Osborne guarantees £2bn of Chinese nuclear investment in UK

Chancellor of the Exchequer George Osborne has announced that the government will guarantee a £2bn deal under which China will help fund the cost of building the proposed Hinkley Point C nuclear reactor on the Somerset coast. Projected to cost some £24.5bn, Hinkley C is scheduled to be the first of the UK’s new fleet of nuclear power stations, and the first built in the country since Sizewell B in the 1990s.

Osborne made the announcement during an official tour of China, and his colleague Amber Rudd, secretary of state for energy and climate change, said that China is expected to take the lead on further nuclear projects, including a power station at Bradwell in Essex, which could be Chinese-designed.

The funding guarantee will be met from Infrastructure UK, a unit within the Treasury that co-ordinates and simplifies planning and prioritisation for UK infrastructure projects. The money will assist EDF, which is building the plant, to meet the enormous building costs. It is not known what proportion of the total cost Chinese finance is expected to reach, and although EDF chief executive Vincent de Rivas welcomed the announcement, he said only that it represented ‘further progress towards a final investment decision’, he did not indicate how far off that decision might be or when work might begin in earnest on the power station (ground works have already begun, but no concrete has been poured). The European Commission approved the project last year while UK planning consent was granted in 2013.