Wylfa: Decision on future of nuclear power station expected

A decision is expected about whether work to build a new nuclear power station on Anglesey will be halted.

Japanese media has reported that Hitachi will suspend construction of its £20bn Wylfa Newydd plant - with the board due to meet on Thursday.

Wales' Economy Secretary Ken Skates said he expected an announcement to be made during the morning.

Anglesey council said if the project was paused it would be a "tremendous blow" to the north Wales economy.

Mr Skates said he hoped that the plant would not be scrapped entirely.

"If it is paused then work must begin immediately across governments and with local government and with the business community in ensuring that there are job opportunities in the short term whilst we find a new investor for the project," he said.

About 9,000 workers had been expected to be involved in building two nuclear reactors on the island, which are due to be operational by the mid 2020s.

But speculation has been rife that Hitachi will suspend work on Wylfa - a project of its Horizon division - or scrap it due to potential increases in construction costs.

Leighton Jenkins, assistant director of the Confederation of British Industry in Wales, said the importance of the decision "cannot be over emphasised".

"This is not just important for the region, not just for Wales but for the whole of the UK's energy structure," he said.

"We are becoming a nation of artist's impressions... We need to have a strategic review as to why we struggle to deliver major infrastructure projects in Wales."

Edward Jones, a lecturer in economics at Bangor University who advises the North Wales Growth Bid, said: "A pause is the best case scenario if we consider how the share price reacted last Friday.

"When there were rumours they were going to suspend the project the share price jumped by 8%."

Speaking on BBC Radio Wales' Good Morning Wales programme, Dr Jones said investors did not like Hitachi in its current form and it would be "difficult to do anything other than pause or scrap" the project.

"If Hitachi does come out and say they're going to pause the project, the UK government have to act very quickly to find out what they mean by pause, is it six months or six years?"

Dr Jones added people in north Wales had already been investing in developing new skills for the project, along with investment by Hitachi themselves and other stakeholders.

"I think it does fall on to the UK government then to make a decision to see how they could help Hitachi... But once we hear the announcement we'll know a bit more about that."

Energy is not currently devolved to the Welsh Government but Mr Skates said an emergency economic ambitions board meeting will take place on Monday to discuss what job opportunities could be offered to people in the region.

He said it would also consider what additional support would be needed for the North Wales Growth Deal, which has been based on the premise that Wylfa Newydd would go ahead.

"Partners in north Wales have requested £170m for the growth deal and UK government, in spite of this comprehensive ask and programme of projects, offered £120m," he said.

"My view is that sum, if Hitachi do pause the project, should be significantly increased."

Albert Owen, Labour MP for Ynys Mon, said he was expecting a suspension of the project but at what level remained to be seen.

"It's better than cancellation. What we've got to do is all work together and speak with one voice, we've got to keep this project alive.

"There's a lot at stake. We've got to be sensitive about this, we've got to get it moving forward."

Mr Owen added the Swansea Bay Tidal Lagoon and the offshore wind farm in north Wales being cancelled showed a proper finance model is needed.

"These bespoke ad hoc deals are not working," he said.

The plant would aim to have a generating capacity of 2900MW of electricity by the mid 2020s - enough power for about five million homes - and a 60-year operational life.

Tom Greatrex, chief executive of the Nuclear Industry Association, told BBC Radio Four's Today programme that despite the funding difficulties, the UK could not turn its back on nuclear power.

"If you want to have a secure, reliable power supply, you definitely do need nuclear," he said.

Dylan Williams, Anglesey council's head of regulation and economic development, said good jobs on the island were important.

"The recession hit Anglesey very hard and we saw several large employers leave the island," he said.

"This led to an increase in outmigration and commuting elsewhere for work."

He added that there was "no doubt" that if the Wylfa Newydd project was suspended it would "signal a tremendous blow, not only for the Anglesey economy, but also for north Wales and Wales as a whole".

The UK government said it was in talks with Hitachi about Wylfa.

A Department for Business, Energy and Industrial Strategy spokesman said: "Negotiations with Hitachi on agreeing a deal that provides value for money for consumers and taxpayers on the Wylfa project are ongoing.

"They are commercially sensitive and we do not comment on speculation."