UK gives development consent to Sizewell C nuclear power plant

Wednesday, 20 July 2022

The application for development consent was made under the Planning Act 2008 by EDF Energy's NNB Generation Company (SZC) Limited for the construction and operation of a nuclear power station near Leiston in Suffolk. Under the act, the secretary of state should make a decision "within three months of the receipt of the Examining Authority's report" unless a new deadline is set, as happened earlier this month in this case when the deadline was pushed back to 20 July.

The plan is for Sizewell C to feature two EPRs producing 3.2 GW of electricity, enough to power the equivalent of around six million homes. It would be a "replica" of the Hinkley Point C plant, under construction in Somerset. EDF Energy submitted a development consent order (a planning application) for the plant in May 2020 and if all goes well, has said it expects to make a final investment decision later this year or in 2023.

It will be built next to the existing Sizewell B plant, and the project is majority owned and funded by the French energy giant EDF.

The project is one which comes under the remit of nationally significant infrastructure. The Planning Inspectorate's CEO Sarah Richards said: "The Planning Inspectorate has now examined more than 100 nationally significant infrastructure projects since the Planning Act 2008 process was introduced, ensuring local communities have had the opportunity of being involved in the examination of projects that may affect them.

"This Examination took place during the COVID-19 pandemic and its associated restrictions and the Examining Authority worked hard to ensure that local people, the local authorities - East Suffolk District and Suffolk County Council - and other Interested Parties were able to fully participate.

"The Examining Authority listened and gave full consideration to local views and the evidence gathered during the Examination before making its recommendation."

The decision was welcomed by Tom Greatrex, CEO of the UK's Nuclear Industry Association: "This is a huge step forward for Britain’s energy security and net zero ambitions. Sizewell C will provide reliable low-carbon power for more than 80 years, cutting gas use, creating thousands of high-quality, skilled jobs, and long-term investment and opportunity up and down the country.

"Sizewell C will be one of the UK’s largest ever green energy projects, and this decision significantly strengthens the pipeline of new nuclear capacity in Britain.”

Earlier this year, the UK government provided GBP100 million (USD120 million) in funding to develop the project, and also took legislation through parliament allowing a new way of funding new large infrastructure projects - a Regulated Asset Base (RAB) funding model - and in this case gave itself the option to take a 20% stake in the project.

Under the existing mechanism to support new nuclear projects - the Contracts for Difference (CfD) scheme - developers have to finance the construction of a nuclear project and only begin receiving revenue when the plant starts generating electricity. The CfD approach was used to finance Hinkley Point C, with the developer agreeing to pay the entire cost of constructing the plant, in return for an agreed fixed price for electricity output once the plant is online. However, this approach places the entire construction risk on developers and led to the cancellation of other potential new build projects, such as Hitachi's project at Wylfa Newydd in Wales and Toshiba's at Moorside in Cumbria.

The Department for Business, Energy and Industrial Strategy (BEIS) announced in June 2018 that the government would review the viability of a RAB model for new nuclear projects and committed in January 2019 to publishing an assessment of this model by the summer. Under this model a company receives a licence from an economic regulator to charge a regulated price to consumers in exchange for providing the infrastructure in question. Most recently, the RAB model was used to successfully finance the construction and operation of the Thames Tideway Tunnel and Heathrow's Terminal 5. In December 2020, the UK government announced it would begin talks with EDF to enable investment in the planned Sizewell C nuclear power plant project.

"When operational, Sizewell C will produce enough electricity to supply six million homes with affordable 24/7 clean electricity," said Sama Bilbao y León, Director General of World Nuclear Association. "Today's decision is the next important step, not only for Sizewell C, but also for the UK as a whole, as it looks to make much greater use of new nuclear capacity to meet its net-zero targets."