Tuesday 3 January 2023

EDF to reconsider end date of two UK nuclear plants amid new windfall tax

Blackout fears mount as EDF has warned it may have to shut down two nuclear power plants as a result of the implementation of the new windfall tax on low carbon electricity producers.

As part of the Chancellor’s Autumn Statement, the government confirmed that starting this month, a 45% windfall tax would be imposed on renewable electricity generators.

The tax on excess profits is set to be in place until March 2028 - the new tax is aimed at helping subsidise the government support for rising household energy bills.

EDF has said the tax will make it more difficult to keep the ageing Heysham 1 and Hartlepool power plants online for as long as had been intended.

Speaking to the Telegraph, Rachael Glaving, Commercial Director of Generation at EDF UK, said: "We accept there's definitely a need for a levy of some kind - you've got to break the link between really high gas prices and the impact they have on power prices.

"But of course, that's going to factor into the business case of life extension and we will have to take that (the windfall tax) into consideration. It's not going to make it easier."

Ms Glaving added that the levy would also damage the business case for the facilities at a time when inflation is already pushing up costs.

A few months ago, EDF unveiled its ambition to extend the generation at Hartlepool and Heysham 1 power stations beyond the planned end date of March 2024.

ELN has approached the Treasury for comment.