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A dangerous habit

Britain's addiction to nuclear energy is costing us a packet - besides being risky and creating waste that won't go away. ALAN SIMPSON says we need to stop subsidising this treacherous industry

As the Energy Bill, a leviathan of lunacy, staggers towards its tortuous conclusion friends in far-flung places keep asking about its most incomprehensible folly. Why would anyone in their right mind throw staggeringly huge subsidies into new nuclear?

After all, EDF has just pulled out of nuclear power generation in the United States because it is uneconomic. Its parent company, the French government, will not be building more nuclear power stations after Flammanville - eventually - gets completed. And potential "partners" from other countries all seem to come with either empty bank accounts or dodgy safety records.

The reality is that nuclear's spiralling costs cannot survive in any genuinely competitive energy market. And we still don't know what to do with the waste.

So how is it that a £100 billion subsidy which will not deliver a spark of new electricity until well into the next decade has become the bedrock of Britain's latest Energy Bill?

Although the answers can come with a degree of levity the consequences, particularly constitutional ones, will all end in tears.

First, forget the current travails of the Co-op Bank. Britain's "taxpayers' bank" - HM Treasury - has its own addiction problems. 

Britain has been snorting nukes for decades. And it's a habit that's become difficult to break.

The computers of Treasury officials may harbour "inappropriate images" of nuclear power stations "on heat," but everything else is hidden within a culture of denial.

Fortunately, government officials do not have to resort to clandestine meetings in the back of cars to get their stash of energy "highs." Their suppliers just second staff into Whitehall, delivering unlimited reassurances in exchange for unlimited cash. What comes out is a dependency dressed up as a strategy.

This addiction turns the most freewheeling libertarian ideologues into champions of a nuclear welfare state. If you want to grasp the absurd spaces this takes you into try the following.

Imagine a "parallel" conversation between the Chancellor and, say, nurses, teachers or pensioners, in which George Osborne applies his nuclear logic.

"These are tough times," he says. "So here's the deal. I'm going to double your pay, index-link it and then guarantee the deal for 35 years, whatever happens to the rest of the economy ... oh, and I'll underwrite a whopping great mortgage to build your house. And we'll worry about any clean-up costs later."

Having difficulty in seeing Osborne saying this in the Autumn Statement?

Me too. But that's the deal the Chancellor's cut with his nuclear suppliers. It's his very own French Connection. C'mon Gene Hackman, where is "Popeye" Doyle when we need him?

This is a far cry from the days when the nuclear lobby was telling MPs that all it needed was the freedom to operate in a competitive energy market.

Whatever mind-altering substances are available on the Treasury corridors, it's just a shame that they don't include ones that allow their economists to see that tomorrow's energy systems will be nothing like today's.

Baseload power will become as essential as a Commodore 64. And the government will find itself owning the most expensive "pup" on the planet.

Tomorrow's energy generation will become more decentralised. Balancing mechanisms will be both interactive and interconnected. Energy systems will deliver more but use less. All this will be the kiss of death for nuclear.

In a different way, it could become a kiss of death for Britain too. Economically, we already know that Europe's wholesale power prices are 50 per cent lower than Britain's.

The current Energy Bill will widen this disparity. This will be a disadvantage but not a disaster. The killer blow may be constitutional rather than economic, with an unexpected victory gifted to France over its oldest rival.

Lord knows, they have waited long enough for revenge. Agincourt, Waterloo and Trafalgar can't sit easily in French history books. But who would have thought that it would all finally be settled on the grassy fields of Hinkley Point? And who would have believed Britain would pay the French for the sinking of perfidious Albion?

If all this sounds a bit dramatic, think through how the huge and foolish subsidies for new nuclear power will play out in Scotland? More specifically, think through how they will play in the referendum on independence.

I have never been a great fan of "nationalisms." As a kid growing up in Bootle, I knew that everything beyond the boundaries of Liverpool just counted as suburbs.

Surrounded by relatives and "aunts" or "uncles" from Ireland, Scotland and Wales, I just thought they were part of the tapestry of internationalism that was us. Apart from football allegiances, I could never see why people got worked up about "nationalism."

I know now that others see this differently. And I can also see how nuclear subsidies will be a free gift to the independence cause.

 

Alex Salmond is no mug. He will see that the £100bn subsidy promised to new nuclear, even before you get to disposal costs, will play out into a 15 per cent increase in household energy bills (or an increase in taxes).

He will also know that the coalition will have strangled British support for renewable energy resources in order to pay for nuclear. Everything that Scotland has in abundance will be short-changed in order to pay for what they don't want.

Salmond knows that the majority of Scottish community energy co-operatives will be left scrambling after whatever financial crumbs EDF hasn't pocketed from this Energy Bill.

He will see Scottish and English energy co-ops being denied priority access to the national grid because Westminster doesn't want to undermine nuclear's cash-fest.

Salmond knows too that the Norway interconnector is coming in via Scotland. He knows that most of Britain's electricity transmission flows - across the Scotish borders - are from north to south. And everyone knows that Scotland has neither the hunger nor the need for new nuclear power. 

It is only a matter of time before someone runs with the line: "Why should the Scots pay for an English folly? Why should we pay for energy we don't want, can't afford and don't know how to dispose of? If the English want to throw money down the drain, let the silly bastards throw their own money, not ours."

In an age of avoidable austerity, this has an appeal to the pocket that goes way beyond ideology.

One of the great weaknesses in the United Kingdom's constitutional settlement is that Westminster has always failed to embrace what people did better in Scotland and Wales.

Family courts, middle schools, the treatment of juveniles in the justice system, support for both health and higher education, and the underlying beliefs in solidarity and community - all are gifts that we "Brits" have ignored to our cost. 

In one way or another both the Scottish referendum and the next election will be fought around the cost of living in the present, of cleaning up the past and of preparing for the future. In each of these, nuclear is nothing but a millstone.

If the Scots say "sod it, the millstone is all yours," don't expect Wales to be far behind. England would be left to the Telegraph, the Wail, the full cost of the nuclear folly and a lifelong duty to subsidise France.

We might all then be looking for the consolation of mind-altering substances. And in such circumstances, Bootle would have to reconsider its position.

 

Alan Simpson is an independent energy adviser and a former Labour MP for Nottingham South

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