The Hinkley Point C nuclear power plant is now projected to cost up to £22.5bn – up to £2.9bn more than originally planned.
That’s according to client EDF Energy which has issued an update on the progress of the scheme.
It has blamed cost increases reflecting “challenging ground conditions” which made earthworks more expensive than anticipated, as well as revised action plan targets and extra costs needed to implement the completed functional design.
Hinkley Point C successfully delivered J-0, the nuclear island “common raft” for its first building, one of two European pressurised reactors (EPR), in June 2019, which was in line with the schedule announced in September 2016.
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After that milestone, a review of the project’s cost schedule and organisation was undertaken. The review found that while the common raft for the second unit was on course for June 2020, the risk of delay of the delivery of units one and two themselves had increased. Meanwhile, the project completion cost is now estimated between £21.5bn and £22.5bn, an increase of £1.9bn to £2.9bn compared to the previous estimate.
EDF said the range of the cost increased depended on the effectiveness of action plans to be delivered in partnership with contractors. The BYLOR (Bouygues TP and Laing O’Rourke) joint venture is delivering the main civil engineering works at Hinkley Point in a deal worth over £2.8b and constructing the buildings that will house the two EPR nuclear reactors.
Under the terms of the contract for difference, EDF said there would be no impact for UK taxpayers. EDF’s project rate of return for Hinkley Point C is now estimated between 7.6% and 7.8%.
Unit 1 is expected to become operational at the end of 2025.
