Hitachi halts work at Anglesey nuclear project

Hitachi has suspended work on a £20bn nuclear plant in the UK because of rising construction costs. Hitachi said Thursday that it was halting work already underway on the Horizon Project, which is located in Wylfa, Wales, on the island of Anglesey. It will also suspend work on another site located in England.

The Japanese firm had been in talks with the UK government since June about funding for the project.

The government said it had failed to agree on terms with Hitachi. The nuclear industry said it was "disappointing".

About 9,000 workers had been expected to be involved in building two nuclear reactors, which were due to be operational by the mid-2020s.

Hitachi said the decision would cost it an estimated 300bn yen (£2.1bn) in expenses, plus another 300bn yen as "extraordinary losses".

It said it was suspending the project "from the viewpoint of its economic rationality as a private enterprise".

The company had been in talks with the British government for years about how it might support the project financially, including through stock and debt investments.

“I am very sorry to say that, despite the best efforts of everyone involved, we’ve not been able to reach an agreement to the satisfaction of all concerned,” said Duncan Hawthorne, chief executive of Hitachi’s nuclear business.

The new nuclear plant had been intended to have a generating capacity of 2,900 MW and have a 60-year operational life.

The decision puts the UK's nuclear policy under fresh scrutiny.

It also comes just two months after another Japanese company, Toshiba, decided to not go ahead with a power station it was looking to build in Britain.

The news was greeted with dismay by the Nuclear Industry Association.

Tom Greatrex, chief executive of the association, said it was "disappointing, not just for the Wylfa Newydd project but for Anglesey and the nuclear industry as a whole".

This leaves the Hinkley Point power station in Somerset as the only new UK reactor still being built.