The UK Government has officially approved the Final Investment Decision (FID) for the Sizewell C nuclear plant, including several private overseas investors as its price tag rises to £38 billion.
Expected to generate £2 billion in annual savings for the electricity system once operational, the project had an original cost estimate of £20 billion in May 2020.
Five years on from its funding statement, this cost has nearly doubled.
The Department for Energy Security & Net Zero insists the plant will be delivered 20 per cent below the cost of Hinkley Point C which saw its cost also nearly double from £18 billion back in 2016 up to £34 billion by 2024.
Announcing the project’s FID, the UK Government confirmed a 44.9 per cent stake, joined by EDF (12.5 per cent), Centrica (15 per cent), La Caisse (20 per cent), and Amber Infrastructure (7.6 per cent with an option to acquire 2.4 per cent more from the government).
EDF will invest £1.1 billion, Centrica £1.3 billion in phased investment, Quebec-based global investment group, La Caisse up to £1.7 billion, and the UK Government £14.2 billion.
Additionally, the National Wealth Fund, the government’s principal investor and policy bank, has stated it will provide a term loan up to £36.6 billion to finance its construction – marking its first support for a nuclear project.
While a proposed £5 billion debt guarantee from France’s export credit agency, Bpifrance Assurance Export, to back the company’s commercial bank loans has also been confirmed.
These investments see the project introduce the Regulated Asset Base (RAB) funding model, combining public and private investment.
The model, which has a no pre-productive capital period, enables it to be financially viable earlier, benefitting both the investors and the project timeline.
Set to deliver low-carbon electricity to six million homes for at least six decades, Sizewell C promises to play a central role in the UK’s energy security and transition to net zero.
Construction is expected to take nine to 12 years, with power generation commencing in the mid-2030s. It would be the first major new nuclear plant in the UK since 1995.
At peak construction, the project is anticipated to support 10,000 jobs, with 70 per cent of the £38 billion – £26.6 billion – construction budget directed to British businesses.
Julia Pyke and Nigel Cann, joint managing directors of Sizewell C, said: “We’re delighted to welcome new investors alongside Government and EDF who, like our suppliers, have strong incentives to keep costs under control and ensure we deliver Sizewell C successfully for consumers and taxpayers.
“We are determined to deliver this major infrastructure differently, and to make sure this is a project Britain can be proud of.”
After years of uncertainty with 14 years passing since the site was identified, the investments signal a major shift towards energy independence and a clean, reliable power grid for the UK.
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