Lib Dems threaten nuclear investment, says Labour

Opposition to nuclear power from the Liberal Democrats risks jeopardising billions of pounds of private investment in new power stations, according to Labour’s former energy minister Lord Hunt.

Philip Hunt told a Nuclear Industry Association fringe event at the Labour party conference in Manchester that the “ambivalence” of the coalition government to new build was a growing concern to the industry.

The Liberal Democrats, who oppose nuclear power, agreed not to block the construction of a new fleet of nuclear power stations as part of the coalition agreement with the Conservative party.

However, with energy policy run by Liberal Democrat secretary of state Chris Huhne, some concerns have been expressed over whether the necessary policy momentum will begenerated to push new power stations through, with a number of Liberal Democrats expressing their complete opposition to energy at their conference last week.

Hunt said: “Before the election the secretary of state was speaking out very vigorously against new nuclear. Now every time he says he’s committed, it comes attached with such hysterical briefing about there being no public subsidy, that the mood music leads people to think there is real ambivalence in government. This must cause concerns to developers. We risk investment not taking place.”

Hunt said he was particularly worried about rumoured cut-backs to the budget of the Nuclear Decommissioning Agency, and delays in announcing whether to press ahead with setting up a new regulator.

However, he added: “My judgement is that the investment is not at real risk yet. But if the government continues to be ambivalent in the way it has been then it comes to the point the private sector loses confidence.”

Paul Spence, director of strategy and regulation at EDF, which is planning to spend over £20bn building four nuclear power stations in the UK, said the company still needed clarity on the timetable for finalising national energy policy, how money would be set aside for decommissioning of nuclear, and a floor price for carbon, before the company could commit to building.

Hunt also hit out at the coalition decision to block the proposed £80m loan to Sheffield-based nuclear manufacturing firm Forgemasters.

He said: “I can’t think of a more foolish decision this government could have made, in terms not just of the development of the supply chain in this country, but also the signal it sends around this government’s commitment to nuclear power. It is a decision this country will live to regret.”

Shadow business secretary Pat McFadden also used his keynote conference speech to say the Labour party will continue to press for the decision to be reversed.

He said: “So if they really have a regional growth fund of £1bn, why is its first decision not to reinstate the loan to Forgemasters and put this stupid refusal behind us once and for all.”