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Brookfield Corporation is set to become the largest private investor in Sizewell C and EDF will cut its stake, according to terms close to being finalised with the UK government for its flagship nuclear project.
The UK government is seeking to reach a final investment decision later this summer, with Canadian investor Brookfield set to have a more than 20 per cent stake, making it the largest shareholder after the UK government, which is expected to retain majority control, according to a person familiar with the situation.
Meanwhile, the original project sponsor, EDF, will reduce its stake to 12.5 per cent, as the French state tasks the business with focusing its energy on development of new nuclear projects in France and the operations of its existing nuclear fleet.
The UK government confirmed the EDF stake on Tuesday and said: “further investors and details on the project’s financing will be confirmed at the point of the final investment decision (FID).”
It said FID was now targeted for this summer, without specifying a month. That represents a further delay to a step originally targeted for late last year. In April, Darren Jones, chief secretary to the Treasury, said FID would be taken in June this year.
EDF, whose stake was unveiled during President Emmanuel Macron’s state visit to the UK, said its latest investment would represent a maximum of £1.1bn. The company has already invested around €600mn. Bpifrance, the country’s export credit agency will provide a £5bn debt guarantee to the power station, the UK government added.
Centrica, the owner of British Gas, is set to take a stake of about 15 per cent, the Financial Times previously reported.
The decisions will help bring certainty to the future of Sizewell, which is the second new nuclear plant to be built in a generation in the UK but has been faced with years of delay and drawn out negotiations over its financing.
The final cost of Sizewell could be close to £40bn, the FT reported in January based on assumptions from industry experts. Both the government and Sizewell’s management have rejected that figure although no new estimate has been given.
Brookfield declined to comment. The UK government also did not respond immediately to a request for comment around Brookfield’s planned investment.
Sizewell C was initially proposed by EDF and China General Nuclear Power Group (CGN). However, the UK government currently owns about 84 per cent of the project after removing CGN in 2022 over concerns about Chinese influence, spending £679mn of taxpayer funds to buy out its stake.
The new reactors are being built using the same EPR technology used for Hinkley Point C and recently launched French reactor Flamanville 3.
Jenny Kirtley, chair of campaign group Together Against Sizewell C said the reduction of EDF’s stake “allowed the original Sizewell C promoter, EDF, to invest the bare minimum into the project, with the result that UK residents will be subsidising French industry & the French govt for the next 75 years — during 15 years of construction and 60 years of operation”.
Additional reporting by Jim Pickard and Rachel Millard in London
