Source · Select Committees · Welsh Affairs Committee
Third Report - Nuclear energy in Wales
Welsh Affairs Committee
HC 240
Published 3 May 2023
Recommendations
4
Rejected
Para 29
Encourage Hitachi to sell Wylfa Newydd site or join a consortium for future nuclear development.
Recommendation
Given that the land at Wylfa Newydd is owned by Hitachi, it is unclear what the current state of play is at the site. If there is to be new nuclear at Wylfa, the issue of ownership of the land …
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Government Response Summary
The government rejects the specific recommendation to encourage Hitachi to sell or join a consortium, stating that any decision to sell the Wylfa Newydd site is a commercial one for Hitachi. They confirm ongoing dialogue with site owners and that Great British Nuclear will work on broader access to potential sites, while also developing a new National Policy Statement for future nuclear deployment.
Wales Office
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6
Accepted in Part
Para 35
Pursue new gigawatt-scale nuclear plants alongside existing Small Modular Reactor policy.
Recommendation
While successfully developing a Small Modular Reactor (SMR) would present a huge opportunity for the UK, the technology is still in development phase. If the UK Government is serious about nuclear energy now it needs to pursue new gigawatt- scale …
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Government Response Summary
The government acknowledges the recommendation to pursue gigawatt-scale plants alongside SMRs, stating that while Great British Nuclear (GBN) will initially focus on SMRs, it will also support the government's consideration of further large Gigawatt-scale projects.
Wales Office
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7
Deferred
Include Trawsfynydd site as a potential SMR host in the Nuclear National Policy Statement.
Recommendation
The UK Government, and Great British Nuclear, should continue to engage with Cwmni Egino on its ambition for Trawsfynydd to become the first site to host Small Modular Reactors (SMRs) in the UK. We urge the Government to include the …
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Government Response Summary
The government states it will continue to engage with Cwmni Egino and will develop a new Nuclear National Policy Statement (NPS) to set out planning policy beyond 2025. It will consult later this year on siting policy for new nuclear developments, including SMRs, but does not explicitly commit to including Trawsfynydd at this stage.
Wales Office
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9
Accepted
Para 48
Explain mechanisms for monitoring and reporting consumer risk during Sizewell C construction.
Recommendation
We recognise the high cost of construction of nuclear energy plants and the large upfront investment needed to get a project to final investment decision. We hope that the Regulated Asset Base (RAB) model will help overcome these investment challenges. …
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Government Response Summary
The government states that existing legislation (Nuclear Energy (Financing) Act 2022) and current processes, including HMT Green Book approvals and Major Project Review Group approvals, ensure consumer interests are considered and projects are monitored. Ofgem, as the economic regulator, will have full oversight and audit rights during construction.
Wales Office
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12
Accepted
Para 67
Collaborate with Welsh Government to develop a national nuclear skills strategy for Wales.
Recommendation
If the UK Government is going to realise its ambitions for nuclear energy, investment in skills is essential and serious work needs to be done on how the required skills can be developed. We call on the UK and Welsh …
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Government Response Summary
The government states it already works closely with industry and the Welsh Government through the employer-led Nuclear Skills Strategy Group (NSSG), with aligned strategic plans to address skills challenges. It collaborates with devolved administrations for a coherent approach, acknowledging education is a devolved power.
Wales Office
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14
Deferred
Para 73
New nuclear development at Wylfa remains uncertain without further concrete government commitment.
Recommendation
While we welcome what feels like small steps in the right direction towards new nuclear at Wylfa, we do still question how much further down the path we are now to seeing a successful development than we were when Hitachi …
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Government Response Summary
The government acknowledges the need for settled policy and will develop a new National Policy Statement and consult on future nuclear siting this year, but states no decisions have been made on which technologies or sites, including Wylfa, will proceed.
Wales Office
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15
Accepted
Para 74
Publish a medium to long-term nuclear energy generation programme, including Wylfa and Trawsfynydd.
Recommendation
We welcome the UK Government’s announcement that it will deliver a programme of new nuclear projects. We recommend that the Government publishes a medium to long-term programme for nuclear energy generation. The programme must set out how it will achieve …
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Government Response Summary
The government commits to developing a new National Policy Statement (NPS) to outline planning policy for deploying new nuclear power stations beyond 2025. As a first step, it will consult later this year on a policy for how new nuclear developments could be sited in the future, which will inform the NPS.
Wales Office
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16
Accepted
Para 79
Mandate Great British Nuclear to plan and deliver a programme for nuclear generating sites.
Recommendation
We have heard strong representations from the nuclear sector for greater clarity and commitment from the UK Government on its ambitions. We put these representations to the UK Government ahead of the Spring Budget and welcome the launch of Great …
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Government Response Summary
The government states Great British Nuclear (GBN) has been launched with funding to drive new nuclear projects. GBN's first priority is to launch a competitive process for Small Modular Reactor (SMR) technologies, with market engagement already underway and a down-selection process planned for summer, aiming for decisions by autumn. GBN will provide co-funding, work on financing and site arrangements, and support consideration of large Gigawatt-scale projects.
Wales Office
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17
Acknowledged
Require UK Government to explain plans for resolving the lack of utility developers in nuclear.
Recommendation
One of the significant missing parts of the future of nuclear development is the lack of a utility developer in the UK, other than EDF-related companies. We recommend that the UK Government explains its plans to resolve this problem and …
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Government Response Summary
The government acknowledges the challenges faced by past nuclear projects and states that Great British Nuclear (GBN) will aim to overcome hurdles and unlock barriers in the market to enable successful project delivery. However, it does not explicitly detail concrete plans to resolve the specific problem of a lack of a utility developer.
Wales Office
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Conclusions (8)
1
Conclusion
Accepted
Para 21
While we have heard dividing evidence on the role that nuclear energy should play in achieving the UK’s net zero targets and ensuring domestic energy security, there is a broad consensus between the UK and Welsh Governments, and the majority of our witnesses, in favour of new nuclear energy generation.
Government Response Summary
The government maintains a positive dialogue with nuclear site owners and has established Great British Nuclear (GBN) to drive its ambition for up to 24GW of nuclear energy by 2050. This confirms the stated consensus on new nuclear energy generation.
2
Conclusion
Accepted
Para 22
The storage technology required for an entire electricity system run on renewable energy is not there yet. Therefore, on balance, we consider that nuclear energy has a strong role to play, as part of a mix of low carbon sources, in achieving net zero and energy security.
Government Response Summary
The government aligns with the committee's conclusion, detailing its ambition for up to 24GW of nuclear energy by 2050 and the establishment of Great British Nuclear (GBN) to drive the UK's new nuclear programme.
3
Conclusion
Not Addressed
Para 28
The previous attempt to bring a new nuclear project to Wylfa by Hitachi has left scars on the local community. We are concerned that expectations are being raised again on Ynys Môn and question how long the uncertainty can continue about whether or not a new nuclear build will be …
Government Response Summary
The government outlines its long-term nuclear ambition and plans to develop a new National Policy Statement and consult on siting policy. However, it explicitly states that no decisions have been made on specific sites or technologies, which does not address the committee's concern about continued uncertainty regarding Wylfa.
5
Conclusion
Deferred
Para 30
We have heard from a wide range of industry representatives that Wylfa is one of the best sites for nuclear development and it is difficult to see how the UK Government can deliver its nuclear ambitions without taking forward a project at Wylfa. We consider that Wylfa should be the …
Government Response Summary
The government acknowledges the desire for a settled policy but states no decisions have been taken on which sites future projects will proceed with. It will develop a new National Policy Statement and consult later this year on future nuclear siting policy, while Great British Nuclear (GBN) will consider further large-scale projects.
8
Conclusion
Acknowledged
The introduction of the Regulated Asset Base (RAB) model is welcomed as a better alternative to the Contracts for Difference (CfD) scheme for nuclear developments. However, financing new nuclear projects is not straightforward and there will still be challenges under the RAB model. For a development to progress at Wylfa, …
Government Response Summary
The government acknowledges the complexities of financing nuclear projects under the RAB model and reiterates its belief that the model encourages private investment while protecting consumers. They outline existing mechanisms like value for money assessments, the Nuclear Energy (Financing) Act 2022, and Ofgem's regulatory oversight to manage risks and ensure financial commitment.
10
Conclusion
Acknowledged
We welcome the UK Government’s announcement that nuclear energy will be included in the green taxonomy, subject to consultation. We consider that this will unlock new avenues of private investment for nuclear development and send the signals needed to the financial sector that nuclear energy is an attractive investment. (Paragraph …
Government Response Summary
The government welcomes Hitachi's continued stewardship of the Wylfa Newydd site and has a positive relationship and dialogue with all nuclear site owners, but no decisions have been taken over which technologies future projects will proceed with, or at which sites.
11
Conclusion
Acknowledged
Para 57
New nuclear developments at Wylfa or Trawsfynydd could be a game-changer for the north Wales regional economy. Such projects would play an important role in the UK Government’s Levelling-Up agenda by bringing high-skilled, well-paid, long-term job opportunities to a rural area of the UK. It is vital that north Wales …
Government Response Summary
The government welcomes the committee's session and recognises the potential significant impact of new nuclear developments on the North Wales economy, noting the strong local interest and support.
13
Conclusion
Rejected
The contribution of businesses based in Wales to current nuclear developments at Hinkley Point C and Sizewell C demonstrates that, at least in part, the skills and supply chains for such projects are available in Wales. There should be investment in scaling up the Welsh nuclear supply chain to ensure …
Government Response Summary
The government rejects placing a requirement for minimum local content, stating that local and UK content in supply chains is a commercial decision for developers. It highlights that strengthening domestic capabilities is a high priority and welcomes companies supporting local regions, citing EDF's spending at Hinkley Point C.