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Government to inject further £5.5bn into Sizewell C

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A new subsidy scheme will make up to £5.5 billion of taxpayer money available to support the development of the proposed new nuclear power plant Sizewell C (SZC).

Sizewell C
Sizewell C. Image credit: GOV.UK, via Wikimedia Commons.

The Department for Energy Security and Net Zero (DESNZ) created the Sizewell C Devex Scheme in order to help the Suffolk nuclear plant reach a Final Investment Decision (FID).

The Devex Scheme aims to provide the government with greater flexibility to cover development expenditure costs up to and including FID.

This is subject to appropriate Value for Money (VfM) assessments and approvals at the relevant time. 

The total value of support allowed by the scheme is £5.5 billion, subject to relevant approvals, including the upcoming Spending Review.

The Devex Scheme stands separate from the existing Sizewell C Investment Funding Scheme (SC10655) which was created at the point of the government’s first investment pledge to the project of £700 million in November 2022.

That was then followed by a further £511 million last summer and in January this year it received a £1.3 billion investment, then its largest funding package to date.

SZC is a proposed 2-unit 3.2 gigawatt (GW) nuclear power station, which would sit adjacent to the existing Sizewell B plant and the decommissioned Sizewell A plant on the east coast of Suffolk.

SZC’s design is a near replica of the UK’s only under construction nuclear plant.

At full capacity, it is hoped the new facility will provide power to the equivalent of six million homes over 60 years.   

The government said 70 per cent of construction contracts for the project will go to UK businesses.

It aims to play a key role in UK net zero energy security policy by providing low carbon electricity at a low system cost as well as security of supply and energy system stability.

The government has a legal obligation to reach Net Zero carbon emissions by 2050.

Carbon budgets place a restriction on the total amount of greenhouse gases the UK can emit over a 5-year period, to help achieve these targets.

In 2021, the government committed to decarbonising the UK’s power sector by 2035, through the Net Zero Strategy.

The strategy reiterates the government’s 2020 Energy White Paper commitment to reach a FID on at least one new nuclear power plant by the end of this parliament.

In May this year, the Government announced its intention to build the UK’s third major nuclear power station at a coastal site in North Wales, to rival Sizewell C.

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