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Can New Nuclear Power Plants be Project Financed? / Simon Taylor. Electricity Policy Research Group, 2011, 19 p. (EPRG working paper ; 1118)http://www.eprg.group.cam.ac.uk/wp-content/uploads/2011/05/EPRG-WP-1118_complete.pdfThis paper considers the prospects for financing a wave of new nuclear  power plants (NPP) using project financing, which is used widely in  large capital intensive infrastructure investments, including the power  and gas sectors, but has not previously been used for nuclear power. It  argues that the first few NPPs will have to be financed on balance sheet  by large corporations because these plants need to build a positive  record on construction risk. If that record can be built there is no  reason in principle why large scale project financing should be denied  to NPPs. The projects will probably need to have a long term power  offtake project, requiring a creditworthy electricity supplier, but this  is feasible even in liberalised but relatively oligopolistic power  markets like the UK. Interviews with practitioners in the project  finance sector confirm that banks are interested, in principle, in  lending for nuclear power stations. Project finance would also readily  allow multiple shareholdings in individual plants. This in turn would  provide the means for power companies to diversify their plant risk and  for third party financial shareholders to invest in diversified  portfolios.  This last feature could open up a new route  for significant equity investment in NPPs. The analysis concentrates on  the UK but is potentially of wider application. (© EPRG)