The £25bn nuclear project could be delayed or even axed as the government tries to cut spending.
Image source, Kate Scotter/BBCA new nuclear power plant in Suffolk is under review and could be delayed or even axed, as the government tries to cut spending, the BBC has been told.
Sizewell C was expected to provide up to 7% of the UK’s total electricity needs, but critics have argued it will be expensive and take years to build.
A new high speed rail line in the north of England could also be axed.
“We are reviewing every major project – including Sizewell C,” a government official told the BBC.
The government is due to unveil its tax and spending plans under new Prime Minister Rishi Sunak at the Autumn Statement on 17 November.
Negotiations on raising funds for Sizewell C are understood to be ongoing. It is not expected to begin generating electricity until the 2030s.
A Treasury spokesperson said delivering infrastructure projects was “a priority”.
“HS2 is underway, within budget, and supporting 28,000 jobs, we are also seeking to approve at least one large-scale nuclear project in the next few years and aim to speed up the delivery of around 100 major infrastructure projects across the UK.”
But the new Business Secretary Grant Shapps gave the clearest indication yet that recent commitments by former Prime Minister Liz Truss were very likely to be scaled back.
Mrs Truss had pledged to build a major rail scheme in northern England in full, with a high speed link eventually connecting Northern towns and cities from Hull to Liverpool, through Bradford.
But the plans for the rail line – known as Northern Powerhouse Rail – are now expected to be reduced.
“There wasn’t really much point in going and blasting new tunnels through the Pennines… It’s not true to say we’re not delivering on what we said we would do on levelling up the north,” he told the BBC.
Henri Murison, chief executive of the Northern Powerhouse Partnership lobby group said scaling back the rail line raised “serious questions” about the government’s plans to boost growth.
“The North’s woeful transport infrastructure continues to weigh down our economy and hold back private investment.
“This option saves little to nothing to Treasury coffers now. Northern Powerhouse Rail is still in early development stage meaning that the vast majority of the investment needed is well beyond the current spending review period.”
Last month, Mrs Truss and France’s president Emmanuel Macron pledged “full support” for Sizewell C station on Suffolk’s coast, which is set to be developed by French energy company EDF.
The government gave the go-ahead for the plant in July. EDF has said it could generate enough for about six million homes.
But there was confusion on Thursday as executives at the French energy contractor EDF – already building a new plant at Hinkley in Somerset – and the Business and Energy department seemed blindsided by a potential change in tack on existing government policy, which promises to press ahead with both large and smaller scale nuclear projects.
“As far we know, it’s still on”, said one nuclear industry executive close to the matter.
New large-scale nuclear plants have been a key part of a government strategy to help reduce the UK’s reliance on fossil fuels. Boris Johnson whilst PM declared it was his intention to build eight new reactors in the next eight years.
A shift away from that position would represent a major change in UK energy policy that some will lament and some will celebrate.
But it would do little to convince investors in the UK – domestic and foreign – that they are dealing with a government with stable policy priorities.