Nuclear pull-out poses threat to the economy

ANALYSIS

Workers in the nuclear industry could justifiably feel that yesterday's announcement, that no more nuclear power plants will be built for the foreseeable future, amounts to a giant slap in the face. After all, it was the nation's nuclear power stations which helped keep the lights on during the coal strike of 1984 when, to Margaret Thatcher's delight, a 20th-century fuel compensated for the lack of one from the 19th.

Yet yesterday's decision could propel Britain backwards, and have a profound effect on the 21st century economy, which will have to rely on imported gas and oil, while jobs that would have been created by the building of power plants will never materialise. Expertise in the nuclear industry will be lost to other countries. And a greater reliance on fossil fuels will create problems in meeting international obligations to reduce emissions of carbon dioxide, which cause global warming.

Nuclear power provides 28.8 per cent of Britain's electricity. It is generated by 16 power plants, four of them in Scotland, employing 9,700 people. The plants are supplemented by 2,000 megawatts each day - the equivalent of power from one- and-a-half stations - via an undersea cable from France.

Hopes for power "too cheap to meter", as promised by newspaper headlines of the 1950s, fell when the true costs of building and then decommissioning the plants' radioactive shells became clear. Even so, within the public sector, nuclear power could justify its existence as a reliable, indigenous source of energy. But the industry was in effect doomed by the privatisation of the electricity utilities in the 1980s.

The idea of splitting the industry into "generators" (in the form of PowerGen and National Power) and "buyers" (in the form of the National Grid), trading in a "spot market" where the price of power fluctuated from hour to hour, left nuclear power flailing in electricity's wake. While the price of gas and oil falls and rises as new reserves are found, or trading embargoes are imposed, a nuclear power station runs for 40 years, using fuel whose cost barely changes.

But in a commercial spot market for energy, nobody gives 40-year contracts.

Yesterday Dr Robert Hawley, British Energy's chief executive, said: "At present the future of UK energy prices is insufficiently certain for British Energy to invest in new nuclear or indeed in any other form of new generation in the short term. Our current priority throughout the group is the successful privatisation of British Energy next summer."

"What sort of people will be attracted to the industry now?" asked Professor Ian Fells, an energy expert from the University of Newcastle. He added: "The Government should look at the Pacific Rim countries like Japan and Korea. They are investing in the long-term; investing in nuclear energy."

Tony Cooper, secretary of the Electricity Supply Trade Union Council, called the decision "throwing in the towel" and predicted that it would be "disastrous" for the country's long-term energy needs.

Greenpeace, however, welcomed the decision and claimed - almost certainly correctly - that it signalled the end of the nuclear industry.

But a problem for Greenpeace, and other environmental groups, may arise early in the next century as prices of gas and oil imported from Norway and Russia is hiked. Then it will be time for some hard thinking. Yesterday that did not seem to be in evidence.