Energy minister Charles Hendry told industry executives that the government wanted the private sector to build new nuclear reactors without public funds, but that the state had a role to play in reducing unnecessary barriers.
He added that the country needed £200bn of investment over the next 10 to 15 years to securely decarbonise energy production and that, for the first time, investment would have to come from abroad.
The coalition government’s policy has been formed despite Liberal Democrat opposition to new nuclear power stations and Lib Dem MPs will abstain from parliamentary votes on the issue.
‘The coalition agreement clearly sees a role for new nuclear, provided that there is no public subsidy,’ said Hendry.
‘We are clear. It is for private-sector energy companies to construct, operate and decommission new nuclear plants. It will be for us to ensure the appropriate levels of safety, security and environmental regulation.’
He highlighted the need to set a strong minimum price for carbon-producing energy − a ’carbon floor price’ − to encourage the development of low-carbon technology.
EDF, which operates eight UK nuclear power stations and plans to build four more, reiterated its support for the government’s nuclear position.
‘We believe nuclear power is the most affordable low-carbon option and can be built in the UK without subsidy,’ said the firm’s chief executive, Vincent de Rivaz, last month.
‘We welcome this commitment on the National Policy Statements and we look forward to a positive parliamentary vote at an early date.’
But the UK’s largest independent energy consultancy, McKinnon and Clarke, warned that the government needed to take more action to support the nuclear sector because of its reliance on private and foreign investors.
‘Nuclear is still not operating on a level playing field when compared to renewable, which receives huge subsidies from government,’ said McKinnon and Clarke energy analyst David Hunter.
‘Considering exempting nuclear power from the Climate Change Levy and transforming the Renewable Obligation scheme into a Low Carbon Obligation to include nuclear power are steps that could be taken.
‘There are still potential planning delays and nuclear skills shortages in new build and regulation, which, despite government assurances, could delay the process. Foreign investors will be aware of such pitfalls,’ he added.