The nuclear stupidity of insisting reactors provide ‘social value’
The government is demanding that companies who want to build small modular reactors must ensure 50 per cent of workers are women and provide jobs for refugees rather than, you know, build a nuclear reactor, says Tom Harwood
Let me take you back in time to a quite different world. Barack Obama is President of the United States. David Cameron is our Prime Minister. Corona is still a beer and Donald Trump is still a joke. The word ‘Brexit’ is a wonkish and barely used portmanteau.
This is the world into which then Chancellor George Osborne announced to the House of Commons in his March 2016 budget speech that: “we’re now inviting bids to help develop the next generation of small modular reactors”.
And yet, one decade and five Prime Ministers later, how has the process fared?
Not a single civil small modular nuclear reactor (SMR) has been built. It was only this summer that finally Rolls Royce was selected as the government’s preferred bidder. The last nine years have consisted of dither, delay, almost comical levels of bureaucracy – and a massive missed opportunity.
Climate crisis, what climate crisis?
Yes, the Prime Minister who presided over parliament declaring a “climate emergency”, and committed the country to net zero carbon emissions by 2050 was also the Prime Minister who cut back Britain’s SMR ambition. Theresa May downgraded Osborne’s competition to a mere ‘feasibility study’. Companies that had spent time and money preparing competition bids were furious.
Enter Prime Minister Boris Johnson who matched private funding to restart Rolls Royce’s ambitions, establishing Rolls-Royce SMR Ltd. But it wasn’t until Prime Minister Rishi Sunak in July 2023 that the competition was finally “reborn” in the words of the then government.
Regulatory gymnastics
For two long years, government dithered over which provider to select. This week we have begun to learn some of the absurd regulatory gymnastics nuclear companies had to perform in order to be in with a shot of winning.
Companies would only be considered if they could prove they were adding “social value” not just in their own firms but right down their supply chains. The government demanded these companies show how they would create jobs for “refugees, people who have recently immigrated or are seeking asylum”, and those “who face barriers to employment”.
The same process demanded how these companies should outline plans to ensure half of all those working on the contract were women. Not just in the companies themselves (traditionally male dominated) but also implausibly through every company that supplies them.
The government spent £22m of taxpayers’ money over the course of two long years just to choose a preferred bidder. And that likely pales in comparison to the obscene amount of money our nuclear companies will have had to spend to contort themselves into providing ‘social value’ rather than showing they can build a decent reactor.
In June, Rolls Royce was finally chosen. But the whole process put Britain on the back foot. Despite an energy crisis, despite legal net zero commitments, the government was wasting time trying to force these companies to deliver social policy rather than, you know, design nuclear reactors.
Despite an energy crisis, despite legal net zero commitments, the government was wasting time trying to force these companies to deliver social policy rather than, you know, design nuclear reactors
It all smacks of an old joke attributed to the great economist Milton Friedman. The story goes that travelling through China, Professor Friedman was shown a canal construction project by a proud government bureaucrat. But Friedman noticed something odd about the digging.
Thousands of men were using shovels rather than modern machinery. After asking the bureaucrat why this was the case, the reply came back that “using shovels supports jobs in the construction industry”.
“Ah,” retorted Professor Friedman. “This is a job creation scheme. I thought you were trying to dig a canal. If it’s jobs you want, take away their shovels and give them spoons.”
The story is meant to be comical, mocking communist state planning. Yet for our nuclear industry here in Britain it’s darkly accurate. The government really has forced them to build the next generation of nuclear reactors with spoons.