Page last updated at 12:37 GMT, Sunday, 1 August 2010 13:37 UK

Minister says private sector will build nuclear plants

Dungeness Nuclear power station
More nuclear plants are on the way

New nuclear plants will be built in the UK as part of the move towards a green economy, Energy Secretary Chris Huhne has said.

Mr Huhne told the BBC that breaking the dependence on traditional fossil fuels was vital.

The minister said the market would decide which types of low-carbon energy would be used, but he believes nuclear investors are waiting to come forward.

He ruled out specific government subsidies for the new power stations.

In an interview on BBC1's AM Show on Sunday, the Liberal Democrat minister admitted that in the past he and his party stood firmly against the expansion of nuclear power but that their stance had changed when they entered into coalition with the Conservatives.

"My position and my party's position was always one of scepticism about the economics of nuclear power, but what we did in the coalition agreement is recognise the differences between the Conservatives and the Liberal Democrats.

"We responded with an agreement which will say very clearly there will be no public subsidy for nuclear because it is an old technology... But at the same time, if investors come forward with proposals it is absolutely clear they will go through.

"We believe that will happen. We believe there are investors who will be investing in new nuclear," Mr Huhne said.

He also ruled out fixing electricity prices as a subsidy by stealth.

"There will be no question of guaranteeing electricity prices. But what nuclear will have access to in some way, like all other forms of low-energy technology is the advantage of not paying through the EU emissions trading scheme.

"It will benefit from the framework we have to make the transition to a low-carbon economy."

Market Forces

Mr Huhne said it was not his job to choose what will replace oil, gas and coal.

"The market will decide which low-carbon technologies will be used," he said.

Moving away from an over-dependence on oil would make the economy more resiliant against the commodity's price rises expected over the next ten to 20 years.

Low-carbon technology could put £300 a year on the average household energy bill according to some estimates.

Mr Huhne said he thought the rising cost of a barrel of oil would wipe out the extra cost of new technologies.

The need to move away from a petro-economy was highlighted by the BP oil spill in the Gulf of Mexico, the energy secretary said.

During the height of the crisis, the coalition and David Cameron were accused of doing too little to protect BP and its then chief executive Tony Hayward from being "vilified and demonised" by the United States government.

Mr Huhne said: "We recognised that this was an enormous environmental disaster and any government would respond this way. But, we made the point both in public and in private that BP was an important force for this country and for the US."

Speaking about the 98% rise in profits announced by British Gas last week, the energy secretary said Ofgem, the industry regulator, had to watch energy companies pricing structures.

"We need a very competitive market to make sure any profits that are made are competitvely made. We need to go on stressing to Ofgem the importance of a competitive framework. They need to look to see if we are being too generous," he said.

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