Sizewell C could add £19 to yearly bills says watchdog

Building a new nuclear power station could add £19 each year to household electricity bills by the time it opens, the public spending watchdog has said.

The government agreed a £38bn deal last year with investors to push ahead with Sizewell C.

A National Audit Office (NAO) report said the cost of the project was expected to increase electricity prices for the typical household by £4 in 2025-26, and could rise as high as between £17 and £19, per year, by the time it opens.

A government spokeswoman pointed out that new nuclear was needed to move the UK away from "volatile global gas markets".

Construction on the project is expected to be completed by summer 2039 and is expected to power the equivalent of six million UK homes for 60 years.

The NAO highlighted the "novel finance structure" used by the Department for Energy Security and Net Zero (DESNZ), with industry investors supporting the project.

But the report said financial returns to investors could cost consumers between £4bn and £4.5bn, unless they also help to reduce costs and the timeframe of the project.

Modelling from government claims the project could provide up to £18bn of net benefits for consumers.

"There has been a concerted attempt to learn from the problems of previous nuclear power construction projects and other large infrastructure schemes," said Gareth Davies, the head of the NAO.

"DESNZ will need to monitor the risks to taxpayers and billpayers closely."

The DESNZ spokeswoman added: "As the NAO confirms, this is a good deal for consumers and taxpayers – leading to cheaper power for families."

Nigel Cann, chief executive of Sizewell C, said it welcomed "scrutiny from the NAO on behalf of Parliament and the public".

"The project will deliver value to consumers and to the country for the rest of this century," Cann said.

"We're fully committed to delivering it safely and efficiently – and to maximising the value for consumers and taxpayers."

Stop Sizewell C, a campaign group opposing the construction, said: "The NAO's report confirms what we already suspected - that 'big assumptions' and the 'significant uncertainty' of factors underpinning DESNZ's claimed benefits could easily turn Sizewell C into a financial disaster, with its investors - thanks to [the regulated asset base] - being the only ones who can't lose.

"We agree with the NAO that DESNZ must provide transparency of forecast cost and schedule for Sizewell C."

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