Japanese group Toshiba has confirmed that it is in the final stages of securing a majority stake in a British nuclear power consortium, bringing a further boost to the UK’s ambitious nuclear programme.
Toshiba’s chief executive, Hisao Tanaka, said an agreement to take a controlling shareholding in the NuGen consortium could be in place as early as January. NuGen is a joint venture between Spanish power company Iberdrola and French utility firm GDF Suez that is developing a plant at Sellafield in Cumbria, where the owners plan to build 3.6 gigawatts of nuclear capacity on a disused reactor site.
Confirming that Toshiba will also buy part of GDF Suez’s 50% stake when it acquires Iberdrola’s 50% shareholding, Tanaka said: “We want a majority to move forward. So we would want to take some of GDF’s share, but have them remain as an operator.” He added that securing a long-awaited majority holding in the NuGen consortium would guarantee a $14bn (£8.5bn) deal for Toshiba’s Westinghouse unit to supply three reactors for the project.
Toshiba is keen to kickstart an ambitious reactor building programme that stalled after countries around the world – led by Germany – froze nuclear expansion plans and tightened regulations in the wake of Japan’s 2011 disaster at Fukushima.
Its domestic rival, Hitachi, has bought the Horizon project which intends to build two nuclear power stations, in Anglesey and Gloucestershire.
Britain is one of the few countries pressing ahead with nuclear plans in spite of the safety fears raised by Fukushima. The government’s determination to make nuclear a central part of its energy strategy was confirmed two months ago when ministers approved a deal with France’s EDF Energy to build the £16bn Hinkley Point nuclear power plant in Somerset. Analysts at Liberum Capital said state guarantees on electricity prices offered to EDF in order to secure the deal could prove to be “economically insane”. The European Union has also weighed into the nuclear subsidy debate by launching an investigation into whether the Hinkley deal broke state aid rules.
Iberdrola, which is selling assets to reduce debt, said this week that it has agreed to sell its 50% in NuGen to Toshiba for £85m, subject to final approvals, terms and conditions.
Tanaka said a majority stake was necessary to make progress on the project, where delays have frustrated the UK government, sources say, as it pushes through its own ambitious nuclear programme to replace new reactors. A controlling stake would allow Westinghouse, 87%-owned by Toshiba, to supply three of its AP1000 reactors for the site. After building the reactors, Toshiba would reduce its stake, Tanaka said.
“We are thinking about an exit, but we haven’t decided anything yet,” he said. “We will reduce our majority stake over time. We are a plant provider, not a nuclear power provider.”
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