The total lifetime cost of the proposed Hinkley Point C nuclear power plant near Burnham-On-Sea could be as high as £37bn, according to an assessment published by the government this week.
The figure was described as ‘shocking’ by critics of the scheme, who said it showed just how volatile and uncertain the project had become, given that the same energy department’s estimate 12 months earlier had been £14bn.
On Thursday (July 7th), the Department of Energy and Climate Change (DECC) confirmed the £37bn figure, but said it was provisional and set in September 2015 when wholesale power prices were low, and would not affect bill payers.
“Hinkley will generate enough low-carbon electricity to power six million homes and around £10 [a year] from [each] consumer’s bill will pay for it once it is up and running,” a DECC spokesperson said.
“We have set the strike price to protect bill payers if energy costs go up or down, so the cost of the project to consumers will not change.”
“The report from the IPA (Infrastructure and Projects Authority) does not suggest that the lifetime costs of Hinkley have increased. It is a snapshot of the position at the end of September 2015.”
EDF said the £37bn figure should be disregarded. “Hinkley Point C will generate reliable low-carbon electricity in the future, so a cost estimate based on last year’s depressed wholesale price is not relevant. HPC’s electricity will be competitive with other low-carbon energy options and consumers won’t pay a penny until the plant begins operating,” said a spokesman.
But experts said the extra money, if the cost did remain at £37bn, would have to come from somewhere – probably the taxpayer – or be removed from other DECC budgets available for different energy projects.
“This whole-life cost of £37bn is a truly shocking figure. It is an extraordinary ramp-up from last year’s figure, and just underlines how hard it is to get a real handle on the long-term cost of Hinkley,” said Paul Dorfman, senior research fellow at the Energy Institute, University College London.