The European Commission鈥檚 investigation into the government鈥檚 deal with EDF for electricity from its planned nuclear plant could have far-reaching consequences.
Although everyone was expecting the European Commission to launch a state aid investigation into the government鈥檚 deal with EDF for a fixed price for electricity from its planned Hinkley Point C nuclear plant, the breadth of the investigation should be a concern for all working in the infrastructure sector.
Alongside the strike price deal the commission is probing the UK Guarantee being given to the project. If it decides that this breaches state aid rules it could have resonance far beyond nuclear new build to a whole raft of infrastructure projects. That would be a massive blow to the construction sector as a whole.
Brussels has also described the deal as a 鈥渟ubsidy鈥� for nuclear, something the government has avoided throughout the project鈥檚 development. Indeed, the EC even estimates it鈥檒l cost tax payers up to 拢17bn to subsidise the scheme. That level of money could be enough to erode public support for nuclear power ahead of a general election 鈥� any subsequent drop in political will would be disastrous. The last thing the industry needs now is further uncertainty and delay.
Vern Pitt, senior reporter
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