Hitachi confirms suspension of UK nuclear projects

The UK government said it remains committed to nuclear power after Japanese engineering firm Hitachi confirmed it is suspending activities at two new projects.

Subsidiary Horizon Nuclear Power "will be suspending the development of the Wylfa Newydd project, as well as work related to Oldbury, until a solution can be found", Horizon chief executive Duncan Hawthorne said. Both projects have a capacity of 2.9GW.

Hitachi announced last week that it was considering the suspension.

The UK government had offered to take a one-third equity stake in the project, was willing to provide all required debt financing for construction, and was considering a contract for difference with a strike price of up to £75/MWh, business and energy secretary Greg Clark said.

The suspension follows Toshiba's announcement in November that it was winding up NuGen, which was planning a 3.4GW nuclear plant at Moorside in Cumbria, northwest England.

The UK is still committed to developing new nuclear capacity, Clark said.

Discussions with Hitachi on the future of Wylfa and Oldbury will continue in the weeks ahead, Clark said.

The government is assessing the viability of a regulated asset base model for new nuclear capacity, and will publish its assessment this summer.

And it is considering a proposal from a UK consortium led by Rolls Royce that would lead to significant joint investment in small modular reactors, Clark said. A government-backed study in August recommended financing small-scale nuclear.

Nuclear is struggling to be competitive because of the dramatic declines in the cost of renewable technologies, such as offshore wind. The cost of these technologies has fallen to point where they now require very little public subsidy and will soon require none, Clark said.