In a further blow to the UK government’s energy strategy, troubled Toshiba has been forced to buy French company Engie’s 40 percent stake in NuGen – the company that was supposed to be building three new reactors in Cumbria.
The buy-out comes on the back of Toshiba’s decision last week to file for bankruptcy protection for its U.S. nuclear unit, Westinghouse Electric, which is expected to post a loss of $9 billion for the last financial year. According to Takashi Mochizuki at Market Watch:
“Toshiba said the Westinghouse bankruptcy triggered a clause in its contract with France-based Engie that gave Engie the right to sell its stake in the companies’ U.K. joint venture, NuGeneration Ltd. or NuGen.
“The purchase means that for now, Toshiba will be more deeply involved in a business it is hoping to exit–nuclear power projects outside Japan.”
It now looks highly unlikely that Cumbria’s new nuclear reactors will be built unless Toshiba can find a buyer with the technical expertise and business acumen to construct profitable new nuclear power stations. However, with the main competitors – Hitachi and France’s EDF – also experiencing profitability problems, it is far more likely that Britain will be left with insufficient generating capacity in the 2020s.