Re­ac­tion time

The UK has the skills and tech­nol­ogy to de­velop an in­de­pen­dent nu­clear in­dus­try Robin Pag­n­menta

The Daily Telegraph - Business - - Front Page - ROBIN PAGNAMENTA

There are few ar­eas where Bri­tain has taken a more egre­giously mud­dled ap­proach to in­dus­trial pol­icy than tele­coms. One of them is nu­clear power, where the Gov­ern­ment has per­formed a se­ries of tor­tu­ous pol­icy back­flips which makes the U-turn over Huawei look pos­i­tively slick.

First min­is­ters flogged off Bri­tain’s stake in one of the world’s top re­ac­tor de­vel­op­ers, West­ing­house, and then all of the na­tion’s ex­ist­ing fleet of nu­clear power sta­tions in the form of Bri­tish En­ergy, be­fore em­bark­ing on a whole­sale re­newal of the in­dus­try in a quest for car­bon-free en­ergy.

The re­sult has put the fu­ture of the na­tion’s most crit­i­cal in­fra­struc­ture in the hands of two for­eign pow­ers: France and China, a na­tion widely ac­cused of in­dus­trial es­pi­onage and the rou­tine use of cy­ber­hack­ing to in­tim­i­date its foes.

It has sad­dled Bri­tish con­sumers with a mind-bog­gling bill that makes the £2bn strip-out of Huawei gear from the na­tion’s 5G net­work look like peanuts.

And what’s more, it has led to Bri­tain buy­ing back – at huge ex­pense – a tech­nol­ogy it orig­i­nally in­vented.

Much like its his­tory as a pi­o­neer of mod­ern tele­coms, Bri­tain built the world’s first civil nu­clear power plant at Calder Hall in Cum­bria. It was opened by a youth­ful Queen El­iz­a­beth one sunny day in 1956.

Back then, the UK’s atomic knowhow was such that a few years later in the Seven­ties, it helped France de­velop its own fleet of re­ac­tors to help it cope with the oil cri­sis.

Quite how we got from there to here is a sorry tale of fum­bling White­hall in­com­pe­tence and an ut­ter lack of long-term strate­gic think­ing. Af­ter all, Bri­tain has had nearly enough en­ergy min­is­ters to fill an old-fash­ioned tele­phone direc­tory – and just as many pol­icy changes to boot. The dis­cov­ery of North Sea oil fu­elled the ne­glect of Bri­tain’s nu­clear in­dus­try too but it doesn’t take a ge­nius to know that the ap­proach has been poor value for money.

The dis­mem­ber­ment and sale of Bri­tain’s nu­clear in­dus­try – in­clud­ing the di­vest­ment of West­ing­house to Toshiba of Ja­pan in 2006 and Bri­tish En­ergy to EDF, French state-owned elec­tric­ity com­pany, in 2008 – raised a to­tal of £15bn – a de­cent chunk of change for the Trea­sury’s cof­fers. But the fig­ure is dwarfed by the bal­loon­ing costs of the new Franco-Chi­nese re­ac­tors Bri­tain is cough­ing up for now. The cur­rent cost es­ti­mate for EDF’s sin­gle new nu­clear power sta­tion un­der con­struc­tion at Hink­ley Point alone is up to £22.5bn – but EDF and CGN, its Chi­nese part­ner, want to build lots more. God knows what the to­tal price for them may be – a hefty bur­den for Bri­tish con­sumers and busi­nesses to shoul­der for decades to come.

Nev­er­the­less, even at this late hour it’s still not too late to switch back to a more sen­si­ble course of ac­tion – and a nu­clear pol­icy that would pro­tect Bri­tish in­no­va­tion, jobs, skills and ex­ports.

Bri­tain still has nu­clear ex­per­tise and the abil­ity to de­velop a cheaper, sim­pler, bet­ter home-grown tech­nol­ogy to pro­duce car­bon-free baseload en­ergy.

Small Mod­u­lar Re­ac­tors would build on the ex­per­tise of UK engi­neer­ing com­pa­nies like Rolls-Royce, which has been qui­etly build­ing and main­tain­ing small nu­clear re­ac­tors for the Royal Navy’s sub­ma­rine fleet for decades.

Un­like EDF and CGN’s gi­ant EPR and Hua­long One re­ac­tors – which are highly com­plex stand­alone in­dus­trial projects which take years to build in situ – SMRs can be built on a fac­tory pro­duc­tion line to a stan­dard­ised de­sign and towed into po­si­tion on smaller and more com­pact sites.

They could be man­u­fac­tured at scale for ex­port, help­ing cre­ate UK jobs while em­brac­ing a colos­sal in­dus­trial op­por­tu­nity to help other coun­tries cut car­bon emis­sions and tackle cli­mate change.

And in the UK they could be built on some of the ex­ist­ing, brown­field nu­clear sites still con­trolled by the UK gov­ern­ment that are owned by the Nu­clear Decom­mis­sion­ing Author­ity, the body re­spon­si­ble for clean­ing up waste and re­tired re­ac­tors that are no longer in use. EDF owns most of the oth­ers through its con­trol of Bri­tish En­ergy.

This week, the Gov­ern­ment pledged a £40m in­vest­ment to de­velop small UK re­ac­tors. It’s a promis­ing start but far more could be done to scale it up more quickly and pro­mote it as a bet­ter al­ter­na­tive.

More­over, it would be a pol­icy that would not ac­tively en­dan­ger Bri­tain’s na­tional se­cu­rity by al­low­ing a po­ten­tially hos­tile for­eign power to gain a grip over our most sen­si­tive en­ergy in­fra­struc­ture. Un­like Huawei, there is no ques­tion CGN is a sta­te­owned Chi­nese firm with close links to the coun­try’s mil­i­tary.

Just as al­low­ing Bri­tish tele­com firms to stuff their net­works with cut-price Chi­nese gear for 15 years with­out thought for the con­se­quences be­fore fi­nally im­pos­ing a ban was a fool­ish mis­take to make, so en­abling EDF and CGN to build Hink­ley Point to an untested de­sign with a hare­brained fund­ing model was dumb.

To al­low these two com­pa­nies to press ahead as planned with fur­ther re­ac­tors at Sizewell in Suf­folk and Brad­well in Es­sex would be lu­di­crous – and un­jus­ti­fi­able.

‘Un­like Huawei, there is no ques­tion CGN is a state-owned Chi­nese firm with close links to its mil­i­tary’

The Queen opens Bri­tain’s first nu­clear re­ac­tor at Calder Hall in 1956. The dis­cov­ery of North Sea oil fu­elled the ne­glect of our nu­clear in­dus­try

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