Westminster Hall debate on Nuclear Fuel Manufacturing - Sep 7
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Mark Menzies (Fylde) (Con) I beg to move, That this House has
considered continued nuclear fuel manufacturing in the UK. It is a
pleasure to move the motion under your chairmanship, Mr Betts. I
know that you are very passionate about manufacturing and skills,
so I cannot think of a more appropriate person to be chairing
today’s debate. Springfields nuclear fuel manufacturing plant is
located in my constituency of Fylde. It is not just a nuclear fuel
manufacturing...Request free trial
Mark Menzies (Fylde) (Con) I beg to move, That this House has considered continued nuclear fuel manufacturing in the UK. It is a pleasure to move the motion under your chairmanship, Mr Betts. I know that you are very passionate about manufacturing and skills, so I cannot think of a more appropriate person to be chairing today’s debate. Springfields nuclear fuel manufacturing plant is located in my constituency of Fylde. It is not just a nuclear fuel manufacturing plant; it is the United Kingdom’s only nuclear fuel manufacturing plant, so by any definition that makes it a key UK strategic asset. That is a theme that I want to touch on later in my speech. Beyond that strategic importance, over 800 people are employed directly at Springfields, with employees hailing from the full breadth of the north-west’s nuclear arc, and with the wider supply chain employing countless thousands more. Indeed, Government estimates indicate that fuel fabrication facilities in the north-west support over 4,000 direct and indirect jobs, including roughly 400 people at Urenco in Capenhurst, who are likely to be impacted hard by any drop-off in demand at Springfields. Among these employees, roughly a third of those who work on site began their career as apprentices, jumping at the chance of what were jobs for life, as 2,000 people have done since apprenticeship schemes started at Springfields 71 years ago. Among those was the current managing director, Brian Nixon. I hope that demonstrates that these are secure, well-paid jobs, of the kind that must be at the heart of the Government’s levelling-up agenda, particularly in a sector that has at its heart the north-west’s economy with its industrial base. Beyond the local economy, our nuclear industry is also helping to forge the UK’s path towards achieving our net zero ambitions, having already produced the nuclear fuel that has powered the equivalent of 20 years’ energy consumption since 1946.
Liz
Saville Roberts (Dwyfor Meirionnydd) (PC)
Mark Menzies From an environmental perspective, it is also believed that existing uranium stocks could be enriched and used to make fuel. Existing stocks are sufficient to power Sizewell C throughout its lifetime, and Springfields Fuels Ltd has built an industry hub, working closely with bodies such as the National Nuclear Laboratory. Let us look at the challenges. Although the future is full of promise for Springfields and the wider UK nuclear sector, significant and urgent challenges remain—namely, a short-term drop-off in fuel orders that risks causing redundancies and, more worryingly, the irreplaceable loss of skills. At the heart of this is the likelihood of early closure and uncertainty around Dungeness B, Hinkley B and Hunterston. With 70% of site income related to advanced gas-cooled reactor fuel manufacture, that uncertainty has seen a sudden drop-off in demand. Given the possibility that manufacturing on existing orders will end as early as 2023, this really is an urgent situation, and retrospective action cannot resolve the issue. We are also waiting on decisions from the Government about the next generation of reactors—the small modular reactor fleet—with Sizewell C and other proposals still to be approved. Even with approval, construction will take several years, which means a lengthy gap until Springfields-manufactured fuel is in use. That ambiguity is causing delays in ownership-level decisions about the future, adding to the uncertainty, particularly among the workforce. In the short term, to cope with the drop-off in demand, Springfields needs to find sources of income to support continued work and employment. To date, the redundancies have been voluntary, but that will likely not be the case going forward for employees, management and the unions. I pay tribute to Unite and Prospect for the incredible way in which they have engaged on a cross-party basis to represent the interests of their workforce. I have corresponded with constituents working on site, who have made their feelings clear. Some other opportunities in the wider nuclear sector are also proposed, such as decommissioning, but the site’s unique selling point is its ability to produce nuclear fuel, and that must be protected. So what are the solutions? As the Minister knows, I come to this debate not with challenges but with key asks. First, it is important to say that this is not a company or a sector in decline. The need is just for support to help bridge the gap before the new technology comes into play and we usher in a golden age of new nuclear. There is a world-class skills base at the site, with plenty of opportunities on the horizon, particularly in the latter part of the decade. The Government need to take a long-term view of the industry. Given that no similar facility exists in the UK, those skills will be impossible to replace. Many of the people who have taken voluntary redundancy were there as apprentices, and the collective knowledge among those people really is quite something. To lose that is shocking. The vision for net zero looks to 2050, and to lose a key component in a low-carbon industry in the mid-2020s, at the start of our net zero journey, due to a short-term approach is incredibly counterproductive. In the long term, it is essential to have a holistic approach that incorporates as much UK involvement in new deals as possible. For example, Lancashire is already at the heart of SMR—small modular reactor—manufacturing in the UK, and that technology of the future creates huge export potential.
Liz
Saville Roberts
Mark Menzies However, this new technology can be achieved only if the Government set out their vision for the UK’s future SMR fleet, including a regulatory framework and site proposals. On SMR and AMR, I welcome the investment, particularly from the United States, but a way for investors to demonstrate their commitment is for them to promise to manufacture fuel in the United Kingdom. I strongly believe that a commitment to produce UK fuel for UK reactors must include all future UK projects and the possible transition of existing EDF contracts to Springfields. To achieve that, it would be a huge step forward if the Minister held meaningful discussions with EDF and US investors to work towards gaining such assurances on future contracts and to move some of the present contracts to the UK. There are many ideas about the next phase, but one is that Framatome could manufacture at Springfields under licence, or that Westinghouse could manufacture Framatome fuel under licence, which would help to bridge the gap without a major renegotiation of EDF contracts. Indeed, having discussed this possibility—only yesterday, in fact—I know that EDF would be open to having a requirement for UK-manufactured fuel written in to contracts, as it works to solidify the long-term future of its key UK operations. EDF actually wants that clarity and certainty, which would go some way to securing Springfields. As mentioned, there are huge opportunities on the horizon, but without the go-ahead from the Government, they remain something for the future. Therefore, it is key that the Government affirm their backing for UK nuclear and approve proposals for new reactors. With the spending review coming up and COP26 rapidly approaching, I cannot think of a better time for them to do that than now. However, we cannot just think about Sizewell C, which will provide opportunities for Springfields to fulfil the required contracts; we also have to consider the future, over the next 60 years, of what reliable nuclear energy looks like. Support for other future opportunities, such as reprocessed uranium, is currently a growing area, and countries such as France rely on fuel imported from Russia. We are a neighbour and strategic partner of France, with a strong nuclear safety record, so with Government support and investment, this is something that Springfields has the expertise to commence work on in earnest. To conclude, I cannot stress enough that, given the time-sensitive situation we find ourselves in, decisive action is needed at the earliest opportunity to protect this strategic national asset, and the Government must do whatever it takes to safeguard that asset’s future. Mr Betts, coming from Sheffield, you will know that Sheffield Forgemasters was regarded as a strategic national asset, and thank goodness action was taken to protect it. To stall further on nuclear would lead to irreplaceable skills being lost and facilities potentially closing. This is an industry with a great future, but it needs the certainty that Government support on investment and future projects can give. The employees who I have discussed today are genuinely world-class; many of them are unique in this country in terms of what they do. However, they are ready to take on the new challenges that exist. Government must work with industry to guarantee that UK nuclear fuel will be produced in the UK, and give the go-ahead to the projects that will create those orders. If we do that in a timely way, both the workers and the plant would have a future, a national strategic asset would be protected, our journey towards low carbon would be a safe one, this country would achieve energy security, we would be able to export fuels, with the AMRs and SMRs, to many other countries around the world, and we would truly be heralding a golden era. I call upon the Government to seize this opportunity.
Mr Clive Betts (in the
Chair) 14:44:00
Sir
Mark
Hendrick (Preston) (Lab/Co-op) The UK’s civil nuclear sector is among the most advanced in the world. Fuel production, generation, new build, and research through to decommissioning are key components of that. They provide tens of thousands of highly-skilled jobs, many in the north-west, particularly in Lancashire near my constituency of Preston, where fuel production is concentrated. Nuclear power is one of the largest and most reliable sources of low-carbon energy and electricity in the UK. It has an essential role to play in the transition to net zero. The UK currently has only one new power station under construction. Without rapid progress, we will have what is referred to as a nuclear gap. The nuclear gap currently means that the UK’s only domestic nuclear fuel manufacturer, Springfields in Lancashire, is facing a very uncertain future. It was a pleasure to meet the trade unions on College Green today and discuss the problems that the industry faces. It was nice to see them and great that they are fighting for the industry in the way that they are. The UK has something like 15 existing reactors, generating about a fifth of the electricity in the UK, with 13 others at various stages of construction or planning. The majority are due to reach the end of their operating lives and be shut down before 2030. In September 2016, the Government gave the final go-ahead to Hinckley Point C, which will be the first new nuclear power station for a generation. There is no doubt that we need new build if we are to have that carbon-free future. A new nuclear sector deal was passed in the Government’s industrial strategy, and £200 million was promised by the Government to support the industry. However, since then, major events have put that future in doubt. In November 2018, there was a collapse of private sector support for a new plant at Moorside. In 2019, the Hitachi project at Wylfa in north Wales was suspended, which cast doubt on the future of nuclear plants per se. I know that the Government have consulted on alternative finance models for the new reactors and are currently in negotiations with EDF about a new nuclear plant, but it is essential that they give these industries that firm support—the hundreds of millions of pounds that was talked about originally—so that the jobs and technology remain in this country. A number of factors have contributed to the decline in construction. Obviously, up-front costs are a big barrier, but once they are out of the way, it starts to look far more viable. The meltdown of Fukushima, the closure of THORP—the thermal oxide reprocessing plant—and nuclear waste disposal are all problems that are being overcome and, with further research and development, can be overcome, I think, in a reasonable time. A push for faster action on nuclear is needed, which includes bringing forward legislation for the new funding model. Springfields, as the hon. Member for Fylde said, is the UK’s only civil nuclear manufacturing site. It is a source of high-value employment in the north-west and is critical, along with aerospace, to the Lancashire economy moving towards a carbon-neutral future. That carbon-neutral future is at risk. There is a possibility of anything up to 120 redundancies at the site, which currently employs around 800 people and supports around 4,000 jobs across the wider supply chain. Prospect and Unite, the trade unions, have since said that axing more than 10 roles would put that carbon-neutral future at serious risk. The Government urgently need to bring forward a mixed-energy policy, which should include carbon-free nuclear. In addition, nuclear technology plays a part in many other areas, particularly in industry and higher education. Some universities across the UK are offering courses related to the nuclear industry, including my local university, the University of Central Lancashire. The National College for Nuclear is a cornerstone of the Government’s policy. Courses are being offered by five education providers, including two near my constituency of Preston, at Lancaster & Morecambe College and the Lakes College in west Cumbria. I also understand that an advanced nuclear skills and innovation campus, which has an eight-month pilot launch from June this year, is now based at the Springfields site, with leaders from industry and academia, including UCLan, the University of Manchester and the University of Sheffield. I was pleased to hear the right hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts) refer to Mike Tynan. I have known Mike for years, from when he was based at Springfields. I understand he is now at the University of Sheffield, which I am sure is not unknown to you, Mr Betts. UCLan also offers modules on decommissioning waste and environment management on the nuclear fuels cycle. There is a lot of controversy around the industry at the moment concerning the involvement of China and China General Nuclear, which owns a significant stake in Hinkley Point C, and our involvement with France. One thing is certain: we have to co-operate with China to develop a carbon-free world. China is a huge country with a huge population and must be part of the solution, not just seen as a problem, as in the case of the very poor debate and decision over Huawei. We can either stay in the 20th century or move forward, with partners such as China and France, who have got so much to offer the industries. In conclusion, investing in new nuclear is a no-brainer, so let us get on with it. 14:51:00
Paul Maynard (Blackpool
North and Cleveleys) (Con) The domes of Dounreay might be more worthy of heritage protection but they relied on Springfields. The current fleet of nuclear reactors also relies on Springfields in the here and now, but the footprint and the numbers employed at the site have declined over time. Employment is now in the hundreds, not the thousands, and cannot afford to be lowered further. We need to look at Springfields’ future. We know that the ultimate parent owners have uncertain intentions, at best, about the future of the site, so policy needs to move at pace. We have heard that advanced gas-cooled reactor closures are likely to be brought forward, creating a gap around 2024 before demand for nuclear fuel increases once more, as new reactors come on stream. I know that the Government have a nuclear fuel working group. I welcome that, but working groups come in many forms and shapes. Every Department has a multiplicity of them. Some of them operate without a Minister even being aware. I know from my own time as a Minister that, if it was moderately important, I might try to attend the initial meeting to set the agenda and make it clear that it mattered to me. If it was really important, I attended every single meeting. I urge the Minister to send a signal to and sit on the shoulders of her no doubt fantastic officials to attend every single meeting. This is really important, not just for Springfields but for our future national security. We rightly hear a lot about net-zero, green recovery and the levelling-up agenda—sometimes too much for my personal taste—but here in the Lancashire countryside is the living embodiment of those three agendas. I have always argued as an MP for more high-quality, high-skilled jobs on the Fylde coast, near my relatively deprived coastal town of Blackpool and Cleveleys. Here they are, just a few miles away, in the Lancashire countryside. There can be found the National Nuclear Laboratory and a clean fuels technology pod. The site trains many apprentices, as we have heard, including for firms in my constituency, such as Victrex. We are in a state of concern because we do not know what the future holds. We risk losing it, like the British empire, in a fit of absence of mind. But it is a vital national capability. It cannot be recreated from scratch. If we lose the golden thread, the continuity of the skills base, we will end up dependent either on the French Framatome or—in my view, unlike that of the hon. Member for Preston (Sir Mark Hendrick), even worse—on the Chinese. Framatome already supply Sizewell B. They already have the contract for Hinkley Point C. In my view, there should be a guarantee of UK fuels for UK reactors written into all future contracts. Framatome already get through processed uranium from Russia. Springfields could do that. The site cannot just be mothballed in the hope that a future Government might wake up. If Springfields really is seen by the Government as a piece of critical national infrastructure, as I firmly believe that it should—and I would welcome a commitment to that effect from the Minister—that has to mean something in practical policy terms. Warm words today will not be enough for my constituents, who want an action plan to bridge the nuclear gap, secure their own jobs and secure the nuclear future of this country. 14:56:00
Jim
Shannon (Strangford) (DUP) My position has been solidified by the push, the correct push, for greener energy where possible, within the confines of the cost, which we cannot ignore either. I was reading in the press recently that, if you ask people whether they are in favour of green energy, the majority will answer, “Yes, we are.” When you tell them that supporting green energy may mean a 10% or 15% increase in their energy prices, all of a sudden what it means for people becomes much more real. It is important that we pursue green energy, but—it is a debate for another day, to be fair—we cannot ignore the implications of some of our decisions. I recently read, in a briefing by EDF Energy, that nuclear is the only proven, reliable low-carbon electricity source and that it is vital to achieve our climate targets and create highly qualified jobs, mostly outside London, as part of the Government’s levelling-up agenda. I see some Members here who are very supportive—indeed, we are all supportive—of the levelling-up agenda, but we want to see what it will mean for our constituents. I would very much like to see Northern Ireland being part of the levelling-up agenda on this issue, as part of the United Kingdom of Great Britain and Northern Ireland—as I always say, Mr Betts, better together. I know that the hon. Member for Kilmarnock and Loudoun (Alan Brown) would wholly endorse that; I am surprised he has not said, “Hear, hear!” That is facetious, but he understands the circumstances. There are occasions when we can do better together, and this is one of them. We need to see similar investment and equality of spending across all of the regions of the United Kingdom, in Scotland, Wales and Northern Ireland as well. I wish to see that happen. The only thing I would add to the motion is the word “safe”—we need to make sure that nuclear fuel manufacturing in the UK is safe. Safe nuclear is the only proven, reliable low-carbon energy source that we have. I have always made it clear that we can and should use nuclear energy, but only to the highest safety standards. That does cost money. There is a cost implication, as there always is. It means ongoing investment, which is why I was interested to learn that currently over 85% of the UK’s nuclear fuel is manufactured within the UK, predominantly by the existing advanced gas-cooled reactor power stations. Fuel fabrication will decline, with seven out of eight of the UK’s current nuclear fleet, responsible for around 20% of the UK’s zero-carbon electricity, currently scheduled to be offline by 2030. I am sure we have all heard the selling points regarding the potential opportunity that Sizewell C in Suffolk presents to secure a future for UK nuclear fuel manufacturing, should that project be approved. It is right and proper that it is explored, and that we have all the information necessary to take it forward. The hon. Member for Preston (Sir Mark Hendrick) referred to China’s position. I cannot agree with him. I am not anti-China—it would be wrong to be so—but we need to know about China’s intentions. We need to know what they are about: if their investment could be used to our advantage as well as to their advantage, that is good, but not if it is solely to their advantage. It is our land and our country, and we need to have the last say on what happens. If protections are in place, we will want to see them before this project can be fully considered. Hinkley Point C in Somerset has already supported around 71,000 jobs, so we cannot ignore the jobs that are created through these projects. It uses a supply chain of more than 3,600 businesses, and has an estimated economic value to the UK of £18 billion. Those jobs in small and medium businesses throughout the supply chain, and the economic value that this project has to the UK, cannot be ignored. That skilled workforce and supply chain need a clear future; they need to know what is happening as well. I want Northern Ireland to be part of that supply chain, so perhaps when the Minister sums up, she can give us some indication of how Northern Ireland can play its part in that. I would certainly like that to be part of the Government’s commitment; I do not doubt that it will be, but I just want to hear it for Hansard and on the record, please. Together, Hinkley Point C and Sizewell C will produce enough zero-carbon electricity to power 12 million homes—again, that is incredibly important and cannot be ignored. EDF is building the UK’s first nuclear power station in a generation at Hinkley Point, and I am given to understand that the electricity generated by that plant will offset some 9 million tonnes of carbon emissions per year, or 600 million tonnes over its 60-year lifespan. Again, those figures cannot be ignored, and we should be encouraged by them. The Energy Technologies Institute has identified the two key cost drivers of new nuclear power stations as construction and financing, and building this series is key to lowering both. Hopefully, we can address both of those drivers by having the series and plan in place; I believe the Government are committed to that strategy and that plan. I have been told that the cost of financing Sizewell C will be lower because of the reduction in risk through building the second project in the series, and because the funding model—the regulated asset base model—enables investors to receive a steady return on their investment during construction, meaning that they will be able to provide capital at a lower cost. I am a great believer in ensuring that investors have a return; I would respectfully suggest that we want to see a return for them, but not an exorbitant one. However, we have a responsibility to the taxpayer to ensure that investors can invest their money and get that return. I look to Government, and in particular to the Minister, to provide a response setting out their vision—and her vision—of low-carbon energy, and how this can be achieved for all of the United Kingdom of Great Britain and Northern Ireland by using safe nuclear power, with a viable financing option in legislation and in operation. If we can do that, I believe we will all benefit. 15:03:00
Chris Green (Bolton
West) (Con) I not only met the organisation there; the National Nuclear Laboratory is sited there as well. I heard the powerful representations and views of the trade unions, Unite and Prospect. Their championing of the workers there, and the clear collaboration and close relationship between the management of the site, the workers and the union movement, is such an important thing for the future of any organisation. Working together is such a key part of the success and, hopefully, the ongoing future success of the site, but we need to understand what ought to be a fairly straightforward debate. Fundamentally, we need clean, reliable and affordable energy to meet not only our current needs but our future needs as well. We do not know what the future will bring, but I would certainly like to see far more industry being located in Britain. China, India and many other countries around the world have been very competitive. We have been losing a great deal of heavy industry, and we need an energy supply that industry and heavy industry can use in an affordable way to be competitive with those countries, and with Germany as well. Germany is going down in terms of nuclear, but by doing so it is going up in terms of coal and other fossil fuels. That does not really fit in with what we normally hear about our European neighbours, which is that they are far more environmentally friendly than us. By turning their back on nuclear, they are embracing carbon emissions. With our ambitions for COP26 and our leadership in this area, we ought to be looking at those sources of power that can reduce carbon emissions. It is the Government’s agenda; it is the international agenda. Nuclear is a key part of that, but we have to think about the steps that we need to take to get there. There was a bit of controversy recently about coking coal being produced in Cumbria rather than being imported for the British steel industry. It is so important that we take the effective and right judgments, and not only for the short term for British industry. Whether it is the Minister or the wider Government, we have to reassure industry and the nuclear sector that we have a future here, and will not export our industry overseas and feel good about exporting our carbon emissions to countries that perhaps have slightly lower expectations and standards than we do. We need to support British manufacturing industry. We also therefore need to support reliable energy, baseload or firm energy, as I think the term is now, where we know, day or night, whatever the day of the year, we will have the energy that we need for industry and for homes—for cooking and for heating. We ought to be able to rely on that. As highlighted earlier this week in The Daily Telegraph, the UK produced a record of 14,286 MW of energy on 21 May, which is extraordinary, but earlier this week or last week we dipped down, just from wind, to 474 MW. That is not reliable energy that people wanting to keep a warm home in the middle of winter can rely on. It is not what industry can rely on, especially the steel industry. The next generation furnaces will be reliant on electricity. How can the steel industry run an arc furnace if it cannot rely on the energy supply? It all goes together and the nuclear industry is key. This is technology that we have at the moment. We know how nuclear energy works. We know that we can produce stations that are reliable and cost-effective. We often hear about wind and solar energy, but there are significant technological problems with those forms of energy when it comes to providing firm energy. Until we have storage of that energy, so that when the peaks happen we can store the energy to take us through more difficult times, those forms of energy will not be as reliable as industry and homes need. It is very positive that the Government have an increasingly strong hydrogen agenda. Again, that relies to a significant extent, it seems, on carbon capture and storage and that is not yet at scale or cost effective. Again, this is more technology that will probably be quite expensive and has not yet arrived. Perhaps in the longer term, we will need those technologies, but in the shorter term, we need more reliance on nuclear. That is where Springfields plays such a key part. It produces the fuels now and will produce the fuels in the future, but there is a short-term gap that needs to be bridged. With more of our nuclear fleet being decommissioned in the very near future, we need to secure the future of the Springfields site. As My hon. Friend the Member for Fylde highlighted, we should perhaps renegotiate with the French nuclear industry to make sure that we can manufacture in the UK, perhaps under licence or whatever kind of relationship. We can do that. We also have the promise of massive investments in the nuclear fleet, because they are very expensive projects. That is some level of leverage we can use with the French, and I am sure we will be able to get a deal that ensures that we can keep those skills. That is such a key part: having Springfields there for the short, medium and longer term means we keep the skills in the United Kingdom. Not only my hon. Friend but the team in Government and the COP 26 President have to have that ambition. We need to speak out more consistently. It is disappointing—I do not know how true it is—that the sense in Glasgow is that the nuclear industry is not being welcomed to participate in COP 26. It ought to be a key part of it. I hear the COP 26 President speak passionately on a regular basis about other forms of energy, but I do not hear the same passion about the nuclear industry. For the nuclear sector, for long-term investment, we need to hear far more about the British Government’s commitment to the sector—not just Springfields but the sector more widely—because that is what creates confidence. If people, whether from my constituency or more likely my neighbours’ constituencies of Fylde, Blackpool North and Cleveleys or even Preston, are to take up an apprenticeship, they must have confidence in the future. There are other companies—British Aerospace and others—that can take that talent, but Ministers need to give confidence to the next generation of engineers and scientists and other people coming through that this is a career for them. We have to see the sector also within the framework of national security and strategic national interest. If we lose the skills and the businesses, it is very difficult if not impossible to bring them back. It is also a question of Hinkley C and the skills there. We need to have that certainty about building the rest of the nuclear fleet, when that is going to happen and what type of nuclear fleet we are going to have. If those engineers and that talent at Hinkley C do not have jobs to go to, they will use their talents in other projects around the country. When we get around to building the next nuclear power station, that talent will be gone. For reliability and effectiveness in terms of delivery, we have to secure that talent, just as we need to secure the talent in Lancashire. It ought to be seen as a key part of the levelling-up agenda, not just for championing Lancashire, the north west and the border, and the north of England, but even for Derby North. I do not know what kind of next-generation nuclear fleet we are going to have, but Derby is going to be a key part if we choose to have small modular reactors, perhaps of the Rolls Royce design. I am sure we have a strong voice in Government championing the cause. It would be lovely to hear it a bit louder.
Mr Clive Betts (in the
Chair) 15:14:00
Richard
Graham (Gloucester) (Con) My hon. Friend made absolutely clear his views of the future of civil nuclear fuel manufacturing in the UK at Springfields in his constituency, and made the case as strongly as any of us could have expected him to do, with a crucial role for Sizewell C. In the remaining minutes before the wind-ups, I want to touch on that crucial aspect of this debate, but then widen it fairly swiftly into the role of nuclear in the United Kingdom, as hon. Members have tended to do. The crucial thing is that the case for nuclear has to be restated again and again, because it has not always been clear that this Parliament has supported it. Whereas nuclear energy itself has continued to deliver consistently throughout the past 60 years, political views have ebbed considerably over that time. Ultimately, although the 103,000 jobs and important supply chains are clearly vital to the economy, that is not the fundamental reason why we need nuclear, which is, in summary, the only proven low-carbon power that does not raise emissions, even in extreme weather. Over the past 60 years, it has consistently delivered more than 20% of the UK’s electricity needs. We know that those needs will rise so it is crucial that we plan for the future. If the criticism of democracy is sometimes that we only think in terms of five-year election cycles, it is vital that nuclear is the exception to that short-term thinking. I listened with interest to the thoughtful comments made by the hon. Member for Preston (Sir Mark Hendrick) about the sector about which he knows so much—engineering, nuclear and skills—but the fact is that unfortunately his own party’s failure to do anything for the best part of a decade led to a loss of skills, the sale of British Energy and our dependence thereafter on foreign investment and skills. Much has changed since 2010, of course. Crucially, with the construction at Hinkley Point, we have the opportunity for the first time in a very long time to build up domestic skills, which can then continue at Sizewell C. I hope very much that the Minister will indicate that there will be further opportunities in the future to build additional nuclear power stations, thus taking on the skills from generation to generation, reducing the cost, increasing our skills, possibly enabling us to become exporters of skills again, and reducing our dependency on foreign skills. The mood music at the moment is encouraging. None the less, I understand that the 18 GW proposal at Sizewell C has not yet reached financial agreement. Anything the Minister can say on that would be welcome. Meanwhile, we have all been slightly sidetracked by the huge opportunities in renewable energy, not least offshore wind and the sector I have spent a lot of time on—marine energy. I encourage all hon. Members who are supporters of nuclear to look at what is being achieved by Orbital Marine Power off Orkney in the north of Scotland. It is a remarkable generation of marine energy. In a sense, all that complements what we can do with nuclear, because it opens another great opportunity, which is to generate hydrogen at or very close to our nuclear power stations. I would welcome it if the Minister commented on what progress we might make on that over the next two or three years. My constituency of Gloucester has been the nuclear operational headquarters for British Energy and now EDF Energy for a long time, operating all the existing nuclear power stations in Britain. Of course, we hope to take our nuclear skills in a new and different direction with a bid to become the hub, at Oldbury and Berkeley, for the development of nuclear fusion. We are very keen to see the operation at Barnwood play a major role in the development of Sizewell C. As colleagues have mentioned, the opportunities for skills, careers and well-paid jobs in a sector that is so vital to everything we do is enormous. Can the Minister give us any update on Sizewell C? When will the Government consider the next project thereafter and how fast we can take forward the development of hydrogen at our nuclear power stations? I hope that my comments supplement and complement what colleagues from around Westminster Hall have said in support of a sector that is so vital to our future.
Mr Clive Betts (in the
Chair) 15:20:00
Alan
Brown (Kilmarnock and Loudoun) (SNP) It is clear that Springfields has been an important employer through the years, with highly skilled jobs that are well paid. It is clearly very important to the north-west region of England, which I appreciate. However, if we are looking forward, when we consider the need for the production of nuclear fuel within the UK, we need to look at the strategic picture. In that strategic picture, we have to ask whether nuclear energy is required at all. Even more important, we need to understand the cost and risks of nuclear energy and the state of the nuclear energy generation market. There are too many false narratives from the nuclear industry, though it is very successful at lobbying. Briefings from EDF argue that it is the only proven reliable low-carbon technology—many hon. Members have said that today—but, by way of an example, last year, Scotland generated 97% of the equivalent of its electricity demand from renewable energy. Looking ahead to Sizewell, EDF argues that, with Sizewell being a copy of Hinkley Point C, there will be cost savings in that building. That might be the case design-wise, but there are different access and construction logistics to consider at Sizewell and the fact that it is still mired in the planning and environmental impact assessments, before it can proceed on to detailed design, means that nothing is certain in terms of cost at Sizewell. It is also nonsense to say that these projects are cost-comparable with other technologies. The reality is that Hinkley Point C has a strike rate of £92.50 per megawatt-hour, for a 35-year concession contract, compared with offshore wind, which now comes in at £40 per megawatt-hour for just a 15-year concession contract. At the moment, nuclear is roughly four or five times more expensive than onshore and offshore wind. Even if the Government agree a regulated asset base funding model for Sizewell, that will not account for such a cost differential.
Chris Green
Alan
Brown
Chris Green
Alan
Brown Turning to the recent history of the nuclear sector in the UK, it is obvious there has been a market failure as well as a failure of Government strategy. Clearly, that has impacted Springfields in the demand for nuclear fuel. Hinkley point C is the most expensive nuclear project in the world. When the right hon. Member for Maidenhead (Mrs May) became Prime Minister, she threatened a U-turn on this project, but then caved in and signed the deal anyway. The cost for Hinkley is now estimated at £22.5 billion, which is an increase of 25% on the estimated cost when the deal was signed. The Government tell us that cost increases are tied up in the risk and that EDF carries that burden. The reality is that no company can afford losses of £4.5 billion or 25% of the original cost estimates, so electricity bill payers must be paying for it somewhere along the line. The sign-off for Hinkley was supposed to send signals to the market to allow other sites to be developed to generate competition and bring down prices. Since then, we know that Toshiba has walked away from developing Moorside and Hitachi pulled out of Wylfa and Oldbury. The good news for us electricity bill payers is that £50 billion to £60 billion of expenditure has not been committed. From a UK Government perspective, that should have been the realisation that their nuclear aspirations were in tatters. Unfortunately for Springfields, that is three pipeline projects that they could have accessed now lost. Worse, Hinkley point C is now predicted to come online in June 2026 instead of 2025, but it is a possible 15 months away on top of that, so it could be September 2027 before unit 1 of Hinkley comes online. We will have to bear in the mind that the European Pressurised Water Reactors system has still not been shown to be successful. Flamanville in France is expected to generate in 2024—12 years late. Finland’s project is due to come on to the grid next year, but that is 13 years late.
Sir
Mark
Hendrick
Alan
Brown
Sir
Mark
Hendrick
Alan
Brown
Sir
Mark
Hendrick “It preserves French purchasing power, with a kilowatt-hour 40% cheaper than our European neighbours.”
Alan
Brown Going back to the timeframe before Hinkley is operational, it is certain that seven of the existing eight nuclear power stations will be offline, because we know that the advanced gas reactor stations are all closing earlier than planned. We heard that Dungeness went offline seven years early. Four more stations will go offline in the next three years. Nobody is going to bet on Torness and Heysham making it to 2030. The existing market demand for nuclear fuel production in the UK all but ends before Hinkley comes on stream. That is why it is so critical to think about and debate the future of Springfields. That is why, for me, the UK Government should have a nuclear diversification or transition policy to help to save jobs or create new jobs as alternatives. We have the North sea transition deal; why not something similar for nuclear? Communities all over the UK have financially benefited from the jobs created by nuclear, but they need replacement jobs. These communities need to be supported, not left behind. That is what I suggest the Government need to look at. We hear that Hinckley has created a lot of jobs, but a £22 billion project should create thousands of jobs. It is not difficult with that level of expenditure. If we look at the £20 billion that the Government may commit to Sizewell, I would argue that this money could be better spent in creating other jobs UK-wide. We are truly world leading in wave and tidal energy development, and floating offshore is getting there. Why not invest in the future? As I said earlier, hydrogen development is getting close to a commercial reality. These considerations need to be part of that transition. The nuclear baseload argument is an outdated concept. That was confirmed by the former chief executive of the National Grid in 2015. Can the Minister confirm that taking these existing nuclear stations offline will not increase the risk of the lights going out? Moreover, going forward, a report by Good Energy and the Energy System Catapult has demonstrated that net zero can be achieved without the need for new nuclear. I suggest that the Minister needs to look at that. Although we hear about renewables and fluctuations, large-scale nuclear is inflexible. Indeed, having more large-scale nuclear in tandem with renewables is a problem. That is why we have the constraint payments for renewables as well. I refute the arguments about baseload and energy security. I am not sure that the future is therefore nuclear, in the way that we keep hearing, because that argument has not held up to date. I ask the Government to revisit their strategy, please support these communities around the UK, and look at diversification and a fair transition. 15:32:00
Dr
Alan
Whitehead (Southampton, Test) (Lab)
Mark Menzies
Dr Whitehead I do not want to be a party pooper, but this debate is about Springfields nuclear fuels. There is a lot I could say about all sorts of things, such as the role of hydrogen in the economy and whether, when the wind does not blow very well, other forms of thermal power may be needed. However, we need to concentrate our minds not on the future of our entire nuclear programme, but on Springfields nuclear fuels. What is unique about Springfields nuclear fuels is that it has single-handedly held up the entire UK nuclear programme for four or five decades now. It has provided pretty much all the fuel for the Magnox systems. It now provides the fuel for advanced gas-cooled reactors, and it should hopefully be able to provide the fuel for the new nuclear power stations coming on stream. The role of fuel is usually unsung, but it is crucial to the whole process of nuclear power. There is a popular perception, which I am sure is not shared among hon. Members here, that using nuclear fuels means finding some uranium, enriching it a bit and sticking it in a pot to make the energy. That is very far from the truth. It is a highly skilled operation, requiring intensely developed engineering skills, which are involved in making the rods and the pellets, which must have the right specification and order for the particular form of nuclear reactor for which they are being made. There is also a whole load of ancillary activities, some of which have been mentioned, such as the reprocessing of uranium to go back into the rods. That is another very highly skilled enterprise, far from the perception of this being a pretty simple journeyman activity that anyone can do. No, not anyone can do it. In the case of the UK, there is only one company that can do it—Springfields nuclear fuels. We need to see Springfields nuclear fuels not just as part of the nuclear landscape generally, but as a vital national strategically important component of whatever our nuclear programme was and whatever it will be. It should be a cause of enormous alarm for hon. Members if there are suggestions that somehow this strategically important national asset will either be downgraded or lost in the not too distant future. There is a very real prospect of that because, as hon. Members have said, despite its crucial and honourable history backing up the nuclear industry in the way that it has, it is finding it difficult to get contracts for the continuation of its excellent production activities. I think there was some work recently for the Norwegian nuclear corporations, but there is a real gap in what is coming up—what we know will be an important requirement, particularly of Hinkley C and certainly of Sizewell C when they eventually come on stream. There is a substantial gap between that time and now. There is a real prospect, therefore, of that company—which is owned by Westinghouse, a private US company with no great feeling for UK national strategic interests—dying, not for lack of praise but for lack of an immediate future between new nuclear and modular nuclear reactors coming on and where we stand now.
Alan
Brown
Dr Whitehead
Sir
Mark
Hendrick
Dr Whitehead However, it is not a question of whether carbon capture and storage can actually do the work, and it is not that the technology has not been developed to make carbon capture and storage perform the entire chain of activities—sequestration, storage, transport, and so on. It can do all those well and at scale; that has already been proven. It is a question of how quickly we can develop carbon capture and storage and put it into operations, so that it works from the day they start, with carbon capture and storage on the back of them, rather than developing operations that are carbon capture and storage-ready, but where carbon capture and storage is not on the back of that process. That is really a question of planning and investment, more than anything else, but it needs to be done in the right place at the right time. That is the end of my diversion. The issue for Springfields nuclear fuel, therefore, is that there is clearly a substantial valley of death before what Springfields can reasonably expect for its work for the future. If we leave it at that, it is inevitable that, even if it eventually survives that gap and comes through well in the end, that may well be at the cost of all the skills in that organisation and most of the workforce; and, at a time when Springfields’ services absolutely will be required in the national interest, its ability to spring back may well have expired in the meantime. As a country, we cannot let that happen. I therefore congratulate the unions, Prospect and Unite, for campaigning strongly for that view of Springfields as a company. It is beholden on the Government to take that view as seriously as the workforce do—and, I think, all of us in this Chamber do—in their responses and reactions to this particular issue. When looking at the nuclear sector deal that was signed in 2018, I was interested by this statement from the Government on securing fuel capabilities: “We will work with the UK nuclear fuel industry to ensure continued, commercial operation of their facilities and secure the long-term future of these important UK strategic national assets to deliver future energy security as well as ensuring the UK nuclear fuel industry continues to deliver long-term UK economic benefit”. That is what they committed themselves to in the nuclear sector deal. However, as far as I know, nothing has yet been done about that. Therefore, my first question to Government is: does the Minister intend that that nuclear sector deal commitment will actually be carried out? Are the Government looking seriously at ways in which Springfields nuclear fuels can be properly supported during this period of its existence and assured of remaining in existence as we move to whatever the next stage of our UK nuclear programme is? My second issue is also important. Are the Government serious about moving on the programme for the already existing nuclear facilities and bringing in arrangements to give greater certainty on the development of Sizewell C? I refer to what hon. Members have also mentioned this afternoon: the regulated asset base arrangement or similar. If the Government do not like that arrangement, an alternative could give certainty to the development of Sizewell C in the next period. As I am sure the Minister knows, there is a row going on between Departments about whether the regulated asset base should be introduced for Sizewell C. That needs resolving. Something needs to come out shortly to get that programme under way. That is also relevant to the future of Springfields nuclear fuels in the way I have described it this afternoon. I have two direct questions for the Minister, both relating to the future of Springfields nuclear fuels, which we want to see secured. We want to make sure that the Government play a full role in securing that future, so that we can say that that national asset is in good shape and in good hands. In passing, there is a question mark about the future ownership of Springfields nuclear fuels. As a national asset, perhaps it should be a Government agency, so that we can secure its activities for the future in a way that befits its importance to the country.
Mr Clive Betts (in the
Chair) 15:47:00
The Parliamentary Under-Secretary of State for Business, Energy
and Industrial Strategy (Amanda
Solloway) I will start by reaffirming the strategic importance of maintaining our sovereign fuel manufacturing capability, as set out in the 2018 nuclear sector deal. As many hon. Members have said, the UK is a world leader in the nuclear fuel cycle, which is a testament to the highly skilled workforce currently employed at the Springfields and Capenhurst sites and in the wider UK supply chain. Maintaining and developing that skilled workforce will be critical to delivering our net zero ambitions. I welcome the Westinghouse launch of the clean energy technology park last year. Such commercial ventures support collaboration and low-carbon research. Development and business are central to the UK’s transition to net zero. I am aware of the short-term challenges facing the Springfields site as the UK’s advanced gas-cooled reactor fleet retires. However, as we look forward to the 2030s, I agree with my hon. Friend that the site could and should have a bright future. That leads me to the Government’s commitment to nuclear power. The 2020 energy White Paper sets out our vision for the transformation of our energy system, continuing to break the dependency on fossil fuels and moving homes and businesses to clean energy solutions. We have not yet made the full transition away from coal, let alone decarbonised our energy system, but “The Ten Point Plan for a Green Industrial Revolution” highlighted the key role of nuclear power in delivering the deep decarbonisation of our electricity system alongside renewables and other technologies. This is an exciting time for the nuclear industry. This Government are clear that nuclear has an important role to play in decarbonising the electricity system, and in meeting carbon budget 6 and net zero targets. In the energy White Paper and “The Ten Point Plan for a Green Industrial Revolution”, this Government committed to advancing large, small and advanced nuclear projects as part of our future low-carbon energy mix, heralding what my hon. Friend the Member for Fylde called a golden age of new nuclear across the regions and nations of the UK, thereby contributing to the levelling-up agenda. That includes at least one large-scale nuclear project, and in December 2020 we announced that negotiations with EDF on Sizewell C had begun. Those negotiations are already well under way. Moreover, as the Secretary of State has said in the House, we will bring forward legislation in this Parliament that will further commit us to creating more nuclear power in this country.
Alan
Brown
Amanda
Solloway As my hon. Friend the Member for Gloucester (Richard Graham) noted, nuclear could have a role in beyond grid applications such as low-carbon hydrogen production. Last month, we published the UK’s first ever hydrogen strategy, confirming our support for low-carbon hydrogen production across the United Kingdom. In addition, we have announced up to £385 million in the advanced nuclear fund to invest in the next generation of nuclear technologies, with an ambition to employ small modular reactors and to develop an advanced modular reactor demonstrator as early as the 2030s. I also recognise the importance of developing our fuel-manufacturing capabilities to support these ambitions. My Department, in co-operation with the National Nuclear Laboratory, has delivered a £46 million advanced fuel cycle programme, aiming to develop world-leading skills and capabilities in advanced fuels and recycling. Recently, we announced a short extension to the programme, which will focus on advanced nuclear fuels for use in small and advanced modular reactors. The programme has been delivered at the National Nuclear Laboratory facility located on the Springfields site in the constituency of my hon. Friend the Member for Fylde. I will also touch on the Government’s levelling-up agenda. We remain committed to addressing the economic disparities across the whole of the United Kingdom. The civil nuclear supply chain is playing an important role, currently supporting over 59,000 jobs across the United Kingdom in the areas where high-skilled, high-value jobs are needed most, including, for example, in the north of England and north Wales. As we develop the next generation of nuclear technologies, with the emphasis on high-quality manufacturing, I agree with the hon. Member for Strangford (Jim Shannon) that it would be excellent if the skilled workforce in Northern Ireland could play a part in that process. I was delighted to hear that nearly 2,000 apprenticeships have been delivered on the Springfields site over the last 70 years. These kinds of training opportunities benefit not just the site and its workforce but the surrounding communities. Westinghouse and Springfields Fuels Ltd should be proud of their impressive achievement. We keenly anticipate the outputs of the trial of the advanced nuclear skills and innovation campus at the Springfields site, which the hon. Member for Preston (Sir Mark Hendrick) drew attention to. We hope to see the successful collaboration between industry, academia and the National Nuclear Laboratory to support skills development. As my hon. Friend the Member for Bolton West (Chris Green) rightly pointed out, the objective should be to create careers, not just jobs. As previously mentioned, the Government recognise the importance of maintaining and developing a strong nuclear skills base in the United Kingdom. I am aware of the plans for redundancies on the Springfields site this year. My Department has been working with Westinghouse, the National Nuclear Laboratory and the Nuclear Decommissioning Authority to explore opportunities to support the workforce on the Springfields site. We will also continue to encourage vendors and developers to maximise their UK supply chain content, including fuel, wherever that is possible, in order to support the economic growth of the UK nuclear sector’s supply chain. Finally, I will reflect once more on the strategic importance of our sovereign fuel manufacturing capability and on the ability of the United Kingdom, as my hon. Friend the Member for Bolton West reminded us, to provide cost-effective support to reduce our reliance on imports, which may have a bigger carbon footprint. This Government would like to see the UK continuing to pioneer nuclear technologies in the lead-up to net zero. Our success will be underpinned by the capacity of our civil nuclear supply chain, including fuel manufacture. We are already considering, along with operators, fuel producers and the research and development community, how best to meet the needs of future nuclear power stations, including the opportunities provided by small and advanced modular reactors. We also continue to work closely with our nuclear fuel industry and trade unions via the nuclear fuel working group, as noted by my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard), to explore ways to secure the industry’s future. Those discussions are wide ranging, and I understand that EDF and Framatome are actively involved. Further Government support is under review as a part of the spending review. Further communications on the subject can be expected following the settlement. In the meantime, the nuclear fuel working group that we have set up will meet again this month and, as my hon. Friend the Member for Blackpool North and Cleveleys said, it is important that we continue the dialogue and make sure that opportunities and ideas are given proper consideration. My right hon. Friend the Minister for Business, Energy and Clean Growth is taking a very active interest in this important issue. The Government have made a clear commitment to nuclear as part of our future low-carbon energy mix. The UK’s success in achieving our net zero ambitions will be underpinned by the critical work carried out in the civil nuclear supply chain. We will continue to work with the nuclear industry to maintain our sovereign capability and the benefits that it brings for the local workforce and surrounding communities. 15:56:00
Mark Menzies I thank the Minister for her very thoughtful reply to today’s debate. There are many audiences who are listening. There are investors who are looking potentially to invest in the UK, and they will take some heart from what she has said. There is the workforce and the trade unions, which are concerned about their jobs, and they will have heard a clear commitment from the Minister and the Government to work in a constructive way to secure a future for Springfields and invest in the next generation of nuclear reactors, which obviously will be fuelled in the UK. There are also those who are involved in the nuclear working group, and of course EDF are key partners in that. I encourage all parties to work, in the days and weeks ahead, in a constructive way, with one mission: what do we have to do to secure jobs and skills at Springfields, and what do we have to do to get key decisions taken in a timely way to secure that plant’s future and ensure that we have the bright nuclear future that all of us are confident that we can have? Next week is nuclear week in Parliament, and there will be many events throughout the course of the week. We have got that off to a fabulous start today. We have certainly made the case for Springfields, but the work will continue. Question put and agreed to. Resolved, That this House has considered continued nuclear fuel manufacturing in the UK. |