Tokyo – Hitachi said Thursday it would freeze construction of its stallednuclear power station in Wales due to problems financing the project, ablow to Britain’s nuclear strategy and a costly decision for the Japanesefirm.
The company said in a statement the decision was made “from the viewpointof Hitachi’s economic rationality as a private enterprise”.
Shelving the project at the Wylfa Newydd plant on Anglesey, a small islandoff the Welsh coast, will cost the Japanese firm 300 billion yen ($2.8billion), it said.
Hitachi launched the planned construction after acquiring Britain-basedHorizon Nuclear Power in 2012.
The British government had reportedly agreed to finance two thirds of thethree trillion yen construction cost, with Hitachi as well as Japanese andBritish investors scheduled to cover the balance.
But Hitachi’s fund-raising efforts have been deadlocked at home while itsrequest for additional investment from the British government has beenshelved with London consumed by Brexit.
“Unfortunately, despite the best efforts of everyone involved, the partieshave not been able to reach an agreement to the satisfaction of allconcerned,” Hitachi said.
The Japanese firm added: “As a result, Hitachi has decided to suspend theproject at this time… as it is now clear that further time is needed todevelop a financial structure” for the project.
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The halting of the project also deals a blow to Japan Inc’s attempts toexpand its nuclear power businesses overseas after the Fukushima disasterof March 2011 effectively halted demand for new reactors in Japan.
A massive tsunami triggered by a 9.0-magnitude earthquake in March 2011overwhelmed reactor cooling systems at the Fukushima Daiichi plant innortheastern Japan.
It caused reactor meltdowns, releasing radiation in the most dangerousnuclear disaster since Chernobyl in 1986. The crisis spurred Japan tostrengthen its safety regulations under a new Nuclear Regulation Authoritywatchdog. The accident also prompted nuclear power companies overseas toreview their projects, a move that increased safety costs.
Toshiba has also been on the ropes after being forced to sell off itstroubled US nuclear energy firm Westinghouse, which racked up billions ofdollars in losses before being placed under bankruptcy protection. AJapanese-led consortium including Mitsubishi Heavy Industries was alsoscrapping a project in Turkey, local media said.
The setbacks have dealt a blow to Prime Minister Shinzo Abe’s efforts tohelp Japan Inc export its infrastructure — a key pillar of his businessdiplomacy.
