Macroeconomics: UK economy, IB Economics

The government has pledged £100m for the Sizewell nuclear site but stopped short of fully committing to it, as negotiations with EDF continue. It is clear that this is the government's preferred option for a new nuclear power station and increased energy security. 

The project is opposed by environmental groups, and will, of course, take a long time to come to fruition. 

Britain's own energy supply is in the spotlight with the news that EDF have applied for permission to build a third nuclear power station in Suffolk - Sizewell C. 

Whilst it could generate sufficient power for 6 million households and create a sizeable number of jobs, critics argue that it would adversely affect investment in other sectors of the UK energy sector - presumably renewables. 

It's an interesting dilemma, with many of the view that, in the short-term, nuclear energy is the best way of reducing carbon emissions and generating greater amounts of electricity.

A boost for the nuclear power industry, with news emerging that a new plant is going to be built at Sizewell in Suffolk, after a couple of projects in Anglesey and Cumbria had previously been scrapped.

This is an important boost to the country's electricity generating capacity, but also highlights the inelasticity of supply in the sector. However, when it comes online, it will represent a significant boost to the nation's supply-side. 

It seems that EDF are preparing to build another nuclear power station at Sizewell in Suffolk. Hmmm. It might ensure that Britain is able to generate the requisite power, but at what cost?

Critics would argue that the new Hinkley Point power station is only viable because of an overly-generous strike price, although the company have argued that the new power station will be £4bn cheaper. I would suggest that it's quite a lot for the government to pay for a firm to benefit from the advantages of learning by doing.