£200m ‘new deal’ for nuclear power sector dangles carrot of new generation of export-led small nuclear reactors

Graphic showing scale of modern modular nuclear reactors
Graphic showing scale of modern modular nuclear reactors

The UK government has published details of a new £200 million nuclear sector deal to maintain security of electricity supplies and drive down the costs of nuclear energy – which it claims will result in cheaper energy bills for customers.

The big prize with future new nuclear projects is for them to be UK designed and built and suitable for export where there is huge foreign interest and demand.  

While the Scottish economy only ever benefitted with local supply chain contracts in building the two large-scale nuclear power plants at Hunterston and Torness, there may also be ‘new nuclear’ supply chain benefits in this deal.

The main elements of the nuclear deal include the following key points:

  • £32 million boost from Government and industry to kick-start new advanced manufacturing programme including R&D investment to develop potential world-leading nuclear technologies like advanced modular reactors
  • A commitment to increasing gender diversity in the civil nuclear workforce with a target of 40% women in nuclear by 2030
  • The unlocking of growth opportunities in the nuclear supply chain through joint Government and industry support for smaller companies in the UK to access higher value contracts and new markets
  • The strengthening of pioneering research with the potential for global impact – with a national fusion technology platform at the UK Atomic Energy Authority’s Science Centre in Culham in Oxfordshire supported by government funding of £86 million.
  •  Up to £44 million for research and development funding to support the development of Advanced Modular reactors
  • A new partnership with Welsh Government to develop a £40 million thermal hydraulics facility in North Wales as part of the Nuclear Innovation Programme to support the design and development of advanced nuclear technologies
  • A firm commitment from industry to reduce the cost of new nuclear build projects by 30% by 2030, and the cost of decommissioning old nuclear sites by 20% by 2030, and: 
  • A new review to look at ways to accelerate the clean-up of nuclear ‘legacy’ sites (where there was previous nuclear activity) – doing this safely whilst providing value for money to the taxpayer

A significant reduction in the high costs associated with the sector through investment in new world-class technology meaning nuclear energy can be produced in a more cost-effective way- and cheaper bills and peace of mind for energy consumers

The emerging findings of the Expert Finance Working Group’s analysis of small modular reactors. The independent group’s analysis suggest that the UK is well placed to develop first of a kind small reactor projects, and that the characteristics of SMRs could attract private investment.

Justin Bowden, GMB National Secretary, commented: “This is a good news story for vital UK infrastructure and jobs but there must be a government stake and certainty on the financing to make the Nuclear Sector Deal work. 

“As the existing UK fleet of nuclear power stations reach the end of their working lives, the country desperately needs the electricity and jobs these zero-carbon stations will produce as part of balanced energy mix of renewables, nuclear and gas.

“The treble prize in prospect for Small Modular Reactors must be that they are UK designed, UK manufactured and their massive export potential is realised.

“So the UK needs multiple Government-owned sites where licences are granted to companies to build SMRs.” 

Tom Greatrex, chief executive of the Nuclear Industry Association, commented: “This ambitious deal between industry and Government will ensure nuclear plays a key role in providing the UK’s low-carbon energy supply for the future, maximising opportunities in overseas markets, leveraging technology and innovation and increasing competitiveness.

“By ensuring new nuclear and decommissioning projects are delivered in a more cost-effect manner, it will also provide a major benefit to the consumer.”

29 Jun 2018


Pixie Energy

Pixie logo Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy here.

Local Energy Matters: Scotland

Local Energy Matters: Scotland is a free-to-download brochure with a focus on energy tariffs in the two Scottish electricity distribution regions, as well news on local energy and low-carbon schemes.

Previous editions can be download here.

Scottish energy market overview

You can read an overview of the Scottish energy market here.

Scottish Government energy feed