Construction Of Hitachi Nuclear Power Stations On Hold

Img Credit: Horizon Nuclear Power

Hitachi has suspended construction of the new nuclear power stations in Anglesey and Gloucestershire. The decision followed some speculation that Hitachi’s nuclear development plans were on hold after failed negotiations with the government based on financing. The Japanese conglomerate concluded that more time is needed to develop a financial structure for the Wylfa Newydd Project. That assessment also included the conditions for construction and operation of facilities.

The nuclear power stations were intended for Wylfa Newydd Anglesey in North Wales and Oldbury on Severn in South Gloucestershire. Horizon Nuclear Power, which Hitachi acquired in 2012, had planned to develop at least 5,800MW of nuclear power across the sites. Adding insult to injury, both sites would have created around 850 full-time positions and 9,000 jobs during construction.

Duncan Hawthorne, CEO of Horizon Nuclear Power said, “We have made very strong progress on all aspects of the project’s development, including the UK design of our tried and tested reactor, supply chain development and especially the building of a very capable organisation of talented and committed people.”

Finding A Solution

Despite being in close discussions with the Japanese and UK governments on all aspects of the project for some time, they were unable to reach an agreement. This has resulted in the suspension of the construction and development of the Wylfa Newydd project until a solution can be found. This also includes any work related to Oldbury.

The company will take steps to reduce their presence while keeping the option to resume development in the future. Welsh Secretary Alun Cairns believes that they will build the plant on the Anglesey site but there would likely be a delay of a few years.

Why Is The Construction Of Wylfa Newydd So Important?

Wylfa Newydd is a plan for the construction of a nuclear plant in north Wales. Besides immediate job creation, it is also a massive opportunity for young people to become better skilled. This project would provide well paid work while providing excellent economic growth for Welsh businesses. An independent research study revealed that the project could bring more than £5.7bn to the Welsh economy.

Even with great promise, the plan to build the nuclear power plants is an expensive undertaking. In fact, the project was costing £1m per day according to Leon Flexman, Director of Corporate Affairs. Despite being dubbed, the “biggest infrastructure project in Wales for a generation”, the future remains unclear.

Wylfa Newydd Is The Best Site In Europe

While Wylfa Newydd is likely the best site in Europe for a nuclear power station, they have to realistic. In light of the mammoth daily costs, the project simply could not continue at the current pace. Flexman stated that the reason for the postponement is that this project is a big ask for any private sector company to finance on their own. It would require participation from both governments but the terms involved in this process is very complicated. “When you’re spending a million a day, you just can’t keep doing that forever as a responsible private company” said Flexman.

He also added that there was a possible solution and that the conversation should continue because the project can yield many benefits which are well-worth the extra effort. He also confirmed that Hitachi will still honour the apprenticeship schemes they put in place.

Is This The End Of The Hitachi Wylfa Newydd Project?

Alun Cairns believes in the future of Wylfa especially after Greg Clarke, Business and Energy Secretary, said that the UK government may consider taking a one-third equity share in Wylfa. It is a true reflection of
the UK government’s commitment to the project. Cairns said that the project could still happen and that he was optimistic that Hitachi would find partners to share the cost.

As Hawthorne stated, “Clearly this will have a significant impact for all involved with our project. Wylfa Newydd on Anglesey remains the best site for nuclear development in the UK and we remain committed to keeping channels of communication open with the government and our other key stakeholders regarding future options at both our sites.”

Missed Opportunities

Jenifer Baxter, Head of Engineering at the Institution of Mechanical Engineers, believes that the suspension is sad news for North Wales and the UK energy industry. The construction and operation would have provided hundreds of highly skilled engineering apprenticeships and jobs in North Wales for decades.

It would have provided approximately 6% of UK’s electricity demand, all reliable low-carbon to help meet the decarbonisation targets. Baxter stated that, “the reduction in nuclear power in the UK is a loss to our ability to decarbonise rapidly. This decision to pause development of one of our major nuclear energy sites combined with the decision to leave Euratom as part of Brexit will damage the long-term outlook for the nuclear manufacturing supply chain in the UK.”

Final Thoughts

According to Prof Sue Ion FRS FREng, “This is a tragedy, all down to a flawed ‘leave it to the market’ approach with no consistency in policy and it proves there are limits to markets. The UK must be the only developed nation on earth leaving our critical energy infrastructure beholden to overseas entities. There are some things which the government has an ultimate duty to deliver and they cannot duck the fact that they have responsibility for nationally significant infrastructure. Successive governments, not just this one, have said they want nuclear energy in the mix so they have to ensure it happens.”

What are your thoughts on the suspension of the project? Do you really think that work on Wylfa Newydd would start in 2020 if they get the final nod? Please comment in the section below or find us on social media. Follow our weekly blog posts for more interesting articles and get in touch if you need help assist with your project.