Big Is Fragile: Why the UK Government Should Not Approve the Hinkley Point C Nuclear Power Station
Petroleum Review, Vol. 70, No. 834, pp. 37-40, July 2016
4 Pages Posted: 6 Sep 2016
Date Written: July 29, 2016
Paradoxically, big is not scaleable. But modular is. Energy mega-projects are pursued in order to deliver a big step-up in capacity ahead of demand. Moreover, big is thought to generate economies of scale. However, Instead of making good on these promises, big investments typically fail — crushed under the weight of their sunk costs. We call this propensity of energy mega-projects to entail more pain than gain "investment fragility," based on Nassim Taleb's book Antifragile. In this article we take Hinkley Point — the big nuclear power plant proposed to be built in Somerset, UK — as an example of a project that is at such a heightened risk of fragility.
Keywords: Nuclear Power, Energy, Finance, Economics, Investment Fragility, Viability
Suggested Citation: Suggested Citation