Nukespeak: subsidies not allowed? Let's call it 'take on financial risks' then

Nuclear Monitor Issue: 
#718
6096
29/10/2010
Article

On October 18, the U.K. listed eight potential sites in England and Wales for new nuclear power stations that should be operational by 2025, the first in 2018. And Energy and Climate Change Secretary Chris Huhne was repeating his mantra: "There will be no public subsidy for new nuclear power."

But 'no public subsidy for nuclear power' is problematic if you actually do want to support new-build, not only political but also financial. So he decided to no longer call it subsidies. Now the text-to-be-explained is as follows, “the U.K. is not ruling out action to take on financial risks or liabilities of nuclear operators for which they (the government) are appropriately compensated or for which there are corresponding benefits” Huhn said. The Lib.Dem. minister campaigned against new nuclear power stations during the election.

The new-nuke-speak provoked several questions by MP’s in the British Parliament. The questions are interesting but the answers are even much more interesting. 

1. “What estimate the Minister has made of the maximum compensation payable to the Government for taking on financial risks or liabilities; and what mechanism he proposes to use to

(a) define and

(b) measure benefits arising from taking on such risks or liabilities ?

Minister of State Charles Hendry, second in line after Huhn: "As the 18 October 2010 statement on 'no subsidy for new nuclear power' made clear, we are not ruling out action by the Government to take on financial risks or liabilities for which they are appropriately compensated or for which there are corresponding benefits. The Government would consider any potential measures in this area on a case-by-case basis, in line with the policy as set out in the statement."

2. “How much support

(a) the Department and its predecessor and

(b) non-departmental public bodies for which the Department is responsible

have provided to the nuclear industry in the form of

(i) full-time equivalent staff,

(ii) facilities, and

(iii) research and development expenditures

in each of the last 10 financial years; and if the Department will indicate in each such case which costs

(A) arise from the UK’s nuclear legacy and

(B) are associated with possible new nuclear power stations.

Charles Hendry: "The Department of Energy and Climate Change does not hold the information requested centrally and providing a breakdown of the support referred to would result in a disproportionate cost."

3. “What information the Department holds for benchmarking purposes on the level of private insurance cover available to operators of nuclear installations in other countries”?

Charles Hendry: "We do not hold any specific information on the level of private insurance cover available to nuclear operators in other countries."

Time for action.
Several groups and individuals in the UK have come together to initiate a more coordinated campaign against new-build. One of the results of these gatherings is theNo Money for Nuclear” (NM4N) campaign-group which believes that the level of support received by the nuclear industry in the UK is unjustified and a serious drain on public finance, especially at a time when the weak and vulnerable are suffering from significant cuts in public expenditure. In addition, the way waste disposal and decommissioning costs of new nuclear power stations are gathered poses a serious risk to the public purse in the future.

The government claims that nuclear power and renewable energy can exist together in a competitive market place. However, the nature of nuclear power is that much of the costs, those for waste disposal and decommissioning, do not materialise until the end of the working life, even though these costs become inevitable once the power station starts operating. The flat rate nuclear levy will act as a substantial subsidy to these capital costs. NM4N believe that it is possible to move to a much more sustainable energy economy without the need for nuclear power.

NM4N spokesperson, Pete Rowberry said “The coalition government has promised that nuclear power stations would not be built if they needed public subsidy. However, they have not changed any of the significant public support which the industry already receives. It also seems that they are determined that support for the nuclear industry will be extended further by allowing it to benefits of the carbon pricing and emissions trading regimes, in spite of the fact that nuclear power is significantly higher producer of CO2 than any renewable source. It continues to cover the industry’s liability in the case of a nuclear accident, in spite of the statement by Rt Hon Chris Huhne MP, Secretary of State at the Department of Energy and Climate Change that this subsidy would be ended, yet another example of the coalition’s broken promises."

Sources:  Bloomberg, 18 October 2010 / Press release NM4N, 25 October 2010 / email D. Lowry, 27 October 2010

About: 
WISE