The nuclear industry needs long-term guarantees from energy policy or it could suffer from investor uncertainty, an expert at an independent think tank has warned. Malcolm Grimston, Associate Fellow at Chatham House said that another big swerve in direction could be off-putting for investors.
Speaking at a fringe meeting at the Conservatives’ conference in Manchester, he pointed to the u-turns in energy policy since the electricity market was liberalised in the late 1980s and early ’90s, such as the end to capacity payments in 2001 with the electricity trading arrangements.
Mr Grimston told ELN: “The danger is that if every ten years you’re changing your market rules massively, but for a nuclear plant it takes ten years to build and it will operate for 60 years, then that means that even when you’re building it the chances are the rules are going to change so radically that the whole basis on which you make your decision might be different when it comes to operating.”
Mr Grimston said that this was bound to affect confidence in investment.
His comments should come as a warning to the Government, which is giving nuclear power a key role in energy policy. Energy Minister Charles Hendry said at the conference that “this Government is making Britain a serious nuclear nation once again.”