Economic benefits of nuclear

6 November 2019


Sue Ferns

Senior Deputy General Secretary


It is legitimate to expect our energy generators to provide good value for money for consumers, but we have been side-tracked into a narrow and sterile debate about price per MWh.

We need a more rounded debate about the costs of investment in energy infrastructure overall – including who pays for it - recognising that these can be very high, especially for trailblazer projects, but tend to reduce over time.

But the economic benefit of nuclear is much wider, especially in the communities where nuclear plants are typically located.

On average EDF Energy’s existing nuclear fleet each contribute around 13% of local gross value added (GVA), rising to close to 30% for Hinkley Point B. This means that on average nuclear power plants generate £1 out of every £8 of economic value in their local communities.

Similarly analysis by Oxford Economics shows that Sellafield contributes around £2.1Bn in GVA, accounting for approximately 59% of both GVA and employment in Copeland.

These figures understate the true impact of these plants because they don’t take account of the impact on the local economy of employees spending their wages. Neither do they take account of local supply chain activities. Around two thirds of Sellafield’s total GVA derives from this broader positive economic benefit.

In addition, EDF Energy’s six nuclear plants contribute between 7.5% and 45% of business taxes. This is particularly important in times of austerity and cuts to central government grants.

The UK nuclear industry is highly productive. GVA per job in nuclear generation is more than six times higher than the whole economy average and productivity across the Nuclear Decommissioning Authority Group is around 40% higher than the average. 

A shift towards greater employment in high productivity sectors like nuclear will be central to closing the UK’s productivity gap. Delivering the new build programme, and the jobs that go with it, could make an important contribution to this effort.

Finally, the UK will not achieve the net zero emissions target by 2050 without an energy policy that delivers investment in low-carbon infrastructure, including new nuclear. This is supported by analysis by the Committee on Climate Change, Cornwall Insight and the National Grid’s Future Energy Scenarios. By contrast Germany, despite major investment in renewables, often generates at higher carbon intensity than either the UK or France because it relies so heavily on coal for back up.