The Hinkley Point C nuclear power station is running £1.5 billion over budget and more than a year behind schedule.
French state-owned company EDF admitted the cost of the plant is now likely to be £19.6 billion and a review found it could be delayed by up to 15 months.
However the energy company hopes to finish the first phase by the end of 2025 as initially planned.
The second reactor is expected to have a nine-month holdup.
EDF said the revised costs “result mainly from a better understanding of the design adapted to the requirements of the British regulators, the volume and sequencing of work on site and the gradual implementation of supplier contracts”.
Its projected rate of return is now estimated at around 8.5% compared to 9% initially.
Hinkley Point C is the first nuclear power plant in a generation and is expected to supply 7% of the UK’s electricity needs.
EDF is funding two thirds of the project while China’s CGN is investing the rest.
A spokesperson at the Department for Business, Energy and Industrial Strategy said: “As the developer has made clear the project remains on track to meet its first major milestone in 2019. The UK Government negotiated a competitive deal which protects consumers and ensures that all of the cost of construction, including any overruns, sits with the contractor.”
Last month the UK’s National Audit Office warned customers have been locked into a “risky and expensive” project.