Hitachi Buys U.K. Nuclear Power Venture (Horizon) for $1.1 Billion

[FBaggins]

The Japanese manufacturer Hitachi Ltd. (6501) agreed to buy Horizon Nuclear Power from Germany’s two largest utilities for 696 million pounds ($1.1 billion), ensuring support for the U.K. government’s energy program.

The transaction will be completed next month and secure financial backing for as many as six new nuclear reactors at two sites in Britain, according to a statement from Hitachi and the utilities, RWE AG (RWE) and EON AG. (EOAN) The German companies are withdrawing as the nation closes its own nuclear plants.

The deal helps Hitachi’s goal to more than double nuclear sales to 360 billion yen ($4.5 billion) by 2021 and underpins U.K. Prime Minister David Cameron’s decision remain one of three western European nations expanding atomic power. Horizon is part of Britain’s 110 billion-pound program to replace aging power plants, upgrade grids and cut pollution.

http://www.businessweek.com/news/2012-10-30/hitachi-to-buy-horizon-nuclear-jv-from-eon-rwe-for-1-dot-1-billion

[ForgoTheConsequence]

1. So whats this mean?

Nuclear powered vibrators?

[FBaggins]

2. About 20% more power.

Horizon was expected to use the Westinghouse AP1000 design, but the Hitachi models have a larger capacity.

[bananas]

3. It means something sleazy is happening behind the scenes

From the article:

For Hitachi, the investment represents a “leap of faith” that the British government will backstop the profitability of the venture by ensuring higher electricity prices, said George Borovas, head of nuclear projects at law firm Pillsbury Winthrop Shaw Pittman LLP.

The British government agreed there would be no subsidies for new nuclear - now they are going back on their word.
They'll try some screwy creative financing scheme, then scew the people with higher rates and corporate bailouts later on.

[FBaggins]

4. "The British government agreed there would be no subsidies for new nuclear "

That was the deal that brought the Lib Dems into the coalition.

Surely if they were really "going back on their word", we'll read about that coallition falling apart any day now, right?

The reality is that the claim simply isn't true. When the deal was made, they (including green lib deb Huhne) also said that there were means of government support that were not considered subsidies.

[Nihil]

5. No offence but that is a non-argument ...

> "The British government agreed there would be no subsidies for new nuclear "
> That was the deal that brought the Lib Dems into the coalition.
> Surely if they were really "going back on their word", we'll read about that coallition
> falling apart any day now, right?

The Lib Dems have gone back on just about every word they put out before the election.

Some of them even needed the Conservatives to persuade them to do so but most just
went "Holy Fuck! The public bought the bullshit!" and toddled off to cash in while they
could still do so (because the public aren't going to put Lib Dems anywhere near a
government post for a couple of decades now after that betrayal).

So, returning to the topic , the fact that the government *do* appear to be going back
on their word is neither a surprise nor a deal-breaker as the "deal" (i.e., the coalition)
has already rotted from within.

Other arguments might counter the suggestion that there will in fact be subsidies for
new nuclear but this one doesn't fly.

[FBaggins]

6. Sorry... no.

Anti-nukes would like to spin to claim that "no subsidy" meant that there would be no government support of any kind for nuclear power. And, since we all know that neither new nuclear nor new renewables in the U.K. can be built without some level of policy support, they wanted to pretend that this meant that nuclear would never be built.

They were wrong and just want to whine about it.

Both sides made clear at the time what "no public subsidy" meant and what it didn't mean. They haven't gone back on that word.

"No public subsidy" explicitly means that "no levy, direct payment or market support will be provided for electricity from nuclear power stations unless similar support is provided more widely for other types of generation – for example, any arrangements to raise the price of carbon fuels, or reform of the electricity market to promote low-carbon generation."