It is misleading to compare future generating costs with the current, wholly artificial, capped pool price, which is not a 'prevailing market price' in any normal sense. When Sizewell C would come on line early next century, electricity prices are likely to be set by the price of the gas then available for the gas- fired stations, which by then would supply most of the generation market. These prices will be higher, even substantially higher, than present-day gas prices.
While Sizewell C itself would be profitable at 2.9p per kilowatt hour, using the rate of return expected in the public sector, private investors look for a higher rate of return. Therefore, if electricity prices do not move sufficiently upwards, support will be needed to help meet investors' expectations.
It is also wrong to suggest that we do not want to build nuclear plants. Our core business is electricity generation, but our core skills are nuclear. Provided the commercial conditions were right, we would want to build new nuclear power stations, as we believe firmly that the UK should retain its nuclear option. The Sizewell design is an asset, it's our product, we're proud of it and we'll market it wherever we can. We hope that includes the UK - but it's up to the Government to create the right conditions for supporting such a long- term investment.
Finally, it is wrong to suggest that UK investment of money and talent in the nuclear industry has been wasted. We think that the success we have had in the past four years (during which the sales volume from our Advanced Gas-cooled Reactors has nearly doubled) is a pay-off for all the hard work and dedication that has gone before. It is certainly good for the electricity customer, to say nothing of the contribution we have made to minimising fossil fuel pollution, and the protection from economic blackmail by dominant fuel producers (whether at home or abroad) that nuclear power has helped to give the UK.
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