Shale Gas 2010
UK Nuclear: "Extraordinarily Unlikely"
- Published: 15 December 2010
No that's not radical greens saying that. That isn't even No Hot Air. The above was told to a Parliamentary committee yesterday by those capital destroying socialists, at the US government owned Citibank.
Tomorrow we get to hear about government plans for electricity market reform. One can safely assume that the Torygraph and Times will paint any opposition as trouble makers. They don't really listen to them anyway, but they have to listen to the markets:
The UK government's goal of seeing 16,000 MW (16 GW) of new nuclear power online by 2025 is "extraordinarily unlikely," Citibank utilities analyst Peter Atherton told a House of Commons committee Tuesday.
Even if the government's imminent proposed reforms of the electricity market socializes the power price risk -- moving it from utilities to consumers -- utilities will still be faced with construction risk, Atherton said.
The UK government will Thursday set out its plans for the most radical reform of the electricity market in decades. It is known to favour feed-in tariffs and creation of a floor price for carbon to entice nuclear investors.
Together, power price risk and construction risk represent the two biggest concerns of potential investors in new nuclear, Atherton said.
"Construction risk is very profound and very real and somebody is going to have to carry that risk," he said.
In the absence of government loan guarantees, which are being offered in the US, investors will run shy of the construction risk, he said.
What Citibank didn't dare mention was that even with government loan guarantees, US nuclear construction is dead:
We think natural gas will stay cheap for a very long time," Rowe said in an interview today at Bloomberg's headquarters in New York. "As long as natural gas is anywhere near current price forecasts, you can't economically build a merchant nuclear plant."