China looking to buy stake in UK nuclear plants, say reports


The Chinese government has emerged as a potential buyer of a multibillion-pound stake in Britain’s nuclear power plants.

The talks will reignite debate about China’s involvement in the UK nuclear power industry. Two years ago, the government paused approval for the £18bn Hinkley Point C project because of security concerns over China’s stake.

China General Nuclear Power Group (CGN), a state-run corporation, is said to be interested in buying a major stake in eight power stations, including Sizewell in Suffolk and Dungeness in Kent.

The power stations are operated by EDF Energy, a subsidiary of the French company EDF, but earlier this year, the British Gas owner, Centrica, put its 20% stake up for sale. The Sunday Times suggested CGN hoped to acquire a 49% stake, which indicates EDF could be looking to offload some of its shareholding.

The proposed deal would be a headache for Theresa May, who is concerned about giving China greater access to critical infrastructure projects and has initiated a new national security test for foreign takeovers.

The sale could attract interest from pension and insurance funds, but analysts say the pool of bidders is small because of nuclear’s huge construction costs.

Paul Dorfman, a senior researcher at University College London’s Energy Institute, said Britain was an outlier in its openness to Chinese investment.

“It’s entirely credible [that China would be allowed to buy the stake] in the context of what the British government is doing,” he said. “There is no other OECD country that would allow China to own any of its critical infrastructure, let alone its nuclear infrastructure.”

Dorfman said EDF, with €33bn (£29bn) of debt, was eager to raise funds from asset sales. “EDF is in financial difficulties and has been for some time. It’s looking to sell off whatever it can sell off. It’s worried about debt, its credit rating … plus its waste and decommissioning liabilities,” he said.

The eight nuclear power stations, which used to be grouped under British Energy, generate 8.9 gigawatts of electricity and supply about 20% of Britain’s electricity needs. They were bought by EDF for £12.5bn in 2008. The following year, Centrica took a 20% stake, which it values at £1.7bn.



Source link

Leave a Reply

Your email address will not be published. Required fields are marked *