It also today confirmed it will announce funding in the New Year for a new arms length development body for nuclear power, called Great British Nuclear.
This will help to steer future projects through the development process while ensuring these projects offer clear value for money for taxpayers and consumers.
Under today’s Sizewell deal, the government will invest £700m in the project to become a 50% shareholder in the project’s development with EDF.
It represents the first direct government investment in a new nuclear power project since Sizewell B, which was approved for construction in 1987.
The government will now work with the Sizewell project company to seek to attract extra third-party investment to help finance the project’s construction and operation.
If approved, Sizewell C’s supply chain strategy will see 70% of the value of the project’s construction and operations contracts placed with UK businesses, creating and supporting thousands of well-paid jobs in Suffolk and across the UK’s national nuclear industry.
The investment also allows for China General Nuclear’s (CGN) exit from the project, including buy-out costs, any tax due and commercial arrangements.
Earlier this week, the Business Secretary Grant Shapps designated Sizewell C as the UK’s first project to use the newly-established Regulated Asset Base (RAB) funding model for nuclear.
RAB has already been used for other major infrastructure, such as the Thames Tideway Tunnel and London Heathrow Terminal 5.
Using the RAB model is expected to further reduce the costs of electricity to consumers, by cutting the cost of new nuclear project finance, which is the biggest driver of nuclear project costs.
