The construction of a £15bn nuclear power plant in north Wales has edged closer after the government confirmed it had begun talks to kick-start the scheme.
Business and energy minister Greg Clark told MPs yesterday that the government had officially started negotiations with Hitachi, the developer behind the Wylfa Newydd nuclear plant in Anglesey, on a final funding deal.
Mr Clark said the talks marked an “important next step” for the project, and confirmed a deal for the plant could see the government invest public money to fund construction.
The energy minister said: “In line with the National Audit Office’s and public accounts committee’s clear findings and recommendations, for this project the government will be considering direct investment alongside Hitachi, and the Japanese government agencies and other parties.”
The Guardian has reported that the government could put as much as £5bn of public money towards the construction of the plant.
The Wylfa nuclear plant, on which construction could begin as early as 2020, will have a capacity of 2,700 MW – enough to power for five million homes. Its construction is expected to create 8,500 jobs.
Mr Clark stressed that no decision had yet been made on whether to go ahead with the scheme, and said the conclusion of the talks would be subject to government and regulatory approvals.
These would include checks on value for money for the taxpayer, due diligence of the developer and state aid requirements.
On Friday, Hitachi’s delivery body Horizon submitted a 44,000-page development consent order for the scheme, alongside an application for a marine licence.
Hitachi has already successfully built a series of nuclear plants in Japan with its Advance Boiling Water Reactor. Last December, the UK’s Office of Nuclear Regulation approved the ABWR reactor design.
The announcement by the government will allow the project’s EPC contractors to speed up development work.
In 2015 Bechtel and Japanese contractor JGC were chosen as the EPC contractors to manage the construction alongside Hitachi.
Mr Clark said the decision to begin talks on Wylfa was an indication that the government supported a long-term pipeline of nuclear new-build schemes, and that this would give the UK nuclear supply chain confidence to invest in capabilities.
The Wylfa plant is the second of five nuclear projects planned across the country over the coming decades.
In addition to Hinkley Point C, EDF is planning another reactor at Sizewell in Suffolk, and is partnering Chinese firm China General Nuclear on a multi-billion-pound facility at Bradwell in Essex.
Hitachi has plans for a second plant in Oldbury, South Gloucestershire, while Korean nuclear developer Kepco is developing proposals to build its own reactor in Moorside, Cumbria.
Mr Clark said the government was continuing negotiations with these developers but would be looking at funding models to drive better value for taxpayers.
He said: “Alongside our discussions with developers, we will be reviewing the viability of a regulated asset base model as a sustainable funding model based on private finance for future projects beyond Wylfa, which could deliver the government’s objectives in terms of value for money, fiscal responsibility and decarbonisation.”