Warnings that the Hinkley Point C could cost up to £2.9 billion more than first thought has put the spotlight on a new finance model that could be used to develop a nuclear large-scale power station at Moorside.

Bosses at French-owned company EDF have been forced to reveal that the estimated cost for building Hinkley Point C in Somerset could be between £21.5bn and £22.5bn as it struggles with “challenging ground conditions”.

And in a double whammy for Britain’s first new nuclear power station development for a generation, they have also said there is a rise the project could be delayed by up to 15 months.

Overspends and overruns have long eroded confidence in large-scale nuclear projects, along with high strike prices, with power from Hinkley Point C set to cost consumers £92.50 per megawatt hour.

EDF and its partner on the project, China General Nuclear, will have to cover the cost under the contract-for-difference model used for Hinkley Point C. But because it carries the risk of the development costs, the strike price are set higher.

However, the revelation has shone a spotlight on a new finance model currently being considered by the Government as a way to back similarly sized nuclear power stations elsewhere, including Moorside in Cumbria.

Under a Regulated Asset Base (RAB) model, it would be consumers who foot the bill for construction costs along with any overruns. That would be in addition to whatever strike price is agreed for the power it generates – although that would be expected to lower than that agreed for Hinkley Point C, which has caused much controversy when the cost of wind power is at an all-time low and closer to £40 per megawatt hour.

A consultation on adapting the RAB model – which has already been used in the UK to finance electricity, gas, telecoms and transport infrastructure – is due to come to an end on October 14.

The RAB model approach has been largely welcomed in the nuclear industry as a way of de-risking projects for investors and developers who currently have to cover the eye-watering up-front costs.

However, opponents say the model shifts the risk to billpayers, who ultimately end up footing the bill.

Rob Johnston, chief executive of Cumbria Chamber of Commerce, said: “Under RAB the risk is lower so the electricity should be cheaper.

“It might get dearer if costs overrun but the Government believes the electricity will still cost less than under the contract-for-difference model used for Hinkley Point.”

He added: “Whichever funding model is deployed, it’s vital that the Government acts quickly to plug the gap in our energy infrastructure. Given that existing nuclear power stations are coming to the end of their lives, and given the extra demand created by electric vehicles, National Grid is forecasting that generating capacity will have to increase substantially by 2050.

“Nuclear new build is essential if we’re to keep the lights on.”

The Department for Business, Energy and Industrial Strategy (BEIS) has said that lessons learned from Hinkley Point C have the potential to reduce costs and risks for future projects.

A BEIS spokesperson said: “The Government negotiated a competitive deal on Hinkley Point C which ensures consumers won’t pay a penny until the station generates electricity.

“Any increase in costs will be borne entirely by EDF and their investment partners and not by consumers or taxpayers.”

BEIS has also said that while the continuing fall in cost of offshore wind is “great news for consumers” new nuclear still has “an important role to play” to help the nation become Net Zero by 2050 because the target will not be met by renewable energy alone.

The RAB consultation has, nuclear experts in the county believe, resurrected the potential for a large-scale development at Moorside, coupled with Prime Minister Boris Johnson’s pledge to support a new nuclear renaissance in the UK.

But many believe the emergence of the model as the Government’s preferred way to support NuGen’s £15bn power station at Moorside, sacred off the investor in pole position to take on the project, Korean utility Kepco.

NuGen’s plans collapsed in November 2018 after its owner Toshiba stripped Kepco of preferred bidder status in a last-ditch attempt to find a buyer. And alternative project has yet to materialise.

Elsewhere the Wylfa Newydd and Oldbury developments in Anglesey and Gloucestershire respectively have both been mothballed due to wrangles between its developer – Hitachi – and the UK government on financial support for the two projects.

Meanwhile, appetite for small modular reactors (SMRs) continues to grow, with Copeland MP Trudy Harrison and Copeland Borough Council recently vowing that they would be pushing for the technology to be deployed in the district, with Moorside an obvious location as a site already earmarked for nuclear development.

SMRs – as the name suggests – are smaller than their equivalents in large-scale nuclear power stations, can be constructed off site before installation, and are cheaper to manufacture.

Representatives from Shepley Engineers Ltd, TSP Engineering and BECBC, which has more than 300 members, were among the businesses to showcase their expertise and capability to multi-national engineering company Rolls-Royce recently.

Rolls-Royce is leading a consortium – which also includes the National Nuclear Laboratory, Nuvia and Wood – to design a first-of-a-kind SMR, which could create up to 40,000 jobs and generate enough electivity to power 750,000 homes.