Joe Costello (Dublin Central, Labour) | Oireachtas source

I welcome the Minister for Health, Deputy Leo Varadkar and congratulate him on his new portfolio. I am glad to have the opportunity to speak on the decision by the European Commission to give approval to the proposed £24.5 billion or €31.2 billion nuclear power station at Hinkley Point in Somerset. There has been no nuclear power plant construction in the UK in the past 20 years and there has been a very substantial emphasis on renewable energy for a considerable period of time, with Ireland hoping to become a net provider of energy to the UK in the not too distant future and Germany turning its back on nuclear energy. Therefore, the announcement by the European Commission that the UK, in its proposal for a very expensive power station in Somerset, 240 km from Ireland, should be allowed to receive state subsidy for its construction and operation came as a surprise to everybody.

Given that it is very difficult to see how this could be other than contrary to the anti-competition laws, I call on the Government to join Austria in the legal action it proposes against the proposed nuclear power station. There are major environmental concerns regarding the impact of the power plant in relation to the state aid. The Austrian Government's legal action in the European Court of Justice is very specifically on the state subsidy element. The problem is that if the European Commission does not regard a state subsidy as anti-competitive, we could have a new generation of heavily subsidised nuclear power plants across Europe. This plant will provide approximately 7% of the UK's energy requirements and could spark a very large number of similar nuclear power projects and shift the dynamic from renewable energy to nuclear energy.

The power plant will use the unproven EPR technology, which is not operational anywhere in the world, even though France and China are beginning to look at construction there. Nevertheless, it is unproven at this point in time. After all these decades, there is still no satisfactory method for dealing with the considerable quantities of radioactive waste the plant will generate over its lifetime of 60 years.

Under the plan, the British Government would be allowed offer EDF Energy, the company behind the project, a guaranteed power price of £92.50 per megawatt hour for 35 years - more than 50% of the lifespan of the plant. This is more than twice the current market rate. Clearly, this represents subsidisation of an operational plant.

EDF Energy will also benefit from a state guarantee covering any debt which the operator will seek to obtain on financial markets to fund the construction of the plant. The new Hinkley Point nuclear power station will require debt financing of £17 billion and will eventually have a capital outlay of approximately £34 billion. These are massive sums.

Rather than these significant subsidies for nuclear energy, it would seem far more appropriate to support alternative renewable energy sources, which are still grossly underfunded throughout Europe. The scale of the subsidy being given to EDF Energy is significant and it is difficult to understand how such extensive support cannot be considered an illegal state subsidy.

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