Lord Spellar
To ask His Majesty’s Government, following the announcement of a modular nuclear programme, what steps they are taking to ensure the manufacturing involved is undertaken in the United Kingdom.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
Following a report on procurement based on fairness and transparency, Great British Energy-Nuclear has selected Rolls-Royce SMR as its preferred bidder to partner with and deploy the UK’s first SMRs, subject to final government approvals and contract signature. The Government’s long-term ambition is to bring forward one of Europe’s first SMR fleets, with GB-Nuclear’s ambition being to deliver over 70% of UK contents—and this is not to mention the jobs already created under the nuclear skills plans. A policy framework is being drawn up to help get SMRs to market and will be published shortly.
Lord Spellar (Lab)
I thank the Minister for that reply but draw his attention to the statement put out by the Government on 15 September, Golden Age of Nuclear Delivers UK-US Deal on Energy Security. I tabled this Question because although the statement was most welcome, it had significant gaps. It highlighted the construction and operation jobs that will be created but was strangely silent on manufacturing sites and the wider supply chain, especially the government-owned Sheffield Forgemasters. What are Ministers doing to ensure that British firms and British workers continue to lead the world in this technology and play a key role in rebuilding our industrial economy?
Lord Wilson of Sedgefield (Lab)
I thank my noble friend for that very important question. Look at Sizewell C, for example, where over 1,500 apprenticeships will be created. Each SMR will have 3,000 jobs at peak construction and hundreds of operational jobs, as he pointed out. The nuclear skills plan has already generated 4,000 early career starts and the recent deal that he mentioned will positively impact the global nuclear industry, including the plan for 12 advanced modular nuclear reactors in Hartlepool, which will bring 2,500 jobs. The deal has the support of the UK industry. Not all of this will happen overnight, but we are setting the foundations for a golden era of nuclear.
The Earl of Kinnoull (CB)
My Lords, can the Minister update the House as to the efforts and timetable for removing Russia from the supply chain for nuclear fuel?
Lord Wilson of Sedgefield (Lab)
Under the agreement that we have just signed with the USA, that is going to happen as soon as possible, but no later than 2028.
Lord Howell of Guildford (Con)
Given that Hinkley, the French-designed nuclear project, has been billed as the most expensive the world has ever seen, and the plan is to repeat that in a replica at Sizewell, can the Minister tell us what thoughts the Government had on an alternative design at Sizewell of small reactors, which would be quicker to build, cheaper, attract more private investment and vastly reduce the demand on government funds?
Lord Wilson of Sedgefield (Lab)
The Sizewell C position is that it will create many jobs in construction and apprenticeships, and for the next 60 years will supply energy to around 6 million homes. It is absolutely right that the idea of the SMR programme is to create a modular reactor which is easy to assemble and duplicate and will keep down costs into the future. It is imperative that we keep ahead of the curve on this.
Earl Russell (LD)
My Lords, given that SMRs will not come online until the mid-2030s, I take this opportunity to ask the Minister what actions the Government are taking to ensure the demand for data centres does not end up with increased use of inefficient and polluting gas. What actions will the Government take to ensure that the energy demand does not end up increasing domestic energy bills?
Lord Wilson of Sedgefield (Lab)
The noble Earl asks an interesting question. We want to expedite the introduction of SMRs. If we can possibly bring them forward to 2030 then we will do that. The way to deal with this, to keep prices down, is to keep out of the market for fossil fuels and ensure that we have a variable field of renewable energy, be it solar, wind or nuclear. As I said, we are at the beginning of a golden age for nuclear energy. We will set the plans out now, so that in 10 years’ time we will feel the benefit.
Viscount Hanworth (Lab)
My Lords, in Britain we are persisting with the development of pressurised water reactors, both large and small. However, the future of nuclear technologies rests with fourth-generation advanced modular reactors that are endowed with passive safety, which will allow them to be close to clusters of population and industrial applications. In recent months, three projects that were pursuing the development of such reactors in the UK have either closed or moved to more welcoming countries. What can the Government do to ensure that we will not be dependent on foreign suppliers to provide the next generation of nuclear reactors?
Lord Wilson of Sedgefield (Lab)
As part of the initiative with the United States, we are looking at setting up 12 AMRs at Hartlepool, which will provide a lot of energy for the area for industry and around 3 million homes will benefit as well. It will create a lot of jobs in the area and bring great economic benefit to the region, into the millions of pounds.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, under the previous Government a commitment was made that 70% of the value of contracts for Sizewell C would go to UK companies, so the recent announcement about Urenco having the contract to supply Sizewell with nuclear fuel is welcome and a good start. I have two questions. How will the Government ensure that future nuclear fuels for the new industries are both produced and made competitive within the United Kingdom? Can the Minister assure the House that a similar 70% content commitment will be made in respect of not just the small modular reactors but the advanced technologies, in which we have a fighting chance still of leading the world?
Lord Wilson of Sedgefield (Lab)
I welcome the questions from the noble Baroness. To answer both, we still intend on making sure that we have 70% of content as far as the supply chain, for example, is concerned. Nuclear fuel is obviously an issue for the private sector and the developers there. As I said, we are not going to rely on Russian fuel after 2028.
Lord Tarassenko (CB)
The announcement that the SMR contract was to be awarded to Rolls-Royce was welcome, but the impact on UK manufacturing is also important. Have the Government made an assessment of how many suppliers in the supply chain are going to be first-tier companies supplying directly to Rolls-Royce, rather than simply second-tier companies?
Lord Wilson of Sedgefield (Lab)
I will write to the noble Lord on that question. As I said, we want to ensure that 70% of the supply chain is in the UK. We have designed the nuclear plan for skills, which is highly important. We have already 4,000 early career starts entering in 2024-25 and we want to ensure that we have the right skills set to do that. I will write to him on that issue. I will continue to say that we are at the beginning of a golden age for nuclear in this country and are putting down the foundations for that. We want to make sure that we fulfil what we are setting out to do in the years to come.
Lord Browne of Ladyton (Lab)
My Lords, wind turbines are modular—they are manufactured in factories and built on site—and modular reactors will be the same. We do not want to make the same mistake with modular reactors that was made over decades with wind turbines. There are 11,000 wind turbines on these islands, nearly 5,000 of them in Scotland. Not one of them was manufactured in Scotland and very few were manufactured elsewhere in the United Kingdom—I cannot find any evidence of any being manufactured here. These are key jobs. Are we going to build manufacturing plants—that is, factories—that will make the modular parts of these reactors? Is that the deal we made with the US?
Lord Wilson of Sedgefield (Lab)
The deal that we made with the US is to ensure that we have a global industry in nuclear energy. We are setting up the foundations in this country to ensure that we have the manufacturing jobs, skills set, supply chain and secure investment into the future so that we can benefit from it over the coming years.
Lord Harrington of Watford (Non-Afl)
My Lords, I declare my interest as chairman of Make UK, which has about 26,000 manufacturers as members, including most of those in the nuclear sector. In 2017, I was the nuclear Minister and made a big announcement that the Government were going to get involved in small nuclear reactors and were funding a competition to decide which company would do it. Now, nine years later, the Government have made another announcement that this is going to happen. Our members, naturally, are a bit cynical about when and how this is going to take place. Can the government side alleviate their fears and let them know when this is actually going to happen?
Lord Wilson of Sedgefield (Lab)
I thank the noble Lord for that question. It will take a Labour Government to ensure that it happens. We are nine years on from 2017 and we have made the commitment. We know what we are doing about this. We will ensure that we have a great future for our manufacturing sector and the people with the skills, and will promote the industry and the economic good for this country in the years to come.