http://www.telegraph.co.uk/finance/newsbysector/energy/10487375/Hinkley-Point-deal-under-threat-from-EU-ruling.html

Hinkley Point deal under threat from EU ruling

European Commission close to concluding that deal between Government and energy firms on Hinkley Point breaches EU state aid rules

By Ambrose Evans-Pritchard
11:00PM GMT 01 Dec 2013
233 Comments

The European Commission is close to concluding that Britain’s nuclear programme at Hinkley Point breaches EU state aid rules and may have to be revised, a move that could lead to long delays and even cause the complex deal to unravel.

The EU competition police are examining a string of subsidies tied to the Government’s £16bn agreement with French groups EDF and Areva as well as China’s General Nuclear Power to build two new generation EPR reactors. These would be the first reactors to be built in Britain since 1995, providing 7pc of the UK’s electricity.

Sources in Brussels say the chief concern is a £10bn loan guarantee for the construction of the plants, insurance against a meltdown, help with decommissioning costs and the inflation-linked “strike price” of £92.50 per megawatt hour for 35 years.

The investigation is being conducted by officials at the competition directorate under Joaquin Almunia. They are expected to issue an initial verdict in January, paving the way for a broader inquiry. Any decision requires backing by the “College” of EU commissioners.

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