MPs call on government to accelerate Welsh nuclear plant project

The Welsh Affairs Committee has warned that “major obstacles remain” before Wylfa could be home to a gigawatt-scale nuclear power station.

The site was already home to a nuclear power station that operated for over 40 years until decommissioning began in 2015. A second plant has been proposed as part of plans to help the government’s ambition for the UK to meet up to a quarter of its electricity needs with nuclear energy by 2050.

But the limitations of finance models and failure to reach a financial agreement with the government resulted in the Hitachi-led Wylfa Newydd project being suspended in 2019.

The Contracts for Difference (CfD) scheme has previously been used to support nuclear energy projects such as Hinkley Point C, which is under construction but has faced repeated delays and budget increases.

The Committee suggested that a regulated asset base (RAB) model could reduce the overall cost of a large-scale nuclear project by £30bn compared with CfD. It also said that RAB is more attractive to investors, but expressed concerns that the model puts some liability back to the taxpayer.

The issue of land ownership at Wylfa is also hampering progress towards a new project as Hitachi currently owns the site. The Committee called on the government to encourage Hitachi to sell it or join other developers to enable future development to proceed.

Evidence to the Committee stated that a new nuclear power station at Wylfa could support 10,000 jobs during the construction phase and 900 permanent jobs once the power station is operational. Many of these jobs would be highly skilled and long-term, some of which would have benefited from experience working at UK nuclear sites Hinkley Point C and Sizewell C.

But the Committee said that more resources need to be allocated to developing the UK’s skills and supply chain as there is currently a skills shortage, which would not support more than one nuclear power station being under construction at any one time.

Stephen Crabb MP, the Committee’s chair, said: “Over the last couple of decades Wylfa has been in a state of limbo. Local people have been enthusiastic about the potential investment to the area only to have been left disappointed when Hitachi pulled out of the Wylfa Newydd project.

“We cannot allow the same to happen again. Despite the positive policy changes and stronger rhetoric from ministers about nuclear, a new power station at Wylfa is still far from certain. Important obstacles remain on financing, which is limiting private sector investment, and on the issue of land ownership, which is preventing a new developer coming in. We must see concrete action on addressing these issues before the next general election, otherwise the uncertainty about the project will increase.

“A gigawatt-scale nuclear energy project at Wylfa would be a game-changer for the north Wales economy. The enormous investment would illustrate levelling-up in action, creating well-paid, high-skilled jobs, and we would be a step closer to energy independence. I urge ministers to finally give a nuclear energy project at Wylfa the green light.”