Spanish target UK's £40bn new nuclear programme

The race to deliver the UK’s £40bn new nuclear programme geared up a notch this week with Spanish utility Iberdrola and Scottish and Southern Energy teaming up to build an undisclosed number of new nuclear plants in the UK.

The joint venture follows close on the heels of a similar agreement announced last week by German utility giants E.ON and RWE. The two JVs will compete for Nuclear Decommissioning Authority (NDA) sites on which to build their reactors.

Contractors welcomed the news. One commented: “It is a vote of confidence in the UK new nuclear programme. It is very likely this joint venture will build more than one facility, so along with the four EDF plan to build and the three to four E.ON and RWE plan, that’s a substantial flow of work.”

Alistair Phillips-Davies, SSE’s Energy Supply Director, said the UK Government’s new nuclear policy and the need to supply energy to its customers from nuclear plants had driven the firm’s decision to hook up with Iberdrola.

Pedro Azagra, Iberdrola’s development director, said Iberdrola was committed to the UK market and welcomed the Government’s plans to develop new nuclear power.

The JV said it was open to adding more partners to the mix. Names in the frame, according to industry observers could include Swedish energy giant Vatenfall and French utility company GDF Suez.

The JV declined to say how many nuclear reactors it plans to build in the UK or which reactor design it will use. Areva and Westinghouse both have reactor designs awaiting approval for use in the UK. Areva’s EPR reactor design relies on traditional construction methods while the Westinghouse AP1000 model involves much more off site and modular construction.

Iberdrola and SSE’s announcement came just one day after expressions of interest were submitted for three NDA sites at Wylfa in North Wales, Oldbury in Gloucestershire and Bradwell in Essex. Other sites up for grabs are those due to be sold by EDF as part of its deal to buy British Energy. Observers say these are likely to be Torness in East Lothian, Hartlepool in Teeside and Heysham in Lancashire.

Iberdrola and SSE said other partners may be added to the joint venture at a later date. These could include another utility company, to spread the high cost of developing new nuclear plants. Names in the frame include Vatenfall and Suez.