Nuclear Energy (Financing) Bill — House of Lords, 2022-03-24
Topic: Energy
Hugh Trenchard (Conservative, Centre-right): My Lords, the noble Lord, Lord McNicol, tabled an amendment similar to Amendment 2 in Committee. The Minister could not accept it because it appeared to rule out EDF as an investor in Hinkley Point C or Sizewell. It also attempted to restrict sourcing of nuclear fuel to domestic producers, which the noble Lord has dropped from his revised amendment. My noble friend explained that the Government do not support investment in our critical infrastructure at the expense of national security, which was good to hear. I ask the Minister to tell your Lordships what progress the Government have made on replacing proposed Chinese investment in Hinkley Point C and Sizewell C Amendment 2 is an improvement on the version debated in Committee, but the link to Amendment 6 requires the Secretary of State to establish a list of foreign powers or entities that are barred from involvement in the UK’s civil nuclear sector. Amendment 2 covers nuclear companies owned wholly or in part by a power or entity included on this list, but ownership in part could mean just one share. Surely this amendment should restrict only significant shareholdings; perhaps 5% would be an appropriate trigger Furthermore, the requirement on the Secretary of State imposed by Amendment 6 would clearly be massively burdensome, if not impossible. It is quite adequate that the Secretary of State should deal with each application separately and assess the shareholders at the time of application I said in Committee that I was inclined to support the amendments in the name of the noble Lord, Lord Vaux of Harrowden, who has experience in these matters and always takes a well-considered view. He has persisted in seeking more safeguards in the Bill by bringing back his amendments, but now aligned with the generally accepted definition of "persons of significant control" of UK companies. Those are usually persons holding more than 25% of the shares in a company or having the right to appoint a majority of the board of directors The noble Lord, Lord Vaux, is also surely right in his purpose in tabling Amendments 7 and 8 that designated nuclear companies should promptly notify the Secretary of State of any change in persons of significant control. However, I am not sure that it is necessary to state this explicitly in the Bill, and there could well be cases where the Government welcome changes in the shareholding structure of nuclear companies. As my noble friend explained to your Lordships in Committee, the Secretary of State may attach any conditions he deems appropriate to the designation of a nuclear company, and I believe that this will give him the flexibility to make whatever stipulations he needs to with regard to the balance of shareholdings in such a company The noble Lord, Lord Vaux, made some further good points today, although I must say that I consider his suggestion that a Chinese company might take a 51% stake in a Japanese company to be very unlikely, based on my experience of working in the Japanese stock exchange. Nevertheless, I look forward to the Minister’s reply to those points.