Nuclear Energy Policy: Climate Change

Katherine Fletcher Excerpts

Wednesday 5th February 2020 Commons Chamber

[Virginia Crosbie]

This reactor technology is proven and has already been delivered four times. I agree with the hon. Gentleman that this technology must be proven to be safe.

Secondly, nuclear power fits in with decarbonisation both here and in the world at large. Nuclear energy has been powering UK homes since 1956, doing the heavy lifting of decarbonisation long before global warming was near the political agenda. According to the “Digest of United Kingdom Energy Statistics 2019” published by the Department for Business, Energy and Industrial Strategy, nuclear power provides over 45% of our domestically generated clean power. Over the next decade, however, all but one of our current fleet is due to come offline. If that capacity is not replaced with nuclear, our emissions will go up.

Countries like Germany have tried to decarbonise by shutting down their nuclear power stations and opening open-cast lignite coal mines—the dirtiest form of coal possible—to keep the lights on when their wind and solar fleet is not generating enough electricity. Their long-term solution is to pipe in gas from Russia, but that is still a polluting fossil fuel. The Nord Stream 2 project risks Germany becoming too dependent on gas from Russia, at a time when the world’s political instabilities risk supply cut-off. This would not be an appropriate course of action for us to take.

If we were to exclude nuclear in the UK, we would need to install 478 GW of capacity, compared with between just 70 GW and 80 GW in a balanced mix. The Massachusetts Institute of Technology concluded in 2018 that not only is it more difficult to reach net zero without nuclear, but it is significantly more expensive.

Lastly, but most importantly, for my constituents of Ynys Môn the economic benefits are clear. As a Government, we promised our voters in areas such as mine that they would not be forgotten any longer.

[Katherine Fletcher (South Ribble) (Con)]

I wish to emphasise the point about economic benefits. An arc goes from Anglesey all the way up to Sellafield, with South Ribble and Mr Speaker’s own patch of Chorley very much at the heart of it. With the number of high-skilled, technical, brilliant engineers within that arc, it is not unusual for someone to live in Warrington and work in Anglesey one day, at Sellafield the next and at BAE Systems in Barrow the next. Does my hon. Friend agree that this proposal is economically vital for the north of Wales and the north-west of England?

[Virginia Crosbie]

I thank my hon. Friend for making that clear point about the nuclear arc and how this will benefit so many more people than just the people on Ynys Môn; it will benefit people throughout Wales. This nuclear arc is going to be very important.

--- Later in debate ---

[Nadhim Zahawi]

I am grateful to my hon. Friend for that question. I am happy to write back to him on how much of the benefit has gone to businesses in Northern Ireland.

A total of almost £4 billion in today’s money will go into the regional economy over the lifetime of the project, composed of about £1.5 billion during construction and about £2.4 billion during operations.

[Katherine Fletcher]

Does the Minister agree that we should not only seek to replicate established technologies, but use the new nuclear base-load as an opportunity to innovate and become a world leader in the sector?

[Nadhim Zahawi]

I am grateful to my hon. Friend for her intervention. She is absolutely right and I hope to address that point in a few moments.

EDF has informed us that Wales is already benefiting from work at the project; more than 1,000 Welsh residents have worked on it so far. Twenty-one apprentices who were previously employed at Wylfa are now working at Hinkley Point C, and more than 100 Welsh companies are working on the project, with contracts totalling more than £150 million going their way. The project is also sourcing more than 200,000 tonnes of Welsh steel from Express Reinforcements in Neath and large components from Vessco Engineering in Bridgend. I hope those examples go some way to showing that this Government recognise and value the highly skilled nuclear workforce and established supply chain that Wales offers.

I understand, however, that talking about successes in Somerset does not diminish the disappointment that north Wales felt upon hearing about the suspension of Wylfa Newydd nuclear power station. I reassure my hon. Friend the Member for Ynys Môn that we worked extremely hard during negotiations to find a deal that was right for everyone, with Government ready to contribute significant investment.

We were clear from the outset that any deal that was made would represent value for money, and be the right one for taxpayers and consumers. Ultimately, we were unable to reach such a deal and Hitachi took the commercial decision to suspend the project. However, the Wylfa site remains a potential location for new nuclear development, and Hitachi has stated that it is keen to discuss future options for the site with us, based on alternative funding models.

The Government are committed to looking at alternative funding models that could improve the value for money and reduce the cost of capital of new nuclear projects. As my hon. Friend the Member for Ynys Môn correctly noted, we recently consulted on a regulated asset base funding model as a potential new option that could attract private sector capital at a lower cost to consumers. The consultation closed on 14 October 2019, and we are currently considering the feedback to inform the best approach to the financing of future nuclear projects.

Ynys Môn will always be the energy island, and this Government are proud of the expertise and skills that north Wales brings to the UK’s civil nuclear sector. In September 2019, we published the Government response to the Welsh Affairs Committee’s report on the suspension of work on the Wylfa nuclear power station. We welcomed the report, and our response reiterated our recognition of Wales’s world-leading capability across the sector. I hope that we can continue to build on the great nuclear history that exists in north Wales.

In June 2018 we launched our landmark nuclear sector deal in Trawsfynydd. As my hon. Friend is aware, the nuclear sector deal comprises a package of measures to support the sector as we develop low-carbon nuclear power and continue to clean up our nuclear legacy. Worth £200 million, the deal is about Government and industry working in partnership to achieve significant cost reductions across the nuclear sector, and to ensure that it remains competitive with other low-carbon technologies.

The deal includes a number of commitments to ensure that the UK’s nuclear sector has a highly skilled and more diverse workforce. I recently signed the nuclear sector gender commitment as part of the Government’s commitment to the nuclear sector deal target of 40% women in nuclear by 2030—and I say that to someone who has clearly had a leadership position in Women2Win.

We believe that apprenticeships and higher education will be a key component in achieving this goal, and are working closely with industry and skills bodies through the Nuclear Skills Strategy Group to understand the skills requirements and potential challenges faced by the sector.

The Government also consider that new technologies, which my hon. Friend the Member for South Ribble mentioned, could play an important role in supporting our economy and allowing the UK to continue to be a world leader in tackling climate change. That is why our £200 million nuclear sector deal includes millions for advanced nuclear technologies. We believe that both small and advanced modular reactors have significant potential to support a secure, affordable decarbonised energy system, alongside other low-carbon generation. That is why we have awarded £18 million to the low-cost nuclear challenge proposed by a Rolls-Royce-led small modular reactor consortium. The challenge aims to design a working model that could be deployed as early as 2030. The consortium believes that a UK SMR programme can support up to 40,000 jobs at its peak, with each SMR capable of powering 750,000 homes.

To support advanced modular reactor development, we have committed up to £40 million to research and development through our AMR competition, the outcome of which will be announced shortly. Additionally, we have committed up to £26 million for an advanced manufacturing and materials competition and up to £12 million to build regulatory capability, which is also important, to take future licensing decisions on small and advanced modular reactors in a safe way.

I would like to thank my hon. Friend the Member for Ynys Môn once more for securing this important debate, and the Members who have made interventions. Nuclear can not only help us along the route to net zero by 2050, but is a key part of our economy. In 2018, there were around 89,000 people employed across the UK nuclear workforce and its supply chain. Our nuclear sector deal is looking to develop the skills that the sector needs and build a more diverse workforce. Hinkley Point C will kick-start new nuclear in the UK, providing firm base-load power and energy security for generations to come as we transition to a low-carbon economy. I look forward to working with all colleagues, and especially new ones, to ensure that we deliver for north Wales and support the energy island.

Question put and agreed to.