The UK Government has announced £100m ($134m) in funding support for the Sizewell C nuclear power project in Suffolk.
Business and Energy Secretary Kwasi Kwarteng announced the funding commitment with an objective to procure additional financing from private investors.
It will be subject to value for money and relevant approvals.
Kwarteng said: “In light of high global gas prices, we need to ensure Britain’s future energy supply is bolstered by reliable, affordable, low carbon power that is generated in this country.
“New nuclear is not only an important part of our plans to ensure greater energy independence, but to create high-quality jobs and drive economic growth.
“The funding announced today will further support the development of Sizewell C during this important phase of negotiations as we seek to maximise investor confidence in this nationally significant project.”
Government ministers aim to reach a final investment decision (FID) on at least one large-scale nuclear power station by the end of the current parliament.
The move is intended to bolster Britain’s energy security and generate low carbon electricity at scale while minimising the government’s exposure to volatile global gas prices.
In December 2020, EDF and the UK government announced negotiations on the Sizewell C project.
The 3.2GW project has the capacity to generate enough electricity to power approximately six million homes and create up to 10,000 jobs in Suffolk and across the UK.
EDF will invest an option fee of £100m for the nuclear power project to help bring it to maturity, as well as to attract new investors and advance to the next negotiations phase.
The UK government will acquire some rights over the Sizewell C site land and EDF’s shares in the Sizewell C company, thereby creating opportunities to develop other nuclear energy infrastructure at the site if the project is not ultimately successful.
If an FID has been reached for the nuclear power plant, the government will be reimbursed the option fee with a financing return in cash or as an equity stake in the project.
In case the project fails to reach an FID, the government will have the option to ask for a stake in the Sizewell C Company or at the Sizewell C site.
EDF has said it will refund the money together with a financing return if it fails to provide these assets.