Nuclear subsidies: Was Eon power chief Paul Golby being entirely frank in telling Andrew Davidson that his company “would be happy to build and run new nuclear plants without subsidy”? (“Eon rides into the corridors of power”, last week).

He said the same thing at the annual conference of the Parliamentary Renewable & Sustainable Energy Group on May 9. When I challenged him to justify this, he declined to answer.

So, let’s put this rhetoric to the test. Is Golby’s Eon prepared to do without the following covert subsidies?

1. Plant operators have limited liability in the case of an accident — anything over £700m is covered by the taxpayer. Is Eon prepared to take on board the full insurance liabilities, which in the case of Chernobyl have run to several tens of billions of pounds?

2. Is Eon prepared to share with any other private investors the full costs of the pre-construction safety analysis, currently covered by the Nuclear Installations Inspectorate using public money?

3. Are private investors prepared to pay the full costs of the UK’s membership of the EU nuclear agency, Euratom; and the International Atomic Energy Agency — both of which do promotional and safety work for nuclear power.

4. Are the private-sector investors prepared to pay the full costs of securing nuclear facilities and nuclear materials in transit, currently covered by a quango, the Office of Civil Nuclear Security, embedded within the DTI, and paid for by the taxpayer?

5. Is the private sector prepared to take over from government in the current research done using taxpayers’ money on so-called “Generation 4” reactor designs?

6. And finally, how will Eon and other private investors pay for the full cost of management (or eventual “disposal”) of the new radioactive waste produced — including the eventual decommissioning of defunct reactors and associated infrastructures — in any atomic renaissance? All of these are hidden taxpayer-funded subsidies on top of the £2 billion capital cost per reactor.

Ministers, above all chancellor Gordon Brown, should be properly briefed on this haemorrhaging of public funds, before any irrevocable nuclear decisions are taken.

Dr David Lowry
Stoneleigh, Surrey

Tech costs: An observation needs to be made following David Smith’s discussion of the vulnerability of western economies after recent stock market losses. (“Ghosts of past inflation come back to haunt us”, Economic Outlook, last week).

He mentions the technology revolution — where new technology helps bring down prices. However, we must also recognise the increasing pace of technology turnover, where technology replacement cycles continue to shorten as a result of more frequent technical advances in capabilities and capacity. Research by my company shows that the UK and Germany are the most frequent replacers of tech- nology in Europe and more frequent replacers than the US, something which naturally carries a cost.

It is interesting to note how companies are affording this. There is strong evidence that alternative forms of finance — leasing, tech-refresh packages and other pay-as-you-use methods — are on the upswing. Germany, for instance, saw growth in the use of this kind of finance approaching 10% in 2005, according to the respected Ifo Institute, and similar rates of growth have been seen in many UK business sectors.

The pace of technology turnover is predicted to speed up. This is encouraging buyers to look for pay-per-use finance, with the traditional model of capital purchasing rapidly falling into disfavour. That the issue will grow in importance is corroborated by one other finding from our research among European business, which found virtually all respondents confirming their belief that one major contributor to competitive edge was being able to take on the latest technology.

Rod Tonna-Barthet
director, Siemens Financial Services, Harrow, Middlesex

Capital note: In your article on the explosive growth of Dubai (“Dubai’s building frenzy lays foundation for global power”, Business, last week) you mentioned that the leaders of Dubai are hoping other countries in the region (notably Qatar, Abu Dhabi, and Oman) will follow a similar western-friendly attitude to theirs. It is important to note that Abu Dhabi is in fact not a country; rather it is one of the seven emirates that make up the United Arab Emirates, and more notably, it is the capital of the UAE.

Darren Goffin
Hendon, London