Three-year funding programme announced for small modular reactors, alongside proposals for large power stations across the UK and £86m for nuclear fusion research
The government has today unveiled a sweeping plan to drive the development of nuclear power across the UK, revealing new funding streams for small modular reactors and nuclear fusion alongside a list of potential sites for large nuclear power plants.
A three-year funding package worth £56m has been earmarked for new advanced and small modular reactors (AMRs and SMRs), which the industry argues could be quicker and cheaper to build than traditional large nuclear power stations.
An expert finance group will also be convened to advise how SMRs and AMRs can raise private finance for UK development.
Meanwhile, the UK Atomic Energy Authority was awarded £86m to establish a centre for nuclear fusion research that will have "global significance", the Department of Business, Energy and Industrial Strategy (BEIS) said.
A further £8m is allocated for the second phase of the Nuclear Innovation programme to support study into advanced fuels and accelerate research into modern safety and security methods.
Finally, a scoping report outlining potential sites for large new nuclear power stations - those with over 1GW of capacity - was released, naming Sellafield, Sizewell, Bradwell, Oldbury, Hartlepool and Heysham as potential locations.
The announcements - trumpeted by BEIS as proof of "the government's commitment to the nuclear innovations of the future" - represent a serious boost for the nuclear industry badly in need of clarity over the prospects for a new wave of development.
Nuclear power accounted for around a fifth of the total electricity produced in the UK last year, and the government expects it to play a key role in delivering a low carbon energy system. However, the industry's infrastructure is ageing, with two-thirds of the fleet earmarked for replacement over the next 15 years.
Long-standing plans to build new reactors face challenges as a result of the UK's decision to quit the Euratom regulatory regime as a result of Brexit, while the plummeting cost of renewables has emboldened critics who argue new reactors will struggle to prove cost competitive. Industry insiders have also been concerned that the programme for small modular reactors, first unveiled by former Chancellor George Osborne, was under threat after continued delays.
But Business Secretary Greg Clark today insisted the sector enjoys the government's full backing.
"New industry figures show that the UK's civil nuclear sector contributed £6.4bn to the UK economy last year," Clark said in a statement. "Today's announcements recognise the importance of industry driving innovation, supported by government, so the sector continues to compete at the very highest level, not just in the UK but globally."
Yet the decision to push ahead with new nuclear remains a controversial one, particularly in light of the cost of Hinkley Point nuclear power station, the UK's first new nuclear plant in a generation.
Last year the government agreed a contract with EDF Energy to buy Hinkley's power at a strike price of £92.50 per MWh, well above the wholesale cost of energy and that of some other sources of clean power generation. The deal was described as "risky and expensive" by the National Audit Office.
And new analysis by consultancy Atkins for the Department for Business, Energy and Industrial Strategy, picked up the Guardian, concluded that energy from SMRs could cost more initially than large nuclear, because of the costs connected with developing new technologies and the loss of economies of scale.
Although the analysis suggestsed costs could come down quickly thanks to shorter build times, its authors admit there is "a great deal of uncertainty with regards to the economics of both SMRs and the counterfactual technologies".
Caroline Lucas, co-leader of the Green Party, accused the government of sending "mixed messages" to investors. "Ministers are ploughing huge sums of money into supporting overpriced nuclear, while retaining a defacto ban on onshore wind and failing to give solar the support the sector needs," she said. "They're sending mixed messages to investors when we desperately need clarity to show that the government is serious about creating a renewables-based low carbon Britain."
"This island nation should be producing its energy from cheaper, renewable clean sources - not diverting even more resources towards new nuclear which is both eye-wateringly expensive and far too slow to get online," she added.
But supporters of the nuclear industry maintain that it has the capacity to bring down costs in the future and provides a valuable form of reliable clean power that can complement more variable forms of renewables. It seems that despite the significant challenges the sector still faces, the government broadly agrees nuclear has a critical role to play in a low carbon power mix.
The UK government has published its latest plan to cut air pollution, focusing on wood burning stoves, farming and car tyres - BusinessGreen rounds up all the reaction
But latest plan to tackle UK's illegal air pollution levels faces meets with heavy criticism from green campaigners and Labour
Bloomberg New Energy Finance predicts EVs to dominate global auto market, as costs continue to tumble
IEMA's Martin Baxter finds that delivering a Green Brexit is about a lot more than simply finalising an effective Withdrawal Bill