EDF warns of £2.2bn cost overrun and schedule slip on Hinkley Point C

Two years before construction work begins in earnest on the UK’s first new nuclear power station in three decades, costs are already beginning to rise

French state-owned electricity generator EDF has warned that the cost of building Hinkley Point C nuclear power station will be up to £2.2bn higher than its last estimate, reaching as high as £20.3bn. Construction work on the plant’s ancilliary facilities has already begun, but the first concrete for the building that will house the reactor itself is scheduled to be poured in 2019.  EDF says that there is a risk that the site’s first reactor, due to come on-line in 2025, might be up to fifteen months late, with the second unit possibly running nine months behind schedule.

Of the increased cost, £1.5bn results from “a better understanding of the design adapted to the requirements of the British regulators, the volume and sequencing of work on-site and the gradual implementation of work on-site.” The scheduler overrun gives rise to the remaining £0.7billion, the company adds.

This represents the second increase in the cost of the project, after EDF raised the estimate from £15bn to £18bn in 2015 because of inflation.

Despite this, EDF said it is still aiming for HPC to start generating by the end of 2025, and has confirmed that its contract with the government — which states that it is responsible for meeting the cost of overruns — is not affected. There will also be no effect on the supply of power to the UK or the cost of energy from the new plant, it added.

Commenting on the announcement, the Institution of Mechanical Engineers’ head of energy and the environment, Jenifer Baxter, said that the delay could have knock-on effects at other power stations.

“It’s possible that some existing power stations will require further life extensions,” she said. “It is not an option to ‘turn the lights off’ and that means that any gaps will need to be covered by gas and other technologies to secure supply and meet changing demands.” The demand profile for electricity in the UK over the next ten years is “almost certain” to become ever more challenging, she added.

Two other reactors of the same type as HPC are under construction in Europe, at Flamanville in Normandy and Olkiluoto in Finland, and both are behind schedule. The Flamanville plant last week received clearance from the French nuclear safety regulator to start up in late 2018, as long as the reactor cover, in which weak spots had been detected because of carbon concentrations in its steel, was replaced by 2024 unless EDF can devise new tests to confirm its integrity. The company has ordered a new cover from a foundry in Japan, rather than its own facility in France.