UK 'puts energy in French hands'

Government plans for nuclear power risk handing control of the UK's climate and energy policies to France, according to four senior environmentalists. Energy giant EDF and reactor builder Areva, big players in the UK's plans, are largely French government-owned. Jonathan Porritt, Tom Burke, Charles Secrett and Tony Juniper say the firms are landing UK citizens with all the financial risks of nuclear new build. They have told Prime Minister David Cameron he is being badly advised. The four - all former directors of Friends of the Earth (FoE) UK - say that the current policy to start building at least eight new reactors over the next decade cannot withstand the "intense scrutiny" it is coming under in the wake of the Fukushima disaster in Japan. "There is now a growing risk of policy failure," they write in their letter to the prime minister. Mr Cameron recently signed an agreement with French President Nicolas Sarkozy to boost nuclear co-operation. "Our analysis shows that building new nukes will be a massive rip-off for the the British taxpayer," said Mr Secrett. "How on Earth can the prime minister justify paying billions of pounds of subsidy to French power companies when the chancellor is slashing welfare budgets for poor people in Britain and there are a million young people unemployed?" Reforming the market The UK operates possibly the most liberal electricity market in the world; yet as a matter of policy, the government wants to see a new fleet of reactors built to replace those that are progressively reaching the end of their working lives. Consequently, it has introduced a number of changes aimed at incentivising companies to construct new nuclear power stations. Ministers have repeatedly claimed that these do not amount to subsidies. However, last May the Commons Energy and Climate Change Committee disagreed, urging the government to stop "disguising" the reality. Campaigners have also reported the UK to the European Commission, arguing that these "hidden subsidies" should have been taken to the commission for approval, but were not. Currently, the Department of Energy and Climate Change (Decc) is finalising a bill on reforming the energy market, which will effectively offer fixed prices to companies generating low-carbon power. The four FoE ex-directors say that with the government relying on EDF to commission and operate the new power stations and on Areva to build reactors, the French firms are in a position to bargain hard and secure themselves a highly advantageous financial package - which will result in higher electricity prices for the UK consumer. And they say that as the French government has a large stake in both companies, it will be able to determine whether the UK nuclear build goes ahead. "The French will only proceed if the large financial risks of new nuclear build are transferred from France to British households and business," they tell Mr Cameron. Even then, they say, "there is no reason to believe that Areva will be able to construct new reactors on time and to budget". The two modern Areva EPR reactors under construction in Europe, at Flamanville in France and Olkiluoto in Finland, are both several years behind schedule and substantially over budget. A French bid to build EPRs in Abu Dhabi recently lost out to a South Korean consortium - partly because the EPRs were too complex and costly in relation to their rival. Renewable vision In France itself, the government recently decided to extend the life of existing reactors rather than build new ones. Last month, EDF said it would apply for licences to extend the working life of its UK reactors. According to the four ex-FoE chiefs, these events suggest that EDF and other companies involved in the new UK fleet may, in the end, pull out - which could leave targets for low-carbon energy very difficult to achieve. The priority, they say, should be to invest in energy efficiency and renewable technologies, in which the UK could become a world leader, generating jobs and income for the national coffers. "Ministers have been well and truly led up the garden path by the nuclear lobby," said Tony Juniper. "The prime minister needs to step in and make sure that energy policy is truly working in the public interest, rather than to the agenda of a massive vested interest."