By Lynne Featherstone
I was impressed when Theresa May boldly announced her 'pause' on the Hinkley decision a few weeks ago. I hoped she would look again at the huge expense of this project, compare it to cheaper renewables, and decide to pull the plug. This is a risky and expensive venture that should not have been given the green light.
It beggars belief that after such a precarious few months, Hinkley has been given the go ahead. First there was the resignation of EDF's finance chief over Hinkley, then a National Audit Office report showed the cost to consumers rising from £6 billion to £30 billion, and then nearly half the EDF board members voted against the project.
Failing to pull the plug on Hinkley will prove a costly mistake. Not just the financial cost to consumers and the public purse, but the opportunity cost for renewables.
Had May decided to invest in green businesses to plug the seven per cent energy gap instead, she would have generated jobs and profits in British businesses that could also export to the world's rapidly expanding green markets. Not to mention the far longer life-span of renewables, and the avoidance of creating nuclear waste to bury in the ground for thousands of years.
The circumstances surrounding Hinkley have changed significantly since the initial plan. What Ed Davey agreed was a clear commitment that not a penny would be spent by the British government unless and until the energy was ready to be used. The costs of construction – and the financial risks associated with the project – would be entirely born by the French and Chinese investors.
But the government reneged on this commitment last year, when it agreed to a £2 billion loan guarantee to EDF and tied us in to subsidising the project even if it is never successfully built.
Whether it will actually be built is highly questionable. The technology has not yet been proven to work and EDF have failed to deliver similar projects in France and Finland, currently running years behind schedule and over budget. Hinkley may suffer the same fate.
And if it is built – by 2025 at the earliest – the alternative technologies available around then will make Hinkley seem old hat. Alongside this are security concerns of giving control of a critical asset to China and France.
So why has Theresa May given it the go-ahead? Well, Osborne's £2 billion loan guarantee has tied her hands. And the damage the government has done to green investor confidence is so deep that filling the energy gap by renewables would be too much hard work. Giving Hinkley the go ahead was the simplest option.
If the decision over Hinkley was genuinely a concern about keeping the lights on, May would be acting very differently. For a start, she would be taking immediate action to reduce energy usage through a large scale energy-saving programme to improve the efficiency of our leaky homes. She would not have pushed back awarding new renewable contracts to next year. And she would have given the go ahead to the Swansea Bay Tidal Lagoon, which will provide energy for 120 years.
With enough political will, our energy mix could look very different – it’s a question of choice. This highly expensive and environmentally un-friendly project should have been abandoned. We are on the cusp of an energy revolution – a greener, brighter future – and Hinkley will keep us chained to the past. The opportunity to pull the plug on Hinkley has been missed, and we will all pay for it from our pockets.
Lynne Featherstone is the Liberal Democrat spokesperson for Business, Energy & Industrial Strategy
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