Great British Nuclear

Dan Poulter Excerpts

Wednesday 28th June 2023 Westminster Hall

[Virginia Crosbie]

I thank the hon. Member for his intervention and for his kind words. He is a true champion for his constituency and certainly for the nuclear sector. I absolutely agree with him. We have to invest in this new technology, and the time is now. It is important for net zero and for all those fantastic jobs. We cannot achieve net zero without it; we need that energy security.

Nuclear’s record in local communities speaks for itself: it provides high-quality, long-term and skilled jobs that pay wages two or three times what people get outside the power station. My community and many others around the UK that have had nuclear power know that it delivers good-quality jobs and local investment—and they say they want more of it. That, as hon. Members may guess, is my particular interest in today’s debate.

We have made great progress on nuclear in recent years, introducing the new regulated asset-based funding model, investing in Sizewell C and putting money into the Rolls-Royce reactor design. We also had the Chancellor’s welcome announcement that we will green-label nuclear, crowned by the formation of Great British Nuclear. We even have, for the very first time, our very own Nuclear Minister.

I can attest to the wave of energy and optimism that GBN’s formation has given to the industry. The Minister will know that technology vendors and developers from all over the world have entered the small modular reactor down-selection process that GBN is running at the moment. Many have come to visit Wylfa in my constituency of Ynys Môn to see the best site in the UK for further nuclear development. The likes of GE Hitachi, Rolls-Royce and Last Energy have all toured the island.

Today, I want to focus on how GBN can convert reactor technology, sites and strong political support from the Government into new projects in constituencies such as Ynys Môn. I hope the Minister is listening carefully. If I start with the small modular reactor down-selection, we should expand the prize of winning. At the moment, that prize is co-funding to help to develop the winning technologies up to the point of a final investment decision.

That is a good start, but we can go further. The winner should get access to named sites that are suitable for building small modular reactors; access to a funding model, such as the regulated asset base model or contracts for difference, to help to raise money; and help from GBN to form the actual project companies that will develop, own and operate the nuclear power stations once they are built.

The first SMR being built in the western world, at Darlington in Ontario, Canada, followed exactly that model. About five years ago, Ontario Power Generation ran a selection process, as we are now, and at the start it was clear that whoever won the selection would build an SMR at the Darlington site and that Ontario Power Generation would develop, own and operate the site. The winners had a site, an order, and a project developer and operator. That is the model that we should follow, because that is how we give investors enough confidence to put their money into such projects.

I am delighted that the Energy Bill gives GBN the power to form subsidiaries and joint ventures with the private sector to do exactly that type of individual project development, and I want to hear how the Minister’s Department will support GBN in doing just that. More than that, I want to hear whether the Minister has thought about awarding sites and offering funding modes to the winners to accelerate the process of deployment and quicken investor interest in the UK.

If the Minister needs sites to offer, I have one in mind: the best site for new nuclear in the UK, Wylfa. Our need for new nuclear means that we have to build more large-scale nuclear as well as small-scale nuclear. Large-scale nuclear, which is often unfairly maligned, has actually had a banner year. All three major western designs—the EPR, the AP1000 and the APR-1400—have connected reactors and entered commercial operation. Coincidentally, I think that the owners of those designs have all expressed an interest in a Wylfa site. Will the Minister say what further thought has been given to other large-scale projects after Sizewell C to capitalise on that interest, and also set out his thinking on the circumstances under which we will pursue more large-scale nuclear in this country?

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

I congratulate my hon. Friend on securing this debate on a very important issue, which will hopefully help to secure Britain’s future energy security. One of the challenges with Sizewell C, which I think will be reflected across the country, is EDF’s failure to properly engage with many communities in Suffolk about their legitimate but easily accommodated concerns about the construction of the plant. What could the Minister do to ensure better engagement for future nuclear plants?

[Virginia Crosbie]

My hon. Friend makes an excellent point. One of the reasons why nuclear sites are successful is support from the local community. That is absolutely vital, as we see with development consent orders for planning. We have seen that with Wylfa, and we have certainly seen it with Hinkley. It is vital that companies engage with local residents.

The Minister will know that Hinkley Point C provides nearly 10,000 jobs on site and supports over 3,000 jobs throughout the construction period, with companies based in Wales, and that £815 million is expected to be spent throughout the Welsh supply chain during construction. There are 22,000 people working across the country, and more than £5 billion spent across the region. What a prize a large-scale project is for a local community. I ask that large-scale developments and SMRs be pursued with equal vigour.

I know, of course, that there is the issue of money. I am convinced that the private sector is willing and able to invest in nuclear if it knows that the UK Government are standing right behind it and the nuclear projects. The planning, regulation, site access and funding models on offer are all within the Minister’s gift, or the Government’s gift. I am sure that the Minister will understand why investors are keen to see Ministers stand by projects, as they have with Sizewell C. That is my request to the Minister: that GBN is able to offer the Sizewell C model —regulated asset base funding, a Government support package and a 20% direct Government stake in the project —to the next two projects that the Government target to get to FID, the final investment decision, in the next Parliament and to all future projects. That would certainly be a godsend to investors and give communities such as mine real hope that new projects will get off the ground.

I will end on this note. On the island, we have been talking actively about new nuclear at Wylfa for 15 years or more. It has not happened, and it has been difficult for the local community to deal with that disappointment and still put their confidence in nuclear as a way to create opportunities for young people on the island. But they still put their confidence in nuclear. They still want the projects, investment and jobs. They look to me, the Minister and his colleagues to get it done. I simply ask him to return the faith that they have put in us, and to help us to get new nuclear at Wylfa over the line. Diolch yn fawr.

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Andrew Bowie)]

It is an absolute pleasure to serve under your chairmanship, Sir George, and—my goodness me—to discuss nuclear with my hon. Friend the Member for Ynys Môn (Virginia Crosbie). The passion that she brings to this debate is unmatched. The term “champion” is bandied about a lot in this building, but she genuinely is one of the greatest champions for nuclear. Indeed, ever since she arrived here in late 2019, she has been an incredible champion in Parliament for her constituency and its interests.

My hon. Friend has an impressive track record of championing her constituency, as I have said, to remain at the heart of decisions on the future of nuclear power, the investment that it could bring and the jobs that it could create, both locally and across the United Kingdom. I will continue to encourage Government and Great British Nuclear to engage with communities such as hers that are considering whether their land might be suitable for the deployment of nuclear facilities in the near future.

The invasion of Ukraine and the subsequent rise in global energy prices have demonstrated the paramount importance of accelerating home-grown power and strengthening our national energy security. The hon. Member for Strangford (Jim Shannon) put that better than I ever could in his intervention. That is in addition to the significant contribution that nuclear could make to achieving our net zero objectives.

As part of our response, the Government have committed to ensuring that the UK is one of the best places in the world to invest in civil nuclear power, and are taking the necessary steps to revitalise the UK’s nuclear industry. Last year alone, the Government made an historic investment of £700 million and became a shareholder in the Sizewell C project, in support of our long-standing objective to take a large-scale nuclear project to the point of final investment decision in this Parliament, subject to all relevant approvals.

[Dr Poulter]

The Minister will also be aware that the Secretary of State overruled some of the concerns with the development control process that supported Sizewell C going ahead. Although most of us accept the importance of investment in projects such as Sizewell C, one of the main concerns was about the failure of EDF to engage with legitimate concerns across Suffolk and its communities about the construction process and the eventual building of Sizewell C. What reassurance can the Minister give to residents that lessons will be learned from that?

[Andrew Bowie]

Perhaps it will reassure my hon. Friend to know that I made it a priority to visit the Sizewell C site, not just to see the site and meet EDF and the Sizewell C company, but to hear from and engage with local communities, including those with concerns about the project, how the consultation exercise was run and the engagement with the companies involved. I look forward to continuing my engagement with those individuals and communities that are concerned about the project and the vast number of critical national infrastructure projects that will be built in and around the hon. Gentleman’s constituency. Those are critical pieces of national infrastructure, but in delivering this new investment into our grid and this incredible investment in Sizewell C, it is vital that we take communities with us and that they feel that they have had a say in the process of getting to the final decision on whether to proceed. I give my commitment, here today, that I will continue to meet the groups concerned and will do so right up to the point that there are spades in the ground at Sizewell. Indeed, whoever my successor is will do the same.

The British energy security strategy set out our ambition for deploying up to 24 GW of nuclear power by 2050, which would be 25% of our projected 2050 electricity demand. That includes two nuclear projects taking final investment decisions in the next Parliament. We also announced the creation of Great British Nuclear, which will be an arm’s length body responsible for driving delivery of new nuclear projects, backed with the funding that it needs.

GBN will be at the heart of a programmatic approach that will give industry and investors the confidence necessary to deliver projects at pace, reducing costs through learning and replication. Earlier this year, the “Powering up Britain” set out our plans for GBN to launch a competitive selection process for choosing the best small modular reactor technologies in the UK.

In April, GBN launched the first stage of this process in the form of a market engagement exercise. The second phase, the down selection process, will be launched over the summer, with an ambition to assess and decide on the leading technologies by autumn. The Government will provide co-funding to be deployed by GBN to support the development of those technologies and will work with successful bidders on ensuring that the right financing and site arrangements are in place, in line with the commitment to progress projects in the next Parliament. The total level of development funding will be subject to future spending reviews. I hear the suggestions from my hon. Friend the Member for Ynys Môn and will take them back to the GBN board.

GBN will work with the Government on access to potential sites for new nuclear projects to achieve our long-term ambition. This reflects our collective awareness of the growing local and regional interest in a number of sites for further nuclear development. We intend to publish consultation in 2023 as a first step towards the development of the new national policy statement for nuclear, to ensure our approach remains resilient to the needs of achieving net zero.

I assure my hon. Friend that community engagement will be central to the development of projects at each site. Developers will need to work with the host authorities and communities, statutory bodies and other key stakeholders to shape the proposals that will ultimately inform statutory consultation requirements and an application for a development consent order. Further engagement will also be undertaken as part of the wider regulatory processes to be completed prior to the construction and operation of a new power station.

The Government recognise the strong interest in and support for nuclear power across north Wales. The Government are also aware of the potential of the Wylfa site, which is included in the national policy statement for new nuclear power. Looking ahead, both Great British Nuclear and the national policy statement team would welcome any conversations with stakeholders who are considering whether their land might be suitable for the deployment of nuclear facilities in the future. GBN will, of course, support the Government’s consideration of further large gigawatt-scale projects to help us deliver on our net zero ambitions.

Our commitment to a nuclear programme and GBN will put the UK on a path to achieving its ambition and becoming a global leader in civil nuclear power and SMRs, which could include the creation of high-value jobs and the development of our capabilities. I would like to close by thanking my hon. Friend the Member for Ynys Môn for securing this important debate. I look forward to visiting Ynys Môn and continuing to engage with her and other stakeholders in the future.

Question put and agreed to.