On the day of a Backbench Business Committee debate on nuclear subsidy Mike Weatherley MP set out why he opposes further taxpayer support to this sector.
As a freemarketeer, I am highly skeptical of state subsidies.
As someone who has witnessed firsthand the long lasting devastation of nuclear accidents at Chernobyl (where signs of contamination remain to this day even in Cumbria from a disaster that struck 25 years ago and 1,200 miles away), I know that we must not pursue any new nuclear, let alone break our Coalition Agreement commitment not to subsidize it.
Today’s Backbench Business Committee debate highlights that negotiations are underway between DECC and new nuclear supplier EDF to guarantee a set price for nuclear energy (“the strike price”). This ‘subsidy by any other name’ shifts the notoriously high economic risk from nuclear corporations to the consumer and will be presented to Parliament as a non-reviewable contact that is likely to be binding for decades.
This outrageous deal, forged behind closed doors, directly contravenes our Coalition commitment and wholly pre-empts the current Energy Market Reform legislation and the proper democratic process of Parliamentary scrutiny.
Today’s backbench call is for pause while the Public Accounts Committee examines whether this deal would represent value for money – bearing in mind their findings last week detailing the huge decommissioning failures at Sellafield where the cleanup will take 120 years and cost £100bn – twice the original estimate and equivalent to our entire Health budget last year.
The prospect for new nuclear development is just as gloomy. The “EPR” design for Hinkley Point has been used before in France – where the construction cost has increased from €3.3bn to €8.5bn and is currently 5 years behind schedule – and in Finland – where construction has increased from €3.7bn to €8bn and is currently delayed by 6 years.
A good indicator of commercial viability is where the sectors’ insurers stand. A 2010 DECC working paper concedes that commercial insurance companies would not be willing to cover some of the Nuclear industries’ liabilities. Why then is the Government even considering these proposals?
Proponents of nuclear will say that the likelihood of accidents is low. But recent history has shown a relative frequency of severe accidents including: Windscale (UK) 1957; Kyshtym (Russia) 1957; Three Mile Island (USA) 1979; Chernobyl (Ukraine) 1986; Fukushima (Japan) 2011.
Margaret Thatcher was a key advocate of removing subsidies from “outdated industries whose markets were in terminal decline”. Today this ‘market of decline’ is the British nuclear power industry.
Another of my political heroes, Sir Keith Joseph, once said that market order “contains within it the source of constant improvement”. Any new subsidy to this mature market is an affront to this principle and will artificially retard the growth and innovation of the sector, in an age of new, green and renewable energy. On balance nuclear does not provide a cheaper energy option and its risks are unacceptable given the alternatives available for much less investment. I would urge caution in our blinkered commitment to nuclear power and fundamentally oppose any new subsidies being bankrolled by consumers to the sector.