The Secretary of State for Business, Energy and Industrial
Strategy (Greg Clark)
With permission, Mr Speaker, I would like to make a
statement on the proposed Wylfa Newydd nuclear power plant.
Britain was the world’s first civil nuclear nation. Nuclear
energy has powered homes and businesses in this country for
over 60 years and currently provides about 20% of our
electricity needs with low-carbon, secure and reliable
base-load power. Nuclear has an important role to play in
the UK’s energy future as we transition to the low-carbon
economy. However, we have always been clear that no
technology will be pursued at any price: new nuclear must
provide value for money for consumers and taxpayers.
In 2016, we agreed to support the first new nuclear power
station in a generation at Hinkley Point C in Somerset.
Developers have set out proposals for a further five plants
to come online over the next few decades. As I said at the
time the contract for Hinkley Point C was agreed, the
Government expect future nuclear projects to provide
lower-cost electricity than Hinkley Point C.
The next project in this pipeline is the proposed Wylfa
Newydd power station, based at Anglesey in north Wales. The
project developers, Horizon Nuclear Power, which is owned
by the Japanese company Hitachi, has developed proposals to
build two reactors with a combined capacity of 2.9 GW.
Hitachi’s reactor design has been deployed on time and on
budget in Japan, and last December, having satisfied our
strict safety standards, it completed the generic design
assessment process run by the UK’s independent nuclear
regulators. Horizon submitted its application for
development consent to the Planning Inspectorate last
Friday.
I am pleased to confirm today that Hitachi and the UK
Government have decided to enter into negotiations in
relation to the proposed Wylfa Newydd project. This is an
important next step for the project, although no decision
has yet been taken to proceed and the successful conclusion
of these negotiations will of course be subject to full
Government, regulatory and other approvals—including, but
not limited to, value for money, due diligence and state
aid requirements.
A key focus of discussions with Hitachi has been, and will
continue to be, achieving lower-cost electricity for
consumers. Both the National Audit Office and the Public
Accounts Committee have recommended that the Government
consider variations from the Hinkley Point C financing
model in order to reduce costs to consumers. In line with
the NAO and PAC’s clear findings and recommendations, for
this project the Government will be considering direct
investment alongside Hitachi, Japanese Government agencies
and other parties. Our partnership on this project will
serve as a further example of civil nuclear collaboration
between the UK and Japan, building on the memorandum of
co-operation that was signed with that country in 2016.
The UK is likely to need significant new nuclear capacity
to meet our carbon reduction commitments at least cost,
particularly as we electrify more of our transport and
heating, so alongside entering negotiations in relation to
Wylfa Newydd, the Government will continue to engage with
the other developers in the UK new nuclear market on their
proposals for further projects. This currently includes EDF
over its plans for a follow-on EPR project at Sizewell C,
CGN—China General Nuclear Power Corporation—over its
proposals for an HPR1000 reactor at Bradwell, and Toshiba
regarding the future of the NuGen project at Moorside, as
well as Hitachi over potential further ABWR units at Wylfa
and Oldbury.
It remains the Government’s objective in the longer term
that new nuclear projects, like other energy
infrastructure, should be financed by the private sector.
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, that could deliver the
Government’s objectives of value for money, fiscal
responsibility and decarbonisation.
Support for nuclear is reiterated in the nuclear sector
deal that we will publish with the sector shortly. That
deal, which the Government have developed in close
partnership with the nuclear sector, will include ambitious
proposals to drive down costs across the sector, including
by reducing the cost of construction in new build and by
investing in innovation in advanced nuclear technologies.
If the Wylfa project were to go forward following this
period of negotiation, it would provide about 6% of our
current electricity needs until nearly the end of the
century, while supporting thousands of jobs, particularly
in Wales, during its construction and operation. The
actions this Government have taken will support a long-term
pipeline for new nuclear projects in this country, and will
provide the visibility needed to enable the industry to
invest in the skills, including through the National
College for Nuclear, and the UK supply chain capabilities
across the country. I will continue to keep the House
informed during the negotiations, and I commend this
statement to the House.
6.28 pm
(Salford and
Eccles) (Lab)
There is cross-party consensus that new nuclear will
continue to play a vital role in the UK’s energy mix, and I
am therefore pleased to hear that progress has been made,
after some uncertainty, on the Wylfa nuclear plant. Given
the well-documented failings of the Hinkley Point C deal,
however, I am deeply concerned by the way in which the
financing has been, or will be negotiated—namely, the lack
of transparency and parliamentary scrutiny thus far.
On 15 May, I wrote to the Secretary of State requesting
information about the negotiations and I am yet to receive
a response. Until the last few days, we have had to piece
together snippets of information from the Japanese press,
and titbits from energy and environmental groups. We have
finally heard today that a deal will be negotiated with
Hitachi, which media reports suggest will include a
guaranteed strike price, loan guarantees and an equity
stake in the project in exchange for direct Government
investment.
I must say that this is a surprising shift from the
Government’s ideological position against Government
investment in new energy infrastructure, and I wonder
whether the shift applies to other renewable technologies,
for which support has been repeatedly cut by this
Government. I suspect not. I must sound a note of caution.
Without sufficient detail and transparency, the House is
unable to determine the risks and benefits borne by
consumers and taxpayers in the proposed deal.
Last year, the National Audit Office concluded on the
Hinkley Point C deal that the Department had
“not sufficiently considered the costs and risks of its
deal for consumers.”
The NAO made a series of recommendations, including
mechanisms for reviewing value for money and the
affordability of the deal; making it clear who is
accountable for oversight and governance; ensuring that the
cost and timing implications of alternatives are shown
clearly; and developing a plan to realise the benefit
across local economies and supply chains. Last year, I
asked the Government to adopt those recommendations. So
will the Secretary of State say whether he has done so and,
if not, why not? However, if the Government have done so,
will he publish all relevant documentation showing that
each recommendation has been followed in relation to Wylfa
or, indeed, confirm that they will be followed if they have
not been processed yet?
Negotiations between the Government and Hitachi thus far
appear to have been conducted behind closed doors. Will the
Secretary of State say whether the House will be given time
to scrutinise the proposed deal outline, or is this simply
a done deal? If so, have any binding commitments been made
or, for example, have any preliminary heads of terms or
memorandums of understanding been issued? The NAO stated
that
“making commitments to investors can limit flexibilities to
react to a change in circumstances.”
The implications of that need to be understood and
communicated clearly to decision makers. It is important to
ensure that the cost and timing implications of alternative
funding arrangements are shown clearly—again, that is
advocated by the NAO. If such alternatives have been, or
will be, examined, can the Secretary of State provide the
House with details today?
I move on to safety issues. It has been widely reported in
the press that Hitachi is seeking to “reduce or eliminate”
its financial responsibility for accidents. Will the
Secretary of State say whether that is true? If so, where
will such liability lie and what safety impact assessments
have or will be carried out from construction and operation
through to decommissioning? Indeed, on the issue of
decommissioning, will he explain who will bear that
liability and how much the cost is likely to be?
Despite the good news for Wylfa, subject to the queries
that I have outlined, it appears that further down the
Welsh coast the news is not so good for renewables
generation. Media speculation suggests an impending
negative decision on the much- anticipated Swansea tidal
lagoon project after years of planning and campaigning by
Tidal Lagoon Power, the Welsh Government, environmental
groups and MPs across the House. If that is true, it is
outrageous. To assume that Swansea is somewhat redundant,
given the plan for investment in Wylfa, is very
short-sighted.
I understand that Tidal Lagoon Power has offered to
negotiate further, but has not received a response from the
Government. Under the plans, there would be a zero-carbon
power plant producing energy for over 100,000 homes,
creating thousands of jobs across Britain; turbines built
in a wall in the sea that harness the power of the tides,
so that we can turn the kettle on in the morning;
world-leading infrastructure built in Britain using British
steel to last more than a century; and the potential to
export our expertise and products across the globe. An
ambitious, decisive and forward-thinking Government would
jump at a project like that, just as they have done with
Wylfa. Well, perhaps not. Recently, someone joked to me
that the desk of the Secretary of State was where good
ideas went to die. I hope that that is not the case with
the Swansea tidal lagoon, and I implore the Secretary of
State one last time to stop messing about, and to sit down
with the company and the Welsh Government to develop a deal
urgently.
I am disappointed that the hon. Lady did not continue in
the spirit in which she opened her contribution. This is an
important moment, and we are beginning a negotiation on a
project that will supply energy to this country for the
next 60 years, until towards the end of the century, which
will create jobs and reduce our carbon emissions. She said
that her party supported the proposal and that there was
cross-party consensus—one could be forgiven for missing
that in her tone—and it is important to establish that,
because it is evident that any 60-year project will take
place over the life of successive Governments. This country
has given nuclear investors confidence over time that there
is a strong commitment to such major infrastructure
projects, so I hope that she will back the commitments that
she and her party made in their manifesto last year to
support new nuclear and recognise the considerable
opportunities, as she put it, for nuclear power
internationally and domestically.
The hon. Lady asked about the financing model. She urged me
in a letter to reflect on the recommendations of the
National Audit Office and the Public Accounts Committee to
explore alternative financing models that can reduce the
price of the electricity that is generated. That is exactly
what I have set out—I have followed the recommendations of
the NAO and the PAC. We are entering a negotiation—I think
somewhere in her remarks there was a welcome for that—but
the essence of doing so is that a deal has not been agreed.
We need to explore that, and it is subject to the very
tests that she set out and that the NAO and the PAC
observed are required, including value for money.
On safety, the hon. Lady should be reassured—there are many
hon. Members who are familiar with the nuclear industry in
this country—that the safety standards operated through our
independent nuclear inspectorate are the highest in the
world, and that the generic design assessment is the most
exacting in the world. We always abide by the rulings and
requirements of the independent regulators, so that we can
have full confidence in the safety of this important
industry.
Finally, the hon. Lady mentioned other potential
investments, including the proposal for renewable power in
Swansea. She knows—we have had exchanges about it across
the Dispatch Boxes—that I believe in a diversity of energy
supply, but we need to make sure that value for money is
offered for taxpayers and bill payers. A rigorous
assessment is required and, as I have done today, I will
update the House when the process is concluded.
(Wokingham) (Con)
How will the Government ensure, if they have a stake in the
proposed investment, that when it comes to buying power
they are fair between that investment and other people in
the market?
My right hon. Friend takes a great interest in this issue.
When I made my statement on Hinkley he advised that we
should consider using the Government’s balance sheet in
that way, and we will consider that as part of the
discussions. As for the contracts that are entered into,
one of the requirements of the state aid regime is that any
contracts have to be on a non-discriminatory basis, which
will guide the letting of any such contract.
(Kilmarnock and Loudoun)
(SNP)
I thank the Secretary of State for early sight of his
statement but, to be truthful, it did not tell us any more
than we have been able to glean from the media today. I
find the Government’s nuclear obsession mind-boggling. When
Hinkley was first proposed all those years ago it was on
the basis that it had to be commissioned by December 2017
or there would be a risk of the lights going out. All these
years later, it will not be generating at full capacity
until something like 2030, which seems to undermine the
need for new nuclear.
Hinkley is shocking value for money, with a 35-year
megawatt-hour strike price of £92.50, whereas recent
offshore auctions have returned bids of £57.50 per
megawatt-hour over a 15-year period. That is the real cost
benchmark that the Government should use. Considering that
the National Audit Office concluded that it would be
impossible to know for decades whether building Hinkley
represented good value for money for UK taxpayers, it is
utterly incredible that we are diving headlong into another
costly venture. The Secretary of State has said that he
wants to do a sector deal, but we do not know what value
for money that will provide. It has been reported that the
strike price for the new power station will be something
like £15 per megawatt-hour cheaper than at Hinkley, but how
much of that cost reduction is due to the billions of
pounds of direct investment from the taxpayer?
Given the company’s questionable track record on safety,
will the Government confirm that Hitachi will be
financially liable in the event of any accidents? Given the
unprecedented level of taxpayer investment, how will the
Government demonstrate that they have met the Public
Accounts Committee’s demand for a full value for money
assessment before they finally sign off the deal, and how
will Parliament be able to scrutinise that? When will we
know the level of the financial commitments?
If the Secretary of State is so willing to commit
taxpayers’ money directly for stakes in projects, will he
consider paying for national grid upgrades to further
facilitate the deployment of renewables, instead of tagging
such upgrades on to the costs of renewable projects? As bad
as the Government’s obsession with nuclear is, this is also
about their attacks on renewable investment. When will they
have a coherent energy policy and proper investment in
future technologies, rather than a technology that has had
its day?
I thank the hon. Gentleman for his comments. On statements
to the House, I think all Members would recognise that I
have come to the House at the earliest possible
opportunity. It was today that the decision was taken to
enter into negotiations. Members will know that I always
keep the House updated and always will.
It is a bit rich of the hon. Gentleman to complain that new
nuclear power will come online later in the 2020s, given
that he and his colleagues have resisted the replacement of
our nuclear fleet, which we have known needs to be replaced
for all this time. It is an act of responsibility on the
part of this Government that we are planning ahead for the
replacement of the 20% of our electricity that is currently
generated from nuclear power. It is important for consumers
in Scotland and in the rest of the United Kingdom that we
do that.
The hon. Gentleman criticised what he regarded as the value
for money of the Hinkley project. He will have heard me say
at the time that that represents the highest price we will
pay for new nuclear. I expect future new nuclear power
stations to come in at a lower price. I have made it
explicit today that that is a requirement of the
negotiation. However, this is the beginning of a formal
period of negotiation.
The recommendations of the Public Accounts Committee and
the National Audit Office have shaped the approach we are
taking. The value for money test has to be met, and at all
the key milestones I will ensure that Parliament has the
opportunity to scrutinise the progress of the negotiations.
Sir (Sevenoaks)
(Con)
Does my right hon. Friend agree that this welcome
announcement and the lower strike price that is being
targeted underline the importance, if we want to keep costs
falling, of securing continuity in the nuclear programme,
so that the supply chain and the skills academy can look
beyond Wylfa to Sizewell C, Oldbury, Bradwell and Moorside?
My right hon. Friend is absolutely right. He contributed
with distinction as an Energy Minister and therefore
recognises that if we are to achieve not only the full cost
benefits but the industrial and employment benefits, it is
necessary to show that we have a pipeline that is being
delivered in a steady and orderly way. If we do that, as we
have done with offshore wind, in which he was instrumental,
we can establish an industry that not only supplies to UK
consumers at a lower cost but offers a big export
opportunity.
(Leeds West) (Lab)
A thriving nuclear sector depends on the ability to move
nuclear materials around safely and securely. At the
moment, we do that via our membership of Euratom. What
assurances has the Secretary of State been able to give
Hitachi about our future relationship with Euratom, nuclear
co-operation agreements with other nuclear states and the
ability of the Office for Nuclear Regulation to recruit the
safety inspectors we need?
The hon. Lady will know from her involvement in the
scrutiny of the Nuclear Safeguards Bill that we have made
very good progress both on the proposed agreements with
other nuclear countries and on our intended association
with Euratom. I regard this as an area in which it is
clearly in everyone’s interest to have the greatest
possible continuity of the existing arrangements. That is
no secret; it is known to any partner and any investor,
including Hitachi.
(Preseli Pembrokeshire)
(Con)
I welcome my right hon. Friend’s statement. He will know
that the Wylfa Newydd project will be the largest
construction project in Wales for more than a generation,
so what discussions is he having with the Welsh Government
to ensure that we maximise the opportunities for the Welsh
supply chain, which will be the backbone of delivering this
important project in Anglesey?
Of course, the opportunities for Wales follow from exactly
the point that my right hon. Friend the Member for
Sevenoaks (Sir Michael Fallon) made. The knowledge of the
investment that will be made there provides great
opportunities for people in north Wales and beyond to
develop the skills that will be in high demand, to ensure
that the engineering companies and other suppliers can gear
up for this important work. Before I came to the House
today I discussed the matter with the First Minister, and
my right hon. Friend the Secretary of State for Wales spoke
to , the Cabinet Secretary for
Economy and Transport. We will work closely together to
ensure that across Wales and, indeed, the United Kingdom,
these opportunities result in real jobs and prosperity for
the people of Wales and the UK.
Sir (Kingston and Surbiton)
(LD)
The Secretary of State knows that there have been two major
revolutions in electricity since Hinkley Point C was
initially agreed to: a dramatic cost reduction for
large-scale renewable power and huge advances in storage
technology. Given that renewables and battery storage will
soon offer cheaper and more flexible security of supply
than nuclear, where are those two historic shifts in
electricity technology in his decision today?
The right hon. Gentleman makes the very important point
that we have seen progress in renewables and that we are
seeing progress in storage. Today, nuclear provides just
over 20% of the electricity we consume and wind provides
5.5%. My view is that we should have diversity in our
energy supply—the wind will not supply all our needs every
day. His point about storage technology is correct and he
knows from the industrial strategy that we are investing in
its development, but it is not at the stage where it can
offer the reliable baseload power that nuclear, which
supplies 20% of the UK’s electricity, offers now. That is a
very important part of the mix.
Mr (Tewkesbury)
(Con)
Horizon Nuclear Power employs 350 people in my
constituency, and I visited Hitachi in Tokyo fairly
recently, so I welcome the Secretary of State’s
announcement today. Does he agree that the fault over the
past 30 years has been the failure of successive
Governments to replace the existing nuclear power stations?
I urge him to press ahead with these projects for the very
reasons that he has given, of security of supply and the
reduction of emissions.
I agree with my hon. Friend. It is not a positive
reflection on previous Governments that, knowing that this
important contribution of more than 20% of our power supply
was coming to the end of its life in the decade ahead, no
plans were made to replace it. The fact that we now have a
pipeline of nuclear power plants will provide confidence
that that source of energy will be maintained and, as we
have discussed, provide important economic opportunities
for people to enjoy successful careers and prosperity in
that industry.
(Ynys Môn) (Lab)
The Secretary of State’s statement on Wylfa Newydd is good
news for my constituency, good news for north Wales, and
good news for the UK nuclear industry and wider industry.
If we are serious about tackling climate change, we need to
be serious about new nuclear and get on with it as quickly
as possible. My constituents will welcome this
announcement, but they will want assurances that the skills
agenda is going ahead and that local people can have the
quality jobs that previous generations in my constituency
have had for over 40 years. I invite the Secretary of State
to come to talk to training providers, local government and
Welsh Government so we can get this agenda up and running.
I am grateful for the hon. Gentleman’s welcome. He knows
very well the potential of the development for his
constituents and those beyond. I had the pleasure, during
the Anglesey Day he hosted, to meet many of the companies
that would benefit. It is the case, I think, that some
young people already working on the site have been to Japan
for training purposes, deepening their skills and
broadening their horizons. They will be very important
engineers of the future in the UK. I am delighted that,
subject to the success of the negotiations, this
opportunity will be available for them.
(Taunton Deane) (Con)
Does my right hon. Friend agree that, particularly with the
electrification of more of our transport and heating, new
nuclear is an essential part of providing the right energy
load—including Hinkley Point C, adjacent to my
constituency, with all the spin-offs it will bring—to meet
our Government’s highly commendable carbon reduction
commitments at least cost?
I am grateful to my hon. Friend and I agree with her that
nuclear should be a part of our energy mix. To be
resilient, we should have a diverse energy mix. It is
important that the cost of any project should be acceptable
and affordable for bill payers as well as taxpayers. That
will be an important principle in the negotiations, but if
we are successful in that, it will make the contribution my
hon. Friend describes.
(Brighton, Pavilion)
(Green)
For the record, may I put it on the record that there is
not cross-party consensus on nuclear power? My question is
about renewables. Investment in renewables is at an
all-time low. Funding streams for clean energy are at their
lowest level since 2008, despite solar and wind being the
cheapest form of new electricity generation. I want to ask
the Secretary of State again how he can justify this
multimillion deal to prop up an outdated and hugely costly
technology. The chief executive of National Grid himself
has said that baseload is an outdated concept because the
cost of batteries will come down far more quickly and will
be much cheaper than new nuclear by the time it comes on
board. Renewables are much cheaper and safer, and they are
ready now. Why does he not choose them?
The hon. Lady has, as she describes, a fundamental
disagreement: she does not see any benefit from nuclear to
the resilience and supply of our electricity. That has long
been her view, but I am surprised that she would talk down
our country’s achievements on renewables. She should know
that as a result of decisions taken by this Government and
our predecessor, we are now the leading nation in the world
for the deployment of offshore wind. Taking a strategic
approach and investing in the future with a pipeline, just
as we propose for new nuclear, has resulted in jobs being
created around the towns and cities, in particular the
coastal towns, of this country. I would have thought she
would recognise and welcome that.
Mr (Maldon) (Con)
Does my right hon. Friend agree it is important to maintain
not just diversity of supply but diversity of suppliers
within the nuclear industry? Will he therefore welcome the
progress made in the construction of unit 3 of the
Fangchenggang power station in China, which is the
reference plant for the proposed HPR1000 reactor at
Bradwell-on-Sea? Will he reaffirm his support for that
project, subject to the generic design assessment and
regulatory approvals?
I agree with my right hon. Friend that having a diversity
of energy sources is important, but so is having some
degree of competition between suppliers. That is why I
referred in my statement to the pipeline that is in
prospect. On the GDA process, we of course welcome progress
through that. For each of these projects, it is
foundational that the safety case is demonstrated. It is
important that they should meet that, but it is also
important that they demonstrate that they offer value for
money for both the taxpayer and the bill payer. In each of
these cases, negotiations will focus on that as well as on
other aspects.
(Barrow and Furness)
(Ind)
Is not a key part of lowering the strike price for Wylfa
that the Government are now proposing a direct stake in the
project? If that is the case with the Japanese firm Hitachi
and the Japanese Government, surely the Secretary of State
will offer the same deal to Toshiba for NuGen in Moorside,
which will sustain up to 20,000 Cumbrian jobs.
I recognise the support for the nuclear industry that the
hon. Gentleman espouses. This is a statement about a very
good development in a particular negotiation. He refers to
the project at Moorside. As he knows, it is not at the same
stage. We are responding to recommendations of the National
Audit Office and the Public Accounts Committee to consider
other financing models. It is the start of a negotiation,
but I feel confident that we should take that step to
commence.
Sir (New Forest West)
(Con)
But it is a nationalisation, isn’t it?
No. The NAO in its report noted that all major energy
projects have some involvement with the state. That is a
feature of the current market not just in this country but
around the world. We want to drive the best value for money
for both the taxpayer and the bill payer.
(Carmarthen East and
Dinefwr) (PC)
Now that the British Government have decided to invest
directly in nuclear projects, surely they will be doing the
same for other energy projects, such as the Swansea Bay
tidal lagoon, or will this be determined solely on the
basis of the contract for difference financing model?
We have decided to enter a period of negotiations and
consider the NAO and PAC recommendations. This is an
announcement about this particular project. The House will
see me make an update as we progress with the negotiations.
(Harrow East) (Con)
One of the consequences of the Labour party’s prevarication
on the nuclear industry has been the deskilling of that
industry. Will my right hon. Friend expand on his plans for
skilling up our workforce, particularly our young people,
so they get the opportunity to work in this thriving
industry?
My hon. Friend is absolutely right. I had the pleasure of
visiting the National College for Nuclear in Somerset a
couple of weeks ago. Seeing the opportunities that will be
available to the next generation of nuclear engineers is an
inspiring sight. I am pleased that this is now available
for them.
(Warwick and
Leamington) (Lab)
The Secretary of State will be well aware that several
years ago the German Government took the decision to
decommission their nuclear reactors and invest heavily in
renewables and other suppliers. Given the significant cost
advantage of offshore wind and the UK’s geographic
advantage in delivering it, what do the UK Government know
that the German Government do not?
I am surprised the hon. Gentleman mentions that, because
one of the problems Germany has faced is that the return to
coal has increased the pressure on its greenhouse gas
emissions. I checked before I came into the Chamber, and
coal was contributing just 1% of our current electricity
generation, compared to 20.5% from nuclear. If we are
serious about meeting our climate change ambitions, we have
to take decisions that are consistent with that.
Mr (Clwyd West) (Con)
I congratulate my right hon. Friend on his statement, which
will be widely welcomed in north Wales where Wylfa is such
an important part of the regional economy. On timescale, he
mentioned that the negotiations will be subject to, among
other things, the requirements of state aid. Are we to
infer from that that he anticipates the negotiations will
be complete before 29 March next year, after which one
would hope state aid would not be a consideration?
My right hon. Friend is ingenious in his scrutiny of the
timetable. If we start the negotiations on the regime while
a member of the EU, it seems to me that we would not want
to delay their completion until the date of Brexit.
(Hornsey and Wood
Green) (Lab)
What reassurances can the Minister give on genuine
consultation with local communities over the long-term
considerations of nuclear waste?
The hon. Lady raises a very important point. The treatment
and storage of nuclear waste is part of the consultation at
the moment. Part of the safety assessment for all new and
current nuclear plants is to make sure that the waste is
stored and eventually disposed of safely, and part of any
contract needs to provide for the money to address that.
(Gloucester) (Con)
I totally agree that starting the negotiations with
Horizon, based in the Gloucester business park, to secure
replacement nuclear capacity and increased demand for
electricity is a very good thing. I wish my right hon.
Friend all good luck in securing a balance of advantages to
the taxpayer between a lower strike price on the one hand
and—no doubt—some cost and construction risk on the other.
The aspects he highlighted—greater security, low carbon,
greater diversity, jobs, supply chains—all apply equally to
the fabulous tidal lagoon project mooted for Swansea. I do
hope he can secure a positive response to the Hendry review
as soon as possible.
I anticipated the direction in which my hon. Friend was
heading. As he will know that, as we have done in this
case, we need to offer and obtain value for money for the
taxpayer and the consumer. Just as in this case, that is
part of the assessment to be made of the tidal lagoon
proposal.
Mr (Sheffield South East)
(Lab)
One aspect of a future nuclear strategy the Secretary of
State did not deal with is small modular reactors. I have
written him several emails about this. Davy Markham, in my
constituency, is one of the few places that can actually
machine the largest parts for these reactors, but it is in
receivership. The receiver is selling off this capacity,
and currently it looks as if it will go overseas. Will the
Secretary of State take another look to see what role he
and his Department can play in drawing up a plan to save
that capacity for this country and make sure it forms an
important part of his future industrial strategy, rather
than simply being sold off to the highest bidder overseas?
I referred in my statement to the nuclear sector deal and,
in particular, talked about investment in innovation in
advanced nuclear technologies, which is the area the hon.
Gentleman mentions. That initiative, which we will launch
with the sector, is forthcoming, and of course I am happy
to meet him to discuss the firm in his constituency.
Mr (Scarborough and
Whitby) (Con)
The Secretary of State in his statement highlighted the
need to drive down the cost of the construction and
operation of this new generation of nuclear reactors. In
that regard, are we likely to see more reliance on offsite
modular construction techniques? If so, will that present
opportunities not just for Wales but right around the
country, including for the expertise that already exists on
the Tyne, the Weir, the Tees and, of course, the Humber?
My right hon. Friend is absolutely right. In the sector
deal, we will set out the opportunities for small modular
reactors, which we have been discussing and developing with
the sector.
(Vale of Clwyd) (Lab)
I pay tribute to my hon. Friend the Member for Ynys Môn
(Albert Owen) for his tireless efforts in lobbying for
this. He is Mr Energy Island. This £13 billion investment
could be multiplied if we get the timing, co-ordination and
planning right. Central Government need to co-operate with
the Welsh Government, local government, the rail companies,
further education, higher education and the private sector.
Will the Secretary of State meet a cross-party delegation
of north Wales MPs to make sure we get this crucial aspect
right?
I certainly will. The hon. Gentleman is absolutely right.
As we have discussed across the Chamber, one of the
benefits of a clear pipeline is the ability to plan ahead
and maximise the local opportunities to the benefit of his
constituents and many others in Wales.
(Fylde) (Con)
I welcome the Secretary of State’s statement and continued
support for the nuclear industry. Will he look at
Springfields, the nuclear fuel manufacturer, which employs
1,200 people in my constituency, and do everything he can
to ensure that the next generation of nuclear fuel is made
right here in the UK?
My hon. Friend is a consistent and passionate advocate for
Springfields in his constituency. The Under-Secretary of
State for Business, Energy and Industrial Strategy, my hon.
Friend the Member for Watford (Richard Harrington), who is
responsible for industry, will be visiting very shortly. It
is a matter for the company where it sources its fuel, but
I know that my hon. Friend’s representations will be heard.
(Amber Valley) (Con)
I urge the Secretary of State to back small modular
reactors, which could be the solution for lower-cost
nuclear energy. Is there more the Government can do to help
the industry bring forward these ideas so that we can be a
leader in the world and not a follower?
My hon. Friend is absolutely right. We announced £56
million of research and development for small modular
reactors last year, and we are now looking at the financing
and the regulatory framework. I mentioned the forthcoming
nuclear sector deal. He will see substantial reference to
this point in that agreement.
(Rugby) (Con)
Today’s announcement is important and good news for the
supply chain for the new nuclear plants. I wonder if I
might join my hon. Friend the Member for Gloucester
(Richard Graham) in asking the Secretary of State whether
he anticipates a similar good news announcement for
companies in the supply chain for the Swansea Bay tidal
lagoon, such as GE Power based in Rugby.
My hon. Friend tempts me to make a different statement from
the one I made, but I note and have heard before his
consistent advocacy of the benefits of that project to his
constituency.
David T. C. Davies (Monmouth) (Con)
Has my right hon. Friend noted a cross-party view in the
House that £92.50 is the absolute maximum we should be
paying for energy generation, and will this feature in his
deliberations on further energy projects?
We made a commitment that the strike price agreed for
Hinkley would be the high-water mark for new nuclear, and I
note my hon. Friend’s recommendation that that apply more
generally.
(Morecambe and
Lunesdale) (Con)
In my constituency, we have two nuclear power stations,
which is welcome news for my constituents, but we need a
third. We have the site—the seventh site—and I could line
up five developers under this proposal. Would the Secretary
of State like to meet to discuss this further?
I am happy to do that. I fondly remember a visit I made to
a nuclear power station in my hon. Friend’s constituency
some years ago. Perhaps he could bring me up to date with
developments since.
Several hon. Members rose—
Mr Speaker
I call Mr .
(Torbay) (Con)
Thank you, Mr Speaker; obviously you are saving the best
till last.
I welcome today’s statement and the Secretary of State’s
commitment to a new generation of nuclear reactors. He will
be aware of the close link in France between nuclear and
the navy and civil nuclear power in terms of long-term
careers for those who serve in the submarines providing the
deterrent. Will he do the same with our industry?
My hon. Friend makes a very good point. The engineering
skills we need in the armed forces and their civil
applications can lead to careers that cross both. I will
make sure that his recommendation is followed through.
(Croydon South) (Con)
I warmly welcome this announcement, which, as the Secretary
of State says, will help us to maintain a balanced,
low-carbon energy mix. So many of these projects can be
beset by delays—Hinkley C is an example—so may I urge him
to progress this initiative with a sense of urgency and to
carry forward the small modular reactor competition as
quickly as possible?
I will indeed. We will have more to say in the sector deal
about small modular reactors. I stress to the House that we
are entering a period of negotiations, and they have to
meet some important requirements, but it is in all our
interests that they proceed in an orderly way. The purpose
of today’s announcement is to allow us to do precisely
that.
Mr Speaker
In a moment I shall call the hon. Member for Walthamstow
(Stella Creasy) to make an application for leave to propose
a debate on a specific and important matter that should
have urgent consideration under the terms of Standing Order
No. 24. The hon. Lady has up to three minutes in which to
make her application.
