Hinkley Point nuclear power station will be late and £2bn over budget

Hinkley Point nuclear power station in Somerset, southwest England, will cost about £2bn more to build than previous estimates and will miss its deadline for completion. Energy firm EDF released an update this morning that warns of an overspend of between £1.9bn and £2.9bn, putting total costs for the project at between £21. …

[Elledan]

Maybe China should build them instead

Meanwhile China has one EPR unit (Taishan 1) already online and connected to the grid, with another one (Taishan 2) being connected to the grid next year: https://en.wikipedia.org/wiki/EPR_%28nuclear_reactor%29

Clearly it's not that EPRs are hard to build, or necessarily expensive. Is the West incapable of large-scale building projects at this point? I'd even include the utter failure that is the new Berlin airport, or what should have become an airport.

The skeptical view here is that maybe we should just give up at this point and let China build all new infrastructure.

[MyffyW]

Re: Maybe China should build them instead

I suspect China doesn't have to contend with quite the same regulatory and social environment as EDF.

[Anonymous Coward]

Re: Maybe China should build them instead

The difference is that State Grid of China is empowered to do whatever is necessary to get the thing built; rather than have to convene endless stakeholder engagement sessions at enormous time and expense that do nothing other than raise awareness of said project thus allowing the opposition to organize against it.

After all, nobody, but nobody wants a nuclear reactor in their back yard. Or HS2. Or a motorway. Or an airport.

State Grid of China don't answer to shareholders or have nonsense such as guaranteed strike prices underwritten by consumers to worry about. And they have an army of staff that utterly dwarfs the GB energy industry as whole - just their transmission staff dwarf it, let alone generation or distribution components.

I'm not familiar with biodiversity in China; but greater crested newts, without fail, are to be found on all proposed infrastructure projects in the UK thus causing more delays. And Bats; which one has to bend over backwards to accommodate also.

[imanidiot]

Re: Maybe China should build them instead

In my backyard would be a bit tricky (or it would have to be a very small reactor), but I wouldn't mind living close to a nuclear plant. It's highly unlikely I'd ever suffer any negative effects from it, any worse than I'd be exposed to now (several now shut down reactors in Germany, a few operating ones in Belgium (Doel and Tihange), and 3 in the Netherlands (Borselle, Petten and a small research reactor in Delft) are all close by in geographical terms).

[Oengus]

Re: Maybe China should build them instead

but nobody wants a nuclear reactor in their back yard

It is funny. Here we have only one reactor and it isn't even for power generation. When it was built (in the 60's), in an outer Sydney suburb, there was a large exclusion zone. In the last few years developers have lobbied government to reduce the exclusion zone so they could develop the area. They then sold off the area at cheaper prices than much of Sydney so the blocks were quickly snapped up. Once people moved in they started to complain that the nuclear reactor 9that had been there for more than 40 years before they bought their places) was too close.

When people I talk to who oppose nuclear power learn I am a supporter of nuclear power ask "Would you have a power plant in your backyard?" they are surprised that I respond "Yes." I usually continue with "I'd rather go out in the flash than suffer with the lingering pain of the fallout."

[Anonymous Coward]

Re: Maybe China should build them instead

Do you get strange looks when you say that? There wouldn't be any flash, even with a core meltdown.

[BebopWeBop]

Re: Maybe China should build them instead

"I'd rather go out in the flash than suffer with the lingering pain of the fallout."

A problem with most nuclear power plants (not that I know which design you are talking about) is much more likely to kill you by leaking radioactive waste than finishing you with a quick flash. So your reasoning doesn't add up except as a riposte to the ignorant.

[Korev]

Re: Maybe China should build them instead

I thought they were talking about "Buckets of Sunshine" -->

[Korev]

Re: Maybe China should build them instead

> I'm not familiar with biodiversity in China; but greater crested newts, without fail, are to be found on all proposed infrastructure projects in the UK thus causing more delays. And Bats; which one has to bend over backwards to accommodate also.

I reckon they'll find some fission

[LeahroyNake]

Re: Maybe China should build them instead

It's not that we are incapable but we have very high standards of safety for the complete projects and masses of H&S requirements during and after the building phase.

I have been on site at HPC and a lot of other large construction projects. The one thing I have noticed in the last 20 years is the massive increase in office staff that are 'on site' normally in portacabins, some times 6 long and 3 high (the large ones have more than 30 people, receptionist, security, site managers, sub contractors, H&S people one site even had a full time environment damage reduction person).

The positve end result is a huge reduction in accidents, less waste and a better working environment for all the staff.

The downside is increased cost and time to complete the build. I'm not commenting on the fact that the initial build cost and time should have been more accurate but in my opinion should be covered by whoever tendered for it.

If even one less death occurs during construction then the delay is worth it.

[Persona]

Re: Maybe China should build them instead

No we are not capable. Our last nuclear power station was completed over 20 years ago. Since then all our experienced workers have moved on and/or retired. When you walk away from a technology don't expect it to be cheap or easy to regain your position.

[MrSafety]

Re: Maybe China should build them instead

Also worth remembering that a lot of the construction experience we had, and operational experience we have is for gas cooled reactors, which we abandoned on account of how cheap and easy to build PWRs are or something like that...

[Anonymous Coward]

Re: Maybe China should build them instead

I'm not convinced that all these extra people on site and meetings do equate to better safety. I've worked on sites in other Eurpean countries who have safety reciords as good as, or better than ours but seem to be able to do it with much less fuss and cost.

[Robert Sneddon]

Re: Maybe China should build them instead

Taishan 2 is grid-connected and has been operating commercially since the beginning of this month.

Actually EPRs are hard to build -- even the Chinese who have a lot of current knowledge on how to build reactors took about 9 years from first concrete to full-power production of electricity for each of the two Taishan EPRs. They normally take about 5 to 6 years to reach the same milestone for the less advanced AP1000 and Hualong 1 PWRs they're building. Saying that the EPR produces 1.6 GW of electricity, significantly more than the 1GW to 1.1GW of the other reactors they're building.

[Elledan]

Re: Maybe China should build them instead

You're right, I misread the dates for Taishan 2.

I think it kind of nails it home that this issue is about experience first and foremost. Chinese culture is about getting massive projects done, preferably within budget and on time. They have also been hoarding technical know-how, and educating engineers to allow China to become a high-tech culture. That's how they came to start building nuclear reactors constantly over the past decades, with Russian, French, American and native designs in use.

It's a far cry from US, French and UK culture, whose last major reactor building experience dates from the 1980s or earlier. For the French to dive straight into the advanced EPR design after not really building nuclear plants for so long has maybe severely overestimated their own capabilities.

[Mark 65]

Re: Maybe China should build them instead

Workers are also seen as a little more expendable which helps. As does scant regard for the environment.

[Tom 7]

Re: Maybe China should build them instead

MBAs.

[eldakka]

Re: Maybe China should build them instead

Part of it wold be that in China they tend to execute (non-party) people who engage in corruption against the state.

In the west, we let people underbid for contracts and then 'find' all these convenient, foreseeable (if the bidder did appropriate due-diligence, but then they wouldn't be able to inflate the price if they did that) issues that inevitably inflate the contract price.

[Sorry that handle is already taken.]

Only 10% over budget?!

What kind of "nuclear power station" do they think this is anyway?

[Zog_but_not_the_first]

Jeez

Haven't the guys who signed off on this ever "had the builders in"?

[imanidiot]

Re: Jeez

This is ofcourse ever relevant:

The gas man cometh

[truetalk]

Re: Jeez

My thoughts exactly.

[Jimathy]

Re: Jeez

The first rule of pricing up any building project is to double the figure the builder has scribbled on the back of his packet of Benson and Hedges.

[Chris G]

Deal of the century

Who agreed to the 35 year fixed price plan and do they now have a comfy well paid seat on someone's board or are happily retired?

Technology has been bringing the price per unit of energy down for some time now, they should have known that.

[Andy The Hat]

Re: Deal of the century

Who said fixed price?

"The UK government has promised to pay EDF a fixed fee, subject to annual increases, of £92.50 (in 2012 prices) per megawatt-hour for 35 years."

In other words they're guaranteed double what we're currently paying *plus* an unspecified annual increase. At what seems like an average increase of 5% that's about £150 after ten years ...

The investors must be crying all the way to the bank ...

[Zimmer]

Re: Deal of the century

Don't worry.

I'm sure the extra 'fuel' duty on all those Electric cars we'll have will more than cover it .. (oh, sorry, weren't we supposed to know about that yet ???)

*Not sure that's the right icon ================>

[BebopWeBop]

Re: Deal of the century

It isn't, government revenue will have to come from somewhere and fuel duty is a decent contributor.

[Schultz]

Contrarian point of view

That current electricity cost 'in the region of £40 per megawatt-hour' is deceptively low, because:

(1) All that subsidised renewable generation came online, depressing average electricity cost;

(2) We don't properly price carbon energy yet (and it'll have to become much more expensive if we want to move towards those climate goals);

(3) Nuclear power can be sold when the wind won't blow and the sun won't shine - hence when the price is far above average;

(4) Future renewable electricity cost may be higher than we think when we price in the need to store electricity to flatten out supply (probably with costly batteries, unless you have a nice mountain valley for stored hydro);

So some nuclear power might be a good idea and might even be profitable. You might also call it a strategic investment to secure the future electricity supply.

I think we should move ahead on both, nuclear power and on renewables -- in 10 years time we'll see which combination works best. If you don't try it, you won't know what could have worked-- and in the long term that is the worst mistake.

[Oengus]

Re: Deal of the century

Technology has been bringing the price per unit of energy down for some time now, they should have known that.

Can you point that out to the energy retailers here in Oz. Here energy prices per unit only go one way - UP. I think a lot of this is because of deliberate under investment resulting in a reduction of supply capability and increasing demand

[imanidiot]

Re: Deal of the century

Don't mix up consumer sale price of electricity with wholesale generating/trading cost of electricity. They are almost entirely unrelated. Take a look at the profit margin of the average leccy farmer over the last few years.

[phuzz]

Re: Deal of the century

"Who agreed to the 35 year fixed price plan and do they now have a comfy well paid seat on someone's board or are happily retired?"

Anyone from elReg looking for a good story to investigate?

[leaway2]

"£2bn over budget, at the time of writing." FIFY.

[JDX]

10 years late for only £3bn extra? Bargain!

[Sandtitz]

"10 years late for only £3bn extra? Bargain!"

You seem to be describing our own reactor farce here in Finland.

[Wellyboot]

Interesting...

£95 for future nuke elec & >>>currently in the region of £40 per megawatt-hour<<< so we're really paying through the nose at the consumer level.

lots of ofgem charts here > https://www.ofgem.gov.uk/data-portal/all-charts

This one shows just how far off carbon neutral & renewables are from being the primary electricity source even with the slowly declining demand due to more efficient systems.

https://www.ofgem.gov.uk/data-portal/electricity-generation-mix-quarter-and-fuel-source-gb

Time to start the next 2 or 3 base load nuke plants?

[MonkeyBob]

Re: Interesting...

There are also some good live charts here:

http://grid.iamkate.com/

https://www.gridwatch.templar.co.uk/

[Tom 7]

Re: Interesting...

By the time planning is finished the sites will be under the sea and renewables 1/10th the strike price.

[seven of five]

earthworks?

They predict an extra two billion (beeeeeleon?!?) pounds on earthworks[1]? What did they do, mix up metres and miles? Is Somerset now completely excavated?

[1] yes, I know, nort only on earthworks...

[baud]

The French version of the EPR, at Flamanville, on the other side of the Channel, is also years behind schedule and B€ over budget

[Anonymous Coward]

That's ok. EDF got a real sweetheart of a deal from a foreign government that will subsidise any French over costs. Merci bien!!!

[Anonymous Coward]

And Finland

The EPR at Olkiluoto Unit 3 was due to come on stream in 2010. It is now scheduled to start next year. The lack of experience in building new reactors has been cited as a cause for the delay, but with that and Flamanville 3 so late and over budget, it might be worth asking if the EPR is just too complex?

[H in The Hague]

Earthworks

"The company blamed "challenging ground conditions which made earthworks more expensive than anticipated,"

Somewhere on the bookshelves behind me I've got a book about foundation engineering which states something like: "Those who economise on soil surveys before starting on a project often discover, some time later, that these assumed savings come at a very high cost."

[Velv]

Re: Earthworks

One would hope that the regulator would have expected very detailed ground surveys before letting anyone build a NUCLEAR power station. How did the not know it was going to be "challenging"

[EvilDrSmith]

Re: Earthworks

The likelihood is that a relatively basic desk study and intrusive ground investigation was undertaken to broadly characterise the site prior to contracts being let (and hence prior to the initial cost estimate). That then gets people in place and frees up funding for the project to progress, at which point much more detailed investigations could have been carried out. At which point people realise that the ground is a bit more wonky than they allowed for, with some squidgy bits (precise technical term, that) that hadn't been allowed for.

Then they get to site and start digging big holes, and possibly find that the ground was much more wonky than they allowed for.

A borehole proves the ground where the borehole is. If you're (really) unlucky, the ground can be totally different just a metre away.

Then remember that challenging ground conditions does not necessarily mean poor conditions - it may be that the stiff clay they planned it excavate in fact was much stiffer, and the machinery originally brought to site wasn't good powerful enough, or perhaps there are sandstone blocks within the clay that have obstructed piling (both pure speculation, as examples of challenging conditions that can delay ground works).

[Annihilator]

Re: Earthworks

Yeah but I'm almost certain the minimalist approach to soil surveys enabled them to win the bid, with a caveat in the bid saying "further soil surveys may identify issues at a later date".

Nearly every single public sector project that involves external parties in some manner will experience some level of cost increment.

[Anonymous South African Coward]

In light of this I'm so glad that the proposed nuclear deal ex-pres Zuma tried to push through (in a very underhanded and devious way) did not materialize at all...

[Matthew Smith]

Rolls Royce SMR

This makes the £18 million grant to Rolls Royce to research SMRs seem really trivial.

[EBG]

Re: Rolls Royce SMR

It is trivial, and simply politics. You need to talk in the many £bn's to build a few reactor type.

[N2]

Fixed fee?

...a fixed fee, subject to annual increases

it's not fixed then, is it?

[b0llchit]

Re: Fixed fee?

You read that wrong. It reads: Fixed increasing fee.

That is politicianspeek for "we, the politicians, give our dear partners, the rich, gold plated conditions because they were generous to us, the politicians".

[Steve K]

Picture

Is that big pit in the picture where they are pumping the money...?

[Montague Wanktrollop]

Can someone explain to me.....

As a private sector employee who regularly bids for and sometimes wins contracts, even Local Authority contracts, if I go over budget due to my lack of due dligence it's my tough titty. I suffer the financial consequences. Same as the penalties I face if go over time. Why is it with Government contracts (HS2, Carrier programme, Universal Credit etc. ad infinitum) that if you go over budget the Government just shells out the dough no matter how large. Over time? No problem.

Am I missing something really fundamental here? Do the Government write their contracts on the back of a fag packet?

[Robert Sneddon]

Re: Can someone explain to me.....

As I understand it the entire cost of the Hinckley project is being borne by the private sector. There is no public money or investment. That may change but the extra costs just announced are not going to be paid from public funds.

[Roland6]

Re: Can someone explain to me..... Accounting...

What is not clear is where in the money chain these additional costs are occurring.

Given the contract was between the UK government and state-owned EDF of France and state-owned CGN of China, I suggest there is some fancy accounting going on.

The price increase is broadly consistent with the GBP falling by 12% against the Euro and 5% against the US Dollar since May 2016. So suspect EDF UK is picking up the bill (ie. adding the debit to their accounts) in GBP, but EDF and China are actually paying in Euros and USD.

[Annihilator]

Re: Can someone explain to me.....

At a guess, your contracts are probably a bit more simple than this? Also, you need to be better at building in obfuscated dependencies that give you some wiggle room, or better at dressing up scope evolution as change requests.

[Sam Haine]

The Integral Fast Reactor

Plentiful Energy (pdf)

Ive just finished reading this interesting book about the Integral Fast Reactor civil nuclear power research programme. The IFR programme solved, in principle, the problems of the production of radioactive nuclear waste with extremely long half-lives and the production of materials that could be used in nuclear weapons. It also made significant advances in passive safety features in a nuclear reactor. It was cancelled in 1994, three years before completion, by President Bill Clinton at a time when renewable energy research was thought to be more important.