Japanese firm pulls plug on £15bn nuclear project in Cumbria
Japanese firm Toshiba has announced it is to pull the plug on the company set up to build a new £15bn nuclear power station in Cumbria.
The tech giant has announced it is winding up Manchester based NuGen, its UK-based nuclear arm, after efforts to sell the business failed.
Business leaders and the unions have criticised the Government for its handling of the project.
The announcement is a serious blow to the UK’s nuclear sector and has left plans to build a new power station in Cumbria in serious doubt.
NuGen, which employs 40 staff, was behind the development of the Moorside nuclear power station project close to Sellafield.
The project would have created thousands of jobs during the construction phase and pumped billions into the region’s economy.
The company made the announcement to the Japanese Stock Exchange.
A statement issued by the firm said: “On November 8, 2018, Toshiba announced its intention to withdraw from the nuclear power plant construction project in the UK, NuGeneration Limited (NuGen) and to take steps to wind-up the business.
“The announcement comes after 18 months of negotiations with a range of potential new owners.
“Unfortunately, it has not been possible to successfully conclude those negotiations. NuGen has retained a team to support the implementation of a winding-up process and will work with Toshiba and its other stakeholders.
“Whilst NuGen will not be taking the project forward, the Moorside site in Cumbria remains a site designated by Government for nuclear new build, and it is now for the Nuclear Decommissioning Authority as the owner of the site and the Government to determine its future.
“NuGen would like to pay tribute to colleagues, its shareholder, Toshiba, and to the other stakeholders, and many various friends of the project both in Cumbria and beyond, who have supported NuGen’s efforts through its development phase and throughout the proposed sale negotiations.”
Toshiba was hoping to sell Nugen to Korea Electric Power Corporation but the sale fell through after more than a year of negotiations.
South Korea’s energy ministry said it will work with the UK government on the NuGen nuclear project.
The Ministry of Trade and Energy said in a statement: “The ministry plans to closely coordinate with the British government on the Moorside project while monitoring the NuGen liquidation process with KEPCO.”
The GMB trade union said the “looming collapse” of Moorside had been “depressingly predictable”.
MPs, business leaders and unions have been calling on the Government to intervene but Theresa May repeatedly dismissed it as a “commercial issue”.
GMB national secretary Justin Bowden called for the Nuclear Decommissioning Authority to be scrapped and a nuclear development authority to be created.
He said: “Relying on foreign companies and countries for our essential energy needs is utterly irresponsible.”
Unite the Union said the Government had a major responsibility for Toshiba’s decision to wind-up its NuGen business, because ministers had adopted ‘a hands-off ’ approach to UK energy policy.
Unite regional secretary for the North West, Ritchie James, said: “Today’s news is a cruel blow to the prospects for the North West economy and the future of thousands of highly-skilled jobs in construction and operations, once it was up and running.
“It is our view that it is not too late to revive this project, but it needs the active engagement of government, including the commitment of public money.
“Moorside could be a powerhouse, literally, for the regional economy, and we will work with other stakeholders, such as local authorities, to see that this project eventually comes to fruition.”
He added: “The hands-off attitude of the government has been the elephant in the room and today this ‘one step removed’ approach has come home to roost. This is another example of the Government’s chaotic attitude to policy making.
“Unite will be seeking an urgent meeting with business secretary Greg Clark to chart a way forward to see what can be done to get this project kick-started again.”
He said: “In an increasingly uncertain and dangerous world, there needs to be a joined-up UK energy strategy for the decades ahead to keep the lights on and the wheels of industry turning.”
Rob Johnston, chief executive of Cumbria Chamber of Commerce, said: “We’ve argued consistently that the best way to fund new nuclear power generation is for the Government to invest as a partner alongside the private sector.
“That reduces the risk and so makes the electricity generated cheaper, and it should bring a long-term return for taxpayers.
“The Government is taking a substantial stake, around £5bn, in Hitachi’s Horizon nuclear new build project in Wales.
“But they won’t consider direct investment in Moorside. Why not? Why is Wales a special case but not Cumbria?”
He added: “It’s negligent of ministers to allow the Moorside project to collapse.
“This is a setback for Cumbria. Moorside would have created peak on-site employment for 6,000 people during construction and 1,000 well-paid permanent jobs once operational.
“It also strengthened the case for much-needed investment in Cumbria’s road and rail infrastructure. But if this is bad news for Cumbria, it’s a disaster for the UK’s energy security.
“Moorside would have generated 7% of the nation’s electricity, replacing older power plants coming to the end of their life.
“Demand for electricity is going to soar with the roll-out of electric vehicles. National Grid estimates that generating capacity will have to rise by at least 80% by 2050.”
NuGen was initially co-owned by Toshiba in partnership with the French firm Engie.