Centrica preparing to take 15% stake in Sizewell C nuclear plant, reports say
The boss of the Windsor-based energy group earlier this year said he was 'hopeful' of striking a deal to invest in the facility.
The investment would mean Centrica has about the same size stake in Sizewell C as French energy giant EDF, the Financial Times reported on Friday.
EDF, which owns and runs Britain's nuclear facilities, and the Government were the first backers of the project.
But they have been trying to raise billions more from prospective investors, including Centrica.
A spokeswoman for Centrica said it would not comment on speculation about acquisitions or investment.
In February, chief executive Chris O'Shea said the group was in discussions over injecting cash in the new Suffolk-based nuclear plant, with aims to secure a deal in the first half of this year.
He said: 'I like nuclear. I'm really hopeful we can make progress with Sizewell C this year.'
But he said it 'all depends on the overall cost of the project and returns'.
Mr O'Shea declined to give details on the size of stake Centrica was looking to take in the group, except to say it would be 'between 1% or 2% and 50%'.
Chancellor Rachel Reeves earlier this month said £14.2 billion will be invested to build the power plant, marking the end of a long journey to secure funding for the project since it was first earmarked in 2010.
Sizewell C will power the equivalent of six million homes and is planned to be operation in the 2030s, and is expected to create 10,000 jobs, the Government said.
The Financial Times reported that all sides were hopeful of reaching a final investment decision on the project before Parliament breaks for recess on July 21, citing sources familiar with the discussions.
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'This would result in a decrease in the rate of installations allowed after 2030 of over 90%, and amounts to a de-facto ban on Scottish onshore wind post-2030. Claim: Scotland is already doing more than its fair share of onshore wind Last year, Scotland, according to RenewablesUK, was operating 63% of the UK's onshore wind capacity. By 2030 Scotland will be producing 20.5GW of power, well over two thirds of the onshore wind generation in the UK, which is set at 27-29GW. As this map shows, Scotland is doing a lot of the heavy lifting when it comes to onshore wind. Partly this is because previously England had a de facto ban on onshore wind developments. But there are, as Morag Watson told me, other factors that feed in to why Scotland, in any case, is getting most of the wind. 'The reason for this," she says, "is you can only put onshore wind where the wind consistently blows at 7ms or faster and there are chunks of England where that doesn't happen. You cannot build a wind turbine within 800m of someone's home, or with the bigger turbines, within 1km of someone's home. "So if you take a map of the UK and take out everywhere where the wind is less than 7 m/s and then take out everywhere where you're within 800 m of someone's home, and then remove National Parks and national scenic areas, where you also cannot build wind, and again is why you don't see onshore wind predominantly down the west coast an central of Scotland, the only places you can build onshore wind are these parts of Scotland and mid Wales. This is why Scotland does do the heavy lifting on onshore wind.' But, she notes, England is doing most of the heavy lifting on solar. Unsurprisingly, the south of England, where the sun is stronger, is also where there are more solar developments. Claim: Constraint payments are already costing millions and only going to rise – suggesting there is already too much onshore wind Often windfarm critics point out the huge cost of constraint payments, made to renewable energy generators to compensate them for reducing their electricity output when the grid cannot handle the full amount of power being generated. A report published earlier this year by the Renewable Energy Foundation found that wind farm constraints continue to rise, both in total volume and in cost. In 2024 the consumer paid more than £393 million in direct costs to discard 8.3 TWh of wind energy, a rise from the previous year's cost of £310 million. "Planning application data," the report said, 'shows that the, in our view, indefensibly high rewards for constraints continue to incentivise wind farm development in areas of the UK that have low demand and weak grid connection, resulting in high constraints. More than 98% of the total constrained volume, it noted, arises from Scottish wind farms. However, by far the biggest constraints were applied not to onshore wind, but offshore wind, including Seagreen. 'In particular, the offshore wind farm, Seagreen, whose majority owner is SSE, was alone responsible for 40% of the total volume of constraints. Seagreen is currently unsubsidised but 25% of its capacity has been awarded an as yet unimplemented Contract for Difference (CfD).' The most constrained onshore windfarms were Viking (Shetland), Dorenell (Moray), which is currently proposing an extension which would make the area home to the largest onshore array of turbines, Stronelairg (Fort Augustus), which claims to be on of Scotland's windiest windfarms, Bhlaraidh (Glenmoriston). Of these four, all but Dorenell are owned by SSE Renewables. But, Morag Watson points out that, relative to other impacts on electricity bills, like the fact gas prices set electricity prices 98% of the time in the UK (which has the highest electricity prices in Europe), the cost of curtailment is not that big. 'If you look," she says, "at the cost of balancing the grid in the average electricity bill, which according to Ofgem is £929, £32 of that is the balancing, just under 3.5% and of that only part of that would be the cost of constraint payments. That's a vanishingly small part of your electricity bill. About £352 of your bill is driven by the wholesale cost of electricity – and that is driven by the gas price. So getting rid of the constraints and getting that gas down would be a really great thing for all of us.' Part of what is driving constraints is the pinch point around what's called the B6 boundary in the grid between Scotland and England, which has a transfer capability currently of around 6.7 GW. But it isn't the only problem. Arguably the B4 boundary, between the North of Scotland and South of Scotland transmission areas, which has a capacity of only 3.4GW is still more important. A recent blog published by UK Energy Research Centre, written by Professor Keith Bell and Callum MacIver of the University of Strathclyde looked at the 'impact of the role of transmission system availability (or rather unavailability) on rising curtailment costs in Britain'. They noted the importance of the B4 boundary. 'Lots of the wind in Scotland is located in the far North, including all of that new capacity from Seagreen, Viking and Moray East, totalling around 2.5 GW. The B4 boundary is therefore often the primary pinch point on the system.' The blog examines the impact of the failure to as yet build planned grid enhancement, especially the Peterhead to Drax undersea cable, which the system operator originally gave a delivery date of 2023, but is now not due till 2029. 'It seems clear we haven't built out enough North to South transmission capacity quickly enough, and that lies at the root of our current issues… but is there more to the story?' It goes on to point out that an additional issue is that 'often, the real-time capacity on the B4 and B6 boundaries is well below the maximum level, often even below 50%". The authors note also note that even these boundaries are not working to capacity. 'Not only have we, up to now, failed to add a 2 GW link across the congested Scottish boundaries, but B4 spent more than half of 2024 with an additional equivalent scale 2 GW reduction in operating capacity.' The reason for this? 'Ironically,' they write, 'it is due to the implementation of network upgrades'. MacIver also looked at what the effect of additional network capacity across the B4 and B6 boundaries would have been and found that 'even a modest increase' across these boundaries of 500MW could have resulted in 'reduced curtailment costs by as much as 25% from the £1.65bn total in the 15 month period from the start of 2024 to the end of April 2025'. He also found that if there had been 'a 2000MW uplift, in line with delivering the Peterhead Eastern Link project to its original schedule of 2023, then a full 73% of the thermal constraint costs could potentially have been avoided'. Overall, therefore, the constraint problem is an argument for more grid enhancement, particularly the development of undersea links, rather than less windfarms.
