Hitachi Scraps UK Nuclear Project

Japanese Hitachi said January 17 it has stopped work on the nuclear plant it planned at Wylfa,"from the viewpoint of its economic rationality as a private enterprise." Hitachi said the decision would cost it an estimated yen 300bn ($2.8bn) in expenses, plus the same again as "extraordinary losses," according to the BBC.

The UK Department for Business, Energy and Industrial Strategy said that any deal had to "represent value for money and be the right one for UK consumers and taxpayers. Despite extensive negotiations and hard work by all sides, the government and Hitachi are unable to reach agreement to proceed at this stage."

However, that does not mean the government is not committed to the nuclear sector, which it sees as an important part of the mix in order to achieve a low-carbon economy. It reminded its readers that it had given the go-ahead to the first new nuclear power station in a generation at Hinkley Point C and invested £200mn ($258mn) in a new sector deal, which includes millions for advanced nuclear technologies. It said: "We are also reviewing alternative funding models for future nuclear projects and will update on these findings in summer 2019."  

The Hinkley Point C approval came in September 2016 after a long pause as the new Conservative government weighed up the pros and cons over the previous summer. However despite the very high guaranteed price for the plant's output, which consumers will have to pay, the deal went ahead with the price unchanged.

The UK's biggest union Unite said that Hitachi's decision was "just the latest chapter" in the "sorry saga" of UK energy policy. Previous chapters it cited include the withdrawal of Toshiba from the Moorside nuclear power station project in Cumbria in November; the controversy over the financing of the Hinkley Point nuclear in Somerset being built by French company EDF, with a stake from Chinese state-owned investor CGN; security concerns over future Chinese involvement in the UK nuclear programme; and the reluctance of the government to commit to large-scale funding of infrastructure projects.