New Nuclear Power

Caroline Flint Excerpts

Thursday 7th February 2013 Commons Chamber

[Caroline Flint (Don Valley) (Lab)]

I congratulate hon. Members on securing this debate. Even if we hold different views, it is important that we find time to debate the role of nuclear power in our energy mix. I think we have heard nine speeches in this short debate so far, and all of them, in their different ways, were reasonable contributions.

At the outset, I will make my position clear: we strongly support and are absolutely committed to new nuclear build in Britain. In our view, the challenge of climate change is so great that there will be a role for new nuclear power in our energy supply in the future, alongside an expansion of renewable energy and, we hope, investment in carbon capture and storage. Let me set out why we support nuclear power, what assurances we are seeking from the Government and the nuclear industry for future nuclear build, and why we will not be supporting the motion before us.

I have always been clear that an effective energy policy must meet three criteria: it must be secure, it must be low-carbon and consistent with our climate change obligations, and it must be affordable. Let me start with security. Today, nuclear power accounts for about one sixth of the electricity we generate. In the next 20 years, however, all Britain’s remaining nuclear power stations are scheduled to close. Of course we support energy efficiency measures to reduce demand, and we look forward to the Government bringing forward proposals in the Energy Bill. However, even if demand does not increase, which seems unlikely, we will still need new electricity generation to replace power plants as they close.

Unless we replace Britain’s nuclear power stations as they come offline, we will leave a significant gap in our electricity generation capacity. As for what we replace them with, my view is that the best way to secure our energy supply is to encourage a diversified mix of generating technologies. A diverse energy supply makes the system more resilient and reduces the risk of interruptions or sudden, large spikes in electricity prices. Not allowing energy companies to invest in new nuclear power stations would increase our dependence on fewer technologies and expose the UK’s energy supply to risk.

Clearly a secure energy supply must also be safe. Every Government have the responsibility to remain vigilant and ensure that our regulatory regime in the nuclear industry is robust. Although there is no room for complacency, I draw the House’s attention to the Weightman report, which was published after the Fukushima disaster in Japan. Dr Weightman was tasked with investigating the implications for nuclear safety in the UK. He found no fundamental weaknesses in the current licensing regime or safety principle, and concluded that there were no grounds to restrict UK nuclear reactors or stop building new ones. On that basis, we believe that investing in nuclear power supports the security of our energy supply.

[Paul Flynn]

Does my right hon. Friend recall that Dr Weightman was expressly forbidden from considering the costs of Fukushima, which—it is quoted—could have been an extra £2 billion for one new reactor? Today’s debate has been about costs. Surely we cannot rely on Weightman for that.

[Caroline Flint]

I was talking about safety, but I will come to costs later. It was absolutely right for the Government to commission that report. Regardless of that report, however, I believe we should always be vigilant and not complacent. I feel assured that we in the UK can be justly proud of the regulatory system, the way it operates and our safety record.

Let me turn to our climate change obligation. Based on the significant evidence available, the life-cycle carbon emissions from nuclear power stations are significantly lower than for fossil-fuel generation and about the same as for electricity generated from wind. Investing in new nuclear is therefore consistent with decarbonising the power sector by 2030 and reducing our carbon emissions by 80% by 2050. No one would pretend that new nuclear alone can solve climate change; equally, no one should deny that new nuclear power stations could make a significant contribution to tackling it. By way of illustration, if our existing nuclear power stations were all replaced with fossil fuel-fired powered stations, our emissions would be anywhere between 8 million and 16 million tonnes of carbon a year higher as result. As I have said, investing in new nuclear should come not at the expense of demand reduction or investment in other clean energy, but alongside it.

Let me turn to affordability. There has been much speculation about the strike price that the Government will agree for new nuclear developments. Obviously I am not privy to the Government’s negotiations, which are ongoing. Estimates of the future costs of generation from technology are often uncertain and vary widely. However, according to the most up-to-date research commissioned by the Government, when we take into account the lifetime levelised costs of the various sources of energy and the up-front capital, fuel, maintenance, decommissioning and waste costs, the latest estimate still has nuclear as the cheapest of the various clean technologies. At a time when energy bills stand at a record high of more than £1,400, we must secure and decarbonise our power supply in the most cost-effective way possible. On the basis of the information we have today, I do not see how we can do that without investing in new nuclear.

Having set out in broad terms why we support new nuclear, let me say a word about what, in return for that investment, we should expect of the nuclear industry and ask of Government. First, new nuclear build has the potential to contribute to economic growth and job creation—a point eloquently expressed by my hon. Friend the Member for Hartlepool (Mr Wright)—but developers have a responsibility to support young people into work and provide them with the skills and training that will allow them to progress in a career in the nuclear industry. Secondly, I can assure the House that we take the issue of waste seriously and understand that the public are rightly concerned about it. As we established in the Energy Act 2008, and in the light of the Public Accounts Committee report on Sellafield, which was published on Monday, operators of new nuclear power stations must meet the full costs of decommissioning and their full share of waste management costs, not leave taxpayers to foot the bill.

Thirdly—and perhaps most topically, given that the Energy Bill is being debated in Committee as we speak—the process for agreeing contracts for difference for new nuclear must be robust and transparent and deliver value for money for consumers. We support new nuclear power, but it is for energy companies, not the Government, to fund, develop and build new nuclear power stations. The development of new nuclear capacity must happen without Government subsidy. Having looked carefully at the proposals for contracts for difference in the Energy Bill—which do not involve any direct transfer of Government money to nuclear generators or provide nuclear power with any support that is not also available to other forms of clean energy—I am satisfied that that is the case. Also, in the event of the market price being higher than the price that nuclear generators have agreed with the Government, generators must pay back the difference.

However, there is a role for the Government in ensuring that we as a country attract the investment we need to keep the lights on, cut our carbon emissions and keep the cost of electricity as low as possible. That means that safeguards must be put in place to ensure that bill payers—who will ultimately be funding this investment—get value for money. I do not think the proposal in today’s motion is the best way of achieving that; however, I do think there are issues that Ministers should address before the Energy Bill returns to the Chamber on Report. From the exchanges at Energy and Climate Change questions last week and from the points my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) has made in Committee, the Secretary of State knows what improvements Labour would like to see.

We would like the investment contracts that are agreed to be laid before Parliament within three days of being entered into. We would like provisions to ensure that any change to investment contracts are published and subject to proper scrutiny. We would also like greater protection to ensure that if construction costs are lower than those projected, a compensatory mechanism will ensure that the strike price reflects a fair return to the company, but also a fair deal for bill payers. I think those are all fair points. From what the chief executive of EDF said when he appeared before the Energy Bill Committee, I think he regards them as legitimate concerns too. With an eye to what we might inherit in 2015, I hope the Secretary of State will consider those ideas and amendments in the constructive spirit in which they are made.

In summary, we recognise that new nuclear power cannot be a one-way thing, where energy companies get the necessary planning permission and price agreement from the Government without offering something in return that benefits the local community where the plant is built, as well as the wider economy. However, I am pleased to have the opportunity today to reaffirm the position of Her Majesty’s Opposition and put it firmly on the record that we believe that nuclear power will have an important role to play as part of a more balanced, secure and low-carbon energy supply for the future.