UK to invest 700 million pounds in new nuclear plant in PM Johnson's swansong

By Muvija M and Susanna Twidale

LONDON (Reuters) -Outgoing Prime Minister Boris Johnson said on Thursday that Britain will invest 700 million pounds ($809.13 million) in EDF’s planned Sizewell C nuclear plant, his last major policy move before stepping down from the role next week.

“In the course of the next few weeks, I am absolutely confident that it will get over the line. We will get it over the line because it will be absolute madness not to,” Johnson said, speaking at Sizewell in Suffolk, eastern England.

“Go nuclear and go large, go with Sizewell C.”

The investment in nuclear power comes as Britain strives to be more energy independent after a surge in oil and gas prices following the war in Ukraine has left millions of households facing fuel poverty this winter, and as the country aims to reach net zero emissions by 2050.

Britain still needs to attract private investors for Sizewell C. France’s EDF has said the plant could cost 20% less than the cost of its Hinkley Point C plant in Britain, which is currently budgeted at 25-26 billion pounds($29.90 billion-$30 billion).

Ramping up nuclear energy production would in the longer term reduce Britain’s reliance on natural gas, which made up around 45% of the country’s electricity production last year.

The promised funding for Sizewell would come out of 1.7 billion pounds pledged by the government last year to help a new large-scale nuclear project get off the ground.

However, it would be years before the plant is operational. The Hinkley Point C nuclear plant has faced repeated delays and billions of pounds in cost overruns.

The Hinkley plant is currently expected to start in 2027, a decade later than originally promised.

EDF has said Sizewell C would benefit from being “a near replica”

To attract private investors for Sizewell C, the UK government has launched a new funding model which it hopes will make the project more attractive.

Under the regulated-asset-base (RAB) model, companies building new plants would be paid during the construction phase, cutting down their development risk and allowing them to secure cheaper financing for the projects.

Critics of RAB say it will leave taxpayers liable for any cost over-runs and delays during construction.

Anti-nuclear Green group Greenpeace criticised the investment.

“This money could insulate huge numbers of draughty homes, and cut next year’s bills, instead of being thrown onto the slow-burning financial bonfire that is EDF, to increase our bills for decades,” said Greenpeace UK chief scientist Doug Parr.

($1 = 0.8650 pounds)

(Reporting by Susanna Twidale and Muvija M in London, editing by Susan Fenton)

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