Nuclear strike price “agreed”
10 Oct 2013
The UK government and EDF Energy have reportedly agreed a strike price for nuclear power-generated electricity, paving the way for French utility to build its Hinkley Point C plant.
A price of £93 per MWh has reportedly been agreed as the level at which EDF and other potential nuclear generators will receive a top-up payment from government should the wholesale electricity price fall below it, and pay money back to government when the price rises above it.
Reports by The Times newspaper suggest this price support mechanism will be given to nuclear generators for a 40-year period. It is not yet know whether the strike price would be tapered to reduce over time, as is the case with the renewable electricity strike prices announced by the Government in June.
Department for Energy and Climate Change spokesman have denied that any agreement over the nuclear strike price has yet taken place.
Despite this, many are suggesting chancellor George Osborne will confirm the agreement next week during a visit to China, where it is widely expected EDF will also confirm China General Nuclear Power Group is to take a 49% stake in the proposed Hinkley Point C reactor.
If the reports are correct, by the time the £14 billion Hinkley Point C is built it will be receiving roughly the same level of price support as onshore wind-generated electricity in the UK.
The renewable electricity strike prices announced in June priced offshore wind at £155/MWh and onshore at £100/MWh up until 2016/17. Prices will decline from 2017-19, and by 2019 offshore will be £135/MWh and onshore £95/MWh – just £2 per MWh higher than nuclear’s reported strike price.
