The government's plan to fund the Sizewell C nuclear reactor in Suffolk represents a "terrible deal" for UK taxpayers over the coming decades, Parliament's spending watchdog has warned. The public accounts committee said the risk to bill payers is "extraordinary" after the government agreed to take a near-45% stake in the multibillion-pound project, which is due to complete construction between 2039 and 2043. The government expects the plant to cost between £40.5bn and £47.7bn, though the PAC warned costs could spiral to almost £48bn, potentially leaving taxpayers and consumers on the hook for an extra £9.8bn during construction and a further £12bn across its 60-year operating life.
Under the deal, which will be funded through taxes and energy bills, the UK government holds a 44.9% stake in Sizewell C. The French state nuclear developer EDF holds 12.5%, while private investors include Centrica at 15%, the Canadian investment group La Caisse at 20%, and the investment manager Amber Infrastructure at 7.6%. The government took a larger than expected share after buying out China's CGN, which had held a 20% stake before national security concerns emerged. The PAC warned that while the public could face multibillion-pound cost overruns, private investors would only need to contribute an extra £30m if problems arise.
Sir Geoffrey Clifton-Brown, the PAC chair, said: "The high level of risk borne by taxpayers and consumers for the construction of Sizewell C is extraordinary. Private investors look set for significant returns on their investments, while customers are likely to be saddled with higher energy bills." He called on the government to ensure successful delivery of the project and to avoid placing taxpayers in this position again with future nuclear schemes. The committee has requested the government provide scenario analysis underpinning its cost estimates within three months and deliver project updates every six months.
Critics of the scheme, including the Stop Sizewell C campaign group and academics, have suggested that abandoning the project now would cost less than paying inflated energy bills over 60 years. They called on the government to rule out using this funding model for future nuclear projects, saying it offers "a free ride for investors and financial pain for households". However, Tom Greatrex, chief executive of the Nuclear Industry Association, defended Sizewell C as providing "clean, reliable and constantly available power". He noted that consumers are currently paying £2.8bn this year to manage grid balancing through wind restrictions and gas-powered backup.
A government spokesperson rejected the committee's criticisms, stating the report "completely ignores that investors are incentivised to complete construction as cheaply and quickly as possible" under the deal's terms. The spokesperson added that once operational, Sizewell C could save £2bn annually across the energy system, reducing costs for households nationwide. The project already has over 2,000 workers on site, the government said.