Power plant deal ‘is risky and expensive’, watchdog has warned
THE GOVERNMENT’S deal for a new nuclear power plant at Hinkley Point in Somerset has locked consumers into a “risky and expensive project” with uncertain benefits, the national spending watchdog has warned.
The Department for Business, Energy and Industrial Strategy (BEIS) finalised the deal to support the £18 billion Hinkley Point C reactor last September, with energy consumers paying subsidies on their bills for the scheme for 35 years.
But the latest report from the National Audit Office claims payments that will be added to consumer bills have ballooned from an estimated £6bn to £30bn. It concludes that BEIS has not sufficiently considered the costs and risks to consumers and it will not be known for decades whether Hinkley Point C will be value for money.
Plans for a new reactor at he Somerset site have been blighted by delays and reports of spiralling costs. The former Cabinet Secretary Lord Turnbull has previously dismissed the project as a “big white elephant” and a “bottomless pit”.
The new NAO study claims the Government’s case for the project has weakened since it originally agreed key commercial terms on the deal in 2013. But it claims that BEIS’ ability to “take alternative approaches to the deal were limited after it had agreed terms”.
NAO head Amyas Morse concluded that BEIS “has committed electricity consumers and taxpayers to a high-cost and risky deal”. “Time will tell whether the deal represents value for money,” she said.
A Government spokesman said: “Consumers won’t pay a penny until Hinkley is built; it will provide clean, reliable electricity powering six million homes.”