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How does Hinkley C compare with the UK’s other mega projects?

The proposed Hinkley Point C nuclear project will be one of the largest construction projects ever undertaken in the UK, but how does it compare with other mega projects?

While it is interesting to compare the cost of projects, it is difficult to gain a true comparison due to factors including variances on the scope included, the allocation of risks, whether the cost of financing is included, consideration of exchange rates and the need to convert prices into a base year.

With these limitations in mind, here is a comparison of some of the UK’s largest and most high profile construction projects.

  1. Hinkley Point C nuclear project. Funded by French and Chinese investors it is claimed to be the largest inward investment in a construction project in the UK’s history. The overall cost including financing has been estimated at £24.5bn with the construction cost being in the order of £16 to £18 billion. The project is likely to commence in 2016 and take between 7 and 10 years to complete, employing up to 5,600 people at peak and providing 25,000 different construction roles over the life of the project. Hinkley C will be capable of generating approximately 7% of the UK’s energy requirement enough for 5 million homes.

 2.  The 2012 London Olympics. The venues and infrastructure cost £6.7bn out of a total budget of £8.77bn, with a price tag of £486m for the        Olympic Stadium (£529 million in 2015 pounds).

  1. Crossrail. Has been Europe’s largest construction project in recent years, extending London’s underground system, with a budget in the order of £16 billion. Work started in May 2009 with up to 10,000 people working on over 40 construction sites. Tunnelling work is largely complete with work now concentrating on the stations towards a planned completion date in 2019.

 4.  The Channel Tunnel. The Channel Tunnel opened in 1994, and now transports an estimated 20 million passengers and a similar amount of        tons of freight each year between France and England. It has the longest undersea portion of any tunnel in the world (23.5 miles) and at the        height of construction, 13,000 people were employed. Construction took six years and cost around £9.5bn to build, double TML's original        estimate (equivalent to £26 billion today).

  1. The Channel Tunnel Rail Link. Now called High Speed 1, runs 69 miles from St Pancras railway station in London to the tunnel portal at  Folkestone in Kent. It cost £5.8 billion to build and opened in 2007.

 6.   High Speed 2. The cost for the project is estimated by the Department for Transport to be £43 billion, which will initially link the cities of        London and Birmingham, followed by further extension to North West England and Yorkshire. Construction of the first phase of HS2 is set to        begin in 2017 with an indicated opening date of 2026 and will create around 26,000 jobs during the first phase. Completion of the entire        network is expected in 2033.

  1. Rail projects. Other significant rail projects include
    1. Thameslink, a £6 billion project to upgrade and expand the Thameslink rail network which is expected to be complete in 2018.
    2. Network Rail have a five-year £38bn capital investment programme, including electrification of the lines, which is publicised as the biggest investment in the UK’s railway system since Victorian times.

8.    Heathrow Terminal 5. The terminal is designed to handle 35 million passengers a year and the main building is the largest free-standing        structure in the United Kingdom. Heathrow Terminal 5 opened in 2008 at a cost of £4.2 billion.

9.    Heathrow expansion. The Airports Commission Report 2015 proposes a new runway at Heathrow Airport delivering new capacity by 2030 at a        cost in the order of £20 billion including provision of local transport connections.

  1. Thames Tideway Tunnel. Is a proposed 16 mile, 7.2 m diameter tunnel running through central London, to provide storage and conveyance of combined raw sewage and rainwater discharges that currently overflow into the river Thames. Starting in 2016, construction of the Thames Tideway Tunnel is expected to be complete by 2023. The current estimate of its capital cost is £4.2 billion in 2012 prices.
  1. Significant Energy projects.
  1. Electricity Market Reform. Has promoted £12 billion of investment in renewable projects. The first round of contracts included 27 projects that could add 2 GW of capacity to the U.K. grid including two large offshore wind projects, onshore wind generation, solar and waste to energy projects. 
  2. Swansea Tidal Lagoon. Once constructed the £1 billion project would be the world's first tidal lagoon power plant with a capacity of 320 MW. The project is expected to start construction in 2016 with a forecast connection date approximately 4 years later. The developer has plans for up to six tidal lagoon power plants in the UK which could add up to a total cost of £30bn.
  3. Gas generation. Recent government announcements have promoted the need for gas-fired power stations. Projects include the Trafford 1,520MW plant at a cost of £800 million which was due to start generating in 2018 but has yet to make a final investment decision. The project will create up to 900 construction jobs.
  4. Nuclear projects. In addition to Hinkley C seven other sites have been earmarked as suitable for new nuclear plants, with five of these sites being actively pursued by investors. You can learn more about the nuclear new build programme here.
  1. Sports stadia.
    1. Wembley had a £757 million price tag for its 90,000 capacity stadium when completed in 2007, (equivalent to £938 million in 2015). At its peak, there were more than 3,500 construction workers on site.
    2. Cardiff’s Millennium Stadium with a capacity of 74,500 opened in 1999 at a construction cost of £121 million. The Millennium stadium is the second-largest in the world with a fully retractable roof. 

Some International Comparisons.

1.       Three Gorges Dam. Located on the Yangtze River in China the dam is the world's largest power station in terms of installed capacity (22,500           MW). The project has been estimated to cost in the order of $28 billion including the cost of resettling the 1.3 million people it displaced.

2.       One World Trade Centre in New York. The tallest building in the western hemisphere, was created on the site of the twin towers. The project           commenced in 2006 and was officially opened in 2014 at a cost of $3.9bn (£2.5bn).

3.       The Burj Khalifa. At 830m it is the world’s tallest building. Located in Dubai the building cost S1.5bn (£958M) to construct.

4.       Boston’s Big Dig. This highways project is currently the most expensive U.S. public works project at a cost in the order of $20 billion in 2015           USD. The construction work commenced in 1991 and was originally scheduled to be completed in 1998 but was eventually concluded in 2007.

5.       California High-Speed Rail. Phase 1 of the rail line connecting Los Angeles with San Francisco is currently under construction and           is expected to begin limited operation in 2022 and be completed in 2029. In Phase 2 the system will be extended to Sacramento and San                   Diego. With an anticipated construction cost of $68.4 billion (in year-of-expenditure dollars) for Phase 1, the project will become the most                   expensive public works project in United States history.

6.       China’s energy investment. In 2014, China had the largest installed electricity generation capacity in the world with 1505 GW. China                        invested $89 billion in clean energy in 2014, with targets for sourcing 15 percent of its energy mix from renewables by 2020 and 30–45            percent by 2050. China has 23 nuclear power reactors operating and 26 under construction representing roughly 40 percent of reactor            construction around the world. 

Once a Final Investment Decision is made, the Hinkley Point C nuclear project will become one of the UK’s largest ever construction projects. With the UK’s 2015 National Infrastructure Pipeline estimated at £411 billion, significant investment in mega projects including High Speed 2, the renewable, gas-fired and nuclear energy generation projects, the expansion of capacity at Heathrow and the Thames Tideway could be the catalysts for a buoyant construction market over the next 10 years.

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