French energy firm EDF has given the go ahead for Britain's first new nuclear plant in decades despite warnings the project could bankrupt it, but the UK government has ordered an inquiry.
French state controlled energy company EDF has said it will go ahead and build a controversial and extremely costly nuclear power station in Britain.
The Hinkley Point C power plant in the south-west of England will cost more than 21 billion euros and would be the UK’s first new nuclear plant in decades.
However shortly after EDF gave the green light, the British government said it plans a new review into the project, which is almost certain to delay it.
“The UK needs a reliable and secure energy supply and the government believes that nuclear energy is an important part of the mix,” Business and Energy Secretary Greg Clark said in a statement shortly after EDF gave its go-ahead to the project.
“The government will now consider carefully all the component parts of this project and make its decision in the early autumn.”
— Alastair Elliott (@marketingwelove) July 29, 2016
EDF, whose shares were up 10 percent on Friday, expressed confidence in the UK’s commitment to the project.
“The statement made by Mr Clark is perfectly clear. I have no doubt about the support of the British government,” EDF Chief Executive Jean-Bernard Levy said.
On Thursday all six EDF union representatives on the board voted against the plan, warning the project could put the entire company at risk given its shaky finances and debt burden of more than 37 billion euros.
The board agreed by 10 to seven votes to go ahead with the project.
Hours before Thursday’s meeting one of EDF’s 18 board members resigned. Gerard Magnin said the project is financially risky and will lead France further away from renewable energy.
EDF’s chief financial officer Thomas Piquemal also quit earlier this year concerned about the cost.
Construction of similar reactors in France and China are years behind schedule and hugely over budget.
Hinkley Point C timeline: all the key moments https://t.co/hhjQFTss3h
— Flying Horse News (@fhhknews) July 28, 2016
The British government has previously pushed hard for the nuclear reactors, which are set to provide seven percent of Britain’s electricity needs from 2025.
Critics have questioned the need for the facility, the cost and the high guaranteed price the government will pay for the electricity produced.
EDF, which is 85 percent owned by the French government, will receive more than twice current market costs of power for the electricity it generates over a 35 year period.
— ITV News (@itvnews) July 28, 2016