Fukushima: What will the fallout be for British nuclear power

The Fukushima prefecture lies near a fault line off the Pacific coast of Japan. The area is mountainous, with volcanic slopes filled by lakes, swamps and settlements. The 1888 eruption of Mount Bandai carved much of the landscape. The small town of Okuma is now the centre of the world's attention, its Fukushima Daiichi nuclear power plant sprayed with tonne upon tonne of water in attempts to prevent the spread of radiation in the wake of the massive tsunami and failed cooling systems.

Hinkley Point is on a headland in Somerset. Nearby, the River Parrett flows gently and birdwatchers stare through their binoculars at Bridgwater Bay.

Okuma and Bridgwater are nearly 6,000 miles apart; their environments totally different; one is suffering the biggest nuclear catastrophe since Chernobyl; the other is best known for its annual Guy Fawkes carnival. Yet plans by EDF to build a new nuclear plant at Hinkley Point, which should replace the existing station shortly after it is decommissioned in 2016, could be delayed by events in a volatile area of Asia.

Fukushima has changed the world's attitude to civil nuclear programmes, to the extent that people wonder whether they will be largely discarded.

As energy prices rose and fossil- fuel supply became more and more subject to the whims of geopolitics, so nuclear power was identified by governments as the best way to keep the lights on. China was forecast to expand its nuclear industry by 8.4 per cent a year to 2035, while the UK has identified eight sites, including Hinkley Point and Hartlepool, for new plants to be operational from 2018.

But Angela Merkel, froze operations at all German plants built before 1980 last week, and Chris Huhne, the Secretary of State for Energy, ordered a high-level report into the events in Japan and any potential lessons for the UK.

Businesses that have staked much of their futures on the growth potential of the nuclear industry are dismayed that the Government's new-build plans are under such massive scrutiny. Robert Clover, the global sector head of alternative energy at HSBC, warns: "We believe that events at Fukushima could change national energy policies in nuclear countries, with, potentially, both shut-downs of existing nuclear plants and fewer new nuclear installations." As a result, financial commentators and analysts are advising investors to take a punt on the stocks of coal and gas producing companies. On Thursday, Shore Capital tipped Xstrata shares – noting that 30 per cent of its revenue is dependent on coal – and Nat Rothschild's Indonesian coal-focused vehicle Vallar.

Officials in Whitehall are privately trying to reassure energy firms and their contractors that the nuclear programme is not under threat. "We're not building reactors in areas of seismic activity," huffs a civil service source. "The designs of these reactors will be two generations on from Fukushima."

The two reactor designs that will be the centrepieces of the new wave of UK nuclear plants are at the final stages of detailed technical evaluation by the Nuclear Installations Inspectorate. Approval for the reactors, known as generic design assessments (GDA), was expected in June.

However, the report that Huhne has asked Dr Mike Weightman, the chief nuclear inspector, to write might not be completed for six months. Huhne said: "The tragic events in Japan are still unfolding. We should not rush to judgment." The civil servant stresses that Huhne is trying to emphasise that any judgements will be "fact-based not emotional". But Huhne did emphasise that the Government needed to understand the implications of what happened in Fukushima on any new programme in the UK, heartening environmental groups which believe this offers a slight hope that nuclear expansion could be limited, or even canned.

What seems clear is that GDA will be delayed, as will a later national nuclear policy statement which will basically give the green light to the whole programme.

Even though an Energy department source insists any delay would be "small", probably just a few months, it could still be significant. Already there is going to be a severe energy gap as many existing plants start to shut down from 2014. Originally, it was hoped that the new plants would be operational from 2017, but that has already slipped to 2018 and these latest delays will almost certainly mean that the life of ageing nuclear reactors will have to be extended to plug the energy gap.

"This process has been much too slow," says Graham Hand, the chief executive at professional services trade body British Expertise. "We mustn't be deceived into the potential of renewable energy – that's important but it can't fill the energy gap."

What is frustrating for nuclear power developers is that already they have to prove that their planned plants are safe even in the worst storm, tsunami or earthquake that could be expected in the next 10,000 years.

At the Nuclear Development Forum on Thursday, EDF chief Vincent de Rivaz said: "While we understand the importance of adjusting the timetable to take into account [Weightman's] report, it is equally important that establishing the framework for new nuclear should not be subject to undue delay. The events in Japan do not change the need for nuclear in Britain."

There seems to be an acknowledgement that the report is necessary to help reassure a sceptical public that nuclear will be safe. Stories of the need to bury the Fukushima plant and "suicide squads" of police teams trying to end the disaster have inevitably strengthened criticisms of the nuclear programme.

Hand argues that "the whole of Europe will want to know in minute detail what happened in Fukushima – and, remember, we do get earthquakes in this country".

Hundreds of quakes a year, in fact, but they are usually so minor as to be undetectable by the public. Japan's tsunami was caused by an earthquake measuring 9.0 on the moment magnitude scale (which replaced the Richter scale). One of the worst to hit the UK over the past millennium occurred in 1580, killing two children in London. This, though, measured only 5.3 to 5.9, which is not considered grave enough to demolish modern buildings.

Huhne will have to be careful in his response to the disaster. The energy industry is largely convinced that nuclear is the only way to meet our mounting energy needs. Huhne is said to be a convert, having opposed the programme before he entered government. He is unlikely to conclude that Japan's choice to build a plant near a major fault line bears any relation to a facility located on a headland on the west coast of England. At least that's what British business will be hoping.