In a statement released today, the Japanese conglomerate said it would withdraw from its plans to build the Moorside Nuclear Power Station in Cumbria, the United Kingdom, and will take steps to wind up associated subsidiaries, NuGeneration Ltd and Advance Energy UK Limited, by January. After this the site will be handed back to the Nuclear Decommissioning Authority.
Toshiba will incur costs of around JPY 15 billion (around US$131.9 million). It has reportedly already spent around $524 million on the project.
The plans, unveiled in 2009, envisaged the establishment of a 3.4 GW nuclear power station near Sellafield. According to the Guardian, it was set to meet around 7% of the United Kingdom’s electricity demands when complete, sometime in the 2020s.
However, Toshiba failed to find other investors for the project, after it was left holding 100% of the shares in NuGen, following an “Event of Default” in 2017 by France-based Engie S.A., which held a 40% stake.
“After considering the additional costs entailed in continuing to operate NuGen, Toshiba recognizes that the economically rational decision is to withdraw from the UK nuclear power plant construction project, and has resolved to take steps to wind-up NuGen,” read the Toshiba statement.
Responding to the news, the U.K. Department for Business, Energy and Industrial Strategy said, “Nuclear has an important role to play as part of the UK’s diverse energy mix as we transition to a low carbon economy, but in each case projects must provide value for money for consumers and taxpayers. This Government remains committed to new nuclear through the Industrial Strategy Nuclear Sector Deal as well as consenting the first new nuclear power station in a generation at Hinkley Point C.”
In May 2016, the U.K. Government gave the green light to the development of two nuclear reactors at Hinkley Point C. The 3.2 GW project, on which construction started in 2016, and which is not set to produce power until at least 2025, is estimated to cost around GBP 18 billion (US$ 23.8 billion. It will be financed by French state utility EDF, and by the Chinese government, with the former fronting GBP 12 billion, and the latter, GBP 6 billion.
Just after the go ahead was given to the project, an unpublished government report found that solar will be cheaper than nuclear by time the plant is built, with large-scale solar power set to cost between £50 and £75/MWh ($65 and $97/MWh) by 2025, while nuclear powers will be somewhere around £85 and £125/MWh ($110 and $162/MWh).
The government has, however, already agreed a guaranteed purchase price of £92.50/MWh ($120/MWh) with Hinkley developer EDF for nuclear power produced at the plant.
Excluding the Moorside and Hinkley projects, a further 11.2 GW of nuclear plans are in the U.K. pipeline.
Responding to Toshiba’s news today, Frank Gordon Head of Policy at the U.K. Renewable Energy Agency told pv magazine, “The energy gap left by the closure of NuGeneration has presented renewable energy with the perfect opportunity to prove its capability. Renewable technologies are cheap, easy and safe to deploy with more sophisticated technologies such as solar being the cheapest form of any electricity generation.”
He continued, “With data published by BEIS this week showing that 80% of the British public support clean energy, filling the energy gap with renewable technology is the obvious choice. If the UK is to benefit from cheaper, greener and smarter energy the Government must capitalise on this opportunity by unlocking a route to market for renewables and implementing consistent long-term policy.”
In a 163 page report released in July, the government’s infrastructure advisors also urged a rethink on nuclear in favor of renewables, specifically wind and solar.
This year has seen a flurry of positive news around renewables in the U.K. despite its lack of support. This includes the news in July that 2017 saw the country switch away from coal and gas to renewables, while non-profit service, MyGrid GB reported around the same time that it had surpassed 1,000 hours without coal already this year.
Meanwhile, a new report published by U.K.-headquartered energy company Drax two days ago found that, for the first time ever, total generation capacity available from renewables overtook that of fossil fuels on Britain’s electric grid.
It reported that the combined capacity of renewables – wind, solar, biomass, hydro and ‘other’ – in the U.K. reached 42 GW in the third quarter of 2018. Available capacity from fossil fuels, meanwhile, fell to 40.6 GW, with around one third being retired over the last five years.
In terms of nuclear, Drax said that in the period, it accounted for 24.1% of the energy mix and had an installed capacity of 9.5 GW, compared to 20.2 GW and 13.1 GW for wind and solar, respectively.
In further positive news, according to the latest figures from BEIS out today, U.K. renewables’ share of electricity generation was a record 31.7% this Q2, up 1.1% on 2017, due to both increased capacity, particularly in wind and solar, and lower overall electricity generation. Cumulative capacity has now reached 42.2 GW.
Q2 renewable power generation was 24.3 TWh, up 3% from the previous year, but down 14% from Q1. “At the end of 2018 Q2, onshore wind and solar PV, both represented around 31 per cent of all renewable capacity, the highest share of renewable technologies,” read the report.
Specifically, generation from PV increased 0.9% to 4.6 TWh compared to 2017 Q2 to set a new record for solar generation. This was a result of increased capacity and average sunlight hours per day being 0.4 hours higher than the long term mean, it added.