On Tuesday 11 July, Alistair Darling, Secretary of State for Trade and Industry, announced the results of the long awaited energy review which signalled the need for new nuclear power stations.

The review titled “The Energy Challenge”, is the result of six months work and extensive consultations by the Department of Trade and Industry and aims to set out an energy strategy to deliver secure energy supplies while reducing greenhouse gas emissions over the next twenty years. The document stresses that there is no single solution to these problems and we need to use all methods to deal with them, and that must include nuclear as it contributes to both.
On the nuclear issue the review contains proposals to deliver all of the measures which the NIA had been calling for to incentivise new nuclear plant. These include streamlining the planning system, introducing pre-licensing of new reactor designs and ensuring a continuing carbon market. It also makes clear that it will be for the private sector to finance and build any new stations and there will be no government subsidies. Again this is in-line with the NIA’s submission to the review.
The report covers the whole energy sphere including transport but it is in the electricity sector that attention has focused. It makes clear that over the next 20 years around 25GW of capacity (around a third of the total) will need replacing and given the long-term nature of investments in the sector, the matter is now urgent. To encourage this investment the government propose to improve the market framework for investment by:




1.     giving a strong commitment to carbon pricing in the UK
2.    strengthening the renewables obligation (rising to 20%)
3.    reforming the planning regime for electricity projects
4.    making a clear statement of the government’s commitment to nuclear new build
5.    improving information provision about future energy supply trends

The day of the launch saw a huge amount of media interest with NIA and industry spokespeople much in demand (see article on page ?). It certainly showed that the issue is now much higher on the political agenda and all parties are taking the issue seriously with the Conservative party also releasing the findings of their own energy policy review. This review broadly made the same proposals as the Government review but in addition called for capacity payments to be introduced into the electricity market in order to ensure supply security.