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September 16, 2016

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UK gives go-ahead for nuclear power plant

BRITAIN yesterday gave the go-ahead for the Hinkley Point power station project, its first nuclear plant in a generation, but set conditions to address concerns about China’s role in the landmark European project.

China has a one-third stake in the project and analysts had warned that Britain, which needs to forge new trade deals after June’s vote to leave the EU, could have jeopardized relations with the world’s second-largest economy if it scrapped the deal.

The announcement, welcomed by French and Chinese backers, came two months after Prime Minister Theresa May ordered a review of the 18 billion pounds (US$24 billion) deal brokered under her predecessor, David Cameron.

Jean-Bernard Levy, chief executive of the French state-owned power company EDF, said the move “relaunches nuclear power in Europe.”

EDF’s board had already approved its participation in the project in southwest England in July when May’s government suddenly announced it was pausing it.

“We have decided to proceed with the first new nuclear power station for a generation,” Britain’s Business Secretary Greg Clark said in a statement, while pledging fresh measures “to enhance security.”

He told parliament that the plant’s construction would create 26,000 jobs and it would guarantee 7 percent of Britain’s electricity needs for 60 years.

It will be “a huge boost to the economy,” he said.

One of Downing Street’s prime concerns was over the security implications of allowing China to take such a large stake in a critical infrastructure project. But Clark’s ministry said the government was now taking steps to ensure it could intervene to stop any sale of EDF’s stake.

“The agreement in principle with EDF means that the government will be able to prevent the sale of EDF’s controlling stake prior to the completion of construction,” it said.

“Existing legal powers, and the new legal framework, will mean that the government is able to intervene in the sale of EDF’s stake once Hinkley is operational.”

Olivia Gippner, a fellow in EU-China relations at the London School of Economics said the framework was aimed at China but “by introducing a general national security test rather than focusing only on Chinese investment, this is a very diplomatic solution.”

Under the deal, the state-run China General Nuclear Corporation (CGN) is set to finance 6 billion pounds of the cost, with EDF providing the remainder.

“We are delighted that the British government has decided to proceed with the project. We will continue to work with our strategic partner French EDF to develop nuclear power projects at Hinkley Point, Sizewell and Bradwell, and provide safe, reliable and sustainable low-carbon energy for the UK,” CGN spokesman Huang Xiaofei said.

According to an agreement between CGN and EDF, the Bradwell project plans to use the Hualong One design, China’s third-generation nuclear reactor design, after the technology passes British regulatory inspections.

“Every step we make in the nuclear program in Britain will have an exemplary effect. Emerging markets will further cement their confidence in the Hualong One design,” Huang said.

French Prime Minister Manuel Valls hailed the deal as “excellent news.”

China’s stake in the deal was sealed last year on a state visit to Britain by Chinese President Xi Jinping.

Agreement was also reached at that stage on a partnership to develop nuclear power stations at Sizewell, on the eastern English coast in Suffolk, and at Bradwell in Essex, southeast England.


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