Conditions have been added to the agreement enabling the government to stop EDF from selling a controlling stake in the plant without its consent. It will also take a “special share” in all future nuclear projects so they cannot be sold without the prior approval of ministers.
The changes will allow Britain to implement a “consistent approach to considering the national security implications of all significant investments in critical infrastructure”, it said in a statement.
Business and energy secretary Greg Clark said: “Having thoroughly reviewed the proposal for Hinkley Point C, we will introduce a series of measures to enhance security and will ensure Hinkley cannot change hands without the government’s agreement. Consequently, we have decided to proceed with the first new nuclear power station for a generation.
“Britain needs to upgrade its supplies of energy, and we have always been clear that nuclear is an important part of ensuring our future low-carbon energy security.”
EDF has given its approval to the new deal. Chief executive Jean-Bernard Lévy said: “The decision of the British government to approve the construction of Hinkley Point C marks the relaunch of nuclear in Europe.
“It demonstrates the UK’s desire to lead the fight against climate change through the development of low carbon electricity. This decision demonstrates confidence in the EPR technology and in the world renowned expertise of the French nuclear industry.”
Chief executive of EDF Energy Vincent de Rivaz said: “Today’s announcement is good news for British consumers, a huge boost for British industry and a major step forward in the fight against climate change. The strong performance of the EDF Energy’s 15 nuclear reactors underpins our credibility as a nuclear operator and developer in the UK.
“We will take the risk and responsibility to deliver Hinkley Point C and provide the UK with the reliable low carbon electricity it needs. The experience and expertise gained from restarting new nuclear build in the UK will help following projects be cheaper.”
The deal has also been given the thumbs up by China General Nuclear Power Corporation (CGN), which took a 33.5 per cent stake in the project in October last year.
It said in a statement: “We are delighted that the British government has decided to proceed with the first new nuclear power station for a generation. We are now able to move forward and deliver much needed nuclear capacity at Hinkley Point, Sizewell and Bradwell with our strategic partners, EDF, and provide the UK with safe, reliable and sustainable low-carbon energy.
“CGN and EDF have worked together in close cooperation for decades and this has laid a solid foundation for these three new nuclear projects. CGN looks forward to leveraging its 30 years’ experience in nuclear construction and operation and playing an important role in meeting the UK’s future energy needs.”
Here’s how others have reacted so far:
Tony Ward, head of power and utilities, EY
“Big, tough decisions that benefit future generations and balance multiple needs are, and should be, hard to make – but that is precisely the role of government. It is absolutely right and proper that the government has taken a final opportunity to validate the deal arrangements, security and governance structures. After ten years of preparation and deliberation, it is now time to deliver.
“While technologies such as solar, wind and batteries will also be hugely important in delivering the UK’s future energy mix, new nuclear, starting with Hinkley Point, has a crucial role to play in displacing our reliance on fossil fuels. We are moving to a more balanced and diverse mix of zero-carbon power generation – a mix that will be capable of delivering reliable and robust baseload power.”
Richard Black, director, the Energy and Climate Intelligence Unit
“Despite this being called a ‘final decision’ to build Hinkley C, other hurdles, including technical and legal challenges, may well lie ahead for the project.
“French trade unions don’t like it, nor do some of the likely candidates for the French presidential election next year, EDF’s finances are not the healthiest, and the French nuclear regulator is examining flaws in steel used for a similar reactor being built in France. So it may turn out not to be quite as ‘final’ as it looks now.
“Although China is reportedly happy with the new position, questions also remain over its main ambition – building its own nuclear reactors at Bradwell in Essex as a route into the Western market.”
David Elmes, head of the Global Energy Research Network, Warwick Business School
“This is what being painted into a corner feels like. After a surprise delay by the new prime minister, Theresa May, the UK government’s confirmation of the deal to build a new nuclear power station at Hinkley Point locks UK bill payers into an expensive source of energy for decades to come.
“The UK’s climate change commitments make it tough to provide electricity reliably at low emissions, but this deal was started a decade ago when we hoped the companies involved could deliver it on time and at a reasonable cost. The price UK bill payers are committing to through the government is now double and the start date has slipped at least eight years.
“The choices the UK has for the supply and use of energy have changed considerably since this deal was first conceived. The ability of governments, companies and financiers to commit to such huge projects has also faded. While those involved will be hugely relieved; we need a serious discussion of cost effective opportunities that offer as much or a greater contribution to the UK economy so we’re not boxed in to such a decision again.”
Josh Hardie, deputy director-general, the Confederation of British Industry (CBI)
“The final green light for Hinkley Point is good news for the UK’s energy future as well as supporting jobs and growth across the South West and the country.
“New nuclear energy will play an important role in supporting a diverse, low-carbon and secure energy supply, so it’s now time to push on with this key project.
“Investors are hungry for further signs from the government that the UK is open for business. Pressing ahead with major infrastructure decisions – such as giving clarity to around the next Contracts for Difference auction and the post-2020 Levy Control Framework … would give a real boost to their confidence in the UK in the long-run.”
Kevin Coyne, national officer for energy, Unite
“Today’s historic decision is very welcome. Our members are shovel ready and dead keen to start work on the country’s first nuclear power station for a generation.
“It is excellent news that the uncertainty caused by Theresa May’s decision to put Hinkley Point ‘on hold’ has now been dispelled and that the government recognises the role of nuclear in a mixed energy economy.”
Justin Bowden, national secretary for energy, GMB
“GMB is delighted that the first of the badly needed fleet of new nuclear power stations will finally begin construction. This is the right decision for the country and the government is right to ignore the begrudgers and naysayers.
“Having secure low carbon electricity, for the 61 days per year when there is no renewable energy sources available, is crucial if we are to meet our energy needs and reduce our dependency on foreign imports of power.”
“With Hinkley now confirmed, attention must rightly shift to the other new nuclear power stations – including Bradwell in Essex and Sizewell in Suffolk – which we badly need across the country. The solution however is not to handover the replacement of vital UK infrastructure lock, stock and barrel to China.”