If you took the forced bonhomie of last week’s pact between David Cameron and Nicolas Sarkozy on civil nuclear power at face value, you'd think that we were heading for a nuclear renaissance. But this won’t be enough to put the wheels back on the nuclear gravy train.
The story starts across the water in France - but long before Cameron and Sarkozy dreamt up their photo opportunity.
France gets 75% of its electricity from nuclear, and the current French government sees its state-owned nuclear industry as a golden goose. Electricite de France (EDF) and reactor manufacturer Areva toured the globe, trying to sell an expensive new reactor, the European pressurised reactor, or EPR. The Finns bought one EPR and the Chinese bought a pair of them. EDF began building one at Flamanville across the Channel in Normandy. EDF set its eyes on Britain, buying our existing reactors and employing Gordon Brown's brother as a lobbyist.
But it’s one thing to sell an EPR, and quite another to build one. The Finnish reactor was delayed: and the cost started rising: from 3bn euros to 5bn, then 6bn. It was meant to open in 2009, but late last year the Finns announced that it was delayed until to 2014. Then things started going wrong in France and China. Flamanville is now four years late and will cost 6bn euros - twice what EDF promised it would.
People started asking why was it was so hard to build EPRs. The French government asked Francois Roussely, a former director of EDF, to investigate. He concluded that the EPR was too expensive and too complicated to build. He recommended that the safety features – one of the key selling points – should be pared back to make the reactor cheaper.
Then the Fukushima disaster happened and everyone remembered just why it was such a good idea for nuclear reactors to have safety features.
Like that notorious episode of Dallas, it turned out that the French nuclear renaissance was just a dream. EDF and Areva started blaming each other for failure. EDF threatened to shack up with Areva’s rivals, Westinghouse, who had designed a smaller and cheaper reactor. The credit ratings agency Standard and Poors downgraded EDF's credit rating, making it more expensive for it to borrow the £20bn it would need to build four new reactors in the UK.
Then the French audit court announced that the EPR was too expensive and took too long to build. It recommended extending the life of the existing ones instead of building new EPRs.
All of this will give Vincent de Rivas, head of EDF in the UK, a bit of a headache. In the past, EDF has relied on the French government to bail it out. But French presidential frontrunner François Hollande wants to reduce his country’s dependence on the risky technology. He'll find it hard to commit French taxpayers' money to help EDF build reactors abroad if he's closing them at home.
David Cameron wants to build new nuclear plants, but he has promised not to provide any public subsidies. That means he has to hide all the subsidies by rigging the electricity market - pushing up bills and asking taxpayers to cover the cost of the inevitable and costly delays. Cameron wants to get the private sector to invest in nuclear, but the bankers - not generally known for their caution - have said they wouldn't touch it with a bargepole.
Their latest plan to to persuade Centrica – the parent company of British Gas – to invest in EDF's plans for new nuclear plant. But unlike EDF, Centrica has no ideological committment to nuclear. Why would it - and its shareholders - want to risk billions of pounds on the French nuclear dream?