Britain 'could lose nuclear power in BNFL disposal'

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Unions warned yesterday that the UK could lose the ability to build a new generation of nuclear power stations after the Government paved the way for the partial or complete sale of British Nuclear Fuels' US division Westinghouse.

Patricia Hewitt, Secretary of State for Trade and Industry, told the Commons that she wanted BNFL to ensure that Westinghouse "operates with greater financial independence from its parent" within the next 12 months.

This opens up the prospect of a foreign investor taking a large stake - possibly a majority one - in Westinghouse, which specialises in nuclear fuel manufacture and reactor design.

BNFL bought Westinghouse for £700m in 1999, since when it has been one of the few profitable parts of the state-owned company, which owns the Sellafield reprocessing plant in Cumbria and which has lost £3bn in the past two years.

BNFL had been promoting a new generation of nuclear power stations for the UK based on Westinghouse's AP1000 design, which has already been accepted in the US. Prospect, one of the biggest unions at BNFL representing some 4,800 workers, said it was concerned that Westinghouse could now be sold off to a French or American buyer.

"BNFL's holding in Westinghouse is vital to the development of the UK's nuclear technology and we will be making representations to the Secretary of State to that effect," said Dai Hudd, a Prospect negotiator.

"Westinghouse owns around 65 per cent of licences for reactor build in the world. That ability to tap into a huge market should stay in BNFL or at most link up to a UK operator," he added.

Ms Hewitt also announced that as part of the restructuring of BNFL, a new parent company would be set up to bid for nuclear clean-up contracts. BNFL's Sellafield site along with its Magnox nuclear reactors are being transferred to a new Nuclear Decommissioning Authority, which will be responsible for the UK's £50bn of civil nuclear liabilities. BNFL will then bid for the contracts handed out by the authority.

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