The decision was announced during the board of directors' meeting yesterday, following 18 months of failed negotiations with a range of potential new buyers for the company and the project.
The £15bn Moorside power station project involved building three reactors at the site near Sellafield using Toshiba company Westinghouse's AP1000 reactors.
The firm say it will start the wind-up process in January. Mrs Hayman, Workington MP and co-chair of All Party Parliamentary Group for Nuclear Energy, said: "This is truly awful news, not just for Cumbria, but for the United Kingdom as a whole".
"Unfortunately, given that the RAB model is still in the early stages of development, has not been determined as policy yet, and still faces a lengthy legislative process before it can be applied to new nuclear, it has not been possible to find a buyer willing to take that level of policy and legislative risk when entering the UK".
Toshiba Corp. CEO Nobuaki Kurumatani addresses a group of new employees of the embattled company during a welcome ceremony in Tokyo on April 2, 2018, a day after its business year for 2018 began. It said it hoped to complete the sale by March 2019.
Unions have attacked the government for not intervening earlier to save the plant with the fate of the nuclear power station being cast into doubt in July when a large majority of staff in Cumbria were laid off.
In a blow to the government's nuclear strategy, Toshiba, the Japanese conglomerate, said that it had made a decision to shut down its Nugen subsidiary, which was developing the Moorside project near Sellafield. It noted the site remains designated by government for nuclear new-build, and it is now the Nuclear Decommissioning Authority, as the owner of the site, and the government "to determine its future". "Quite simply, the people of West Cumbria have been betrayed by this Conservative government".
Commenting on the announcement, Dr Dame Sue Ion DBE FREng FRS, Honorary President of the National Skills Academy for Nuclear said: "It is tragic that ceding of control of a vital part of the UK's energy infrastructure overseas has, through events outside the UK's control, led to a stall in our aspirations as a nation to replace the generating capacity of our retiring nuclear fleet of reactors - critical for decarbonising the United Kingdom economy". "I will continue to fight for vital jobs and investment in West Cumbria, even if the Government has no interest in our community". In a lengthy statement, Mr Samson expressed his desire to see another project come forward to fill the void left by his company's demise.
Rebecca Long Bailey, shadow business secretary, said: "Today's announcement by Toshiba is hugely concerning for the future of the sector and the thousands of jobs it would bring to Cumbria". There is now significant uncertainty over the intentions for the valuable Moorside site in Cumbria.