Out-Law News | 14 Oct 2020 | 10:22 am | 1 min. read
The UK government is reportedly considering pledging up to £2 billion in support for a new generation of mini nuclear reactors to provide low carbon electricity.
A consortium of nine companies including Rolls-Royce, Laing O’Rourke and Atkins are planning the construction of up to 16 small modular nuclear reactors (SMRs) by 2050. According to a Financial Times report, the government is discussing a pledge of between £1.5bn and £2bn in the project and the consortium is seeking further private investment of a similar level.
SMR developers seek to maximise the benefits of off-site manufacturing and use modular construction processes to improve the predictability of cost and the timescales to completion of projects.
UK nuclear power development is at a crossroads. It should be part of our low carbon power future if it makes the economic case. Like all technologies it needs investment. However, it also needs clear government policy support.
Nuclear energy expert Graham Alty of Pinsent Masons, the law firm behind Out-law, said investment in SMRs by the consortium and the government would be a positive development.
“Significant investment in the UK SMR programme would be welcome news for an industry that has been experiencing a roller coaster ride of fortunes over the last few years. It was roughly 10 years ago that a new dawn was heralded for low carbon power from a new generation of nuclear reactors,” Alty said.
The focus on nuclear in the 2010s led to the government’s approval for the construction of a new 3.2 gigawatt electrical nuclear plant at Hinkley Point in Somerset by energy companies EDF and CGN in 2016.
“Since then there has been a change of direction. A number of key investors have withdrawn, government policy has become less clear and the comparative cost of producing electrical power from renewables power sources has reduced,” Alty said.
“UK nuclear power development is at a crossroads. It should be part of our low carbon power future if it makes the economic case. Like all technologies it needs investment. However, it also needs clear government policy support in the next energy white paper and will likely need further support through equity participation,”
According to Alty, investment in nuclear should come in addition to investment in renewable energy sources if it is affordable.
“Prime minister Boris Johnson has recently made clear the government’s backing for low carbon power from renewable energy sources, particularly wind. That is fantastic, but analysts suggest this cannot provide all the low carbon power we need. Affordable electrical power and heat from nuclear energy can also support our move towards net zero,” Alty said.
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