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Hitachi wins rights to UK’s new £700 million nuclear project
- 12 years ago (2012-10-31)
- Junior Isles
Japan's Hitachi has signed a £700 million ($1.13 billion) deal giving it rights to build a new generation of power plants in the UK, effectively restarting the UK's stalled nuclear expansion plans.
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Hitachi is to buy Horizon Nuclear Power from Germany's E.On and RWE, who had plans to build reactors on existing nuclear sites at Wylfa, Anglesey, and Oldbury, near Bristol.
"This is a decades-long, multi-billion pound vote of confidence in the UK, that will contribute vital new infrastructure to power our economy,” said Prime Minister David Cameron.
"It will support up to 12 000 jobs during construction and thousands more permanent highly skilled roles once the new power plants are operational, as well as stimulating exciting new industrial investments in the UK's nuclear supply chain. I warmly welcome Hitachi as a major new player in the UK energy sector," he said.
UK engineering companies Babcock International and Rolls-Royce have also signed preliminary contracts to join the Hitachi deal, which should be completed by the end of November.
There are still regulatory issues to clear, with Hitachi's reactor design still needing to be approved by the necessary authorities. Once past this hurdle the company intends to build 6 GW of nuclear capacity, with the first plant generating power by the early 2020’s.
Up to 6000 jobs are expected to be created during construction at each site, with thousands more in the supply chain, and a further 1000 permanent jobs at both locations once operational.
Earlier this month, the UK’s energy regulator Ofgem warned that the UK risks facing a shortfall of generating capacity in the winter of 2015-16, as a result of the so called ‘energy gap’ between retiring old nuclear plants and new ones coming on stream. Its report predicted that UK’s spare power capacity could fall from 14 per cent now to only 4 per cent in three years.
Investment in the UK nuclear sector was still a "leap of faith", according to George Borovas, head of nuclear projects at global law firm Pillsbury. Hitachi's decision was a "significant... vote of confidence in the UK nuclear programme", he said.
"Hitachi bring with them decades of expertise, and are responsible for building some of the most advanced nuclear reactors on time and on budget, so I welcome their commitment to helping build a low-carbon, secure-energy future for the UK,” said Energy and Climate Change Secretary Ed Davey.