Reassurances over planned nuclear power station urged after bankruptcy move
The Government is being urged to give reassurances about a planned nuclear power station in the UK after Toshiba's nuclear unit, Westinghouse, filed for bankruptcy protection.
NuGen, the company behind the Moorside scheme in Cumbria, has previously insisted that Toshiba remains committed to the project despite doubts after the Japanese giant said last month it was on track for losses of 390 billion yen (£2.7 billion) for the year to March.
Toshiba has a 60% stake in NuGen.
Westinghouse filed for Chapter 11 bankruptcy protection in the United States following a series of losses.
Toshiba said: " The Chapter 11 filings have made planned supply of the AP1000 (nuclear power plant) for the UK project uncertain, and we have therefore recorded an impairment loss covering the cost of the NuGen project.
"However, if you consider the project in terms of the overall power generation business, there is no change in the business climate.
"We will work to enhance NuGen project's value, in consultation with stakeholders, such as Engie and UK government.
"Toshiba is committed to invest until the FID (final investment decision), but there is a certain point before the FID where we can review and determine whether or not to continue the project.
"Also, we are allowed to sell the shares through a certain process and under certain conditions at other times.
"We would like to explore the alternatives, including sales of the shares, and carefully watch the situation."
Rebecca Long-Bailey, Shadow Business Secretary, said: "This announcement throws into doubt the Moorside new nuclear plant that could create 20,000 jobs in Cumbria.
"Questions have been raised over Toshiba's role in Moorside for some time.
" When Westinghouse's viability was first called into question, Labour said the Government should step in to underwrite the company's investment if the project was at significant risk of collapsing.
"Unfortunately, the Government dragged its heels.
"The Government must now urgently provide assurances about the future of Moorside. Relying on the private sector alone, in absence of a robust contractual legal structure, has failed."
Doug Parr, policy director at Greenpeace UK, said: "The world is watching the meltdown of a major corporation and questioning the cost of new nuclear.
"Declaring bankruptcy in the USA might shield Toshiba from Westinghouse's debt, but as Toshiba's share price ricochets and its multi-billion dollar losses escalate, the beleaguered nuclear industry is being shaken to the core again.
"Every nuclear project in Europe and the USA has gone massively over time and over budget.
"If Moorside is to go ahead, the UK government is likely to have to wade in with taxpayers' cash now Toshiba is poised to drop its majority stake.
"To save face, they look set to contribute billions of pounds of public funding to ensure the plant gets built.
"Considering the cautionary tale of Toshiba, the Government would do better to support the drive for a renewable energy system which will see costs fall, not spiral."
Chris Jukes, of the GMB union, said a collapse of Toshiba could delay the Moorside project or even put its entire future in "limbo".
He said: "This project could bring thousands of jobs to West Cumbria, lead to huge regeneration and infrastructure investment and provide as much as 7% of the UK's domestic energy needs.
"It is vital that this project is given the certainty it needs and therefore we are calling on an urgent government announcement to give clear and unambiguous clarity for the short, medium and long-term future of Moorside."
A NuGen spokesman said: "NuGen is continuing to develop its Moorside project to deliver three Westinghouse AP1000 reactors in West Cumbria.
"NuGen will continue to work alongside our technology supplier, Westinghouse, and our shareholders, Toshiba and Engie, in taking forward the Moorside development phase.
"NuGen will continue in a 'business as usual' manner working in collaboration to gain the appropriate permits and licences required to construct Europe's largest nuclear new-build project, and will continue to increase value and attractiveness of the project to potential future investors, as we have always done.
"NuGen cannot comment on specific financial issues relating directly to Toshiba or Westinghouse."
A Business and Energy Department spokesman said: "The UK Government is committed to new nuclear as an important part of our energy mix, having commissioned the first new nuclear power station in a generation at Hinkley Point C.
"The UK is one of the most attractive countries to invest in new nuclear and we engage regularly with the developers of proposed new nuclear projects."