To ask the Chancellor of the Exchequer, for what reason nuclear energy projects are excluded from the new green savings bonds; and how his Department plans to attract private investment to support point 3 of the 10 point plan for a Green Industrial Revolution.
The government recognises that reaching net zero emissions by 2050 will require power to be generated from low carbon sources. As set out in the Government’s Energy White Paper last autumn, nuclear power will play an important role in achieving net zero.
Some energy sources have been excluded from the UK Government Green Financing Framework, including nuclear energy. This is in line with current international market standards for sovereign green bonds, it does not represent an assessment of what the Government considers ‘green’ or affect an expenditure’s eligibility for traditional financing instruments. We will review the framework on a regular basis with the aim of adhering to best practices in the market.
In December, the Government published responses to the consultation on the proposed regulated asset base (RAB) funding model for nuclear projects, which involves an economic regulator granting a licence to a company to charge a regulated price to users of the infrastructure. The funding model could help secure private investment and cost consumers less in the long run. The Government is continuing to explore a range of financing options, including the RAB model and the potential role of government finance during construction, provided there is clear value for money for consumers and taxpayers.