Westminster attitude to EC nuclear inquiry suggests wrongdoing, say SNP

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Wednesday, 09 April 2014 21:59

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  By Sean Martin
 
UK Government attempts to freeze Scotland out of a European Commission investigation into the funding of a new nuclear power plant proves it has something to hide, the SNP has said.
 
Westminster had moved to block Scottish Government Ministers from taking part in the EC inquiry into the UK Government’s plans to subsidise an EDF power station at Hinkley Point in Somerset.

Energy Minister Michael Fallon warned his Scottish Government counterpart, Fergus Ewing, that any Holyrood involvement in the investigation would be viewed as a ‘hostile act’.  First Minister Alex Salmond subsequently wrote to Prime Minister David Cameron requesting an explanation for the conduct of Westminster on the subject.

French energy company EDF would only agree to build the £16bn plant at Hinkley Point if a minimum price could be guaranteed for the electricity generated from it.  This kind of ‘strike price’ is generally covered through an increase in bills for consumers.

The UK Government argued that such a deal is needed in order to safeguard Britain’s energy supply and, as such, should not be considered a subsidy.  But the EC’s competition commissioner, Joaquin Almunia, compiled a 70-page report in January which suggested the strike price could give EDF excess profit and constitute illegal state aid under EU law.

The EC also warned that Hinkley Point will hit consumers the hardest.  It concluded that it ‘could hardly be argued to contribute to affordability’ and would ‘most likely contribute to an increase in retail prices’.  The power station is likely to cost customers around £1bn per year for the entirety of its 35-year contract.

The taxpayer subsidy that the new Hinkley Point nuclear power station could receive dwarfs the amount offered to renewables.  Hinkley Point could receive an estimated £35bn subsidy – over four times the cost of support to all renewable development across the UK over the last ten years.

Deputy convenor of the Economy, Energy and Tourism Committee, Dennis Robertson, condemned the actions of Westminster and contrasted the attitude of the UK Government to that of its Scottish counterparts, pointing out that there is significant support in Scotland for renewable energy investment.

“People will be wondering what it is Westminster has to hide on the issue – the attempts to silence Scotland show there must be concern that the EC will find against them,” said Mr Robertson, before adding: “A majority of people in Scotland support investment in renewable energy over nuclear power.”

Mr Robertson’s comments follow recent results of a YouGov poll which found almost twice as many Scots favoured large scale wind farms over nuclear projects in their local authority area.  In the same survey, 80% of respondents said they would be for a large scale hydro project in their area.

In response to the findings, chief executive of Scottish Renewables, Niall Stuart, said he considered it evidence that people who opposed wind and other sources of renewable energy are the minority.  He also said investing in renewables was simply playing to Scotland’s strengths and that it was delivering well in that respect.

“Renewables generated more than a third of the electricity used in Scotland last year, supports more than 11,000 jobs, and are helping to cut harmful carbon emissions,” said Mr Stuart.  “What other industry can help us tackle climate change while creating jobs and investment on the scale of our renewable energy industry?”

A report last month by Scottish and Southern Energy said that the UK Government’s deal for the construction of the two reactors at the Hinkley Point nuclear power station will see increased energy bills for the next 35 years.

According to the report: “the deal which the UK government has reached with EdF over the construction of two reactors at Hinkley Point, which will add considerable costs to consumer energy bills for 35 years.”

On 18 December 2013, the European Commission stated that new nuclear costs will likely push up consumer bills, stating Hinkley C, “could hardly be argued to contribute to affordability – at least at current prices, when it will instead and most likely contribute to an increase in retail prices.”