Less than a year after getting the final go-ahead, Hinkley Point C is already on course to breach its budget by £1.5 billion, EDF has admitted.
Following a review of the costs and timetable, the developer has revealed the new build nuclear project in Somerset is also facing delays of up to 15 months, which could add a further £0.7 billion to the price tag.
The projected cost for Hinkley Point C is now estimated at £19.6 billion, an increase of £1.5 billion over the previous figure (2015 prices), EDF said in a statement.
The French energy giant attributed the cost increase to a “better understanding” of the construction and regulatory requirements.
The review concluded that the first reactor risks being delayed by up to 15 months and the second reactor by up to nine months. The cost is expected to reach £20.3 billion if these delays materialize.
EDF said it remains on track to begin pouring concrete for the first reactor building in mid-2019, provided that the final design is completed by the end of 2018, and is still aiming to start generating power in 2025.
The projected rate of return for the plant – initially estimated at 9 per cent – has now been dropped to 8.2 per cent – or 8.5 per cent if there are no hold-ups.
Greenpeace UK executive director John Sauven described the revelation as a “damning indictment” of the government’s decision to proceed with the project: “This year’s school leavers will still be paying for Hinkley when they approach their pension age.
“Long before Hinkley is even finished, offshore wind will be producing far cheaper and safer power,” he added. “The nuclear new build program should be halted for better alternatives that will meet our energy needs and provide jobs in the regions.”
Jennifer Baxter, head of energy and the environment at the Institution of Mechanical Engineers commented: “Today’s news that the Hinkley Point C project will cost more and maybe take longer means that it’s possible that some existing power stations will require further life extensions.
“It is not an option to ‘turn the lights off’ and that means that any gaps will need to be covered by gas and other technologies to secure supply and meet changing demands.”
The government signed the agreement to build the 3.2GW plant in September last year, shortly after giving its final approval to the project. The first permanent concrete was laid at the end of March.
A recent report by the National Audit Office blasted the deal for locking consumers into a “risky and expensive project with uncertain strategic and economic benefits”.
Speaking at the Utility Week Energy Summit last week, EDF Energy chief executive Vincent de Rivaz nevertheless insisted that new nuclear could provide the “best value for money for taxpayers”.