A pricing record for offshore wind this month won't change Britain's nuclear plans, government sources confirmed.
“We need a diverse energy mix to ensure that demand for energy can always be met, and both nuclear and renewables will play an important role in this for many years to come,” a spokesperson for the U.K. Department for Business, Energy & Industrial Strategy said.
The statement follows widespread speculation about the future of the U.K.’s new nuclear program in the wake of an auction that saw offshore wind prices drop to just £57.50 (USD $76.34) per megawatt-hour.
That’s almost 38 percent below what the U.K. government has agreed to pay for nuclear generation at Hinkley Point C, a contentious 3.2-gigawatt plant slated for construction in Somerset, southwest England.
The project, which has already been criticized for increasing costs, was called into question after the renewables auction result, which awarded 11 competitive projects that ranged from offshore wind to waste-to-energy conversion.
“As renewable energy becomes more affordable, the government’s decision on the new nuclear project may come under additional scrutiny,” Bloomberg reported.
Since Hinkley Point C was approved in September 2015, developer Électricité de France has increased the cost estimate for the project from £18 billion ($24 billion) to more than £20 billion ($27 billion), said Bloomberg.
In contrast, said Giles Dickson, CEO of industry body WindEurope: “Offshore wind has now shown it provides excellent value for taxpayers' money."
“In light of these latest price reductions, we call on the U.K. and other European governments to make ambitious commitments on future deployment volumes for offshore wind. To sustain these cost reductions, the industry needs to be able to plan ahead," said Dickson.
Caught off-guard by the auction result, the nuclear industry hit back against the narrative.
“Reading about how offshore wind is now cheaper than gas and nuclear, you could easily say we should build more offshore wind turbines, turn off the gas taps and tear up the U.K.’s nuclear new build plans,” said Nuclear Industry Association chief Tom Greatrex in a blog post. “But if you care to delve a little further into the subject, then it becomes clear that one technology can’t deliver the U.K.’s future energy needs alone. The U.K. will need the full range of low-carbon technologies to replace ageing infrastructure.”
U.K. grid operator National Grid was planning for nuclear in all future energy scenarios, he said, because of nuclear’s ability to provide baseload power. In 2016, offshore wind generated electricity 36 percent of the time while nuclear had a capacity factor of 77 percent, government figures show.
David Hess, communication manager for the London-based World Nuclear Association, said policymakers should look to support nuclear as well as offshore wind.
“The falling price of offshore wind is fantastic news for climate action and the U.K. public, as well as a great example of what a sustained policy commitment can achieve,” he said.
“It means that the country really has a decent shot at decarbonizing its grid, as long as it sticks with its nuclear new-build program. New nuclear provides a clean, flexible base, making it an ideal partner for renewables.”
If the government supported offshore wind when prices were high, it should do the same for nuclear, said Hess. “Now is not the time to forget the value of a diverse, low-carbon mix."
It remains to be seen whether Hinkley Point C will make it into that mix. The project, based on a French design which has seen cost and schedule overruns in France and Finland, has been beset by other problems.
This month, workers threatened to walk out over a pay dispute. And the BBC slammed plans to dump potentially radioactive waste from dredging works near Hinkley Point’s two existing reactors.