You can set your watch by the Lib Dems. Every promise they make is worthless, and each one will be broken precisely at the moment at which it is tested (apart from on increased tax allowances, which are more regressive than might be thought). The latest is on nukes, predictably enough. In opposition they were against nuclear power altogether, but coalition changed that: the new line was yes to nukes, but without subsidies.
Even Cameron had been firmly set against subsidies: “We’ve taken the very clear view that there shouldn’t be subsidies, so if nuclear power stations can make their case in the market and be built, then they should be able to go ahead. That’s been our view for a long time. Our view has always been no subsidies, but if they can come forward as part of the energy mix then that’s fine.”
As the industry gradually retreated from the idea of new plants, with one eye on the chaos in Finland, the coalition clearly started to panic (can you hear Sir Humphrey warning about the lights going out?), and today we find out that, as predicted, the taxpayer will indeed be forced to pay for these white elephants.
The apparent aim is to keep the cost of nuclear power stable just below £100 per megawatt hour by concealing the fact that the cost is above that. It must seem quite cunning to divide the cost between energy consumers and taxpayers, who are, after all, largely the same people. Worse, that same piece confirms we’ll be locked into this absurd subsidy for up to 40 years. If the actual price of nuclear generation falls, as the enthusiasts think and the industry claims, this move would mean we’d just be handing over even more money to EDF. This isn’t a market. A true free market would never build nuclear plants: the entire economic justification of these new stations to shareholders will be based on our money.
To be fair, a true free market wouldn’t be building offshore wind just now either: it currently costs around £140 per megawatt hour. But then generating from renewables has another purpose: decarbonising our power system, and the costs of offshore wind are falling. The Crown Estate looked at the numbers, and by 2020, which ain’t far away, the costs of offshore will come below £100 per megawatt hour, and it doesn’t come with the massive decommissioning and waste disposal costs that a new nuclear fleet would bring (costs that would be borne by the taxpayer, natch).
The scale’s comparable too: offshore wind isn’t niche. That same paper notes that licences for 10GW-worth have already been granted, just in Scottish waters. That’s a ninth of the UK’s energy requirements (and about 100% of Scotland’s needs).
This decision, therefore, is pure ideology, not anything approaching rational either on economic or environmental grounds. Yet again, anyone who expects principled consistency or even pragmatic flexibility from the Lib Dems has just been disappointed. The only two things they’re consistent on are a love of Ministerial office at all costs and an ability to abandon principle the moment it comes under pressure.