Britain is an expensive place to build almost anything. From roads to railways, from trams to tubes, British projects are invariably the most expensive. In this sense, nuclear power is not special.

British nuclear infrastructure projects are expensive, in part, because British infrastructure projects are expensive and British infrastructure projects are expensive for more than one reason. After all, to be two, five, or nine times more expensive than peers suggests more than one thing is wrong.

Four causes stand out:

  1. Slow, resource‑intensive consultation, planning, and permitting processes: For example, offshore wind farms take about two years to build, yet typically more than a decade end‑to‑end when planning is included. Before a single spade is in the ground, developers must run multiple consultations, produce lengthy environmental impact assessments (which can run to 10,000s of pages), and obtain dozens of permits.
  2. Over-specification driven by political demands and gold-plated regulation: For example, HS2 was built to run at up to 250mph. As a consequence, HS2 was forced to adopt a straighter route requiring more tunnelling and cuttings pushing up costs. In order to comply with the Habitats Regulations, HS2 is currently spending £125m to build a ‘bat tunnel’ designed to protect a small number of bats from the high speed trains.29
  3. Stop-and-start approach to construction limiting gains from learning and reducing incentive to invest in supply chain (e.g. training and equipment): For example, Britain’s investment in electrifying our railways has followed a ‘feast or famine’ trajectory where decades with almost no electrification are followed by major programmes. As a result, lessons learnt from past projects are often forgotten while supply chains are fragile. In the case of electrification, many workers have left rail to work on the grid. One outcome of a lack of clear pipeline is Britain’s largest construction firms are small by international standards, invest less in skills and equipment, and are heavily reliant on expensive sub-contracting.
  4. Lack of standardisation and frequent design changes between projects: For example, each British tramway has its own standards, which dictate features like platform height, turning radius, and operational concerns. In effect, each tram project must start from scratch on engineering and design work. Opportunities to cut costs through bulk-buying are limited as a result.

All of the above apply to British nuclear projects.

  • The planning process for Sizewell C involved seven consultations, an over 80,000-page environmental impact assessment, and multiple legal challenges.30
  • Hinkley Point C had to make thousands of design changes to meet environmental and safety regulations. While every nuclear project faces site‑specific issues, only Hinkley Point C includes a dedicated fish‑return system and an acoustic fish deterrent.31
  • Hinkley Point C is the first nuclear plant built in Britain in three decades. Supply chains had to be rebuilt as many people from past projects have retired or moved abroad. In fact, there was only one nuclear qualified welder in the UK when Hinkley Point C’s construction began.
  • Hinkley Point C includes several safety features—not present in the French and Finnish units—such as a separate analogue control‑and‑instrumentation system, additional diesel backup, and an extra spent‑fuel‑pool cooling train.

British nuclear construction costs may be the highest in the world, but nuclear costs have increased over time across the world with few exceptions. In general, technologies become cheaper over time as more units are installed. Televisions, computers, and renewables have all seen quality-adjusted price falls over the past 50 years. Nuclear, by contrast, appears to exhibit negative learning. The more we build the worse we get.

Where nuclear projects differ to infrastructure projects more generally is that cost-increasing design changes are often not the result of political demands (e.g. tunneling large parts of HS2 to avoid disrupting the views of people live in the Chilterns) and environmental protection (e.g. building a £125m bat shed for HS2 to avoid disrupting the habits of bats), but the also disproportionate application of safety regulations designed to protect the public from the harm of radiation.

In the United States, nuclear regulation increased sharply in the 1970s. One measure of regulation, the US Nuclear Regulatory Commission’s regulatory guides rose from 21 at the end of 1971 to 143 by the end 1978.32 Not all changes were inadvisable by any means. For example, past rules had assumed the risk of earthquakes and tornados was much lower than they actually were. Yet as a result of the changes the Atomic Industrial Forum estimated that materials, equipment, and labour per watt doubled, while design‑engineering effort tripled. One study estimated that increased regulatory burden raised nuclear plant construction costs by 176%.33

How regulation is making nuclear more expensive

There are two key ways that regulation can make nuclear power more expensive to build.

Direct costs of regulation
People discussing regulation’s impact on cost typically focus on the direct costs. In other words, complying with specific regulatory requirements directly incurs additional expenditure. Direct costs can be straightforwardly identified and measured.

Examples include:

  • Environmental Impact Assessments: fees paid to ecologists and lawyers to carry out surveys and produce 80,000‑page assessments.
  • Nature Mitigations and Compensation: expenditure on environmental measures such as acoustic fish deterrents (‘fish discos’), fish returns systems, and wetland creation.
  • Design Changes: Requirements to re-design stations to add additional safety features, which in turn increases labour, design, and materials costs.
  • Judicial Review: Delays incurred due to legal challenges and slow approval processes.

The above costs are meaningful and can, in some cases, be large. For example, the requirement to have a separate analog control and instrumentation system will significantly increase the cost of Hinkley Point C and Sizewell C. At the same time, the total direct costs of the planning process and unique to the UK design changes are unlikely to explain alone why British nuclear plants are 2, 3 or even 6 times more expensive than plants built elsewhere.

Indirect costs of regulation
There’s another major way that regulation can increase construction costs for nuclear (and indeed all forms of infrastructure).

Beyond the direct costs of regulation, regulation can indirectly increase costs by creating barriers to methods and strategies that are proven cost-reducers.

Regulation can undermine proven cost-reducers by:

Limiting gains from learning across projects: There is strong evidence that First-of-a-Kind (FOAK) nuclear projects tend to be substantially more expensive than the third, fourth, or even tenth plant in a fleet. Construction teams become more productive and are less likely to make preventable mistakes as experience with a design grows. Welding at Hinkley Point C’s second reactor building is being done at four times the pace as welding at the first reactor building. This is estimated to generate a 30% saving.34

If frequent design changes and project-specific environmental mitigations impede standardisations, it is likely the cost savings associated with a fleet approach are less likely to be found.

Making it harder to innovate in reactor design and construction: In most markets, innovation is a key driver of cost-reductions. For example, solar panel factories have changed substantially over the last 15 years and have become more productive as a result. In nuclear, changes must be justified with detailed safety cases and can trigger planning delays. Hinkley Point C was required to gain additional planning permission to change its approach for storing nuclear waste based on operational experience.

Deterring investment in supply chains: One key way the fleet approach to nuclear saves money is by creating a strong incentive to invest in the nuclear supply chain. Nuclear construction involves not just specialist skills like nuclear welding but also specialist equipment. For instance, the world’s largest crane, ‘Big Carl’, lifted a 245‑tonne dome onto Hinkley Point C’s first reactor building.

Costs can be saved when expensive investments in workforce training and machinery can be spread across multiple projects. Yet, if uncertain planning processes, legal challenges, and the risk of design changes leads to stop-start construction then these investments will either be more expensive, or not be made at all, such as by using foreign welders instead of training new British welders.

Creating barriers to entry to disruptive competition: Competition forces companies to stay lean and to innovate. In markets where only a few producers can profitably operate (e.g. industries with high-upfront costs such as nuclear), market leaders keep prices low and operate efficiently to guard against innovative competitors who have the potential to undercut them offering an entirely new product.

Expensive licensing and planning processes can create a significant additional hurdle for new innovative competitors who bear large costs before a single order is made.

Increasing the risk associated with financing fleets: Building fleets, as Britain did in the 1960s, France did in the 1980s, and South Korea does now, means that large upfront costs can be spread over multiple projects and leading to substantial ‘learning-by-doing’ between projects. However, the fleet model, in order to work properly, requires that nearly every decision, especially planning and financing, are ‘one and done’ at the beginning. No developer or operator can make a fleet model investable if they are subject to enormous risks that there will be planning delays or required design changes.

Preventing the use of modular construction through increased design complexity: Additional environmental mitigations and safety features such as a hard-wired analog backup increase the complexity of plant designs. As a result, projects are less able to use modular construction (e.g. built in a factory assembled on site) and more reliant on civil works with greater construction risk.

Our plan to cut costs

In February, the government announced a taskforce led by John Fingleton, former head of the Office of Fair Trading, to “examine all aspects of the regulation of civil and defence nuclear”.35 Major regulatory reform is a pre-condition of reducing the cost of building new nuclear in Britain to Finnish, French or even South Korean levels. The Taskforce’s Interim Report is robust, criticising a “culture of risk aversion irrespective of cost, increasingly complex processes and procedures, and excessive bureaucracy.”36

The stakes are high. If the taskforce is radical and its proposals are adopted, the prize is enormous: Lower bills, lower emissions, protection from volatile fossil fuel markets, and if we are really successful, an industrial renaissance in the UK. Reducing the cost of new nuclear powerstations in Britain is crucial, not just because a clean energy mix with nuclear will be cheaper, but also because the defining technology of the 21st century – AI – needs reliable power. If Britain is unable to create the conditions for rapid cheap nuclear deployment, then it sets up a sharp choice between decarbonisation and economic growth.

Britain Remade has a plan to cut the cost of building new nuclear. Developed after extensive engagement with industry and reviewed by leading experts from the Universities of Cambridge and Liverpool, our plan targets three key areas where Britain’s existing approach to regulating and financing nuclear projects increases costs, discourages innovation, and provides, at best, minimal public benefit.

  • Britain’s approach to regulating the risks of radiation exposure (and why it is disproportionate)
  • Britain’s planning system for major infrastructure (and why it is not fit for purpose)
  • Britain’s electricity market arrangements (and how they block private investment into new nuclear)