England will keep the lights on with nuclear energy

A new generation of nuclear power stations will be built to prevent an energy crisis

The award for decisiveness in energy policy this month goes to Ed Miliband, Energy & Climate Change Secretary (right) in the U.K. government who has committed the nation to “significant infrastructure construction” in the next decade.

Miliband told the daily Telegraph Nov 7 Britain will face a serious energy crisis unless plans to build new nuclear power plants are sped up. The government warned that endless delays will have only one result – lights out. He told the newspaper, “”saying no to nuclear is no longer an option.

“We have go to say yes to nuclear energy. It isn’t just the green thing, it is the right thing by way of energy security.”

Miliband also targeted the expected backlash from anti-nuclear groups. He said, “We can’t have endless delay.”

The reason for Miliband’s move is that natural gas fields in the North Sea are running out and so-called clean coal technologies are not available at a commercial scale. He wants the first nuclear power station, at Hinkley, Somerset, 40 miles southwest of Bristol, to be in revenue service by 2017. He wants eight under construction by 2015 Otherwise, he says, the U.K. could experience blackouts on a major scale.

The government has selected a list of sites which include some that already have nuclear reactors. The sites include two at Sellafield, Wylfa, and Dungeness.

Private sector wants floor price on carbon

The government will rely on the private sector to build the plants, but that’s where controversy broke out. At the same time Miliband was making a historic speech in support of nuclear energy, the Times of London reported that carbon cap-and-trade prices could push up family energy bills on average of {L}227 or $377 a year.

Green groups fastened on the claim by EDF Energy CEO Humphrey Cadoux-Hudson (left) that the price of carbon would have to rise to {L}25-35/ton as a floor price to push energy investments to nuclear energy. He reportedly said that the current price of carbon permits is too low.

“The waste product of fossil fuel generation needs to have a cost.”

If there is a loose spike in the tracks to derail Miliband’s plan for more nuclear energy, it is a public perception that the government will subsidize construction of new nuclear plants with increased prices for carbon permits. Taxpayer groups reacted to Hudson’s comments saying that EDF was trying to hold the government hostage.

Green groups went much further in their condemnation of EDF’s position. Ben Ayliffe, (right) a spokesman for Greenpeace, told the Times,

“They [EDF] has them by the short hairs. Even with the full resources of the French government behind them, it seems they cannot make the economics of new nuclear stack up.”

Government spokesmen responded that there are no plans to provide any subsidies and that private industry must provide the financing for new nuclear reactors. The spokesman told the Times,

“The government has no current plans to introduce a floor price for carbon. All our efforts are towards an ambitious deal at Copenhagen.”

What Miliband and the U.K. government know is that while nuclear reactors are expensive to build, once operating they are huge profit centers. They are banking, literally, on the fact that EDF and other firms planning to build reactors in the U.K. are focused on the profit potential as well.

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