Government cancels Forgemasters’ nuclear press loan

The coalition government announced today it will be axing £2bn worth of projects, including a loan that would have helped a British engineering firm build steel components for next generation nuclear reactors.

Chief Secretary to the Treasury Danny Alexander told parliament that Sheffield Forgemasters would no longer be granted a £80m loan that was promised by the Labour government in March this year to help buy and install a 15,000-tonne forging press for developing large steel components for next generation nuclear reactors.

The capability to make such components on an industrial level is only available at Japan Steel Works.

Graham Honeyman, chief executive of Sheffield Forgemasters, said the announcement was a disappointment.

‘Today’s government announcement to overturn the loan offered to Sheffield Forgemasters’ plans to install a 15,000 tonne press is a huge disappointment to all at the company,’ he said in a statement.

‘While the press would have placed the company at the forefront of civil nuclear manufacture, it is important for us now to focus on other elements of the company’s development.

‘The government clearly has a remit to reduce spending and cut the economic deficit and it is for them to decide how best to do that. Sheffield Forgemasters will continue to develop its significant involvement into civil nuclear, thermal and hydro power generation markets and seek other ways to develop the business.’ Read our article about the project here.

The coalition government’s decision to cancel the loan for Sheffield Forgemasters comes a day after energy minister Charles Hendry told energy companies at the Nuclear Industry Forum that future nuclear power stations would be built with only private sector funding.

Unions have today accused the government of taking a position that will harm the UK’s future low-carbon economy.

‘This is terrible news for the region, as well for the wider prospects of new nuclear build in the UK,’ stated Mike Graham, national secretary for nuclear union Prospect. ‘It’s ironic that this government should move so fast to attack a measure so important to progressing Britain’s move to a low-carbon ecomomy.’

Unite, Britain’s biggest union, has called the move ‘a colossal error of judgement’.

Derek Simpson, Unite joint general secretary, said: ‘This is an appalling decision because it denies UK manufacturing the opportunity to become a supplier on a global scale. Every other country in Europe sees the value in supporting its industries and jobs.’

Business secretary Vince Cable confirmed that several key programmes supporting innovation and low carbon technology would go ahead.

These programmes include the £2.6m Bristol and Bath Science Park, £12m for the International Space Innovation Centre in Harwell, £75m for the Discovery Research Ship, £11.5m for the National Renewable Energy Centre (NaREC) Offshore Wind Blade Test Site in Blyth, £18.5m for the NaREC Offshore Wind Turbine Test Site, £12.4m for Offshore Wind Demonstration and Development and £30m for Offshore Wind, Mitsubishi Collaborative R&D.