A new nuclear reactor plant in Essex is at risk of collapsing due to political opposition to the participation of a Chinese investor, warned the French energy giant EDF.
The Big Six energy supplier told investors it had no obligation to continue financing the project in Bradwell, Essex, and that there was now “great uncertainty” as to whether it could be delivered.
In its annual report, EDF also warned that billions in additional funding could be needed for Hinkley Point C, Britain’s first new nuclear power plant in three decades, if China refuses to participate in an investment round scheduled for 2023.
The state-owned energy company China General Nuclear (CGN) is currently developing the Hinkley plant in Somerset, Bradwell B and Sizewell C in Somerset, under a nuclear cooperation agreement between China and the United Kingdom dating back to 2015 in what was considered a new ” a golden age ”between the two countries.
Kwasi Quarteng, the business secretary, and Boris Johnson have put nuclear energy at the heart of plans to divert dependence on Russia in a new energy security strategy released in April.
Mr Johnson has promised to commission so many mini-nuclear reactors that he expects “not everyone to have their own small modular reactors in their gardens, but close to it”.
But ministers are plotting to remove CGN from Britain’s nuclear infrastructure amid growing concerns about the involvement of the emerging superpower. Ministers are trying to secure outside investors to exclude CGN from co-investing with EDF in Sizewell C.
The EDF has already signaled that political opposition to China’s investment could lead to the end of the Bradwell project. So far, the plant has received UK regulatory approval for the design of a Chinese reactor proposed by the General Nuclear System Joint Undertaking (GNSL). EDF and CGN own 33.5% and 66.5% of the Bradwell project, respectively.
In a report by the investor, EDF said: “There is great uncertainty about the prospects for the development of the Bradwell project, mainly due to the political opposition of a Chinese company leading a critical infrastructure project in the UK and the lack of support from local stakeholders.
The risks of not being able to implement the Bradwell project are high and have increased in 2021.
“EDF’s commitment to fund GNSL and Bradwell is subject to an equity ceiling, without any obligation to finance the project outside the funding ceiling.”
The Nuclear Regulatory Authority approved the use of Chinese HPR1000 technology in Bradwell in February. Sources said the move prompted China to end its nuclear ambitions in Britain and move its reactors elsewhere.
A source said: “CGN is only in the UK because of the opportunity to build its technology in Bradwell. There is no other reason to be here.
“They could come out of Hinckley and demand that someone else buy their share. The only other possible investor is the UK government. There are no other utility companies in Europe that would be interested and there are no other possible sources of investment.
“CGN would be happy to leave now because what they really wanted was the approval of the UK safety regulator for their design so they could sell it elsewhere in the world. The Chinese have not yet managed to export any reactors.
EDF raised the prospect of the Chinese stopping further investment in Hinkley C for the first time in its annual report.
Steve Thomas, an honorary professor of energy policy at the University of Greenwich, estimates that EDF will have to contribute £ 7.7 billion to fund the excess cost, which will lead to 77.6 per cent.
The French energy giant is expected to release the results of a review of spending in the coming weeks amid delays it blames on challenges, including the war in Ukraine.
EDF said in its report: “The total funding needs of the project exceed the contractual commitment of shareholders and shareholders will be asked to provide additional equity on a voluntary basis in 2023.
“This could lead the group to increase its contribution to the financing of the project from that date, if its partner decides not to contribute outside the contractual commitment.
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