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The decision by German power firms E.ON and RWE npower to sell joint venture Horizon Nuclear Power will set the UK鈥檚 nuclear new build programme back by up to two years, experts have said.

Last week, Horizon was put up for sale because of financial constraints on its parent companies arising from the German government鈥檚 decision to call a halt to all nuclear power, as well as financial difficulties stemming from the eurozone crisis.

E.ON said the situation in Germany had cost the firm 拢1bn. Tony Cocker, chief executive of E.ON UK, said: 鈥淲e believe that for the right company Horizon remains an attractive project - but sadly, at this time, not for us.鈥�

Horizon has been developing plans for new nuclear power plants at Wylfa in north Wales and Oldbury, South Gloucestershire, which would have cost about 拢15bn to construct. The firm was due to make a decision later this month on the type of plants to build, but this has now been put on hold.

It was tipped to select Areva鈥檚 technology - a decision that would have meant that the construction work would have gone to contractor Balfour Beatty, which is in a consortium with the French supplier.

Analysts told 好色先生TV that the move had been foreseeable as it had never been clear how Horizon would finance the project. Suggestions had been made that Horizon had asked the bidders for supplying the technology, Areva and Westinghouse, to buy into the project with upfront investment.

Alistair Smith, chair of the Institution of Mechanical Engineers鈥� power division, said if a buyer for the Horizon project was not found quickly, there was a risk the Horizon team would be disbanded, which would put the project back by up to two years because the licences would need to be awarded to new owners.

The move leaves EDF鈥檚 plans for nuclear power plants at Hinkley in Somerset and Sizewell in Suffolk as the only nuclear projects with an investor on board that are close to being started.

William Shirley, an analyst at Liberum Capital, said the move would not affect EDF鈥檚 plans.

鈥淭hese are such massive projects that you don鈥檛 enter into lightly - and if anything the government is going to be twice as keen to get Hinkley built now as nuclear needs to be part of the energy mix,鈥� he said.

But Paul Stapleton, head of energy at consultant EC Harris, said the nuclear pipeline of work for construction firms now looked much less attractive and firms that had invested in building a capability to work on these projects could now find themselves having to cut staff.  

鈥淗alf the market has just disappeared,鈥� he said.