The cost of the Hinkley Point C nuclear power station in Somerset could rise to £21bn but developer EDF said it still expected to complete the project on-time and on-budget.

In a statement released ahead of the French energy giant’s annual general meeting yesterday (12 May 2016) it revealed that its equity commitment to the plant include a contingency margin that could mean its investment rises from £12bn to £13.8bn.

Its partner, China General Nuclear Power Corporation (CGN), could also increase its commitment from £6bn to £6.9bn.

EDF will also provide financial guarantees to CGN, in the event of cost overruns delays to the project or in the event of a challenge to its agreement with the UK Government by European authorities.

However, EDF said the contingencies did not mean that it expected the project to cost more than the previously stated £18bn.

The company said it “simply reflects normal, prudent good practice for any construction project to know that the money would be available in the case of more extreme scenarios”.

“We don’t expect to use the additional 15 per cent because we expect that Hinkley Point C will be on time and on budget at £18bn,” EDF added.

The group has now begun its consultation with the union management council Comité Central d’Enterprise on the power station. EDF expects to make a final investment decision on Hinkley Point C once this has been completed.

There would then be a construction period of almost ten years until commissioning of the first reactor takes place.

CGN has also denied reports that it has drawn up plans to take over the Hinkley Point C project, should its joint deal with EDF fall through.