RWE npower has announced that it won’t develop new nuclear power projects in the UK with E.ON.

RWE npower and E.ON created a joint venture called Horizon to develop and build new nuclear power plants in the UK. However, only weeks after the UK’s oldest nuclear power station at Oldbury was shut down, as reported by Utility Exchange, RWE npower has announced that after a strategic review carried out by each of the parent companies, they will not proceed with the new nuclear power projects.

The Government had hoped that to ensure the country’s energy security, companies such as RWE npower and E.ON would build new nuclear power plants to fill the gap as older plants are closed.

As more countries turn to gas to generate their energy wholesale gas prices are increasing which in turn is forcing up business gas prices. It is argued that having an alternative form of energy generation as a back up to renewables would not just help energy security but would help to keep business energy prices down.

RWE npower said there had been a change in a number of factors since the creation of Horizon in 2009. As a result of the global economic crisis there’s a premium for capital needed for such large scale projects, with long lead times and payback periods. The company added that the phase out of nuclear energy in Germany which was speeded up after the Fukushima disaster last year has resulted in the company taking on a number of measures including “divestments, a capital increase, efficiency enhancements and a leaner capital expenditure budget”.

The CEO of RWE npower, Volker Beckers said “We remain convinced that Horizon’s development projects represent excellent sites for new nuclear power stations in the UK, and we would like to express our sincere thanks to the Horizon employees for their hard work in bringing the projects to this stage of development. We would also like to thank the communities around Wylfa and Oldbury, the business partners we have worked with during development, and everyone who has shown support for our development work”.

He continued “It is because of the strength of support for our development work, particularly on the Island of Anglesey, that we continue to believe that nuclear power has an important role to play in the UK’s future energy mix. We are therefore looking to ensure that work on development, including grid connection, can be taken up quickly by other potential investors”.

Mr Beckers concluded “RWE npower has more than 12,000 employees and has invested more than three times its profits in the UK over recent years. We remain committed to the need for significant investment in low carbon energy technologies. RWE has invested over £1.2 billion into new renewable energy in Britain over the last three years, and more than £1.6 billion into new, highly efficient, flexible gas-fired power stations over the same period. In the same period, RWE has been one of the largest investor in Wales in any sector”.