The European Commission is allowing the UK to subsidise the construction of a nuclear power plant which is to account for 7 percent of the country’s electricity needs.
The UK has revised its scheme in such a way that the subsidies are “in line with EU state aid rules”.
The €17 billion plant, Hinkley Point C, is to be built in Somerset in south-west England, at the site of its sister plants Hinkley Point A and B. It should start operating in 2023, for 60 years.
The decision is controversial.
When the commission started its investigation in December last year, it flagged up possible illegal state aid. “In particular, the commission has doubts that the project suffers from a genuine market failure”, a press release read.
But competition commissioner Joaquin Almunia said in a press conference on Wednesday (8 October) the UK has convinced Brussels that state aid is needed for the construction to go ahead.
“There is market failure here”, he said, or, in other words, the plant could not be built without state support.