Plans by EDF Energy to build Britain’s first nuclear reactor for a generation were in disarray last night after Brussels said that the controversial subsidy deal agreed with the Government could amount to illegal state aid.
In a withering initial assessment, the European Commission said that consumers would end up paying up to £17.6 billion of “super-normal” subsidies via their energy bills to EDF Energy, which is controlled by the French Government.
Its most damning objection was that the subsidies were entirely unnecessary, since nuclear power would become economic by the end of the next decade, according to the Government’s own forecasts.
Ed Davey, the Energy Secretary, announced an agreement in October to guarantee paying almost twice the market rate of electricity for 35 years