Photographer: Andrew Aitchison/Corbis via Getty Images

Is China’s Role in Hinkley Point Really a Security Threat?

  • Adviser to U.K. PM wrote of risk China could shut down plant
  • China wants to design, build its own reactor after Hinkley

All it took was an unexpected delay and a rediscovered blog by the Prime Minister’s new chief of staff, and suddenly the debate about the U.K.’s first nuclear power station in a generation shifted from the project’s price tag to the risk of Chinese cyber-sabotage.

After the U.K.’s last government welcomed China’s investment in everything from wind farms to oil fields, it touched a nerve when Nick Timothy, a long-time adviser of Prime Minister Theresa May, warned last year that involvement by the Asian giant in nuclear projects could allow them to “shut down Britain’s energy production at will.”

While the government has postponed approval for the project, experts say fears over China’s involvement in Hinkley Point is overblown, and the huge cost of the plant’s public subsidy remains the biggest threat to its future.

“Are we really saying as a country that we are so distrustful of our future relations with the Chinese that we think it’s a real possibility” they could pull the plug on a nuclear plant, Barry Gardiner, the opposition Labour Party’s spokesman on energy, said Thursday in a phone interview. The government needs to “take a critical look at what is really wrong with this contract, which is that the public is being asked to pay 30 billion pounds of subsidy.”

Controversial Plant

The British government last week cast doubt on the future of a controversial 18-billion pound ($24 billion) project led by Electricite de France SA to build Britain’s first nuclear power plant in more than 20 years, pledging to review the deal just hours after the board of France’s state-run utility gave the go-ahead. Concern about China General Nuclear Power Corp.’s minority stake in the project may have been among reasons for the delay.

The Prime Minister’s office reiterated Friday that the government is considering all component parts of the project, without specifically addressing Chinese involvment.

Concern about China is largely misplaced, said Tim Yeo, chairman of New Nuclear Watch Europe, an industry-funded lobby group, and former chair of U.K. Parliament’s Energy and Climate Change committee.

“There’s no reason to be concerned about China having a minority stake in any U.K. infrastructure asset,” Yeo said Thursday in a phone interview. “I welcome that CGN is willing to make investments.”

Trustworthy Partner

The Chinese company’s main involvement will be in the supply chain, providing some components for Hinkley, said Malcolm Grimston, senior research fellow at Imperial College London’s center for environmental policy. Operation of the facility would be in the hands of EDF, which has been in U.K. for years, he said.

“The Chinese see Hinkley C as first step towards their goal of building a nuclear station using Chinese technology in the U.K. and as a stepping stone to starting a plant export business to rival the Russians, the Japanese and the French,” said Grimston. “I’m not sure what their motivation would be” to halt an operational power plant “given their interest in being seen as a trustworthy partner.”

The strategic investment agreement reached by EDF and state-owned CGN in October was to build three new nuclear power stations in the U.K., including a 1 gigawatt plant at Bradwell that the Chinese company would build using its own technology and take a 66.5 percent stake. Chinese reactor designs haven’t yet been approved by the British nuclear regulator, a process which could take at least three years.

High Cost

Bernard Jenkin, the Conservative member of parliament for Harwich and North Essex, near the proposed Bradwell plant, last year urged the government to assess the security implications of a Chinese designed, owned and operated technology. It could be a “Trojan horse” used to threaten the U.K at a time of critical disagreement or conflict, he said. He wasn’t immediately available for comment on Friday.

There is potentially more cause for concern about Bradwell, said Yeo and Grimston. However both doubted the Chinese company would have any motivation to switch off the plant.

“I can’t see in what circumstances it would be in the interests of the Chinese owner not to make the plant work as efficiently as possible,” said Yeo. “They would both lose any prospect of getting a return on their very big investment and secondly I think they would effectively close down any future chance of infrastructure investment in the U.K.”

The U.K. government agreed to pay 92.50 pounds for every megawatt-hour of electricity produced from Hinkley Point for 35 years, about twice the current market rate. That contract has been widely criticized after data published on a government website last month showed this subsidy could cost more than 30 billion pounds.

The government should “focus on the real upfront issues that make this contract a bad deal for the U.K.,” said Labour’s Gardiner. The emphasis on China’s involvement "really does smack a bit of James Bond.”

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