Energy news, often confined to the inside pages of UK national newspapers, led the front pages last week when the British government stunned French state-owned firm EDF by announcing a review of the contract underpinning the giant Hinkley Point C nuclear power plant.
When discussing our coverage with ICIS colleagues, we made a back-of-the-envelope calculation of the total cost to subsidise the plant over 35 years.
The figure we arrived at was £33,358,080,000 – rounded down to £33bn – based on an average wholesale power price of £50.00/MWh over the 35 year period. Not far off the £30bn conclusion reached by the National Audit Office (NAO) a fortnight ago in a lengthy report.
The NAO figure was based on a projected wholesale power price of £66.00/MWh by 2030. This is a forecast I and colleagues consider potentially high. And this is important because, the way the subsidy is structured for Hinkley, the lower the wholesale price, the higher the cost of the subsidy, hence our higher calculation.
It’s fair to say commodity prices are volatile, and I may well be proved wrong over time regarding the power price, but however you look at it Hinkley Point will be enormously expensive.
So, in the best traditions of national newspapers’ inside pages, I’ve compiled this list of three other things you can do with just over £33bn, all of which have suitably spurious links to Hinkley Point.
Take the city of Oxford to space
Former British prime minister and current Oxford resident David Cameron was a champion of the Hinkley project while in office. Why not take Cameron – alongside the city of Oxford’s 135,000 other residents – to space? Virgin Galactic is charging $250,000 for a guaranteed seat on one of its commercial space flights. There is no group discount. Cost: £25.5bn.
Feed the world
The town of Stolford is walking distance from the Hinkley Point site. The Economist’s Big Mac index last month priced the benchmark McDonalds offering at £2.99 in the UK. Buy a Big Mac from the Stolford branch for each of the globe’s 7.4bn people, and with the change, why not throw in some fries? Cost: £29.5bn.
Hear lots of frozen-body-part-themed anecdotes
Hinkley Point is considered vital to achieve the UK’s long-term carbon goals, and so is energy efficiency. Last year’s Green Deal awards for energy efficiency included after-dinner speaker Ranulph Fiennes, also known as “The World’s Greatest Living Explorer”. Specialist entertainment company NMP Live quotes speaking appearances from Fiennes starting at £6,000. Allowing an hour per speech, you can look forward to 5.5 million speeches which, without pause for sleep, would take 628 years to deliver. That’s a lot of frozen-body-part-themed anecdotes, even for The World’s Greatest Living Explorer. Cost: £33bn.