The row about the Hinkley Point nuclear power station – reignited by the resignation of the Finance Director of EDF – has been further intensified by an Ed Davey article in today’s Times. It’s a peculiar dispute, in a way, attracting fire from opposing directions. One group of critics in the UK accuse the Government of agreeing an excessively high price for the energy produced, while another group of critics in France (evidently including the ex-Finance Director) accuse EDF of taking on a project which will not be financially viable. Davey’s contribution is to muddy the waters further, arguing the price he agreed is correct but alleging that the Chancellor “would have shaken hands with EDF at a higher price”.
There are various expert views on both the price of Hinkley energy, the cost of the construction and the choice of design, which we’ll be hosting in the coming days, but it’s worth considering what political lessons there are from this issue.
The first is that avoiding political pain in the short term can inflict much more in the longer term. If, as Davey alleges, Osborne was “desperate” for such an infrastructure project to go ahead, the responsibility for that desperation is not just the Chancellor’s. Decades of delay, indecision and fudging have left the UK facing a growing energy gap – and in the nuclear sector in particular, every single operational plant is due to be retired by 2030. For years politicians issued warm words about renewables as if they would be enough in themselves to heat people’s homes. Osborne is understandably keen to ensure the nation has sufficient energy to keep running. It’s up for debate as to whether he made the right decision, but the urgency of the situation was not primarily of his making. It’s something we should bear in mind when other vital infrastructure decisions (cough, airport expansion) are delayed – refusing to make a decision has a price.
The second lesson is one about specialised skills. We are in the unfortunate situation of relying on a French state-owned energy company to decide whether or not to construct our new nuclear capacity – even though Britain was the first country in the world to develop civil nuclear power. In the 60 years since we did so, our homegrown expertise has been allowed to atrophy until we have reached this diminished position. Skills like the ability to deliver the power required to sustain our industry are essential – this isn’t like sport, where we routinely invent games and then go on to routinely lose at them to other nations.
The Coalition did commission a study of the skills challenge in the nuclear sector (titled the Nuclear Workforce Assessment, or NWA, apparently by someone who isn’t a hip hop fan). After taking into account the rate of expected retirement among an ageing workforce, the nation will need 51,600 new, skilled workers by 2021. That’s a huge mountain to climb in a very short period – how many school pupils right now are pursuing the right qualifications and applying for the right courses to fill that demand?