National Grid hits pause on Moorside connection

Plans shelved for "biggest new power line since electricity network was built"

Plans to build a 102-mile power line connecting the proposed Moorside nuclear plant in Cumbria to the transmission network have been placed on hold, National Grid has revealed.

The news comes after developer NuGen confirmed earlier this month that it was conducting a “strategic review of its options” following reports that its main shareholder, Toshiba, may mothball the Moorside project.

A spokeswoman for National Grid said: "Following NuGen’s announcement of a strategic review of their project, we will work with them to understand the implications for the timescales of their project.

"In line with NuGen’s review, we are pausing work on our connection. This will ensure we can align our plans both for the application for consent and the development of the infrastructure itself."

National Grid unveiled plans for the North West Coast Connections project – “the biggest new power line since the electricity network was built” – in October last year.

Under the proposals, more than a quarter of the line would be buried underground to reduce its visual impact. National Grid would spend £460 million running an underground section through the Lake District National Park and a further £1.6 billion constructing a 13-mile tunnel under Morecambe Bay.

The NuGen consortium would not comment directly on the pause, but said in a statement: “NuGen is undertaking a strategic review of its options following well-publicised shareholder and vendor challenges.

“NuGen is confident that the review will lead them to an outcome that provides a more robust, stable and sustainable platform to meet its commitment to deliver the next generation of nuclear baseload for the UK.

The statement concluded: “NuGen remains a key player within the UK nuclear industry, has a vital role to play within the UK industrial strategy, and the Moorside project remains a key infrastructure project focused on creating employment and economic prosperity in Cumbria and across the north.”

Moorside has been beset problems ever since Toshiba announced in January it was reviewing it overseas nuclear operations due to a multi-billion write-down on the value of its US nuclear arm Westinghouse.

Towards the end of March, the situation took another turn for the worse when Westinghouse - which was due to supply three of its AP1000 reactors for the project - filed for chapter 11 bankruptcy protection at a court in New York.

The following week Engie decided to offload its 40 per cent interest in the NuGen consortium by invoking a contractual right to transfer its stake to Toshiba in the event of a default. Toshiba will be left as the sole shareholder once the sale is complete.

The situation became worse still when the Japanese conglomerate warned there was “substantial doubt” over its continued survival as it belatedly reported a £4.2 billion loss in the last three months of 2016. Investors were told to brace themselves for an even bigger loss of up to £7.3 billion over the company’s full financial year.

Toshiba said it would “continue to look for investors interested in investing in NuGen, and seek to sell off its holding in the company”.

Author: Tom Grimwood,
Channel: Operations & Assets , Finance & investment

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