The China deal heralded for UK new nuclear shows that the UK  is
better at public relations than energy policy.

EADT said - before the television hype - that a £2 billion taxpayer guarantee for the French Hinkley reactor was a 'step closer' for Sizewell. That was a lot more accurate than the tv hype.

What needs to be understood is that the news is truly only a very tiny step in the UK’s nuclear-led energy marathon. The £2bn won’t stretch very far.  Mr Osborne’s official Treasury press statement admits that it is only the first slice of a guarantee.

And if EDF and China were to get the guarantees, the other two companies doing Anglesey and Sellafield, Moorside will properly want the same guarantee from the taxpayers’ pockets. That’s going to be really big money we simply do not have. The Treasury is already cash-strapped for its big infrastructure Pipeline programme which provides these guarantees.

A second public relations sleight of hand on the nuclear subsidy remains important. It is implied that Europe agreed a subsidy “strike price” for Hinkley and Sizewell. Not true, if you read the documents. What Europe said was that if EDF were to build Sizewell, the strike price for Hinkley would be reduced a bit to reflect the economies of scale. And there certainly wouldn’t be a subsidy for China at Bradwell without that having to go to Europe separately.

Influential people who are not anti nuclear are not being taken in by the PR and hype. They are queuing up to say Hinkley is a bad deal, a white elephant, a waste of public money. Mr Osborne’s father in law, Lord David Howell, an energy minister to Mrs T, says think again.The Daily Telegraph has joined in the chorus alongside a former Cabinet Secretary. HSBC bank says no thank you to Hinkley. A former Cabinet Secretary has joined the throng.

Happily, for a saner energy policy, there are still many obstacles in the nuclear marathon: have the two Chinese companies come up with the 45% of funding which EDF apparently needs ? Is Bradwell worth enough if sold  by EDF to China to fill the funding ago for Hinkley and Sizewell ? That’s not a credible arithmetic. EDF maybe doesn’t have the promised money either. Then, court cases are still awaited in Europe from Austria and a powerful German group on the Hinkley subsidy decision.

Further, if China, by hook or by crook, goes for anything like a controlling interest in Hinkley ,Sizewelland Bradwell, it will raise new questions for Europe. French dominant ownership because of its European role is one thing. China using the UK as a platform for getting its nuclear technology into Europe is a different matter. The economic questions will then be joined by political questions about China.

The hype may work for a few days in the UK, but the rumour machine in Brussels says what is really going on is that the UK government and EDF want out of the whole sorry EPR reactor story but need someone to blame other than themselves. One can only say we must await further announcements without bated breath. Can China’s Premier really add anything next month ?

Meanwhile, the real question is whatever happened to a sensible UK (and increasingly realistic) carbon-free energy future ? Other countries have got this in their sights. Why not the UK too, instead of so much destructive, time-wasting posturing ? Amber Rudd, Energy Secretary, has a standing legal duty to review the nuclear renaissance because of evidence of non-nuclear and non-fossil options for the UK. But for the moment she and Osborne seem to believe their own PR. For the rest of us, the 'golden decade' with China is a very different matter.

 

Regan Scott,