Blair set to press nuclear button

Tony Blair is preparing to commit the country to the biggest nuclear power programme since the 1960s if he wins the forthcoming general election.

The Prime Minister is expected to use a third term in office to pave the way for the construction of up to 10 new nuclear stations in an attempt to ensure that Britain plays its full part in tackling global warming by cutting carbon emissions.

A White Paper backing the nuclear option is widely expected to be published soon after the election, provided Labour is victorious. The document is likely to set out the case for nuclear power but stop short of spelling out how a new generation of reactors would be financed and built.

Support for a new nuclear programme would represent a major about-turn in government policy - which has so far been for Britain to meet its environmental targets through an expansion of renewable energy such as wind, wave and solar power.

Such a seismic shift in policy would almost certainly also require a Cabinet reshuffle to bring supporters of nuclear power into the key posts of Secretary of State for Trade and Industry, and Secretary of State for Environment. The present incumbents, Patricia Hewitt and Margaret Beckett, are both anti-nuclear.

Britain's 12 nuclear power stations provide 23 per cent of the nation's electricity. But unless they are replaced with new ones as they reach retirement, then there will only be three nuclear stations left in operation by 2020 producing just 7 per cent of the country's requirements.

As things stand, the plan is to replace nuclear with renewable, even though the latter is more expensive than the former, so that by 2020, green energy accounts for 20 per cent of UK electricity consumption - the so-called 20-20 target.

But there are grave doubts about whether that target will be met and serious cost implications if it is achieved. A National Audit Office report last week estimated that electricity bills would need to rise by 5 per cent, adding £1bn a year to household bills, just to meet the interim target of generating 10 per cent of the country's electricity from renewables by 2010.

Even if the 20-20 target becomes a reality, many commentators find it difficult to see how Britain's longer-term goal of cutting carbon emissions by 60 per cent by 2050 can be achieved unless nuclear is somewhere in the energy mix.

Despite the near-death experience of the country's main nuclear generator British Energy, which has only survived thanks to a £5bn government bail-out, there have been sufficient straws in the wind of late to give proponents of atomic power fresh heart.

First, there was Mr Blair's testimony to the Commons liaison committee last year in which he spelled out the case for nuclear in a more graphic way than before. Then there was the government chief scientific adviser Professor David King's acknowledgement that Britain should be prepared to build new nuclear capacity, even as it looked for ways of maximising the potential of renewables.

Martin O'Neil, the influential and well-connected Labour chairman of the Commons Trade and Industry Select Committee, says: "There is a sense in which the issue has moved further up the agenda. The impression I have is that within government it is becoming less of a no-go area. While there are obviously individuals within the Cabinet who are opposed to nuclear power, if one assumes a post-election reshuffle, it may be that people better disposed to a nuclear replacement build programme could be put in positions of responsibility.

"Cost and safety will be the two main considerations but if you can win the argument on those two grounds, then the environmental upside kicks in. At the moment, mature renewable technology is not producing enough energy at reasonable cost, Britain cannot rely on gas and it is unlikely we will have the kind of clean-coal technology we need."

Even if the political will is there to usher in a new nuclear era, the practical obstacles remain daunting. Mike Alexander, British Energy's chief executive, spelled out the hurdles yesterday. First, he said, Britain needs an agreed waste policy for the environment; second it needs an agreed technology approved by UK regulatory authorities, third it needs a planning system which deals with planning issues rather than technical and safety ones; and finally it needs a market structure which supports investment in new plant.

By way of a postscript he added that the country also needed a "competent operator" - a role which he volunteered British Energy could fill once all the other issues had been addressed.

The company's latest set of performance figures (see story on right) is not the best of advertisements. Nuclear stations provide baseload electricity and therefore need to operate for the maximum amount of time to achieve maximum efficiency. In the first nine months of this year, that has not happened because of what are termed "unplanned outages" at two of them.

Mr Alexander insists that the problems which shut Heysham 1 and Hartlepool occurred in conventional and not nuclear areas and were the result of the plants "being starved on remedial investment for years". He adds that it is "at best tenuous" to argue that problems with British Energy's current fleet of reactors will in some way undermine the chances of gaining support to build a new generation.

The meltdown in nuclear's contribution to the energy mix could be mitigated partly by keeping older stations open for longer. Dungeness B, for instance, one of British Energy's seven advanced gas cooled (AGR) reactors, is due to close in 2008 but the company is now working on a proposal to extend its life by five or perhaps even 10 years. Most of its other AGRs have, however, already had extensions to their lives.

The Government's last energy White Paper in 2003 acknowledged that "current economics" made nuclear power "an unattractive option" as a source of carbon-free energy and the same will hold true after the election. It also noted that the issue of what to do with nuclear waste needed to be resolved.

There is also the debate over which technology to use. British Nuclear Fuels backs the Westinghouse AP1000 while British Energy supports the Canadian Kandu design - both light water reactors. But the Chinese have recently opted for a South African design known as the pebble bed - a high-temperature, gas-cooled reactor which is said to be small and safe but also expensive.

Financeability, design and the waste legacy are but three of the big questions which need answers. Mr Blair's White Paper is unlikely to provide them but at least it may allow proponents of atomic power to declare: The future's bright, the future's nuclear.