A funding deal for the proposed Wylfa Newydd nuclear plant in North Wales will be outlined by ministers next week, according to reports in the Times and Financial Times.
Sources cited by the Times confirmed the UK government will make a direct investment in the project alongside the Japanese government and Hitachi, as well as underwriting billions of pounds of loans.
Meanwhile, the Financial Times quoted sources who said ministers are prepared to offer a guaranteed price for the electricity generated at the 2.7GW power station on Anglesey which is around £15/MWh less than the £92.50/MWh strike price awarded to EDF for Hinkley Point C.
The paper said the outline agreement will not include precise details of the size of the government’s stake or the level of the strike price.
In a separate story earlier this week, the Financial Times reported the board of Hitachi voted to move ahead with detailed negotiations on the basis of a tripartite investment structure on Monday, after being offered enhanced terms in a letter from the UK government on the eve of the pivotal board meeting.
Sources told the paper the meeting was “very finely balanced”, with some board members raising objections over concerns the company may be taking on too much risk.
The multi-billion-pound project is being developed by Horizon Nuclear Power, a subsidiary of Hitachi. Back in December, Horizon’s chief executive Duncan Hawthorne told the Times it would cut off funding unless the government agreed to provide financial support by the middle of 2018.
He said Hitachi had already invested £2 billion in the development and was not prepared to keep “throwing a bottomless pit of cash at a project without some certainty it can get to a successful conclusion”.
Shortly afterwards, the Office for Nuclear Regulation, the Environment Agency and Natural Resources Wales gave their approval to the UK Advanced Boiling Water Reactor (ABWR) developed by Hitachi-GE, which is intended for use at the power station, following the completion of a generic design assessment.
Horizon plans to deploy two of the reactors at Wylfa Newydd and another two at its Oldbury site in South Gloucestershire.