Nuclear Energy Giants Brawl Over UK Government Support

  • Date: 21/09/10

The future of a £15 billion German-backed project to build nuclear reactors in Britain is in doubt after Chris Huhne signalled that the Government would not support a key plank of the proposals.

The Times has learnt that E.ON, the world’s largest utility company by revenues, has written to the Energy Secretary to complain about remarks he made last week during a House of Commons select committee hearing.

Volcker Beckers, the chief executive of E.ON’s joint venture partner RWE npower, has also sought clarification from officials at Mr Huhne’s Department of Energy and Climate Change.

Both companies, which are partners in Horizon Nuclear Power, a German consortium that aims to spend £15 billion building nuclear reactors at Wylfa in Anglesey and Oldbury-on-Severn in Gloucestershire by 2025, are said to be “livid” about the remarks.

Mr Huhne let slip plans to reject Horizon’s calls for a consumer-funded levy designed to support investment in new British nuclear stations, which are far more expensive to build than conventional coal and gas-fired stations.

Instead, he backed an alternative proposal from EDF, the French state-controlled energy giant, to establish a so-called “carbon floor price”. The price is a support mechanism intended to boost the competitiveness of low- carbon nuclear power stations against more polluting coal and gas stations.

Mr Huhne said: “We had some people in the industry saying that the carbon price floor would be enough, we had other people in the industry preferring other options. The contact that I have had with the industry recently has been quite interesting in that they have converged on the view that the carbon price floor will be enough.”

RWE and E.ON believe that the comments contradict repeated arguments they have put to Mr Huhne since the general election in May.

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