Hinkley Point – Ruling Class in Disarray after Brexit Vote

The latest postponement to the construction of the nuclear power station at Hinkley Point shows the ruling class in complete disarray. The May Government may now be on the point of reversing, not just the Cameron/Osborne policy for British nuclear energy but also their scheme to revive British capitalism with Chinese investment.

The revival of UK nuclear power, starting with the construction of Hinkley Point C, has been a fixed policy of British capitalism for the last 10 years. Despite innumerable delays, twists and turns, the government had:

· Cleared the use of state aid for the project with the European Commission in 2014.

· Cajoled the French and Chinese governments to provide enormous sums of money. The latest price is £18bn but rises to £24.5bn when financing costs are added. A third of this is to be provided by the Chinese nuclear companies and the rest by the French utility company EdF.

· Guaranteed a price for the power produced of £92.5[1] per megawatt hour (MWh) indexed to 2012. This price is now £102 and is double the present price of energy. This indexed price is guaranteed for a 35 year period from completion of the works. Apparently this represents a 10% annual return on the capital invested,

· Agreed to provide a £2bn infrastructure guarantee to support the project[2].

However, when it came to the final signing of contracts, with the great and powerful about to jet in and the champagne on ice, the new administration announced yet another review of the whole project. Even within the May Government disarray is evident as only a few days before the signing was supposed to take place the Chancellor, Philip Hammond had announced the government was fully committed to the project, obviously quite unaware that a new review was planned.

This latest review is partly a result of continuing economic stagnation and a new, earlier than anticipated recession following the Brexit vote. Key pillars of the previous government’s economic strategy are being thrown in the dustbin, the most notable being that of a balanced budget by 2020, and other major projects such as the Heathrow airport extension, High Speed 2 rail link from London to Birmingham (HS2), and a host of road projects are now all in question. However, there is obviously more behind this particular delay than the cost.

The project now appears too risky for British imperialism. With the British economy now consisting of 80% services and under 10% manufacturing the UK is no longer able to undertake engineering of this complexity and scale. The result is that critical British infrastructure now depends on French and Chinese engineering. Further, because of the privatisation of the infrastructure which was carried out from the 1980s onwards, such critical elements of the infrastructure will be, not only financed, but also owned and operated by foreign state controlled companies. The project could therefore pose risks for British imperialism should relations with China turn sour. The Prime Minister’s chief of staff, Nick Timothy, articulated the fear that if the project went ahead “the Chinese could shut down Britain’s energy production at will.”[3] Cameron, but more particularly Osborne, did not see this as a significant issue. On the contrary it attempted to foster a “golden era relationship” with China. The reason for this is the increased economic power of Chinese capitalism.

In the ten years to 2015 the size of the Chinese economy has quadrupled, its share of the world economy has doubled and is now approximately 17%. Chinese Foreign Direct Investment (FDI) has gone from almost zero to $100bn a year, and China is set to become the world’s biggest cross border investor. At present Chinese offshore assets are $6.4tn but are expected to rise to $20tn by 2020.[4] Between 2000 and 2014 Chinese companies spent €46bn on 1047 projects in the EU and the UK was by far the biggest recipient receiving €12.2bn, Germany was second with €6.9bn.[5] One of the reasons for this love affair is both countries want London to become the premier financial centre for Renminbi trading. We should note also that under Osborne Britain was the first developed country to sign up to membership of the Chinese created Asian Infrastructure Investment Bank (AIIB). This bank has obviously been set up as a rival to the World Bank and thus represents a clear challenge to US global economic dominance. The UK’s accession to the bank was in the teeth of opposition from the US.

The whole saga illustrated the present globalised nature of capitalism and the feebleness of British national capitalism. It also illustrated the somewhat ridiculous pretentions of our rulers for Britain to remain an independent imperialist power.

However after the Brexit referendum, the ruling class is in a state of confusion on a host of issues and this 11th hour review of Hinkley C is just the latest example. There are two parts to the question of why a new review has been launched; on the one hand the price, together with the strategy of rebuilding British nuclear capacity, is now being queried as too high in relation to potentially cheaper renewables, on the other, there is a reluctance (as US pressure has built up) to allow Chinese ownership and control of such critical aspects of the UK infrastructure.

UK energy strategy

Britain’s electricity generation is in a parlous state. A quarter of all generating plant will have to be shut down in the next 10 years, and by 2025 all coal plants are due to be shut down. Many of the existing Advanced Gas cooled Reactors (AGRs) have had their design lives extended but even so the only existing nuclear plant expected to be operating after 2025 is the Pressurised Water Reactor (PWR) at Sizewell. The highest electricity demand to date, which occurred in winter 2010, was 60 Gigawatts (GW) and according to Ofgen, the energy regulator, there was only 7% spare capacity, so if the stations which close are not replaced there will be load-shedding and blackouts. The government estimates maximum demand will increase to 65GW[6] by 2025. All of this adds urgency to the present situation yet since 2006 the government has been attempting to implement construction of new nuclear capacity without success. There have been numerous white papers, reviews of reactor designs, streamlining of planning regulations and now, following the Brexit result, the new regime has disbanded the government department which was dealing with this issue and transferred responsibility to a new department.[7] Thus all the efforts of the previous 10 years have led only to delay, muddle and administrative reorganisation.

The need to reduce greenhouse gas emissions[8] is also behind the drive for nuclear energy generation.[9] The government’s targets are to reduce CO2 emissions by 35% from their 1990 levels by 2020, and by 80% by 2050. A third of UK greenhouse gas emissions are from electricity generation most of these come from coal and gas stations[10]. There is therefore an urgent need to close down these stations in order to meet the climate change targets. In 2014 the about 60% of electricity generation was from coal and gas. The figures were:

Fuel % of total generation
Coal 29.1
Gas 30.2
Nuclear 19.0
Renewables 19.2
Other 2.5

Hinkley C, which is to have a capacity of 3.2GW, was to be the first of a proposed 16GW of new nuclear capacity to be on line by 2030.

The development of nuclear energy is, of course, not the only option for installing new electrical generation capacity which reduces greenhouse gas emissions. Germany and Japan, for example, have both abandoned nuclear power and instead are concentrating on renewables. The government could install more wind, solar or tidal power plants. The disadvantage of this is that it would entail a large number of small scale plants[11] and the costs would not necessarily be less. The proposed Swansea tidal pool generation scheme, for example, will produce only a tenth of the power of Hinkley C (320MW), and is estimated to produce power at £168/MWh, nearly double the agreed price for Hinkley power! If the government is considering renewals as an alternative to nuclear this represents a massive reversal of the policy followed for the last decade. For this reason at least it seems unlikely.

The China link

The environment for reviving Britain’s nuclear programme has dramatically changed from when the programme was started a decade ago. In 2006 the UK nuclear stations were owned by British Energy and its partner in the revival was a British multinational, Centrica, the gas and electricity utility. However in 2009, British Energy was bought by the French utility EdF which is 85% owned by the French state. Centrica pulled out in 2013 and was replaced by China General National Nuclear Group[12] (CGN) and was later joined by the China National Nuclear Corporation (CNNC) both of which are Chinese state owned companies. The new plant at Hinkley is to be a European Pressurised Reactor (EPR) to the French design developed by EdF and Areva. Areva is a nuclear energy company, again majority owned by the French state. It is true that there have been problems with the EPR at plants being built at Olkiluoto in Finland and at Flamanville in France and EdF management[13] was divided on going ahead with Hinkley before Flamanville is commissioned. In addition the French trade unions who are represented on the management board are trying to annul the decision to go ahead by a legal challenge in the courts. There are consequently technical reasons why a review could have been called but it is doubtful that this is the real reason. Although the plants in Finland and France are massively over budget and years[14] behind programme, the solution of their problems could actually benefit the Hinkley plant and, as EdF points out, two EPR reactors have been successfully built in Taishan China one of which is being commissioned. Both these plants were started after Flamanville.

The consortium for development of Hinkley C now consists of EdF, CGN and CNNC. EdF is providing 66.5% of the finance while the Chinese are providing 33.5%. An incentive given by Cameron/Osborne to the Chinese for provision of this finance was the agreement that the Chinese could have a 20% share in the next EPR to be built at Sizewell and could themselves build a 3GW nuclear station at Bradwell in Essex. Chinese companies would provide 65% of the finance for the Bradwell reactor and it could be to a Chinese design. The Chinese companies would own and operate it. All this together with a few other projects, which in total amounted to £40bn of investment, was announced with great fanfare during Xi Jinping’s visit to the UK in October 2015 and was part of what Osborne called the “golden era relationship” between Britain and China. This was accompanied by supine complacency as Cameron, announced his government’s ambition to be China’s “best partner in the west”. He even offered as long ago as 2010 that he would help “make the case” for China to get market economy status. It did not stop there as the Financial Times reported on 12 August.

“British eagerness to please Beijing reached new heights on December 10, also International Human Rights Day, when the UK embassy in Beijing put out a press statement lauding China’s “strides to better protect civil and political rights” and quoting President Xi Jinping, who has overseen a draconian crackdown on civil society.”

As George Magnus an associate at Oxford University China Centre, writing in the Financial Times commented, a decade ago the idea of Britain grovelling to China for finance for railways, for housing[15], for nuclear power stations and for other projects would have been unheard of.[16] How the relations of economic power have changed in a decade! Britain is setting its sails to the strongest economic wind! The Times newspaper reported that there are a further £100bn of Chinese investments planned for the UK over the coming years, including part of HS2, which could be put at risk if Hinkley is cancelled on the grounds that China is considered untrustworthy.[17] The Chinese ambassador to London, Liu Xiaoming, writing in the Financial Times 9/08/2016 warns the UK not to cancel Hinkley and says that Chinese/British relations are at a “crucial historical juncture.” He notes that Chinese investment into Britain exceeds that into Germany, France and Italy combined and that this has been founded on “mutual trust.”

This is the Cameron-Osborne legacy. It has led to a strong Chinese link with both the revival of British nuclear industry and the British economy as a whole. It is difficult to see how the present review could reopen Hinkley price agreements (despite the massive fall in energy prices since the deal was drawn up) or indeed financing agreements. All it is likely to lead to is either a climb-down by the new administration and an acceptance of the status quo or a cancellation of the whole project. If suspicion of China is the reason for the May government cancelling the project the “mutual trust” Liu Xiaoming talks of will be lost. Britain runs the risk of losing Chinese investment thereby worsening the collapse of investment which the Brexit vote has brought about.

Global capital contradicts national imperialist interests

All of this highlights the contradictions between the international, global nature of capitalism and the imperialist concerns of the nation state. In its move towards the globalisation of capital the British capitalist class privatised their infrastructure utilities and key industries, such as steel production. They were delighted to receive the funds which these privatisations brought in but less delighted by the loss of control which this entailed. For the utilities they set up supervisory bodies such as Ofgen for power, Ofwat for water etc. But these bodies are able only to police price and competition of utilities; they are powerless to control developments in the infrastructure itself, such as replacing clapped out plant, or ownership passing to foreign state controlled companies. In the case of an industry critical for any imperialist power of the first order such as steel, global economic forces dictate developments as we see with the present crisis over Tata steel. Control of infrastructure and key industries by foreign states is deemed acceptable when those states are allies, such as France, but not when they are potential adversaries, such as China.

Whilst Cameron and Osborne were blasé about the political consequences even they could not ignore the rising tension in the South China Sea where China is claiming sovereignty over almost all of it. In response to their creation of artificial islands with port and airbase facilities even the British Government was forced under US pressure to send a destroyer to express solidarity with the US and its Asian allies. Prime Minister May has thus inherited a contradiction which is made worse by the economic crisis. On the one hand Britain faces a collapsing infrastructure. But its strategy for restoring profitability of British capitalism entails restricting government spending and squeezing its working class in a vice of austerity. It is therefore unable to invest large amounts in the infrastructure itself. On the other hand a potential adversary is offering billions of dollars of investment to regenerate the infrastructure including some of its most strategically vital services. All this explains the current paralysis over Hinkley Point.

In a communist world, without nation states, without imperialist interests and where the law of value has been abolished, we would simply choose the best technical and environmental solution and devote the resources to it. Under capitalism, of course, this is impossible.


[1] When the project was first started the price of power was supposed to be £24/MWh. The price was negotiated before the collapse of energy prices when oil was $100/barrel.

[2] See edfenergy.com

[3] Quoted in Financial Times 9/07/2016

[4] Quoted in Financial Times 26/6/2015

[5] Quoted in Financial Times 26/6/2015

[6] See World Nuclear Association world-nuclear.org

[7] The Department of Energy and Climate Change (DECC) has been abolished. Responsibility has been transferred to the new Department of Business, Energy and Industrial Strategy (BEIS).

[8] A report by the National Oceanic and atmospheric administration (Noaa) finds 2015 as the hottest year on record. Global warming is proceeding on all fronts with a vengeance. The world is now 1oC warmer than pre-industrial times, Pacific Ocean 2oC warmer than the long term average, the Artic 8oC warmer, Artic ice area is the smallest since satellite records began etc. See, theguardian.com

[9] Life cycle emissions of CO2 from nuclear stations are in the range of 10 to 50 grams per kilowatt hour. A British Energy study of Torness nuclear station put the figure for this plant at 10g/kWh. The equivalent figure for a typical coal plant is 900g/kWh. See nei.org

[10] See government publication gov.uk

[11] The largest wind turbines for offshore generation are 7MegaWatts (MW) so about 460 would be needed to equal Hinkley C installed capacity, and then because wind generation only happens 44% of the time this number would probably have to be doubled. The much larger Swansea tidal pool scheme is expected to produce 320MW so 10 of these would be required to equal Hinkley. The price of power from Swansea’s tidal pool, at £168/MWh, is almost double the price agreed for Hinkley.

[12] CGN is the world’s largest developer of nuclear power plants. It has completed 8 plants and has a further 15 under construction including 2 EPRs at Taishan being built with EdF. See New Civil Engineer 24/10/2013

[13] Two EdF directors has resigned over the decision to go ahead with Hinkley.

[14] The Finnish plant was supposed to be complete in 2010 and the French one in 2012. Both are still under construction.

[15] Chinese capital has provided £500m for the redevelopment of “Nine Elms” in London. Financial Times 17/07/2016

[16] See Financial Times 20/10/2015

[17] See Times 2/8/2016

Saturday, August 13, 2016


British Imperialism aka capitalism is in a mess, in the doghouse, seemingly on the verge of disintegration. Chinese Imperialism aka capitalism is doing pretty well thank you very much and busy buying out the oldies like the UK. This is the message I get from this article at any rate.

Should workers be saddened by Britannia's decline or give three cheers? It depends on how we respond I supose. The decline will presumably lead to more unemployment, more attacks on benefits, and a general increase in the misery of the the working class. So it's another downer in a long succession of increasing shit going back years. But it's also a sign of the bankrupt nature of capitalism as a way of life.

Because it's really closing time for capital and it is amazing that workers internationally don't see it. Or perhaps we do vaguely see it but are too gob smacked by it as yet to know consciously how to respond, so we go on putting up wth all the crap.

We put up with Cameron and Osborne - the Abbott and Costello of British Politics, all buffoonery but not all that funny, not up to the standard of Laurel and Hardy who the bourgeoisie can never replace being up to their necks in decadence - but Cameron and Osborne have crawled off stage to boos from former supporters. We put up with Hillary and Donald of the ever wagging finger who both talk rubbish. And we put up with the grandpa's of bourgeois social democracy like Sanders and tired old Corbyn who masquerade as radicals bourgeois style. Don't you love them? So quaint and so old fashioned. Such liars too.

With new technology just waiting to be made intelligent use of, not merely exploited for profit, but with the environment already on its knees courtesy of rampant abuse aka capitalism, perhaps there's still opportunity and time to change and save the world. This we can do by waking up, taking charge of life ourselves, and starting to build communism. But to do that we workers everywhere need to start thinking, to organise ourselves and start resisting capital's murderous rule with its overpowering stink, which will destroy us all if we let it.

And thank you CP for your article.

Because it's really closing time for capital and it is amazing that workers internationally don't see it.

That line encapsulates a huge chunk of the predicament.

However, I would hesitate to use the word amazing.

For thse of us who (think they) know the answers, it is tempting to regard such a perspective as easily acquired.

It is easy to dismiss the ''old texts'' setting strict limits on the capacity of the class in general to acquire a revolutionary outlook. It is easy to be optimistic regarding the ease of acquring class consciousness when in the company of those who share the revolutionary perspective.

But outside of the temples, the vast bulk of the population, the vast bulk of which is working class reliant on the sale of labour power or charity, are immersed in illusions and perspectives which are anything but communist.

There is no simple path which arises from the class struggle alone. There is no way out of the need for class consciousness.

Academic Marxists and the like argue all day about the cause of the capitalist crisis, but to go beyond the crisis, there is only the path of consciousness.

No amount of struggle, defense of conditions and the like can remove that need for adequate theoretical comprehension generalised to the extent that revolution is possible.

Outside of such consciousness, the economic contradictions, the tendential fall in the rate of profit and the like will only manifest itself in ultimately negative outcomes for humanity.

Common ruin, war, destruction, even the destruction of humanity.

Class consciousness, whatever the objective material roots which give rise to its formulation, won't arise spontaneously, it requires revolutionary organisation.

No revolutionary theory, no revolutionary party, no revolutionary class.

Unless they act as a goad to generalised class consciousness, capitalism's objective tendencies will only result in more capitalism or destruction.

No revolutionary theory, no revolutionary party, no revolutionary class.

Surely we have a revolutionary theory and have had it since 1848 in the Communist Manifesto. Capitalism isn't eternal or even the natural way of organising economies, but is an historically produced phenomena which could be challenged and overthrown by those it exploits, who carry the seeds of a better way of organising work and life within their very being.

It's true we don't have the revolutionary party. But the working class, even though atomised into petty-bourgeois individuals, is still the revolutionary class even if it doesn't know it. This fact is the basis of our revolutionary theory! The working class, conscious of it or not, is the revolutionary class and it's very existence enabled the elaboration of revolutionary theory which first appears in elaborated form in 1848 and has since been further elaborated by revolutionaries on the basis of experience gained from on-going working class struggle like the Paris Commune.

What we don't have, as Stevein points out, is the class consciousness necessary to trigger and motivate the class into action. Where does class consciousness come from? I suspect Stevein thinks it comes from the party. Rosa Luxemburg thought it came from the workers themselves, particularly in her day from the mass actions of striking workers. This consciousness in the form of solidarity spread among them in in ever widening "fructifying ripples" as Rosa put it, of dawning understanding ie. consciousness. But however it is generated, and there may be various ways, the latent and emerging consciousness of the class spawns an avant-garde of advanced thinkers of the class. These advanced thinkers may form themselves into an organised party at the appropriate time. Perhaps when the time is ripe

But when is the time ripe? That's the question. And is it possible that class consciousness may develop in ways other than through the type of mass strike now possibly an unlikely event given the way work forces are organised these days.

It is no surprise that I don't know the answer to this important question.

But I would rewrite what Stevein wrote, which I give at the opening of this post as follows.

No revolutionary class means no revolutionary theory. Not enough class consciousness means no revolutionary party = no revolution.

There is a working class.

But it is not revolutionary unless it embraces a perspective which does not arise spontaneously.

That perspective would likely not arise in circumstance where the working class did not exist, but that does not mean the class by its existence is revolutionary.

Perhaps this may appear as irrelevant word play, but in an anti-party, anti -political climate, I think it is relevant.

Just because as you say Stevein there is an anti-party climate, doesn't mean the working class has ceased to be a revolutionary class. Because whether workers like it or not, or know it or not, they are always and implicitly a revolutionary class because of their position in this society where they are the exploited class that produces all the wealth. They thus have in their very bones the possibility of overthrowing the old and building a new society. Of course they can't do this as isolated petty-bourgeois individuals but only through solidarity and class consciousness. Solidarity and class consciousness come and go however. But surely they are always implicit in workers, even when these workers are voting for Trump or Corbyn?

I don't think it requires a party to introduce solidarity and class consciousness to workers, it must always be there. Otherwise how do potential party members acquire it or become aware of it? After all, potential party members are just workers whose class consciousness has become explicit at an earlier stage in their being than it has for most other workers, and who manage to hang on to it even when circumstances are against it. Don't forget how the communist left managed to do this through the darkest days of the counter-revolution, and the 2nd. World War.

Nor do I think it would be the job of the party to introduce class consciousness and solidarity to workers, as if they were incapable themselves of developing and becoming aware of this mode of being. After all, class consciousness and solidarity are the discovery of the working class, not of superior beings called the party who may think they have a hot-line to heaven. The party works for the further development and fructifying spread of this new way of thinking ie. class consciousness, through out all the class. For without it the revolution will fail.

Solidarity, class consciousness and the Party are the only weapons the proletariat has. But they are far mightier than the sword.

I still think you are reducing the essential role of the revolutionary organisation as bearer of revolutionary theory which cannot spontaneously arise.

Perhaps this helps.


Somewhat more related to the original piece....if the UK or whatever it becomes given Scottish independence is a live issue cannot become a major imperialist player, does it necessarily have to become dependent on another imperialist power? Is there an option for minor countries to ''play both sides'', having deals with several imperialist blocs without necessarily becoming dependent to any particular one. In the UK case this may be impossible given its apparent subservience to the USA, but could other countries avoid dependenxce on ay single imperialist mater?

Also regarding the UK's global role, this seems significant


Somewhat more related to the original piece....if the UK or whatever it becomes given Scottish independence is a live issue cannot become a major imperialist player, does it necessarily have to become dependent on another imperialist power? Is there an option for minor countries to ''play both sides'', having deals with several imperialist blocs without necessarily becoming dependent to any particular one. In the UK case this may be impossible given its apparent subservience to the USA, but could other countries avoid dependenxce on ay single imperialist mater?

Also regarding the UK's global role, this seems significant


should finish.... single imperialist master.