Chinese firm with military ties invited to bid for role in UK’s nuclear future

By 

This piece was published by The Guardian

 

inside Hinkley

 

China National Nuclear Corporation on government list of preferred bidders for development funding for next-generation modular reactors

 

Tom Burke, chairman of the environment thinktank E3G and a former British government adviser, said there were legitimate concerns over the company. “I don’t fuss very much about the Chinese owning a nuclear power station [China General Nuclear in the case of Hinkley]. But I would be much more concerned about bringing in CNNC because they are known to be much more closely involved with the military and Chinese nuclear weapons programmes,” he said.

CNNC was not involved in the original Hinkley deal but it was reported on Sunday that the company has agreed in principle to buy half of China’s 33% stake in the £24bn project if it goes ahead.

 

See full article here

 

 

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The nuclear option: Where next for Hinkley Point?

This piece was first published by BusinessGreen

 

HINKLEY BUSINESS GREEN

 

 

 

 

 

 

 

 

 

BusinessGreen asks a range of experts their views on what should come next for the controversial and further delayed nuclear project

Last week was quite a rollercoaster for those involved in low carbon energy policy. French utility EDF spent the first part of the week drumming up media excitement for a final investment decision on its Hinkley Point C development, briefing heavily that the project would likely be green lit by the board on Thursday – a decision widely viewed as the final hurdle for the UK’s first new nuclear power plant in a generation.

But in a surprise twist of events, just hours after EDF approved the investment – losing a board member and angering its own unions in the process – the government launched a review into the project’s “component parts”, pushing the contract signing back into the autumn, assuming it happens at all.

Plans for a VIP party at the site of the proposed plant in Somerset were hastily shelved as EDF came to terms with the shock turn of events. Meanwhile, UK trade unions fumed, environmental campaigners cheered, and journalists hoping to have put the Hinkley saga to bed finally before their summer holidays wearily returned to their keyboards.

So what now for the beleaguered energy project? Is this review really just a chance to double check the finer details? Or could this be the start of a major shake up of the UK’s clean energy policy? BusinessGreen spoke to a range of experts to get their views on where next for Hinkley Point.

Tom Burke, chairman of E3G

What will be different in September? And what was it that caused the plug to be pulled so late in the day? The story that is now coming out is that this is all about the Chinese involvement. But those concerns were made public last October, so it will be no surprise to Mrs May that there are anxieties about China’s role in the project. I think the government is now working on a way to secure the Chinese investment while alleviating these security concerns.

But really, the government should drop the project. It’s now taken most of the political damage for abandoning it anyway. All of the people opposed to it – financial analysts, credit rating agencies, environmentalists, even members of the EDF board – have been encouraged to redouble their efforts to stop what is now I think pretty widely recognised by everybody outside of government and nuclear theologians as a very bad deal indeed. You now have huge momentum behind the calls for the government to enact a Plan B.

There are so many things that you could do that would be faster, cheaper, cleaner and more reliable than Hinkley. There’s no shortage of alternative plans that would actually keep bills down for people and be low carbon, such as a new energy efficiency programme, a new fleet of offshore wind farms with power two-thirds the price of Hinkley’s, and more interconnectors to bring clean energy for the continent.

The big obstacle to this is that there is still a vast illusion among the commentariat that you need baseload power which only nuclear can supply – but that’s coming from people who haven’t caught up with where electricity grid technology has got to. This is really all about letting go of bad ideas.

 

 

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HINKLEY DECISION GRINDS TO A HALT

 

TOM BURKE HINKLEY

 

 

On Thursday 21st July the Prime Minister dined with Francois Hollande in Paris. On the same day, EDF announced a meeting of its Board had been called for the 28th of July. A press release stated simply that the new nuclear power station at Hinkley Point would be on the agenda.

Since it has been on EDF’s Board agenda for many years this was no surprise. Subsequent media briefing, however, both in Britain and France, made it clear that EDF would now make its final decision to proceed with Hinkley. This was a surprise as earlier briefings were that this decision would be made in September.

On the 26th of July an Extraordinary General Meeting, the shareholders of EDF agreed to a €4bn recapitalisation. This meeting cleared the way for EDF to make its Final Investment Decision (FID) at its Board meeting two days later.

In Britain, meanwhile, preparations went ahead to sign the Investment Agreement that would lock the British Government into keeping its part of the bargain on the next day, July 29th. As well as committing British electricity consumers to providing a subsidy of £37 billion over 35 years, this Agreement would prevent any future British Government from changing its mind about Hinkley.

At Hinkley, a marquee was erected, a lavish celebratory lunch prepared, French, Chinese and British guests invited and an extensive round of media interviews scheduled. At 6.30pm on the 28th the Board of EDF duly announced that it had made the FID.

Then, at 8.00pm, the same evening, to astonishment, the British Secretary of State, Greg Clark issued a statement that said, ‘The Government will now consider carefully all the component parts of this project and make its decision in the early autumn.’

Subsequent briefing insisted that the decision to puncture the carefully crafted balloon of expectations at the last minute had been taken by the Prime Minister herself. The public surprise of Britain’s partners in this massive venture has been accompanied by private fury. The political damage is considerable.

Most obviously damaged are Britain’s relations with both the French and Chinese Governments at a time when the need for cordial relations with them is at a premium. Both have been publicly humiliated. The Prime Minister’s  own strategy for reassuring the country that Brexit was not undermining our economic prospects has been heavily dented. Hinkley was the flagship project to demonstrate that Britain retained the confidence of foreign investors.

Her personal reputation for being a steady hand has also taken a hit. The Government is now competing in the headlines with  the Labour party for possession of the word ‘chaos’. Whitehall keeps large barrels of plain vanilla spin to hand for occasions like this. Nothing to worry about chaps, just a few ‘i’s to dot and ‘t’s to cross – the new boss just wants to take a look under the bonnet.

The plausibility of this line didn’t last long. Reports at the weekend informed us that she had actually warned Hollande about her doubts over dinner the previous week and confirmed them with a phone call on the Wednesday before the EDF Board meeting.

If so, these warnings lacked clarity. No-one in Hollande’s office thought they were sufficiently serious to give EDF a heads up. The company’s track record for ducking the issue on its FID would have led to little surprise if it had done so again. This might have been embarrassing but it would not have been as damaging.

The problems facing Hinkley can now only get bigger. Doubts about the viability of the project are already in full flood. The EDF Board split on the decision; senior managers have resigned; the unions are taking legal action; the ratings agencies have threatened a further downgrade. In Britain Parliamentary, public, media and official sentiment has shifted sharply away. There are calls for a plan B.

It no easier to see why the Prime Minister made such a dramatic, and politically expensive, decision at such short notice than it is to see what will have changed by September. The arguments surrounding this project have been extensively rehearsed. So what exactly is going to be reviewed. There is a small clue, however, in the wording of Greg Clark’s statement.

It contains an obscure reference to considering carefully ‘all the component parts of the project’. One component part of the deal for the Chinese financial contribution to Hinkley involved agreeing to allow China to build one of its own reactors at Bradwell in Essex. Accepting Chinese money is one thing, letting a Chinese company closely tied to the military know enough about your grid software to connect its reactor to the grid is another.

The Prime Minister’s chief of staff made his reservations about China’s involvement in Hinkley public almost a year ago. If these have been augmented and caught the Prime Minister’s ear this may be the component which she wishes to review. If so it will take political gymnastics of some skill to both answer the questions this raises and keep China’s money.

Even if the document signings and celebrations planned for last Friday had gone ahead, the new reactors at Hinkley faced formidable obstacles before construction could begin. The Prime Minister’s abrupt decision last week has just added another.

 

 

Tom Burke

London

July 31st 2016

 

Tom Burke is the Chairman of the China Dialogue Trust and of E3G.

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Hinkley delay is a really big deal – BBC News

 

 

I am finding it extremely difficult to think what could have caused such a massive dislocation, not just to our relations with other countries, as we have heard they are all going to be upset, but also to Mrs May’s own program of persuading us in this country that the economy was safe and secure, and that we really were still attractive to investment, that really was the highlight of that reassurance strategy, and that has gone out of the window.

Mrs May was abroad when the decision to pull the plug on Hinkley was taken, nothing at this scale is normally done with the Prime minister being abroad without there being some new factor, something new and big that nobody knows about.

In a way Theresa May has taken the political hit for abandoning the project now, so in a sense the political imperative, which was there very strongly, to get on with it even at the expense of having a white elephant, to some extent she has taken the hit for that. The pressure now is to really re-examine Hinkley, and that has never been done by the way, the assumptions with which this project has been brought forward have never been subject to any kind of descent forensic examination. I think the pressure for that will now become very, very strong.

 

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Why Hinkley is a very risky bet – BBC Radio Wales

 

 

This is not where we expected to be this morning, and it is very difficult to imagine what the government will discover in a few weeks time that it doesn’t already know. So I think that it is fortunate that this is giving us a chance to look again at what is a very bad deal for Britain, a 37 billion pound punt by the British government with energy bill payer’s money on an unproven technology. It is a 20th century technology that locks us into the wrong kind of infrastructure for the 21st century. It shuts us out from building an energy infrastructure that will be cheaper, faster, cleaner and much more reliably delivered than Hinkley Point.

There were lots of hurdles even if the government had gone ahead and signed the contract today, there were lots of hurdles it would have had to overcome. There is already a legal challenge by the Austrian government in the European court against the British government’s financing for this.

There is a legal action in the French courts by some of the French Unions seeking to quash the decision that EDF made yesterday. There is a very high chance that the French government’s attempts to refinance EDF, which is in a parlour state economically will also run into State Aid problems, and that will also be legally challenged. So you could end up with the final decision on this really ending up in the European Courts.

There are also problems with the fact that the safety of some of the components is under review by the French nuclear regulator. There is an investigation by the Financial markets authority in France, into the misreporting of financial matters by EDF. So there are a lot of obstacles still to be overcome, even if this decision had been taken today.

I share concerns about the implications, of the extraordinarily casual treatment of a very big project, for employment. It’s not just in the nuclear industry that this government had been careless. We have lost 12,000 jobs in the last couple of years in the solar industry because the government can’t make it mind up about energy policy. We lost even more jobs in the energy efficiency industry again because the government seems to treat energy policy like a political bagatelle, that it can just change in an arbitrary way.

But the risks associated with Hinkley Point are enormous, in terms of what we spend our money on. Actually there are three of these reactors already built. All of them, including the one that is being build in China are years late and billions of pounds over budget. I just think this is too risky a project to go ahead with when there are lots of other things that we could do that are faster, cleaner and cheaper ways to meet our requirements for energy going forward. By the way if we went ahead with this, it wouldn’t help us with the immediate problems we have securing supplies of electricity because this won’t be generating electricity until 2030.

 

 

 

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Hinkley is a big economic problem – Sky News

 

 

The National Infrastructure Commission just pointed out a while ago that with better use of our existing energy generation capacity we could avoid four Hinkleys, and save 8 billion pounds. McKinsey pointed out that if we just took forward the energy efficiency that we are already doing we could avoid six Hinkleys. So it’s a very good deal if you want to invest in the French nuclear industry but it’s not a very good deal for the British consumer, who is going to end up paying 37 billion pounds for this.

Remember Hinkley might be the first in this country, but it’s not the first of these reactors that is under construction. The previous three have all been over budget and late, sometimes three times over budget and 7 or 8 years late. So it’s a big gamble not just in terms of the money that we are going to spend, but also on whether it is actually going to deliver for us when we need it.

The track record of the nuclear industry in this country has been very good, so I don’t think that people need to worry very much about the safety of this reactor, what they really need to worry about is the value for money.

Storing the waste is something that nobody has yet figured out how to do or what it will cost. What the British government has done is basically capped the amount that EDF will have to spend on paying for its waste disposal, and that is going to take a long time, and as far as we can see everywhere else in the world, as time has gone on you would have expected the cost of waste disposal to come down, but actually what has happened is that they have gone up. So I think that it is a big economic problem, as well as a big environmental problem, because these wastes will last a very, very long time.

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Hinkley Point – BBC News

 

 

Hinkley will actually slow down, and make much more expensive the pace at which we can decarbonise our economy and therefore avoid the dangers of climate change. So there are much better things to do, that we can do faster and cheaper than nuclear.

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Hinkley Point – BBC Radio 4 – Today Program

 

 

 

There is no doubt that we need electricity, we just don’t need the electricity from Hinkley at enormous cost. It’s very unreliable, we are not sure that this type of reactor will actually work. There are much better ways of achieving the security of supply we need at an affordable cost, and in a low carbon way, without going to this sort of trouble. The National Infrastructure Commission pointed out that if we did a serious program of demand response we could get the equivalent of four Hinkleys much faster and much cheaper than we can get Hinkley.

It is going to get worse. The Secretary of State  tomorrow will sign an agreement which means that if we discover this really is unsupportable economically over the next few years, we will still have to pay EDF for the value of the contract that we are proposing with them. We are talking 37 billion of subsidy. The cost of construction is 18 billion, but the contract that we will sign tomorrow commits us to signing an agreement for the electricity that will basically require, based on current wholesale prices, about 37 billion.

We can achieve all of the low carbon electricity we need, and we can achieve that at much lower cost. Offshore windmills are now being built in the North Sea at two thirds of the price of wholesale electricity that we are offering EDF. McKinsey did a study just a while back which showed that if we just went ahead with the kinds of improvements in energy efficiency that we are already getting we could avoid six Hinkleys. The National Infrastructure Commission has said that there are things that we can do to manage our generating assets more effectively than we do now, that would save us four Hinkleys. All of these things will happen faster, more reliably and cheaper than going ahead with this, as everybody has said, very risky project.

The idea of baseload (the lowest amount you will always need to supply) is an outdated concept. We have variable demand and variable supply, and the real trick, which we which we can now do much better than we were able to do in the past, is to manage our generating assets so that you can match supply and demand much more effectively. This is why baseload is an outdated concept; it doesn’t take into account technology developments that have taken place in the last few years.

 

 

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ET TU BRUTE

 

johnson gove

 

 

Assassination is rare in Britain. But do not doubt that the political knife slipped into Boris Johnson’s back was anything other than a carefully crafted assassination. It began, supposedly, with a leak.

Mr Gove’s wife, Daily Mail journalist, Sarah Vine, e-mailed her husband. The e-mail urged him to be sure to get ‘specific assurances’ from Boris as they were needed in order to guarantee support from Mail editor Paul Dacre and Rupert Murdoch. Inadvertently, this e-mail was copied to a, as yet unnamed, ‘member of the public’ from where it swiftly found itself in the hands of Sky News.

This is a risible proposition. It involves believing that Mrs Vine, who spends her life working at a keyboard, managed, by accident, to type into a copy list, the name and address of someone she did not know. This would be a difficult trick to pull off with the most anodyne e-mail let alone one of the most sensitive e-mails this experienced political wife can ever have written.

It is much more likely that one of Mr Gove’s own staff, with his approval, passed the e-mail to a friendly journalist.  Some effort would have been made to keep Gove’s fingerprints off the ‘leak’. Few journalists today would pass up such a tasty story despite its total implausibility.

It is a mark of the contempt our current crop of politicians have for the British public that they think they can get away with such an obvious manoeuvre. One reason is that they have managed to so often before. Another is that they can rely on the media not to probe too deeply for fear of not being able to run the story.

The purpose of this tortuous stratagem was the sly introduction to Tory Party members of the idea that their house magazines had doubts about Mr Johnson’s suitability to lead the country. Though widespread among MPs, such doubts had not yet seeped out to the Party’s base.

As implausible, and equally contemptuous of British common sense, is Mr Gove’s explanation for his action, delivered with stomach-turning sincerity to the media. Somehow, this experienced politician, now proposing himself as our Prime Minister, had not noticed Mr Johnson’s flaws until hours before he himself was due to lead a campaign to elevate Mr Johnson to the country’s highest office.

It is not as if these flaws were not the subject of much high profile discussion, most notably by Matthew Parris. Either Mr Gove does not read the newspapers, never talks to colleagues and has very poor judgement or he is lying about his motives. In either case he is not fit to be Prime Minister.

Fortunately, as he himself has said on at least nine occasions, it is not a job for him. So why risk all the pain and notoriety in pursuit of a job he doesn’t really want and probably won’t get? This is better understood if you remember that Mr Gove is not just keen to get Britain out of the EU, he would like to destroy the whole thing. Among the true believers in Brexit there were real doubts that Mr Johnson could be trusted not to sell them out in the negotiations.

Their problem was Mr Johnson’s popularity with the 150,000 rank and file members of the Conservative Party. The rules for the election of a leader require its MPs to agree a shortlist of just two candidates from among all those who put themselves forward. The members then choose.

There was real anxiety among the Tory brexiteers that if Mr Johnson was on the short list he would win. Thus the only option open to them was to keep him off the shortlist. But how to guarantee that without risking the ire of a membership deprived of a popular icon?

Given his popularity and his role in winning the Brexit campaign it would be difficult to explain to your constituency party that you had voted against him. Many, perhaps too many, of the Tory MPs would have required a lot of persuading to take the risky course of not supporting Mr Johnson in the ballot.

Better, then, if he were not to compete to be on the shortlist in the first place. So, how could this be arranged? Well, we have just seen how, live on TV. This is exactly the kind of scheme that would have come quickly to the mind of Mr Gove’s controversial advisor, and leading Brexit organiser, Dominic Cummings.

As always when such murky events occur, ask yourself cui bono. Who would benefit most from the defenestration of Mr Johnson?  We know the answer already: Theresa May. Mr Gove is too experienced with the Tory Party’s ruthlessness to have had any illusions about his chances of seizing the crown. So why help Theresa May despite their well-known spats?

Never underestimate to ability of politicians to overcome personal aversion in the pursuit of power. Mr Gove’s dishonourable act makes Theresa May a shoe-in for leader. It is not only possible; it is probable, that there is a deal. Do not be at all surprised if Mr Gove ends up in a very senior position in a new government playing a leading part in negotiating our exit from the EU.

I have no idea whether what we are witnessing is a carefully constructed operation or just political rats behaving as they are wont to do. We will never know for sure, even when all the memoirs have been published. But I do know that the current Conservative Party leadership is yet again demonstrating its appetite for putting its own, and its Party’s interests above those of our nation.

 

 

Tom Burke

London

June 30th 2016

 

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ON MEDDLING WITH EUROPE

 

forward together

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

‘You don’t know what you’ve got ‘til it’s gone Joni Mitchell

 

The Second World War welded Britain into a united nation. The pre-war divisions so well portrayed in Downton Abbey were swept away by a successful defence against an existential threat. The bonds forged to unite the nation were the welfare state and the Butler Education Act.  They were the foundations of my journey from a council estate in Plymouth to university in Liverpool and a life spent protecting our environment.

Those bonds have been corroding for some time. Last week they burst. Deciding to leave the EU is as momentous as was the decision to fight on alone in May 1940. Then, as now, it was fiercely contested, albeit out of sight of the public. Halifax, the Foreign Secretary, mounted a vigorous campaign to cut a deal with Hitler and keep the Empire.

In the end, Churchill prevailed and Britain decided to fight on. Then, as now, the consequences of that decision weren’t just unknown, they were unknowable. Then, as now, there was no plan. We made it up as we went along.

There is no plan for how we leave the EU. British voters were not asked to choose between two carefully planned paths to their future.  They were simply asked if they liked what they had or would prefer something else. Given the corrosion of those war forged bonds they took the opportunity to send a compelling message.

A brittle carapace of deceptively bright headlines had long concealed a seething stew of discontents. The Prime Minister’s decision to hold a national referendum on EU membership drilled deep into this reservoir of misery. The pressure released blew away the carapace and revealed the sorry state of the bonds which unite us: young against old; city against countryside; graduate against labourer; Scotland against England; affluent against poor, career against zero-hours contract.

Choices have consequences. The British people have yet to learn those of the choice they have just made. Today’s world is very different from that of 1940. For a start, then there were just over 2 billion people on the planet now there are 8 billion. It is very much more complicated. Our lives have become much more entangled, economically and digitally, as all of us struggle to survive and thrive. It is much harder now for the rugged individualist to do well, whether as a person or a nation.

The voters who chose, whether to leave or remain, on Thursday all did the best they could to do what they thought right for themselves, their families and their fellow citizens. There is something very encouraging about a 72% turnout – more than at the general election. It says much for the strength of our democratic culture that so many of us worked through the confusion created by sometimes malign newspapers to make a choice.

But it says less for a Conservative Party that offered them a choice most had expressed little interest in making and few felt fully ready to make. The constitutional consequences for Britain of the decision to leave the EU are larger than any since the 17th Century. They will reverberate for as long.

It is ironic, therefore, that it should have been a Conservative philosopher, in many ways the intellectual father of the Conservative Party, who warned so forcefully against meddling rashly with hard crafted constitutional settlements. In one of his famous essays, talking about the sovereignty of the people, Edmund Burke wrote:

‘An ignorant man, who is not fool enough to meddle with his clock, is, however, sufficiently confident to think he can safely take to pieces and put together, at his pleasure, a moral machine of another guise, importance and complexity, composed of far other wheels and springs and balances and counteracting and cooperating powers. Men little think how immorally they act in rashly meddling with what they do not understand. Their delusive good intentions are no excuse for their presumption’.

I could not have put it better myself. I have little reason to believe the Boris Johnson has any more idea of how to put back constitutional relationships he has disturbed, to Europe, to Scotland and Ireland, or to the rest of the world, than he does about how to reassemble a clock. But he has played a merry part in taking those relationships apart. The least he owes us for his presumption is his plan for putting them back together.

 

Tom Burke

London

June 26th 2016

 

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