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Centrica is increasing its commitment to nuclear power as part of a £10bn plan to build the UK’s first advanced modular reactors in north-east England in partnership with US group X-energy.
The agreement, announced on Monday ahead of the visit to the UK of US President Donald Trump, is one of several partnerships between British and American companies, which the UK government has said will help boost the country’s energy security.
FTSE 100-listed Centrica and Maryland-based X-energy said they had signed a “joint development agreement” to deploy the US company’s Xe-100 advanced modular reactors in the UK. The first step would be the deployment of 12 80-megawatt reactors at a site in Hartlepool, capable of powering 1.5mn homes, the companies said.
The announcement comes after Centrica, which owns UK household supplier British Gas, agreed to invest £1.3bn for a 15 per cent stake in the large-scale 3.2GW Sizewell C project being built on the Suffolk coast.
Advanced modular reactors are smaller and more flexible than conventional reactors. The Xe-100 reactor has been designed and the first commercial plant is under development in Texas.
Chris O’Shea, Centrica’s chief executive, told the Financial Times that he liked nuclear power as a “long-term” business. “I like the fact that you put these things in and they run for 50-80 years, they are zero carbon and they are very secure.”
O’Shea estimated that the site in Hartlepool would cost roughly £10bn and require government backing in the form of a construction levy on consumer electricity bills that would enable investors to earn a return from the outset. The same model is being used at Sizewell C in an effort to lower financing costs.
“If the government is supportive — and I’ve got no reason to believe they’re not — then I’m pretty confident we should be able to develop this and hopefully quickly,” he said
The companies said they were already talking to other potential equity partners and to engineering and construction groups, and they would aim to start generating electricity in the mid-2030s.
Longer-term, the companies said the Hartlepool site could become the first part of a fleet of up to 6GW of advanced reactors nationwide.
Advanced modular reactors offer the possibility of increasing total generating capacity at a power station by adding further units. Supporters argue this will make planned sites such as Hartlepool cheaper and quicker to build than conventional nuclear power stations.
X-energy said its Xe-100 reactors, which are designed to generate up to 80MW of power each, would be optimised to perform in multi-unit plants ranging from 320MW to 960MW.
O’Shea declined to say exactly how much Centrica would invest in the project, but said Centrica was interested in investing in the full 6GW rollout and not just the planned first phase.
“I’d be happy to put a lot of our capital into this,” he said. “It gives us clean energy for our customers, so I like these projects a lot.”
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