Rolls-Royce in line for big Hinkley nuclear contracts

Rolls-Royce Holding Plc (LON:RR) has been selected as a preferred bidder for a set of contracts to supply parts for the new nuclear power plant at Hinkley Point.

EDF picked Rolls Royce to supply heat exchangers worth 25 million pounds ($38 million) and a joint venture between the same company and Nuvia to supply and install two systems for the treatment and waste processing of reactor coolant worth GBP75 million.

He said EDF plans to build two EPRs in Hinkley Point, two more in Sizewell, and then a reactor based on Chinese technology – the Hualong – on the Bradwell site in eastern England.

It is now estimated that contracts worth more than 60 per cent of the construction cost for Hinkley Point C will be placed with United Kingdom firms, against an initial estimate of 57 per cent.

Delays and cost overruns at two nuclear reactors under construction in France and Finland have made potential investors wary of joining a consortium led by France’s EDF for a similar project in Britain, EDF’s chief executive has admitted.

EDF is working on a cheaper and simpler upgrade to the design and plans to build two EPRs at Hinkley Point with two Chinese partners, but it has been unable to find other investors for the £16bn project.

The announcement follows news earlier this week of a Government guarantee of £2bn for the project ahead of a final investment decision which is expected next month.

“(This) represents a significant step forward in the UK’s nuclear new build programme and demonstrates the progress that EDF continues to make so that a final investment decision can be taken as soon as possible”, a Rolls-Royce spokesman said.