9th Jul 2026 09:23
(Alliance News) - Centrica PLC on Thursday said the UK government has signed heads of terms for a 20-year regulated contract that will support the life extension of the Sizewell B nuclear power station from 2035 to 2055.
The Windsor, England-based energy firm, which holds a 20% stake in the 1.2-gigawatt plant, said Sizewell B will receive an inflation-linked contract-for-difference strike price of GBP70.50 per megawatt hour, based on 2025 prices, providing predictable revenues.
Centrica said the agreement underpins a fair return on around GBP800 million of life extension investment, which it expects to fund through existing operating cash flows from its nuclear partnership with EDF Energy, without requiring additional equity.
The FTSE 100-listing, which owns British Gas, expects the final contract with the UK government to be completed later this year.
Chief Executive Chris O'Shea said: "We welcome the constructive engagement with Government in reaching this agreement, providing the certainty needed to support the required investment. The agreement gives Sizewell B a clear, regulated framework through to the 2050s. This further strengthens Centrica's portfolio of long-term infrastructure assets with predictable earnings, which includes the neighbouring new nuclear power station, Sizewell C."
Sizewell B is one of the UK's five operational nuclear power stations and provides zero-carbon electricity to power around 2.5 million homes a year.
In addition to Centrica's 20% ownership of the UK's operational nuclear fleet, the company is also supporting the development of new nuclear in the UK. Last July, Centrica acquired a 15% stake in the neighbouring Sizewell C, a new 3.2GW power station under construction in Suffolk, while last September, it signed a joint development agreement with X-energy for the UK's first advanced modular reactor fleet.
Shares in Centrica rose 0.1% to 171.65 pence each in London on Thursday.
By Jeremy Cutler, Alliance News reporter
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