EU examining UK support of nuclear plant

A steel dome is hoisted onto the No 1 reactor at Haiyang nuclear power plant in Shandong province in March. China plans to have an installed nuclear power capacity of 58 gigawatts by 2020. [Photo / Xinhua]

The European Commission is assessing the planned support by the United Kingdom's government for a new UK nuclear power plant, which has attracted Chinese interest, a spokesman at the EC said.

The move may prevent Chinese nuclear companies from taking a stake in the massive project, industry insiders said.

"The commission has been assessing the UK plans to support nuclear power on the basis of a notification by the UK authorities," said Antoine Colombani, spokesman for competition policy and for EC's Vice-President Joaquin Almunia.

The focus of the case is whether the British government has offered financial support to the project, which would be against European Union rules.

The project is backed by France's EDF SA and by potential co-investors such as China General Nuclear Power Corp and China National Nuclear Corp, which have expressed an interest in sharing the costs.

"It's clear that the intervention of the commission will affect Chinese firms' participation in the UK nuclear market due to the delay of the whole project," said a source at a Chinese State-owned nuclear company, who wished to remain anonymous.

"But it will not have a direct impact on Chinese nuclear firms in general. Usually, this kind of move is intended to protect other renewable sectors, such as solar and wind," the source added.

The EC spokesman said that if the commission has doubts about whether the nuclear project complies with EU state aid rules, it may decide to open a formal investigation.

The decision came after a visit earlier this month by the UK's prime minister to China. David Cameron reiterated his country's openness to Chinese investment in the country's nuclear power industry.

The $25.9 billion project between the UK and France's utility EDF for the Hinkley Point C nuclear power station in southwest England will be the first nuclear plant deal in the EU since the disaster at Fukushima in Japan prompted a major rethink of the energy source's merits.

Belgium, for instance, closed two nuclear plants after the Fukushima disaster.

Nicholas Stern, president of the British Academy, said that China and the UK could set an example in low-carbon technology research and application by cooperating with each other in the nuclear electricity generation field, which is essential to decrease the burning of fossil fuels and tackle climate change.

"This is a very active approach in low-carbon cooperation, and we need to support it," said Stern, who is also a professor at the London School of Economics.

To tackle climate change and develop low- carbon technology, Stern said that China, the EU and the United States are important players and should join hands in this global effort.

British Energy Secretary Ed Davey gave the go-ahead in October for a consortium led by France's EDF Energy to build the Hinkley Point C plant in Somerset.

A spokesman for the Department of Energy & Climate Change told local media: "We have always been clear that EDF will only be offered an investment contract if it is fair, affordable, value for money and consistent with state aid rules.

"The UK government continues to work closely with the commission on state aid. It would not be appropriate for the UK government to comment on an ongoing process or on the timescales for approval."

Zhang Chunyan in London contributed to this story.