UK carbon emission goals in jeopardy if Hinkley delayed: minister

Reuters News
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Posted: Apr 19, 2016 10:41 AM

LONDON (Reuters) - Britain's carbon emission targets could be at risk if the Hinkley C nuclear power project is canceled or delayed beyond its planned 2025 start date, the country's energy and climate minister said on Tuesday.

The 18 billion-pound ($25.5 billion) project was announced in October 2013 but developer Electricite de France has stalled on making a final investment decision while the firm secures partners and financing.

"Any such delay could put at risk our decarbonization targets – one of the key reasons the Government is supporting Hinkley in the first place," Amber Rudd said in a letter responding to questions from a group of cross-party MPs dated April 12 and published on Tuesday.

The project, which is expected to provide around 7 percent of the country's electricity, is part of Britain's plans to replace ageing power plants and meet the country's goal of reducing carbon emissions by 80 percent on 1990 levels by 2050.

Rudd said the government is confident the project will go ahead but that it has "arrangements in place to ensure that any potential delay or cancellation to the project does not pose a risk to security of supply."

The government would be able to secure at little cost extra electricity through its capacity market mechanism - which pays generators a fee to have certain amount of capacity available at short notice during peak demand periods - as long as the delay is flagged up before the auctions for capacity for 2025 and beyond take place.

If a delay or even cancellation happened after the auctions the lights would still stay on but the costs involved would rise, she said.

Currently the government would not face any liabilities if the project is canceled since no contracts have been signed.

"Once the contracts are entered into, all risk is borne by EDF, except in the case of a narrow and extremely unlikely range of circumstances such as a political shutdown or a change in law," she said.

Environmental lobby group Greenpeace, which has called for the project to be scrapped, said the country could still meet its climate targets without Hinkley C.

"There is absolutely no reason that the UK could not meet our de-carbonization targets if the government dropped Hinkley and gave renewable energy businesses a fraction of the political and financial support that nuclear and fossil fuel companies enjoy," said Greenpeace director John Sauven.

(Reporting by Susanna Twidale; Editing by Greg Mahlich)