Hinkley Point: EDF gives green light to new nuclear site

It's official, there's no turning back.

The board of EDF has committed to building Hinkley C, Britain's first new nuclear station since 1995.

As it stands, 1/5 of the electricity we use is generated by nuclear, but our existing fleet of eight power stations looks increasingly arthritic - all but one is set to close by 2030.

In 2006 the Labour government decided it wanted them replaced, it's taken an astonishing 10 years to get to a point where everyone is signed-up and legally committed to start building.

EDF's chief executive, Jean-Bernard Levy, has be up for this project from the start, but he's struggled to convince his staff, certain French ministers (the French government owns EDF) and even his executive team.

In March, Thomas Piquemal, EDF's head of finance, resigned.

This morning, before the board meeting in Paris to agree the final decision, another director, Gérard Magnin, stood down in protest at what he sees as a "very risky" investment.

When the two pressurised water reactors come on line in 2025 they will be capable of generating 7% of all the electricity Britain needs.

The problem is the technology is unproven and the price tag is hefty.

Similar reactors in France and Finland are behind schedule, over budget and have yet to generate a single unit of electricity.

In the circumstances some board members are hesitant about committing to another project, particularly one that will cost £18 billion.

Hinkley C has plenty going for it on paper.

The government is clear it sees the project as a vital means of keeping the lights on and hitting our CO2 emissions reduction targets.

The ultimate bill for Hinkley will be paid by British consumers.

EDF has been guaranteed a price of £92.50 per unit of electricity generated - their current market price is £42 - which will rise in line with inflation.

The government expects the average energy bill to rise by £10 a year when Hinkley is finally hooked up to the grid.

But the upfront costs, and therefore the risk, is shouldered by EDF and its junior partner, the Chinese company CGN.

Get this project right and EDF wins prestige and immense financial rewards.

Get it wrong and Hinkley C could prove commercially disastrous.