Electricite de France SA (EDF), French Areva SA and two Chinese nuclear companies will partner to build the first nuclear plant in the United Kingdom since 1995.
After a year of negotiations with the French EDF utility, in a deal agreed with the British government for power prices that are double the current market rate, EDF, Areva, China General Nuclear Power Corp. and China National Nuclear Corp. will build the plant at Hinkley Point in southwest England.
EDF will build two EPR reactors made by Areva at Hinkley Point, with a total capacity of 3.3 gigawatts, enough to supply 5 million homes for 60 years, according to Bloomberg.
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In total, the project will cost some $26 billion and take a decade to build.
The headlining news here is China’s entrance into the British nuclear market, where its two nuclear companies will now be allowed to buy a 30%-40% stake in the project. EDF will hold a 45%-50% stake, while Areva—the supplier of reactors—will hold 10%.
The deal follows an agreement signed between the UK and China on civil nuclear collaboration, which is in line with the UK’s ambition of increasing investment in low-carbon electricity and avoiding blackouts.
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By 2023, the UK will have shut down 15 of its 16 existing nuclear reactors, and recent dire predictions of looming blackouts have sparked panic.
According to a statement by British Prime Minister David Cameron, the deal with EDF for a new nuclear reactor will mean “16 billion pounds of investment coming into the country and the creation of 25,000 jobs.”
“This also marks the next generation of nuclear power in Britain, which has an important part to play in contributing to our future energy needs.”
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com