Hinkley Point bill spirals to £22.5billion

Cost of nuclear power plant has jumped 25pc

THE bill for the Hinkley Point C nuclear power station has ballooned by up to a quarter in just three years to as much as £22.5bn.

EDF, the energy giant backed by the French government, blamed ‘challenging ground conditions’ for the spiralling cost.

After engineers began preparing the site for the first nuclear reactor three years ago they discovered the rock was more prone to breaking up than previously thought.

This has made it more difficult and more expensive to lay the foundations for the site of the first of two nuclear reactors. As a result, EDF yesterday warned the cost of building the first nuclear power station in Britain for a generation will rise to between £21.5bn and £22.5bn.

This is up to £2.9bn higher than previous estimates and means the budget has soared by up to £4.5bn – or 25pc – from the £18bn price when work began in 2016.

EDF also warned the risk of the huge plant in Somerset being delayed by 15 months had increased, although it said it was confident it would still be generating power by the end of 2025.

Stuart Crooks, managing director of the project, said: ‘Getting this far has cost more money than we anticipated.

‘Our earthworks are complete, but challenging ground conditions meant we overspent to finish them on time.’ The news has provided ammunition for critics.

MPs have warned it is a bad deal for taxpayers and environmental campaigners say the Government should invest more in renewable energy, a view that has gathered momentum as offshore windfarm costs have fallen.

But EDF, which is working with Chinese state-owned firm CGN to build Hinkley, insisted the rising costs will have ‘no impact for UK consumers and taxpayers’.

This is because of a complex deal with the Government.

The French and Chinese firms have agreed to finance the construction of Hinkley Point, meaning they will also foot the extra cost announced yesterday.

In return the Government has agreed to pay a guaranteed price for electricity. The spending watchdog, the National Audit Office, has lambasted ministers for locking consumers into a ‘risky and expensive project’. It warns this will cost £30bn over the 35-year contract as households pay an inflated price.

The Government agreed to pay £92.50 per megawatt hour in 2013. Last week prices for new wind power delivered by 2025 were as low as £40 per megawatt hour. Nuclear power is critical to the Government’s target of reaching net zero carbon emissions by 2050 and more energy is needed as drivers switch to electric cars.

Gail Cartmail, of the Unite union, said: ‘The Government needs to swiftly learn the lessons from the project, to ensure the nuclear power building programme, desperately needed in order to keep the lights on, is able to proceed and be expanded.’

The Department for Energy said: ‘Any increase in costs will be borne entirely by EDF and their investment partners.’