Nuclear industry and its pols caught in another backhanded deal
To form the majority needed for the present UK government the conservatives had to ally themselves with the LibDems. Part of the deal was that since the LibDems believed that spending money on nuclear power was an impediment to the fight against climate change, and since the Conservatives were dead set on building new nuclear power, there was a compromise needed in this area. The LibDems agreed to not impede the building of nuclear plants if and only if they could be built with no subsidies. Of course, since new reactors simply cannot be built without transferring the risk to the tax/rate payers (which is a form of subsidies) the conservatives have been trying since day one to wriggle and squirm out of the deal.
Background from 2010: http://www.guardian.co.uk/environment/2010/jun/16/coalition-support-new-nuclear-power
Here is the latest chapter in that saga...
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The Guardian has also seen a presentation made by Scottish & Southern Energy to MPs last month, saying the plans contain "hidden subsidies", will be open to challenge on legal grounds, and could "mess up" funding for renewables. Hall commented: "I have not seen the SSE presentation but even the nuclear industry accepts this is a covert subsidy."
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The leaked document, a submission to the European commission, which the government has confirmed as genuine, says: "Our reforms will put in place a regulatory framework based on feed-in tariffs for all low-carbon technologies, which will allow younger technologies to mature so that in the near- to mid-term future they will be able to compete in the open market … in time, we expect that this regulatory framework will enable different low-carbon technologies to compete against each other on a level playing field for their appropriate role in the energy mix."
This is the clearest evidence yet of government plans to subsidise nuclear power through the back door, by classifying it with renewables as "low-carbon power", despite repeated assurances that there would be no public subsidy. In the coalition agreement subsidies to nuclear are explicitly ruled out. It said: "Liberal Democrats have long opposed any new nuclear construction. Conservatives, by contrast, are committed to allowing the replacement of existing nuclear power stations provided that they are subject to the normal planning process for major projects (under a new National Planning Statement), and also provided that they receive no public subsidy."
The government is already facing a crisis over its hopes for a fleet of new reactors to replace ageing generators. This week French company GDF Suez warned it would need increased financial incentives, including a strengthened price on carbon dioxide, to go ahead with its building plans. This followed the shock cancellation by German companies E.ON and RWE npower, partners in the Horizon consortium, of their plans to build new plants at Wylfa, Wales and Oldbury, Gloucestershire.
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http://www.guardian.co.uk/environment/2012/apr/20/coalition-u-turn-nuclear-energy-subsidies
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