Question

To ask the Secretary of State for Energy and Climate Change, what the market rate for electricity was when the strike rate of £92.50/MWh for the proposed Hinkley Point C power station was agreed with EDF; and what the current market rate for electricity is.

The Strike Price for Hinkley Point C was agreed in October 2013. The monthly average of market prices in October 2013 was around £48/MWh. This is based on published indicators by the industry regulator Ofgem:

https://www.ofgem.gov.uk/monitoring-market/wholesale-market-indicators

Using the most recently published data from Ofgem, the monthly average of day-ahead prices between Jan and May 2015 ranged between approx. £40/MWh and £44/MWh.

Current wholesale market prices are an inadequate comparator for the costs of different electricity technologies in the future. The current wholesale price reflects an average of the short-term costs for existing generation already on the system, rather than the costs of future generation including investment costs.

Hinkley Point C is expected to be cost-competitive with other electricity technologies capable of delivering at scale in the 2020s. It will also pave the way for a new nuclear pathway to deliver secure and low-carbon, reliable baseload generation.