UK Government’s investment in Sizewell C nuclear plant passes £1bn

Pictured: An artist's impression of Sizewell C. Image: EDF

Nuclear Minister Andrew Bowie announced the new funding on Tuesday afternoon (29 August), stating that it will be allocated to prepare the site in Suffolk for construction works to begin.

Funding will also be set aside to develop and grow the project’s supply chain and to ensure that there are enough skilled workers in Britain to deliver the plant. On the skills piece, the funding will support the construction and staffing of training facilities for 1,500 apprentices.

The funding has been announced just one month after Whitehall confirmed £170m for pre-construction preparations at Sizewell. This initial investment had a focus on materials and components.

Bowie said the additional funding “is a clear demonstration of the government’s commitment to this vital project, and will mean the site will be shovel-ready, and work able to start, much more quickly”.

The Nuclear Industry Association has, of course, welcomed the announcement.

Ongoing financing efforts

A final investment decision and final approval have not yet been reached for Sizewell C.

Developer EDF estimates that the project will cost £20bn to deliver and expects around 60% of the cost to be footed by private investors. The UK Government has edged Chinese investors out and some British investors, including the BT Pension Scheme and NatWest Pension Scheme, have exited negotiations.

The UK Government last year took a £700m stake in Sizewell C in the hopes of delivering its Energy Security Strategy commitment to deliver one new large nuclear project this decade

Further private funding is still being sought. The Financial Times reported earlier this year that Sizewell C is unlikely to raise the full £20bn before the end of 2024. Further delays could then result from the next UK general election, which is due to take place by January 2025 at the latest.

The UK Government introduced the use of a regulated asset base model to fund Sizewell C under Boris Johnson. This approach enables investors to recoup some of their costs through taxation during the construction phase.

MPs and academics have been urging Ministers to ensure that costs to the general public are kept low amid the cost-of-living crisis.A report from the Infrastructure and Project Authority this summer did not disclose progress on the delivery of Sizewell C, as it did with more than a dozen other projects overseen by DESNZ, on commercial grounds.

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