UK backs exports for nuclear power plant

UK government gives financial guarantee to exports for use in a Chinese nuclear power plant without doing an assessment of the environmental impact.

British company ClydeUnion Pumps is exporting $15 million of safety pumps for the Fuqing 3 & 4 nuclear power plant being built in South West China. The British government’s Export Credits Guarantee Department has insured the export, leaving UK taxpayers liable if something goes wrong with the deal.

However, despite backing parts for the power plant, the UK government has made no assessment of what its environmental impact might be. The Export Credits Guarantee Department has been made to reveal under Freedom of Information regulations that it has not carried out “an assessment of the environmental impacts associated with this export transaction”. Because the export is for less than $16 million, the UK government does not assess its impact before supporting it.

The Chinese buyer is being given access to a bond from UK bank HSBC. The UK ECGD has guaranteed this bond. If the pumps are not exported, the Chinese buyer can call in the bond, receiving payment from HSBC. HSBC would then in turn charge the ECGD. Exporter ClydeUnion Pumps has to pay a premium (via HSBC) to the ECGD in return for this backing of the deal.