a strike price — a guaranteed payment for the plant’s electricity — of about £77.50 per megawatt hour. The government was determined to achieve a cheaper price than the £92.50 agreed with EDF, which is building the £20bn Hinkley Point power station in Somerset.

It is understood that this week’s heads of terms agreement with Hitachi will refer to “lessons learnt” from Hinkley. That deal was criticised by the National Audit Office for driving up the cost by piling too much risk on EDF.

The Sunday Times revealed the prospect of British and Japanese taxpayers taking stakes in the Wylfa project in March 2016.

The deal this week has had to overcome opposition from the Treasury and will be a coup for the business secretary Greg Clark, who sees nuclear power as a key pillar of the government’s industrial strategy.

Ministers will claim the investment is vital to cut carbon emissions, replace ageing coal and nuclear plants, and supplement wind and solar power.

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