ABSTRACT
It was the attempted privatisation of Britain’s nuclear power stations in the late 1980s which revealed at last their atrocious economics. The stations couldn’t be sold because of concerns over the unquantified liabilities and their high operating costs. But by the time the stations were withdrawn from the privatisation, the generating industry in England and Wales had been restructured into a duopoly that would inhibit competition for nearly a decade. This duopoly led to power prices being higher than they would have been under competition, which meant that nuclear power, reconstituted as British Energy plc in 1996, could at last be privatised. But the rapid unwinding of the duopoly in the late 1990s brought about a power price collapse that led to British Energy’s financial crisis in 2002. The roots of the company’s crisis therefore lay in the failure of the original attempt in 1989 to privatise nuclear power, which is the subject of this chapter.
