3 ms·

OTOH if I understand it right the French "taxpayer", i.e. govt, will be the beneficiary of the above-market price for electricity produced by the plant that the

OTOH if I understand it right the French "taxpayer", i.e. govt, will be the beneficiary of the above-market price for electricity produced by the plant that the UK has guaranteed, presumably for the lifespan of the plant, which is 60 years. So I presume that will be a net gain for France, otherwise there would be no sense in continuing with the project.

davedx 2y ago
Weren’t those agreements made way back before the giant cost overuns?
- pfdietz 2y ago
  Yes. Huge mistake for France, that. Fixed price contracts in the nuclear industry have rarely if ever worked out well for the suppliers. Contrast this with renewables which typically come in within 10% of the contracted price.
  - tonyedgecombe 2y ago
    Yes, it seems the only projects that have larger cost overruns than nuclear power stations is dealing with nuclear waste.
    - chickenbig 2y ago
      I take it you are referring to https://x.com/BentFlyvbjerg/status/1662016016493191169 https://x.com/BentFlyvbjerg/status/1662016016493191169 Interestingly the nuclear data implies that those (45% of) projects not in the tail (defined as >= 50% cost overrun) have a mean overrun of 17.33%. 120% = 0.45 * X% + 0.55 * 204% therefore X% = (120% - 0.55 * 204%)/0.45 = 17.33%
    - chickenbig 2y ago
      Don't forget the Olympics, with a format designed to minimise the learnings. Note that the point of the article was that the design is being proven, lessons are being learnt, and the skills of individuals and organisations developed, which reduces the risk of overruns etc.
      - pfdietz 2y ago
        Hasn't it already greatly overrun the initial promises? I mean, that's the whole reason France is crying for relief here from the UK. Anyway, claims that nuclear will show good experience effects this time, for sure, are to be treated with skepticism.
        chickenbig 2y ago
        > Hasn't it already greatly overrun the initial promises? Hinkley Point C got the green light in 2016 with an estimated £18bn build cost The most recent estimates put costs as high as £34bn at 2015 prices, £46bn in today’s money. I believe the range is £31–35 billion in 2015 prices, so between 75% and 100% overrun. > that's the whole reason France is crying for relief here from the UK. The overrun combined with COVID combined with the spike in inflation and also CNG being frozen out of the UK nuclear market/cooling of relationship with China. > claims that nuclear will show good experience effects this time, for sure, are to be treated with skepticism. Agreed, which is why the second unit at HPC will be interesting.
actionfromafar 2y ago
Depends on what, if any, penalties there are for discontinuing.
chickenbig 2y ago
> that the UK has guaranteed, presumably for the lifespan of the plant, which is 60 years https://www.gov.uk/government/collections/hinkley-point-c https://www.gov.uk/government/collections/hinkley-point-c The Hinkley Point C CfD provides a Strike Price for the developer of £92.50/MWh (2012 prices), reducing to £89.50/MWh (2012 prices) if EDF take a FID on their proposed Sizewell C project, for a 35 year term from the date of commissioning. > I presume that will be a net gain for France I think the project has a certain momentum to it. Also failing to complete the project would rather call into question their competence for the EPR2 build-out in France.

davedx 2y ago

Weren’t those agreements made way back before the giant cost overuns?

pfdietz 2y ago
Yes. Huge mistake for France, that. Fixed price contracts in the nuclear industry have rarely if ever worked out well for the suppliers. Contrast this with renewables which typically come in within 10% of the contracted price.
- tonyedgecombe 2y ago
  Yes, it seems the only projects that have larger cost overruns than nuclear power stations is dealing with nuclear waste.
  - chickenbig 2y ago
    I take it you are referring to https://x.com/BentFlyvbjerg/status/1662016016493191169 https://x.com/BentFlyvbjerg/status/1662016016493191169 Interestingly the nuclear data implies that those (45% of) projects not in the tail (defined as >= 50% cost overrun) have a mean overrun of 17.33%. 120% = 0.45 * X% + 0.55 * 204% therefore X% = (120% - 0.55 * 204%)/0.45 = 17.33%
  - chickenbig 2y ago
    Don't forget the Olympics, with a format designed to minimise the learnings. Note that the point of the article was that the design is being proven, lessons are being learnt, and the skills of individuals and organisations developed, which reduces the risk of overruns etc.
    - pfdietz 2y ago
      Hasn't it already greatly overrun the initial promises? I mean, that's the whole reason France is crying for relief here from the UK. Anyway, claims that nuclear will show good experience effects this time, for sure, are to be treated with skepticism.
      - chickenbig 2y ago
        > Hasn't it already greatly overrun the initial promises? Hinkley Point C got the green light in 2016 with an estimated £18bn build cost The most recent estimates put costs as high as £34bn at 2015 prices, £46bn in today’s money. I believe the range is £31–35 billion in 2015 prices, so between 75% and 100% overrun. > that's the whole reason France is crying for relief here from the UK. The overrun combined with COVID combined with the spike in inflation and also CNG being frozen out of the UK nuclear market/cooling of relationship with China. > claims that nuclear will show good experience effects this time, for sure, are to be treated with skepticism. Agreed, which is why the second unit at HPC will be interesting.

actionfromafar 2y ago

Depends on what, if any, penalties there are for discontinuing.

chickenbig 2y ago

> that the UK has guaranteed, presumably for the lifespan of the plant, which is 60 years https://www.gov.uk/government/collections/hinkley-point-c https://www.gov.uk/government/collections/hinkley-point-c The Hinkley Point C CfD provides a Strike Price for the developer of £92.50/MWh (2012 prices), reducing to £89.50/MWh (2012 prices) if EDF take a FID on their proposed Sizewell C project, for a 35 year term from the date of commissioning. > I presume that will be a net gain for France I think the project has a certain momentum to it. Also failing to complete the project would rather call into question their competence for the EPR2 build-out in France.