Good news for UK nuclear industry as government lays out billions

The UK government will spend £14.2bn to build the twin-reactor Sizewell C nuclear power plant in Suffolk. It will become the majority shareholder, alongside utility EDF. The project was originally proposed as a sister to Hinkley Point C in Somerset, which is currently under construction. They share the reactor design (1,650 MWe EPR pressurised water reactor) and operator (EDF Energy). The Suffolk site is promised to power 6 million homes.

Pre-construction work has already begun; the government said that £330mn in contracts have been committed. In May, the site was awarded a nuclear site licence by the UK government regulator, the Office for Nuclear Regulation (ONR).  

Project company Sizewell C described the funding announcement as the government ‘giving the go-ahead’ for Sizewell C. The project has reportedly been delayed by attempts to find project investors.

Sizewell C also said that it will be the first nuclear power station in the UK that will be funded through a regulated asset base (RAB) model.  

Under the RAB model, the UK government would provide a plant owner with regulated rates that can be adjusted to guarantee its costs are covered, according to a World Nuclear Association dossier. The RAB model allows the owner of a regulated operation to collect an authorised return on the asset’s value that includes operating costs and profit. It protects the operator of a facility by ensuring that the operator has sufficient revenue to maintain its financial capability.

Julia Pyke and Nigel Cann, Joint-Managing Directors of Sizewell C, said: ‘Today marks the start of an exciting new chapter for Sizewell C, the UK’s first British-owned nuclear power plant in over 30 years. It’s a privilege to be leading a project that will create over 10,000 jobs, secure Britain’s energy future and revitalise the UK’s nuclear industry.’

Rolls-Royce SMR wins preferred bidder status

In related news, state-owned body Great British Nuclear has selected the indigenous Rolls-Royce small modular reactor (SMR) design as a preferred bidder, along with a pledge of £2.5bn for the overall SMR programme. The body aims to sign contracts later this year and form a development company. It plans to allocate a site in 2025 and connect projects to the grid in the mid-2030s. Final government approvals are also required to move forward.

The announcement concludes a two-year competitive bidding process to build three SMRs in the UK. Earlier this year, the government relaxed planning rules to enable nuclear plants to be built outside nuclear-licenced sites. SMRs are intended to be smaller and easier to build than traditional civil nuclear power plants, partly by making many components in factories and assembled on site.

The Rolls-Royce SMR is a 470 MWe pressurised water reactor. The design entered the third and final stage of mandatory assessment in July 2024. At that time, Rob Exley, ONR’s Head of Generic Design Assessment, said: ‘The Rolls-Royce SMR GDA [generic design assessment] is one of firsts. We are the first regulators to assess this reactor design, determining whether it meets our robust safety, security, safeguards and environmental protection standards in Great Britain.  

He added: ‘ONR is satisfied that Rolls-Royce SMR Ltd are progressing and as regulators, we can now continue into Step 3 assessing in more detail the evidence that supports the claims made about the design in the Step 2 submissions.’ ONR predicts that process will end in December 2026.  

Rolls-Royce SMR was chosen last year by Czech Republic utility CEZ to build up to 3 GW of SMR capacity in the country. The utility also took a stake in Rolls-Royce SMR, which World Nuclear News reported as 20%. (WNN reports the company’s other shareholders as BNF Resources, Constellation and Qatar Investment Authority.)

Rolls-Royce supplied the nuclear power plant of UK nuclear-powered submarines, and the Rolls-Royce SMR for civil use borrows design features from that more compact design.

The UK government also announced plans to invest £4bn in Plymouth naval base and £6bn for the UK submarine industrial base, including at BAE Systems in Barrow and Rolls-Royce Submarines in Derby, £250mn of initial funding for HMNB Clyde.

Ed Miliband, the Secretary of State for Energy Security and Net Zero, said: ‘We need new nuclear to deliver a golden age of clean energy abundance, because that is the only way to protect family finances, take back control of our energy, and tackle the climate crisis.’

Uranium supply chain investments needed

Meanwhile, according to the OECD’s Nuclear Energy Agency, sufficient uranium resources exist to support both the continued use of nuclear power and its significant growth through 2050 and beyond. However, the Uranium 2024: Resources, production and demand report finds that the establishment of new production centres is anticipated to face significant lead times due to today’s risk-averse investment climate and complex and lengthy regulatory processes in many uranium mining jurisdictions. Geopolitical challenges and technical difficulties may further compound the situation. As a result, efforts must begin immediately to ensure adequate uranium supplies are available in the medium term, says the report.