Government ambition on nuclear energy must be translated into action by pushing ahead with Wylfa nuclear power station, MPs argue
3 May 2023
Concrete commitment by ministers on the future of nuclear energy, and in particular at Wylfa in North Wales, is lacking despite positive policy signals, the Welsh Affairs Committee argues today.
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- Inquiry: Nuclear energy in Wales
- Welsh Affairs Committee
In its report, Nuclear energy in Wales, MPs welcome the UK Government’s ambition that nuclear energy is to meet up to a quarter of UK electricity demand by 2050. Over the course of the Committee’s inquiry, both the Energy Minister and interim-Chair of Great British Nuclear referenced Wylfa as being an ideal site for a new nuclear power station. The Committee is of the view that new nuclear could be a game-changer for the north Wales economy.
Yet despite this, major obstacles remain before Wylfa could be home to a gigawatt-scale nuclear power station.
The limitations of finance models and failure to reach a financial agreement with the UK Government led to the Hitachi-led Wylfa Newydd project being suspended in 2019. The Contracts for Difference (CfD) scheme has previously been used to support nuclear energy projects. However, evidence to the Committee suggested that a regulated asset base (RAB) model could reduce the overall cost of a large-scale nuclear project by £30bn compared with CfD. The Committee heard that RAB is more attractive to investors, but the Committee is concerned that the model puts some liability back to the taxpayer and careful monitoring of the RAB model for Sizewell C is therefore crucial.
The issue of land ownership at Wylfa is a further barrier to progress which must be addressed. At present, Hitachi owns the site, and MPs call on the Government to encourage Hitachi to sell it or join other developers to enable future development to proceed.
If these key issues are resolved, we could see levelling-up, in a rural part of the UK, in action.
Evidence to the Committee stated that a new nuclear power station at Wylfa could support 10,000 jobs during the construction phase and 900 permanent jobs once the power station is operational. Many of these jobs would be highly-skilled and long-term, some of which would have benefited from experience working at UK nuclear sites Hinkley Point C and Sizewell C.
However, for this potential to be realised, the Committee is calling for further development of skills and supply chains. The Committee heard that there is a UK skills shortage which would not support more than one nuclear power station being under construction at any one time. Collaboration between the UK and Welsh Governments, and the sector, is needed to overcome this.
The Committee's report also considered small modular reactors (SMRs), but as these are still in the development phase, they should be pursued in tandem with gigawatt-scale reactors. There are opportunities to develop SMRs at Trawsfynydd, which could further benefit North Wales.
Welsh Affairs Committee Chair, Rt Hon Stephen Crabb MP, said:
“Over the last couple of decades Wylfa has been in a state of limbo. Local people have been enthusiastic about the potential investment to the area only to have been left disappointed when Hitachi pulled out of the Wylfa Newydd project.
“We cannot allow the same to happen again. Despite the positive policy changes and stronger rhetoric from ministers about nuclear, a new power station at Wylfa is still far from certain. Important obstacles remain on financing which is limiting private sector investment, and on the issue of land ownership which is preventing a new developer coming in. We must see concrete action on addressing these issues before the next general election, otherwise the uncertainty about the project will increase.
“A gigawatt-scale nuclear energy project at Wylfa would be a game-changer for the north Wales economy. The enormous investment would illustrate levelling-up in action, creating well-paid, high-skilled jobs, and we would be a step closer to energy independence. I urge ministers to finally give a nuclear energy project at Wylfa the green light.”
Image: Ian Cappla/Geograph