Subsidies and Contracts for Difference (CfD) that the UK government has promised to the two projects for new nuclear power stations are expected to add $1.32 billion (£1 billion) annually to the UK power bills from around 2030, The Telegraph reports, citing documents by the Treasury and the Office for Budget Responsibility (OBR).
The Hinkley Point C nuclear power station, developed by EDF, is expected to begin generating electricity in 2030-31, after years of delays and cost overruns.
That year, CfD is expected to generate $6.1 billion (£4.6 billion) in receipts, including £1.0 billion to fund subsidy payments to the Hinkley Point C nuclear power plant for its first year of expected generation, OBR said in its economic and fiscal outlook released after the UK’s latest budget announcement.
The UK government earlier this year also took the final investment decision to build the $51-billion Sizewell C nuclear power plant on the Suffolk Coast in eastern England, which was the first British-owned nuclear power station to be announced in over three decades.
Sizewell C will be the first nuclear power station in the UK financed using a regulated asset base (RAB) model that levies an additional charge on consumer energy bills, which contributes to the financing costs of the plant, OBR noted. This levy is also expected to increase energy bills as early as January.
UK households will pay slightly higher energy bills in the first quarter of 2026 after energy market regulator Ofgem last week raised the Energy Price Cap by 0.2%, against expectations of a 1% drop.
The slight increase in the price cap is driven by government policy costs and operating costs. This includes funding the government’s Sizewell C nuclear project, which will bring more clean power, Ofgem noted.
Opponents of new conventional nuclear plants in Britain argue that consumers will be burdened with a “nuclear tax” for the expensive projects in their energy bills.
“The Government has a misguided belief that nuclear will be a cheap, ‘green’ solution to our energy needs, but the evidence shows the opposite – that costs of delivery and of dealing with nuclear waste – will continue to rise,” Alison Downes, of Stop Sizewell C, told The Telegraph.
“We remain opposed to the imposition of a nuclear tax on households, given the acknowledged uncertainty about the projected costs of constructing Sizewell C.”
By Tsvetana Paraskova for Oilprice.com
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