The UK Government plans to build the Hinkley Point C nuclear plant could need additional cash and electricity payment top-ups worth £30bn ($38bn), according to the National Audit Office (NAO).
The parliamentary watchdog said that the Department for Business, Energy and Industrial Strategy’s deal for Hinkley Point C is a risky and expensive project with uncertain strategic and economic benefits.
Though UK needs some new nuclear power, the economic case for Hinkley Point C was marginal and subject to significant uncertainty, it said.
It also said that the Department had limited capacity to take alternative approaches to the deal after it finalised the terms in 2013.
NAO said: “The government has increasingly emphasised Hinkley Point C’s unquantified strategic benefits, but it has little control over these and no plan yet in place to realise them.”
In September last year, Britain approved the £18bn project, following the completion of a revised agreement with French energy giant EDF.
EDF is the developer of the 3.2GW Hinkley Point C project, which will be located in Somerset, England.
Upon commissioning in 2025, the Hinkley Point C project is expected to meet 7% of electricity needs in the UK for 60 years.
The project will feature two turbines, each with a gross generating capacity of 1,770MW.
The project, which is being financed by the French and Chinese governments, is expected to create up to 25,000 jobs and supply power to about six million homes.
In 2015, China General Nuclear Power (CGN) agreed to acquire 33.5% stake in the project by investing €6bn through its new company General Nuclear International (GNI).
NAO head Amyas Morse said: “The Department has committed electricity consumers and taxpayers to a high cost and risky deal in a changing energy marketplace.
“Time will tell whether the deal represents value for money, but we cannot say the Department has maximised the chances that it will be.”
Image: Illustration of the Hinkley Point C nuclear project in the UK. Photo: courtesy of EDF Energy.