French energy giant EDF gave the final approval to go ahead with the £18 billion project at Hinkley Point in Somerset, despite a split in the board, but the government said it wanted more time to study the details.
The move stunned the industry and prompted warnings that jobs were at risk, though government sources insisted the delay had been agreed with the French.
Critics believe the government has been stung by criticism of the amount of money EDF will be paid for generating power from Hinkley – £92.50 per megawatt hour of electricity generated.
It is thought there are also security concerns about the role of the Chinese state – which has a one-third share in the project – investing in critical infrastructure in the UK.
In response to the shocked reaction to the delay, a source said Theresa May and French president Francois Hollande had discussed the deal during the Prime Minister’s visit to Paris last week.
“The timetable was agreed with the French government,” a source said, indicating that a decision was expected to be taken in September.
The delay was not announced until after EDF had made its decision because ministers were keen for the energy giant to finally commit to the project, but it was always the case that the government would have the final say.
While under David Cameron that would have effectively been a “rubber-stamping” of a project he enthusiastically backed, Mrs May’s administration wants to look at the project “in the round as part of its industrial strategy”.
Yesterday, the government was warned that 25,000 jobs were being put at risk by its “bewildering” decision.
Justin Bowden, the GMB union’s national secretary for energy, said: “Theresa May’s decision to review the go-ahead is bewildering and bonkers. After years of procrastination, what is required is decisive action not dithering and more delay.”
The sector was alerted to the delay by a brief statement from Business and Energy Secretary Greg Clark.
It said: “The UK needs a reliable and secure energy supply and the government believes that nuclear energy is an important part of the mix.”