Chancellor of the Exchequer George Osborne pledged a government guarantee of 2 billion pounds ($3 billion) for building the Hinkley Point C nuclear power station in southwest England.
The money, which will be provided through Infrastructure U.K., may be the first tranche of a num-ber of similar guarantees and “pave the way” for a final investment decision by Electricity de France SA, supported by China General Nuclear Corp. and China National Nuclear Corp., Os-borne’s office said in an e-mailed statement Monday.
“Britain was the home to the very first civil nuclear power stations in the world and I am deter-mined that we now lead the way again,” Osborne said in the statement, issued while he is on a visit to China.
“Nuclear power is cost competitive with other low carbon technology and is a crucial part of our energy mix. I am delighted to announce this guarantee for Hinkley Point today and to be in China to discuss their investments in Britain’s nuclear industry.”
Britain reached a deal with EDF in October 2013 to build the nation’s first reactor since 1995, agreeing on loan guarantees to cover construction costs and a fixed power price for 35 years.
The 24.5 billion-pound project is key to U.K. plans to cut carbon emissions and maintain security of its power supply so that electricity generation doesn’t depend on intermittent sources of renewable energy such as wind farms and solar plants.
“The chancellor’s approval of the infrastructure guarantee is a clear sign of the government’s com-mitment to Hinkley Point C,” EDF Chief Executive Officer Vincent de Rivaz said in the statement. “It is further progress towards a final investment decision on a project which will provide reliable, affordable low carbon electricity for decades.”