Renewables organisations have urged the UK government to plug a 9GW hole in its low-carbon energy policy with “shovel-ready” wind and solar capacity after Hitachi suspended its nuclear development programme.
RenewableUK said the UK risks “relying more heavily on polluting gas and coal” unless it allowed mature renewables to compete in Contracts for Difference auctions following the shelving of the 2.9GW Wylfa Newydd in Anglesey and 2.9GW Oldbury in Gloucestershire.
Hitachi’s UK subsidiary Horizon Nuclear Power said it had abandoned the projects after failing to agree financing terms with the government, which was willing to take a one-third stake in Wylfa and offer a CfD of £75 per megawatt-hour.
The move comes just two months after another Japanese nuclear developer, Toshiba, pulled the plug on its 3.3GW Moorside plant in Cumbria.
The scrapping of 9.1GW of new nuclear equates to around 72 terrawatt-hours of low-carbon generation by 2030, according to analysts Carbon Brief.
“Today’s announcement risks blowing a hole in the government’s plans to meet our carbon targets,” said RUK deputy chief executive Emma Pinchbeck.
“We have a pipeline of shovel-ready onshore wind projects that can provide cheap power to consumers and help close the gap on our carbon targets and it is time government allowed onshore wind compete on a level-playing field,” she added.
The Solar Trade Association said the decision by Hitachi made it “painfully obvious that the UK cannot afford to marginalise the cheapest renewables”.
Renewable Energy Association policy head Frank Gordon said renewables are “cheap, easy and quick to build and they can provide the baseload, stable power required.”
“The government must capitalise on the opportunity renewables present by unlocking a route to market and implementing consistent long-term policy,” he added.
UK energy department BEIS said it remained committed to new nuclear as long as it is “delivered at the right price for consumers and taxpayers in a world of rapidly falling costs for alternative technologies.
“The cost of renewable technologies are falling rapidly, with the cost of offshore wind halving over the last two years to £57.50/MWh, and positive developments in the energy market more widely meaning these are expected to fall further,” a spokeswoman said.
“To offer a higher price (to Hitachi) or greater exposure to risk was not right for us, and we would not embark on that,” she added.
The department will unveil details of alternative funding models for future nuclear projects in an energy white paper to be published in the summer.