CAB128-94_A1b — Page 175

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THE SECRETARY OF STATE FOR SCOTLAND said that a decision to retain all nuclear stations in England in the public sector had major implications for Scotland, 60% of whose electricity output came from such stations. There were differences between the position in England and Scotland. In particular, there were no plans to construct new nuclear stations in Scotland, and the existing Scottish reactors were working well. Nevertheless, the Chairman of the two Scottish Electricity Boards had advised him, and he agreed, that if such a decision was made for England, there was no practical chance of privatising the Scottish nuclear stations. These stations also must therefore remain in the public sector, and Scottish electricity would have to be privatised without its nuclear component. Since that component

arge, this would not be easy to present. But it would the Government had already proposed that the nuclear

otland should be held by a separate company,

was

help assets Scottis

ear Ltd. The Government could also point out that the privatise non-nuclear part of the industry would own around 75% of generating capacity and employ 14,000 out of the 16,000 staff. The relationship between the privatised industry and the nuclear company pecially on pricing policy, would require careful thought. was clear, however, that there was a very strong case for increasing the capacity of the interconnector between Scotland and England from its present level of 700 MW to its maximum level of 2000 MW.

In discussion the following were the main points made:

a.

It was important to emphasise in presentation that the problems of nuclear power had not been caused by privatisation. On the contrary, privatisation had brought to light problems which were already there but had remained hidden while the industry was nationalised. The estimates of the cost of de-commissioning calated dramatically as privatisation approached, and it clear that those in the industry still had no firm idea se of the prospective costs. The history of nuclear power also showed how inefficient the nationalised industry had been at building nuclear stations. Industries abroad, for example in Germany and Belgium, had been successful in building such stations at reasonable cost and with private finance. On the other hand, successive Governments were not immune from criticism for their handling of the nuclear power programme, and could not claim that they had been unaware of all the deve problems.

b.

The draft statement circulated by the Secret.

ing

State

for Energy did not mention the environmental advantages of nuclear power. This would be regarded as inconsiste other recent Government statements on environmental poi The statement should be amended to include a suitable

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