Breaking: China has signed a deal to part-fund the construction of Hinkley Point C, the UK’s first nuclear plant in a generation.
EDF has agreed terms with partner China General Nuclear Corporation on a strategic investment agreement that will see EDF take a 66.5 per cent stake in the multi-billion-pound nuclear project, with CGN taking 33.5 per cent.
The pair have also agreed terms in principle for further construction of nuclear plants at Sizewell and Bradwell, the latter of which would be majority-funded by China and would use a new, Chinese reactor technology.
Prime minister David Cameron said: “I’m pleased to announce that today we are signing a historic deal to build the Hinkley nuclear power station, providing reliable, affordable energy for nearly six million homes and creating more than 25,000 jobs, all while working together to build a low-carbon future.”
EDF Energy chief executive Vincent de Rivaz said: “Hinkley Point C and successive nuclear projects will guarantee the UK the reliable, secure low-carbon electricity it needs in the future.
“Nuclear power will save customers money compared with other energy options and provide a huge boost to British industrial strength, jobs and skills both in Britain and abroad.
“Today’s announcements are also good news in the fight against climate change.”
The deal was signed today at a press conference by Chinese president Xi Jinping and prime minister David Cameron.
However, EDF Energy has not yet confirmed its final investment decision for the project. It is expected to do so before the end of the year.
EDF has said the final cost would be £18bn, with the state-owned nuclear firm CGN investing £6bn for its one-third stake in the project.
According to EDF, it still has the option to sell another 15 per cent of the project but said it was keen to maintain a majority stake.
It is understood the deal could be the precursor to a further new plant in Bradwell, Essex, which would be delivered entirely by Chinese companies.
The agreement marks a significant step forward for Hinkley after years of delays to the plant’s development, with work potentially commencing within weeks.
In 2007, EDF announced that it expected the plant to be fully operational by Christmas 2017.
However, it has been beset by issues surrounding a delayed final investment decision and agreements around government subsidy levels for the project.
It is now expected that construction will be completed by 2025.
The news will be welcomed by contractors set to benefit from the huge pipeline of work.
These saw a Balfour Beatty/NG Bailey JV pick up the electrical cabling and equipment installation contract, with Laing O’Rourke being handed the deal to build the workers’ campus accommodation.
Further nuclear agreement:
EDF and CGN have an agreement in principle to develop Sizewell C in Suffolk in which EDF would take an 80 per cent share and CGN 20 per cent.
EDF’s initial proposals for Sizewell C were published in November 2012 and the first round of formal consultation has already taken place.
EDF and CGN have an agreement in principle to seek generic design assessment approval for a UK version of the third generation HPR1000 reactor called Hualong.
The HPR1000 will be based on CGN’s Fangchenggang Plant Unit 3/4 in China, the reference plant for the UK Hualong design.
Under the terms of the agreement, a JV would undertake and manage the GDA process. CGN is expected to take a 66.5 per cent share and EDF 33.5 per cent.