If given the go-ahead, the government hopes to use a regulated asset base (RAB) financing model to fund the project, which is being proposed by French energy company EDF. RAB reduces risk for investors, who will receive regular payments before the project starts generating electricity. However, it also means customers pay for the cost of construction through higher energy bills. A consultation on the use of the RAB model is due to conclude next month and shows that operators in energy-intensive industries will be exempt, but households in receipt of universal credit will have to pay. In the consultation, officials said the exemption for electricity-intensive users – such as factories – would avoid the risk of putting them at a “significant competitive disadvantage” when operating in international markets, as they may have to add costs to the price of products . MPs had proposed that electricity suppliers be prevented from recovering the cost of RAB payment obligations from consumers who have universal credit. But officials rejected that idea, saying such a measure could “discourage suppliers from engaging in commercially advantageous practices,” such as payment plans and loyalty benefits to attract customers. They also argued that other vulnerable consumers who do not claim universal credit could also be affected by the move. Greens MP Caroline Lucas said: “When energy bills are soaring amid a cost of living scandal, the last thing people can afford is the high cost of embryonic nuclear white elephants like Sizewell C. “Not only are these projects hugely expensive to build, with Hinkley Point C now at £26 billion without a single watt of power being produced, the RAB business model passes this huge upfront cost directly to the consumer. While the corporate giants do not have generous exemptions, the worst in society will have to pay the bill. Nuclear is too slow, too expensive and the wrong priority.” The 3.2 gigawatt plant at Sizewell in Suffolk could be capable of generating electricity for 6 million homes and is part of a plan to approve one nuclear reactor each year by 2030. Alison Downes, of the Stop Sizewell C campaign, said: “Taxes of all kinds hit the poorest hardest and this nuclear tax is no exception. Multi-million pound businesses will move away if they use too much energy, but a family on universal credit struggling to afford their heating bills will have to cough up to pay for an unwanted nuclear power station.” The Department for Business, Energy and Industrial Strategy (BEIS) said the Government considered it very important to support low-income households, but believed “supporting vulnerable groups would be better addressed holistically” by looking at the factors driving up energy bills. BEIS has estimated that Sizewell C would add an extra £1 a month to household bills to help build costs. However, research from the University of Greenwich business school seen by the Guardian shows that the average monthly cost can be as high as £2.12. In January, the Government committed £100m to advance Sizewell C to the next stage of negotiations and help the project attract further private investment. In May, it moved the deadline for a decision on a “development approval order” for Sizewell C from May 25 to July 8. Subscribe to the Business Today daily email or follow Guardian Business on Twitter @BusinessDesk Ministers have appointed Barclays to lead the search for investors to back the project alongside the government and EDF, which each plan to take a 20% stake. That structure would drive out CGN, the state-backed Chinese nuclear specialist that has a 20% stake in the Sizewell C venture. According to the Mail on Sunday, British Gas’s owner, Centrica, is considering taking a stake. CGN has been working with EDF on Hinkley Point C in Somerset – which has been delayed and over budget – but ministers want to avoid further Chinese involvement amid worsening relations between the UK and China.
