Sizewell C power station to be built as part of UK's £14bn nuclear investment
The biggest nuclear programme in a generation will 'get Britain off the fossil fuel rollercoaster', the energy secretary, Ed Miliband, has said, announcing £14.2bn to build a new nuclear power station and a drive to build small modular reactors.
The multibillion-pound investment at Sizewell C on the Suffolk coast, which has been long expected, will create 10,000 jobs and power the equivalent of 6m homes.
Nuclear will be one of the key investments Rachel Reeves will champion at Wednesday's spending review, which the chancellor hopes will overshadow uncomfortable decisions for the government including the U-turn on the winter fuel payment and a major row over police funding.
Miliband said the 'golden age' of nuclear investment was critical to the government's net zero goals, which will probably require a significant increase in electricity demand, and said that it would not detract from investments in renewables.
'I'm doing this because of my belief that climate change is the biggest long-term threat facing us,' Miliband said.
'The truth is that we have this massive challenge to get off fossil fuels. That is the central driving ambition of the government's clean energy superpower mission. We know that we're going to have to see electricity demand at least double, by 2050.
'All of the expert advice says nuclear has a really important role to play in the energy system. In any sensible reckoning, this is essential to get to our clean power and net zero ambitions.'
The announcement comes as part of the £113bn of new capital investment Reeves will announce in the spending review that the Treasury hopes will be the key theme – and enough to stave off further disquiet over expected cuts to day-to-day spending.
On Monday, it emerged that all departments had settled with the Treasury after a deal was done with the home secretary, Yvette Cooper, who was deeply dissatisfied with funding for policing.
The Home Office could still be forced to cut the overall number of police officers in the aftermath of its lengthy spending review negotiations with the Treasury.
Whitehall sources said the department had been asked to look at all options including reducing officer recruitment, which would mean an overall cut in the headcount.
On Monday morning, Cooper was the last minister still to reach a deal, with reports suggesting greater police spending would mean a squeeze on other areas of her department's budget. On Monday afternoon, a source said that cuts to police numbers remained 'a possibility'.
The mayor of London, Sadiq Khan, has also privately complained to the Treasury about Met police funding and a failure to finance any of the capital's key transport infrastructure requests.
On Monday evening it emerged there were concerns that some English regions, including London, would lose money to support local economic growth and tackle poverty through schemes such as the UK Shared Prosperity Fund, Growth Hub funding and the Levelling Up Fund.
A source close to the London mayor said: 'If the Treasury go ahead with this cut it would be incredibly shortsighted. They say they want economic growth but their actions in failing to invest in new infrastructure in the capital and cutting local growth funds will actually damage our economy, not improve it.
'They say they want regional mayors to be the drivers of growth but then remove their levers to achieve growth.'
Earlier on Monday, Reeves formally announced plans to restore the winter fuel payment to all pensioners with an annual income of £35,000 or less, after a furious backlash to the government's most unpopular policy to date.
While the reversal was welcomed by Labour MPs worried about pensioner poverty and the political toxicity of the issue, there were concerns the £1.25bn price tag would mean more tax rises or spending cuts this autumn.
The green light for the development at Sizewell C marks the end of a long 15-year journey to secure investment for the plant since the site was first earmarked for new nuclear development in 2010. Campaigners argued the development of the site would be hugely expensive compared with investment in other energy sources and would create only short-term job opportunities.
The government announced Rolls Royce as the winners of a long-running competition on Tuesday for a bid to build one of Europe's first small modular reactor (SMR) programmes – a model that some in government hope could eventually attract private investment, especially from tech companies, which might build SMRs to power datacentres. The FTSE 100 manufacturer Rolls-Royce was the long-running favourite to be chosen to build the first British SMRs.
Reeves will confirm the nuclear investment in her address at the GMB congress on Tuesday, including £6bn of investment to the nuclear submarine industrial base to deliver on recommendations in the strategic defence review.
The investment also includes £2.5bn over five years for research and development of fusion energy. Combined, the Treasury said they would be vital to the UK's energy security, replacing the UK's dependency on fossil fuel markets with homegrown power.
'We need new nuclear to deliver a golden age of clean energy abundance, because that is the only way to protect family finances, take back control of our energy, and tackle the climate crisis,' Miliband said.
He said projects such as these were also essential for making the economic case to voters that the transition to net zero would not come at a cost to their families. 'There aren't enough industries in this country that provide good jobs at decent wages with strong trade unions. Nuclear is one of them. This is absolutely about delivering the kind of economic change right across the country,' he said.
He said investment in fusion in Nottinghamshire would be directly on the site of the old West Burton coal-fired power station. 'That is the transition in action – from an old coal-fired power station to a new fusion prototype plant,' he said. So for climate, for energy security, for jobs, I genuinely think this is the right choice.'
Miliband has argued for nuclear power to be a part of tackling the climate crisis since 2009. As energy secretary in the last Labour government, he said he was brought up in a family that opposed it, but he now saw it as vital.
'I didn't expect to have to become the energy secretary again to make it happen,' Miliband said. 'We've been too slow, definitely. This is also about accepting the role of government because this is going to be majority state-owned and state invested.
'Hinkley was done under a different model. That is a way of lowering the cost of capital, getting a return for the taxpayer. So I think there have been real missed opportunities in the last 14 years.'
Sizewell C was one of eight sites identified in 2009 by Miliband as a potential site for new nuclear. The project was not fully funded in the 14 years that followed under subsequent governments. The Treasury said that combined with the ambition to build SMRs, it would deliver more new nuclear to the grid than over the previous half century by the 2030s.
Campaigners opposed to Sizewell C said they believed the development would end up as 'HS2 mark 2' with years of overspending and delay. Alison Downes of Stop Sizewell C said: 'Ministers have still not come clean about Sizewell C's cost and, given negotiations with private investors are incomplete, they have signed away all leverage and will be forced to offer generous deals that undermine value for money.'
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