Second French utility joins fray to build UK nuclear power stations

France's second biggest power company has joined the race to build nuclear power stations in the UK, as tipped by CJ earlier this week.

French power company GDF Suez yesterday said it is teaming up with Iberdrola, Spanish owners of Scottish Power, to bid to build two reactors on exisiting nuclear sites.

Big suppliers from across Europe are lining up to take part in the UK's nuclear new build programme, needed to replace a third of electricity generating capacity in the next 15 years as ageing reactors are closed, and European environmental regulations force the closure of coal-fired power stations.

The Nuclear Decommissioning Authority (NDA) started the process to sell land adjacent to three existing power stations in January. The Iberdrola-GDF Suez group will be bidding against two other European teams.

One is EDF, the French utility giant that took over British Energy last year for £12.5bn. A 25 per cent stake of that group is now being taken by Centrica, the UK utility, and the venture is committed to building one nuclear power station by 2017 and another three plants by 2025.

The other is a joint venture set up by RWE and E.On, the two German utilities, last month with the stated intention of building at least four reactors in the UK, adding at least six gigawatts, or around 10 per cent of the UK's current installed capacity.

The deadline for expressions of interest in the first three NDA sites to go under the hammer – at Wylfa in Anglesey, Bradwell in Essex and Oldbury in Gloucestershire – was last month. The next stage in the bidding process is in March.

GDF Suez was created last year by a merger of France's former state gas company with Suez, a Belgian group.

Utilities are not the only companies jostling for a position in the new market. In December Rolls-Royce, Balfour Beatty and Areva, the French reactor maker, signed up to a partnership expected to create up to 15,000 long-term manufacturing and construction jobs in the revived industry.