It’s Official: The United Kingdom is to subsidize nuclear power, but at what cost?

The report argues that the UK government is providing a comprehensive package of subsidies for Hinkley Point C that creates significant financial uncertainty and risk for the public. These include a long-term price guarantee, loan guarantees, and caps on waste disposal and liability costs, which the authors suggest could make nuclear power more expensive than renewable alternatives.

• The Contract for Difference (CfD) provides a guaranteed 'strike price' of GBP 92.50 per MWh for 35 years, linked to Consumer Price Inflation (CPI). Depending on future energy prices, the total net present value of this effective subsidy could range from GBP 3 billion to GBP 40 billion.
• The UK government provides loan guarantees that reduce borrowing costs for the developer. The GSI estimates this subsidy value to be between GBP 7.5 billion and GBP 18.4 billion over 35 years, representing a borrowing cost reduction of approximately 2-5%.
• Waste disposal costs for Hinkley Point C are capped at GBP 5 billion under a Waste Transfer Contract; any costs exceeding this limit will be borne by the government. Current expected payments are around GBP 2.3 billion.
• The government limits the liability of nuclear operators for accidents to GBP 1.2 billion, effectively providing implicit insurance for any costs beyond this cap. The report notes that historical disasters like Fukushima Daiichi cost an estimated USD 200-500 billion.
• Decommissioning costs are subject to high uncertainty and historical underestimation. While the government requires a Funded Decommissioning Programme, the report suggests the government may ultimately need to provide additional funding due to the likelihood of cost overruns.
• The combined known subsidies from the CfD and loan guarantees result in a per-unit subsidy between GBP 11.6 and GBP 64.7 per MWh, which the report argues places the cost of nuclear power above most other technologies, including onshore wind.

APA

Bridle, R., & Attwood, C. (2016). It’s Official: The United Kingdom is to subsidize nuclear power, but at what cost? International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/united-kingdom-subsidize-nuclear-power-at-what-cost.pdf

Chicago

Bridle, Richard, and Clement Attwood. It’s Official: The United Kingdom is to subsidize nuclear power, but at what cost? International Institute for Sustainable Development, 2016. https://www.iisd.org/system/files/publications/united-kingdom-subsidize-nuclear-power-at-what-cost.pdf.

Wikipedia

{{cite report |last1=Bridle |first1=Richard |last2=Attwood |first2=Clement |title=It’s Official: The United Kingdom is to subsidize nuclear power, but at what cost? |publisher=International Institute for Sustainable Development |date=February 2016 |url=https://www.iisd.org/system/files/publications/united-kingdom-subsidize-nuclear-power-at-what-cost.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{bridle2016its, author = {Bridle, Richard and Attwood, Clement}, title = {{It’s Official: The United Kingdom is to subsidize nuclear power, but at what cost?}}, institution = {International Institute for Sustainable Development}, year = {2016}, month = feb, url = {https://www.iisd.org/system/files/publications/united-kingdom-subsidize-nuclear-power-at-what-cost.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }