Leading Article: Nuclear power: not a spent force

The undignified rush to privatise nuclear power this year has had some serious consequences for the long-term security of Britain's energy supplies. Plans for new nuclear stations at Hinkley and Sizewell had to be scrapped last month: thinking about such developments has become impossible at a time when the industry is up for sale and other sources of electricity have become, at least temporarily, much cheaper.

Ministers seem to think that these consequences are acceptable.They comfort themselves with the short-term attractions of the sell-off. Privatisation is officially expected to raise pounds 2.6bn, enough to fund a chunk of the tax cuts that could make the difference between victory and defeat in the general election.

Today, however, it emerges that the official estimate could be hopelessly optimistic. Analysis by experts at Sussex University suggests that the industry may in fact be worth only pounds 800m, less than a third of the official valuation. Their report argues that even that sum may not be available for tax cuts - they say that it ought to be set aside to cover the costs of reprocessing spent fuel.

In short, if the Sussex University research is correct, the public will in effect get nothing for a privatisation that could undermine the nuclear industry.

There are good grounds for believing that this research is indeed right. The City certainly thinks that those selling Britain's nuclear power stations are deluding themselves about its potential value. A number of experts have for some time been saying privately what the Sussex study sets out in black and white.

All of this ought to make the Government think again about what it is trying to do with the nuclear industry. After all, what is the point of rushing if there is not even a short-term electoral advantage of extra tax cuts to be gained from a quick sell-off?

Delay would provide time to rethink the abandonment of the Hinkley C and Sizewell C projects. The building of these power stations is essential if Britain is to retain its position at the cutting edge of civilian nuclear technology. If Britain leaves itself with only ageing reactors that are gradually decommissioned, it may find itself with no alternative to imported fossil fuels in the next century. It will also not be in the best position to meet possible international growth in demand for nuclear know-how and technology.

Ministers may not be too worried by this prospect. They may well be glad just to get the nuclear industry off their hands, even if it does go for a song. They know that for the next few years, at least, nuclear power stations are not likely to be able to compete price-wise against gas-fired competition. To them the industry probably looks like an unreliable car that is about to prove expensive, needing an MoT, taxing and insurance: certainly not worth fresh investment. Better just to off-load it, at whatever loss, on to anyone prepared to accept it.

But this thinking is the worst type of short-termism, which could leave Britain's energy supplies prey to the whim of the next century's gas and oil sheikhs. If the Sussex research is right, then it is time the Government reconsidered its proposals and the whole future of the nuclear industry.