EXCLUSIVE: State-owned Russian nuclear corporation says the industry’s credibility is at risk if building the new UK power plant is delayed or runs over budget.
LONDON, 19 September, 2016 – A major nuclear developer has warned the French energy giant EDF that it must deliver the Hinkley Point project in the UK on time and on budget or risk damaging the credibility of the wider industry.
In an exclusive interview with Climate News Network, Kirill Komarov, first deputy chief executive of Russian state-owned corporation Rosatom, expressed fears that problems at other EDF schemes − such as Flamanville in France and Olkiluoto in Finland − could be repeated.
Rosatom believes the decision by the UK prime minister, Theresa May, to give the go-ahead to the first new nuclear reactors in Britain for over 20 years was a major step forward, but knows that the eyes of the world will now be on a good performance at the Hinkley power plant in southwest England.
Commitment to nuclear
Komarov said: “It’s a good signal that the government confirmed its commitment to nuclear. At the same time, record-high cost and the risks of possible delays and cost overruns might undermine the reputation of the sector.”
The Russian group, which is constructing nuclear reactors in China, India and the Middle East, believes its own prices are up to 30% lower than EDF’s.
Rosatom accepts that strained political relations between Russia and the West make it difficult for Rosatom to offer to build in the UK.
But it points out that it is already providing fuel for UK reactors, including the EDF-owned one at Sizewell in eastern England, plus others in the US.
Komarov said: “Twenty per cent of all enriched uranium in the US comes from Russia, and this has continued to be supplied through the good and bad times of political relations with the West.”
The UK government gave the green light to EDF last Thursday after subjecting the £18.5 billion (US$24bn) project to a review called for by Theresa May after she was appointed prime minister in July.
“Building a first of a kind is always more risky,
as we have seen with Flamanville and Olkiluoto”
There has been speculation that the UK’s new Conservative administration might insist on renegotiating the subsidy arrangement, which guarantees EDF £92 (US$120) per megawatt hour – double the current wholesale cost – for the power from the two new reactors over 35 years.
Rosatom said it has done a deal with the Turkish government under which it would provide power from new reactors there for around a third lower. That arrangement was only for half the power, and the subsidy was guaranteed for only 15 years.
The Russian company claims to have a $110bn (£84bn) order book stretching out over the next 10 years. Thirty-six of them are on foreign soil, and Rosatom is confident it can bring the order book up to $130-$140bn (£100-107bn) by the end of this year.
Countries want to construct nuclear power plants for their low-carbon, high-volume capability − if they can be built on time and on budget.
“Building a first of a kind is always more risky, as we have seen with Flamanville and Olkiluoto,” Komarov said. “We had some problems of our own with new designs in China and India. You need to repeat the same design again and again, and that is what we can now do.”
Rosatom believes the UK should be wary of the potential delays attached to the new European Pressurised Reactor (EPR) designs that are being trialled at Olkiluoto, Flamanville and soon at Hinkley.
The company also reckons that the 1600 megawatt capacities of EPRs may be too large for the needs of the modern world. It believes its own VVER-designed 1000-1200 MW reactors are more suitable, especially in developed countries where power demand is unlikely to grow too much, because of energy efficiency and demand reduction policies.
Rosatom is clearly keen to sell its reactors in the UK, which has relatively tight regulations and is seen by EDF and others as a good shop window for the world.
But Komarov is coy. He says: “Would we build in the UK? We have a lot of opportunities in all parts of the world. We have a lot of work. If a country invites us we would need to assess it.” – Climate News Network