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Legal challenge

Hinkley Point faces full-blooded challenge  

(Montel) A decision by the European Commission to approve a plan by France’s EDF to build a UK nuclear plant will face a “full-blooded” legal challenge, said a British academic leading a group opposed to the plan.

“Our view is that they [the EC] may very well have a problem. We don’t think they have done their sums properly. Everyone is concerned about competition and market distortion,” Paul Dorfman of the Energy Institute at University College London told Montel this week.

“There are secure grounds for a legal challenge on behalf of stakeholders that will be directly impacted by their decisions...The sheer extent of market distortion seems to be incompatible,” he added.

Political pressure
Dorfman and 20 others, including renewables companies, green lobbyists and other academics, sent a letter of protest to the EC on Monday following reports, later confirmed, that it would approve plans for the 3,200 MW plant at Hinkley Point in south-west England.

It would be “entirely incompatible with the original, rigorous approach adopted by the commission that any approval decision should now be rushed through”, the letter said.

In its original response to the Hinkley Point plan last December, the EC issued a 68-page letter laying out a “long list of concerns and issues with the UK’s application. With so many areas to cover and the volume of evidence that would be needed to address each and every point, a final decision to approve the proposal would require significant time, evaluation and scrutiny”.

But a decision appears to have been forced on EC competition commissioner Joaquin Almunia, Dorfman said. 

“Industry and the UK government don’t want to wait for new commissioners” to take up their posts, he added.

The mandate of the current EU executive expires at the end of October, when Almunia is set to be replaced by the former Danish deputy prime minister Margrethe Vestager.

“One is looking to the EC for a compromise. We would not wish to see excessive market distortion generalised given the context,” Dorfman said. 

Agreement in principle
“Our discussions with the UK authorities have led to an agreement... in principle a decision should be taken within this mandate,” a spokesman for competition commissioner Joaquin Almunia told Montel on Monday, following a nine-month state-aid investigation into the project.

The agreement with the EU’s powerful competition directorate comes after lengthy negotiations, with UK energy minister Ed Davey having met Almunia for talks in Brussels on 17 September.

With the nuclear sector having been left out of environmental and state-aid guidelines published by the commission in April, the Hinkley Point probe is seen as a test of the extent to which state subsidies will be permitted in the nuclear sector.

Under a deal with EDF, the UK would guarantee a loan to finance the project and pay a fixed minimum price – a “strike price” of GBP 92.50/MWh – for the electricity it generates for 35 years.