UK ousts China from new nuclear project Sizewell

Britain on Tuesday ousted China General Nuclear from construction of its new Sizewell C power station, further cutting controversial economic ties with the world’s second biggest economy.

The CGN announcement came one day after Prime Minister Rishi Sunak warned that the “golden era” of UK-China relations was “over”, adding Beijing posed a “systemic challenge” to UK interests and values.

Tuesday’s announcement comes also amid a diplomatic storm over the arrest and alleged assault of a BBC journalist covering Covid protests in China.

Sunak’s Conservative government is stripping CGN of its controversial 20-percent Sizewell stake under plans to form a joint venture with remaining French partner EDF.

The UK will invest £700 million ($843 million) in the project, a figure that was matched by EDF.

Sizewell C, which is under development on the Suffolk coast in eastern England, will power the equivalent of about six million homes for more than 50 years.

It is expected to start producing electricity from 2035.

– ‘Energy sovereignty’ –

Nuclear and renewables, such as offshore wind, are seen as critical to ramp up Britain’s energy security, after key producer Russia’s invasion of Ukraine sent household gas and electricity bills rocketing.

The Sizewell decision sparks questions about CGN’s role alongside EDF in the construction of Hinkley Point, southwestern England, in Britain’s first new nuclear power plant in more than two decades.

London last month ordered a Chinese-owned company to divest most of Britain’s biggest semiconductor maker — a leading UK industrial asset — after a national security probe. 

And in 2020, Chinese telecoms giant Huawei was banned from involvement in the roll-out of Britain’s superfast 5G broadband network, after US concerns about spying.

The UK’s “stake in Sizewell C is positioned at the heart of the new blueprint to Britain’s energy sovereignty“, the Department for Business, Energy and Industrial Strategy (BEIS) said in a statement on Tuesday.

The move “also allows for China General Nuclear’s exit from the project, including buy-out costs, any tax due and commercial arrangements”, it added. 

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The UK says Sizewell will deliver cleaner energy than fossil fuels and create 10,000 jobs for the local area and national economy.

Greenpeace UK policy director Doug Parr, however, slammed the nuclear push.

“Several academic institutes have shown we can have a 100-percent renewable system that would be cheaper than those based on nuclear or fossil fuels,” said Parr. 

“And it has the added benefit of not creating millennia of worry over the nuclear waste that future generations will end up dealing with.”

– UK support ‘essential’ –

The news comes as EDF power plants in France have been dogged by maintenance issues.

“The support of the UK government through its direct participation… is essential” to Sizewell, EDF Energy chief executive Simone Rossi told AFP in an interview.

“This decision is a sign of confidence in the nuclear industry — and in the French nuclear industry.”

Business and Energy Secretary Grant Shapps said Sizewell would move Britain “towards greater energy independence and away from the risks that a reliance on volatile global energy markets for our supply comes with”.

The UK has 15 nuclear reactors at eight sites but many are approaching the end of their lifespan.

Sizewell comprises two power plants: Sizewell A, which opened in the 1960s and shut in 2006. Sizewell B, which opened in 1995, is still in operation.

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Britain is turning to new plants also to help meet its long-running target of net zero carbon emissions by 2050.

The government on Tuesday added it would create Great British Nuclear, a body overseeing development of more projects.

Britain also launched an official campaign this week to encourage less energy use amid supply risks.

The government is partially subsidising household energy bills — which have pushed UK inflation to a 41-year peak — to cushion a cost-of-living crisis.