ERC Research Papers

New Nuclear Build in the UK

Published February 2008
By Nigel Hawkins
ISBN 9780903499293

Britain's government seems to think it can just give nuclear power stations the green light and they will magically appear. The truth is that only probably three European utilities, EDF, E.On and RWE, have the financial strength - market cap. and portfolio diversity - and the inclination - to take on the risk of building new nuclear power stations and the government may have to negotiate directly with them.

Key Points:

 Using a financial model, based on four units and with an allowance for First-of-a-Kind (FOAK) costs, the overnight capital cost is estimated at £1.5 billion per 1,250 MW unit

 The government may need to issue a Financial Indemnity for the accruing debt - similar to Network Rail - and also require electricity suppliers to sign up to a long term Nuclear Purchasing Obligation

 Over a 40 year lifetime, unit costs are estimated to be between 3.0p and 3.4p ker KWh, with a Weighted Average Cost of Capital of 7.5% (based on 70% debt and 30% equity).



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Other Publications

The full list to purchase research papers from the archives, and their paper and electronic availabilities, is below.

Research Paper Name Paper Electronic
Energy Policy: Which Way for the UK? Y Y
Aqua Britannia! Y Y
The Essential Guide to EU Quangos 2009 N Y
The Digest of Energy Statistics 2008 Y Y
New Nuclear Build in the UK - The Criteria for Delivery Y Y
Playing with Monetary Fire Y Y
The Spectre at the Economic Feast N N
Cracks in the Foundations? N Y
Creative Destruction in the Music Industry - The Way Ahead Y Y
Cost Effective Defence Y Y
The New Economics of Energy Security Y Y
The Essential Guide to British Quangos 2005 N N
Electrifying Britain - forward with Coal, Gas or Nuclear? N Y
Family Structure and Economic Outcomes Y N
Recharging The Nation Y Y
Identity and Development N Y
Forward with the Euro and the Pound N Y
The Deadweight State N Y
VAT: The Unacceptable Face of Taxation? N Y


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