Nuclear revival could lead to £5 billion-a-year boost to UK economy
Research shows more than 32,000 jobs a year and new export markets could be created by continuing investment in new nuclear
Government policy to promote a new generation of nuclear power plants could boost the UK economy by more than £5 billion a year, new research shows.
Figures from the Institute for Public Policy Research also suggest that rebuilding new nuclear energy capacity in the UK could create more than 32,000 additional jobs while giving a significant boost to annual exports.
In its National Policy Statements, the Government set out the “urgent need” for new nuclear electricity generation so the UK can meet its energy and climate change objectives.
It added that new nuclear power should be free to contribute “as much as possible” towards meeting the need for around 18 GW of new non-renewable capacity by 2025.
The research by IPPR shows that if nuclear power met all the additional capacity required, the result would be a boost to UK GDP of up to 0.34 per cent a year and an annual economic gain of £5.1 billion. Furthermore, the investment could result in additional direct and indirect job gains of more than 22,000 a year, together with further induced jobs of up to 10,000 a year created by increased economic activity as a result of the associated investment.
The research was commissioned by EDF Energy, which has plans to build four new nuclear plants at Hinkley Point in Somerset and Sizewell in Suffolk, with a combined capacity of 6.4 GW, sufficient to power ten million homes.
The IPPR report says: “Achieving the UK’s climate change targets will require a number of measures, including closing down carbon-intensive electricity generators, such as coal-fired stations, over the next decade. Other generators are also reaching the end of their lifecycle. As well as replacing this existing capacity, the UK will need substantial investment in electricity generating capacity over the next 20 years to meet a likely rise in demand.
“Investment in nuclear energy will have benefits in contributing to both economic growth and job creation and has the potential to give Britain a greater share in the export market. Particularly at the local level, investment in nuclear energy can boost jobs. Estimates suggest that delivery of up to 18 GW in new nuclear power could deliver, on average, 11,250 direct and the same number of indirect jobs per year. It is possible that between 5,000 and 10,000 induced jobs per year could also be generated with the necessary investment in place.
“If the Government makes a clear and credible long-term commitment to nuclear energy in the form of a long-term nuclear energy strategy, and if it has all-party support in doing so, then UK industry can be reasonably confident that there will be a steady stream of work and contracts in the future.”
The report suggested that export activity from the energy sector could more than double, from around £700m annually now to between £1.2 - £1.7 billion by 2030 at today’s prices.
EDF Energy has already awarded hundreds of contracts worth many millions of pounds in the South West of England as part of the preparatory works associated with the Hinkley Point C development. Just last week the company announced the preferred bidder for the £2 billion civils work contract.
Vincent de Rivaz, chief executive of EDF Energy, recently told MPs scrutinising the government’s draft Energy Bill that the company was committed to moving the project forward ahead of crucial decisions on planning consent and design approval later this year.
He said: “It is important to maintain the current momentum. A huge amount remains to be done ahead of our final investment decision at the end of this year – but we are determined to do it. New nuclear build must be cost-competitive with other low-carbon choices. The Contract for Difference will demonstrate this transparently. It is good for customers, policymakers and investors.”
Commenting on the report Mark Prisk MP, Minister at the Department for Business, Innovation and Skills, said: “This research from the IPPR, commissioned by EDF Energy, demonstrates the compelling business case for investing in the UK’s energy infrastructure. This much-needed investment could create significant numbers of jobs for years to come as well as increase UK export potential. New nuclear build is an important part of the diverse energy mix we need for the UK’s low-carbon future.”