The cancellation of the Wylfa and Moorside nuclear plants has opened up a “giant hole” in UK energy policy, the chair of the Business, Energy and Industrial Strategy (BEIS) Committee has warned as she announced a wide-ranging inquiry into the nation’s power infrastructure investment needs.
The House of Commons committee will be looking at whether the government needs a new approach to bring forward the investment required to deliver a low-carbon, low-cost energy system and secure energy supplies for the long term.
The inquiry has been launched as concerns mount over the UK’s gap in low-carbon generation opened up by the recent decisions by Hitachi and Toshiba to halt new nuclear projects at Wylfa, Oldbury and Moorside.
The inquiry will examine how the decisions and trends in low-carbon generation affect the investment outlook for UK energy infrastructure and if a case exists for the government to change its approach to attracting cash into the sector.
And the MPs will look into how the attractiveness of the UK energy sector to investors compares to other countries.
They are also seeking evidence on whether existing financing mechanisms, notably the Contracts for Difference scheme, are fit for purpose and the factors that could affect the feasibility of implementing alternatives, such as the Regulated Asset Base model that the government is looking to apply to new nuclear development.
Rachel Reeves MP, chair of the BEIS Committee, said: “In the wake of investment decisions over nuclear plants at sites such as Moorside and Wylfa, a giant hole has developed in UK energy policy.
“With coal due to go off-line, and the prospects for nuclear looking unclear, the government needs to set out how it will create the right framework to encourage the investment needed to plug the gap.
“In this inquiry, we want to examine the government’s approach to creating the right conditions for investment to deliver the secure energy capacity to meet the nation’s needs.
“A bigger shift in our energy infrastructure to a low cost, low carbon energy system is necessary. As a committee, we will want to consider what more the government needs to do to attract greater investment into financing future energy capacity, including renewables.”
The committee is inviting submissions of evidence by 3 April 2019.