But Britain, a country with dwindling North Sea gas reserves, remains one of the few major Western nations still considering a massive rollout of new nuclear plants. At the same time, Britain maintains some of the world’s most open policies on foreign investment. Together, that has given China’s state nuclear power companies — now in the midst of building 26 reactors at home — an opportunity to muscle in on the global market, which had long been dominated by European, American and Japanese companies.
“As China slows down, its companies are looking more and more to developed economies for growth,” said Thilo Hanemann, research director at New York-based Rhodium Group, an economic research firm that monitors Chinese investments. “One of their motives is to gain access to technology and human talent, an exposure to global management techniques. They are trying to move up the ladder.”
Over the next decade, eight of Britain’s nine plants will be decommissioned, with plans to replace them, and possibly increase their numbers, still seen here as key to meeting London’s pledged targets to cut carbon emissions. Two of the first four new reactors were set to be built by the German consortium Horizon, and two others by a group led by French power giant EDF.
But with the Germans phasing out nuclear power and the French-backed group under financial strain, industry insiders here say Britain has dwindling options to meet the Conservative-led government’s pledge of building new plants without throwing in billions of pounds’ worth of state subsidies.
In what appears to be a move designed to assuage political concerns, Chinese state nuclear companies are seeking to partner with French giant Areva or Japanese rival Toshiba’s U.S.-based Westinghouse to buy out Horizon’s rights in Britain. Negotiations are continuing over the structure of a deal, with the role of the Chinese state companies under intense discussion. Besides offering financial backing, the Chinese companies could potentially become involved in construction and operational aspects of the plants, according to sources familiar with the talks.
The Financial Times reported Monday that EDF is also reportedly in talks to partner with the Chinese to build reactors in Britain.
Talk is rampant here that the Chinese companies may be forced to ultimately accept deals giving them no more than 50 percent ownership stakes in the new plants. But a British Energy Department official, speaking on the condition of anonymity because of the sensitivity of the issue, said that the government would not seek to limit a potential Chinese stake and that it would treat China “as we would any potential investor.”
The public response in Britain has been relatively muted. Nevertheless, criticism is starting to emerge from an unusual pairing of liberal anti-nuclear groups and staunch conservatives who question whether Britain is offering China a strategic foothold here that could become a significant security concern if tensions with Beijing were ever to rise.
“This is part of a worrying and incremental growth in what I call ‘China correctness,’ or not wanting to unduly upset the Chinese for want of investment,” said Mark Pritchard, a Conservative member of the House of Commons. He added, “Do we really want a Chinese communist state-backed company behind a U.K. power station? You have to wonder whether this is wise.”
Julie Tate in Washington and Karla Adam in London contributed to this report.