The truth is that neither the Government nor the private sector is willing to spend billions of pounds building new power stations when they are unlikely to make profits for at least 10 years.
Both the public and private sectors have one good reason for closing their wallets. It is quite possible that the Sizewell and Hinkley plants would never make enough profit to justify the initial investment. Alternative forms of power - such as gas - may be much cheaper for decades to come. Indeed, few people predicted how low gas prices have turned out to be in the Nineties, or how plentiful gas supplies have become.
However, there are strong reasons to believe that new nuclear power stations will in time prove to be an essential and ultimately profitable venture. The dash for gas may make economic sense right now, but if we don't maintain alternative forms of power Britain could eventually become extremely dependent on the gas sheikhs of the next century. When the North Sea gas reserves are depleted, those who control the Trans-Siberian pipeline may wield considerable power over the price we have to pay for gas.
Meanwhile, if the world is serious about tackling global warming, it must reduce carbon dioxide emissions. So alternatives to gas-fired power stations will be needed all over the world. Nuclear generation is therefore likely to be vital in the 21st century. New nuclear power stations will have to be built in Britain. And when nuclear power plants are planned for countries such as China, British industry will have a better chance of picking up the contracts if we have recent experience of building our own modern versions.
The abandonment of the Sizewell and Hinkley Cs really amounts to short- termism. From the City's point of view, these nuclear power stations are not a good investment. After all, private investors are used to picking up the profits within five years at relatively low risk.
Sadly, the Government has failed to inject a long-term perspective either, despite the fact that the investment is in the national interest. It will provide neither direct investment nor incentives to encourage private- sector cash. Sizewell C and Hinkley C were making privatisation of the nuclear industry difficult. So they had to go. Tax cuts funded by privatisation proceeds are clearly a greater priority than protecting our supplies of energy. Giving up on Sizewell C and Hinkley C is a decision we may all live to regret.Reuse content