The government will restart talks with EDF on its plan to build a nuclear reactor at Sizewell C in Suffolk, and may take a direct financial stake in its construction.
The latest round of negotiations over the GBP20bn nuclear reactor will focus on whether EDF can prove that it has learned lessons from the Hinkley Point nuclear project, and that a successor plant would offer the public value for money.
The government said it was considering a new deal to help the French state-owned energy company finance Sizewell, which may include taking a direct stake in the project and making taxpayers liable for any cost overruns.
A statement from the Department for Business, Energy and Industrial Strategy said it would consider a greater role in the project provided there was “clear value for money for consumers and taxpayers”.
The decision to restart formal negotiations comes after a hiatus in talks that have been dogged by concerns over cost, and the involvement of China General Nuclear Power (CGN), which holds a 20% stake in the project.
CGN is reportedly considering backing out of the project, which would leave a financing gap for EDF if the UK government is unwilling to help pay for the construction costs. The government is also planning to back a new generation of small modular nuclear reactors, or “mini nukes”, which can be built at a lower cost.
The decision to reignite Britain’s new nuclear ambitions was announced alongside industry-wide plans to cut carbon emissions from the energy system while keeping a lid on energy bills and helping to create 220,000 new jobs in the next 10 years.
Alok Sharma, the business and energy secretary, said the plans will transform the government’s “climate ambition into climate action” through a “decisive and permanent shift away from our dependence on fossil fuels”.
The white paper builds on the prime minister’s 10-point climate plan which set out plans to invest in offshore wind farms, spend GBP1bn to develop carbon capture technology, ban the sale of new fossil fuel vehicles from 2030, and provide GBP1.3bn for a nationwide roll-out of electric vehicle charge points.
The energy white paper also includes the following proposals:
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Cut energy bills: trials for a new switching service to automatically move homes onto better deals, as well as GBP6.7bn over the next six years to support socially vulnerable and fuel poor homes.
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Replace fossil fuel boilers: an aim for all newly installed heating systems to be low carbon by the mid-2030s.
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UK carbon trading: a new UK emissions trading scheme to replace the EU’s carbon market from January 2021 which will put a tighter limit on emissions.
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North Sea transition: plans to support the people and communities most affected by the move away from oil and gas production.
Sharma added: “At every step of the way, we will place affordability and fairness at the heart of our reforms – unleashing a wave of competition so consumers get the best deals possible on their bills, while protecting the vulnerable and fuel poor with additional financial support.”