France’s EDF has again revised up the expected cost of Hinkley Point C, the nuclear power station under construction in south-west England, warning that delays arising from the pandemic will add about £500m and push back the station’s estimated start-up date to 2026.
The group, which is financing the construction of the plant along with its junior partner CGN of China, said it expected the project in Somerset to cost up to £23bn compared with a 2019 estimate of a maximum of £22.5bn. EDF quotes costs in 2015 prices in order to maintain consistency for the markets but the real bill is likely to be higher after accounting for inflation.
It said on Wednesday that the first electricity is now likely in June 2026, against a previous hope to start generating by the end of 2025. It has not been able to catch up work that was postponed last year at the height of the first lockdown.
“Ten months after it began, we are still facing the full force of the pandemic,” Stuart Crooks, managing director of Hinkley Point C, said in a message to employees on Wednesday.
“Even though experience has allowed us to increase numbers on site during the pandemic from below 2,000 to more than 5,000, social distancing requirements still limit the number of people we can safely have on site at any one time,” he said.
Mr Crooks added that “a longer construction period also adds some cost — as does the reduced efficiency of operating a site for a long period under Covid-19 conditions”.
However, he insisted: “None of this extra cost is carried by British consumers.”
Opponents of the scheme — which is Britain’s first new nuclear power plant in a generation — will not be surprised by the latest revisions.
Hinkley Point C is one of three EDF projects in Europe where the French company is using next-generation European Pressurised Reactor technology. The other two, the Flamanville power plant in France and Olkiluoto in Finland, have both been affected by long delays and cost overruns.
In 2013 the UK government struck a deal with EDF that guaranteed a price of £92.50 per megawatt hour for the electricity produced at Hinkley Point C in exchange for the French company financing its construction. At the time, the estimated construction cost was £16bn.
The government’s guarantee is for 35 years and is index-linked, which has given fuel to opponents of nuclear power, who argue that other forms of generation such as offshore wind are much cheaper. Offshore wind developers have agreed to build the latest turbine arrays in waters off Britain’s coast for less than £40/MWh, although nuclear supporters argue renewable generation is dependent on weather conditions.
EDF’s former UK chief executive, Vincent de Rivaz, once promised Britons would be cooking their turkeys using power from Hinkley Point C in 2017.
The French company is in talks with the UK government to build another plant, Sizewell C in Suffolk, although executives have made clear that a different financing model will be required for construction.
Ministers are examining taking a direct stake in Sizewell C as well as using a “regulated asset base” model that would involve consumers paying upfront through their energy bills.