Small Modular Reactors

Drew Hendry Excerpts

Wednesday 20th February 2019 Westminster Hall

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Thank you for calling me to speak, Mr Paisley; I believe that this is the first time that I have served under your chairmanship.

I congratulate the hon. Member for Copeland (Trudy Harrison) on securing this debate. Normally, I would look around Westminster Hall and see all these friendly faces and think, “Great, it’s going to be a very consensual debate,” but a debate needs a dissenting voice and this afternoon’s debate will certainly hear one from me. Before I do that, however, I congratulate right hon. and hon. Members on the passionate case that they have made. I have been looking for words and points that I can agree with, and I do agree about the need to tackle the trilemma, particularly the issue of climate change and affordability. However, I cannot say that new nuclear is the way to do that and the small modular reactor development is not going to change that.

There has been a common theme among some hon. Members today that renewable energy is not reliable. In October last year, 98% of Scotland’s electricity was generated by wind power and we are on track to produce all of our electricity from renewables by 2020. That is possible through the Scottish National party’s environmental policy support.

The hon. Member for Strangford (Jim Shannon) has always been a passionate champion of nuclear; I understand that although, again, I cannot agree. The right hon. Member for Scarborough and Whitby (Mr Goodwill) said that the safest and greenest power is nuclear. Actually, the safest and greenest power is renewables. There is no half-life and nothing to clean up. If he wants to come up and speak to some of the people who saw the clean-up at Dounreay to hear about the eye-watering cost and the danger to the public from that British nuclear project, he is welcome to do so. The fact that he once purchased a Lada car tells us everything about his choices. I will leave it at that.

The hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts) talked about generational depopulation. I absolutely agree that that must be tackled and there must be ways to do that, but nuclear does not fix it. We need a challenge on well-paid work.

[Albert Owen]

I echo the point made by the hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts). In peripheral areas, the nuclear industry has been a saviour in many ways. It ensures longevity and skills. People who left school at the same time as me are still working in it. The hon. Lady highlighted that. We want renewables and nuclear, not either/or.

[Drew Hendry]

I understand that. The one thing I was agreeing with is that there must be more solutions on offer. There must be a mix, but I respectfully disagree about nuclear. I was going to highlight the hon. Gentleman’s support for renewable projects, which a couple of people have mentioned.

I will not use my time to go through every Member’s speech, but the hon. Member for Barrow and Furness (John Woodcock) made a powerful case. He incidentally made the Minister something of a deity and said that he was doing the Lord’s work. I am not sure which Lord, but we will come back to that.

The hon. Member for Stroud (Dr Drew) talked about the SMR competition. A warning about competitions from the UK Government can be found in Peterhead, where the carbon capture and storage competition was launched, and £100 million was spent before the £1 billion—[Interruption.] The Minister is trying to wave me away from that bit. The people of Peterhead will not forget the UK Government’s betrayal and the cancellation of that carbon capture project, which could have given the UK a five-year lead on carbon capture and storage. That is all gone.

[Trudy Harrison]

Will the hon. Gentleman give way?

[Drew Hendry]

I will not give way, because the other Front Benchers have to get in and I have to restrict my comments.

The first SMR is not due for 10 years. The costs are uncertain. There will probably be limited access to sites, planning delays and rising costs. The UK Government have pursued costly, dangerous nuclear energy over cheap renewables out of misplaced ideology. We have heard about the delays at Wylfa and the collapse of Woodside. That is the pursuit of ideology over pragmatism, and it does not work. The Government are letting people down.

The UK Government are already spending vast amounts on nuclear schemes about which there are safety concerns. They were about to lend £15 billion to Hitachi in Wales for Wylfa before the project collapsed because even that was not enough money. At Hinkley Point C, there is a £30 billion cost to the public sector. The Minister will argue that that is not the case, but the strike price amounts to what the public will be paying over that period to cover the cost of delays, complications, overspends and up-front costs. That is from the National Audit Office, not from me.

[Ian Paisley (in the Chair)]

Will the Member draw his remarks to a conclusion?

[Drew Hendry]

The fact is that there is a very good future in renewable energy. If the Government set down their ideological opposition, particularly to wind and solar, they would be able to do a lot better in providing the mix that is required.

--- Later in debate ---

[Richard Harrington]

I very much regret that I do not have time to go through all the points raised by hon. Members. I am happy to go through them later with any of those Members, except of course the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry)—for the sake of Hansard, I am joking. I congratulate my hon. Friend the Member for Copeland (Trudy Harrison) on securing this excellent debate. The term “Trudy-isation” is beginning to enter our parliamentary language, and she has Trudy-ised the whole debate on small modular reactors.

The development of small modular reactors is very much at the core—excuse the pun—of the Government’s strategy for the development of nuclear power, which we know is an important part of the mix. I would like to answer in detail the shadow Minister’s questions about money, but I do not have the time. Suffice it to say that we are considering a consortium bid. Rolls-Royce is at the centre of that, but many other companies are involved. I obviously cannot go into detail, but this is of the magnitude of money that the shadow Minister mentioned, and it is very close to fruition. We worked closely with all members of the consortium to develop it.

The good thing about this debate is that every Member bar one was very much in favour of the development of nuclear energy, our sector deal and everything we are trying to do to make sure that nuclear remains an important part of our mix, for several reasons. There are security reasons. The point was made about the excellence of offshore and onshore wind and all sorts of wind, but the wind does not blow all the time. There is the green energy point of view, because this will develop a significant amount of carbon-free power. My right hon. Friend the Member for Scarborough and Whitby (Mr Goodwill) quoted President Putin, who made the point that countries that have tried basically to have no nuclear or coal energy do not know what to do. We will not put ourselves in that position. Modular reactors are an important part of our future.

Times are changing and costs are going down. The shadow Minister made the point that we have to be very careful about the costs of small modular reactors. Those are very well known, which means that we have to look at scale. Building one was the original problem, particularly for the two sites at Moorside, which were mentioned by my hon. Friends the Members for Carlisle (John Stevenson) and for Copeland. The hon. Member for Ynys Môn (Albert Owen) spoke so well about Anglesey. The hon. Lady who is the spokesperson for Plaid Cymru—

[Drew Hendry]

The Westminster leader.

[Richard Harrington]

And she is the Westminster leader. I beg the pardon of the hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), but I was trying to avoid making a mess of her constituency name, which I have done before—I will not fall for that one again. I will, however, have a good go at saying Trawsfynydd, because I have been there. It is an excellent site for small modular reactors, as are Anglesey, Moorside and many others. The good thing about them is the support of the local community for nuclear, because many have seen the benefits that nuclear has brought in the past, such as prosperity and good-quality, highly paid employment.

In the time that I have left—I believe that my hon. Friend the Member for Copeland should be left a couple of minutes at the end—I will talk briefly about the financing models. Clearly, one of the big problems about nuclear generally has been financing. Everyone knows that, and that the large chunk for current nuclear power stations is about £15 billion-plus, and could be £20 billion. That is a significant sum of money. The two projects we have talked about—Moorside and Wylfa in Anglesey—are not to take place in the timescale we had hoped for because of the financing.

However, I believe that the efforts we are putting into the regulated asset base model will open up nuclear again—a modern way to fund it. Institutions are very interested. On the small modular reactor side, my Department organised a very successful conference for the first time—in a high-tech area of the midlands, rather than one of the traditional sites—and quite a few financial institutions attended. We are in talks with the Treasury and inside the Department about developing that finance model. Logically, I believe it will work for smaller nuclear developments as well as large ones, because institutions obviously like to invest in smaller chunks.

The Government are very committed. We are helping small modular reactors. Apart from dealing with the consortium that I mentioned, we are providing funds to give the regulators the kinds of facilities necessary for the regulatory process. Quite a lot is going on, and I had wanted to speak for about 20 minutes on this subject. Earlier I was waving my hands at the hon. Member for Inverness, Nairn, Badenoch and Strathspey not out of disrespect for him personally or because of anything he said, but because I wanted more time to go through my speech. However, I have galloped through the major points. I would just like formally to put on the record that the Government’s policy is firmly behind nuclear and very much behind—