UK nobbles nukes with hefty clean-up bill
Pay for your mess
Energy and Climate Change minister Christopher Huhne last week made nuclear energy a whole lot less attractive. The liability for clean-up in case of a nuclear accident is currently limited to £140m. The EU has proposed increasing this to €600m (£507m). But Huhne wants to raise it to £1bn (€1.2bn).
"We've already set out how operators will be required to put aside money from day one for their eventual clean up and waste storage, and now we're increasing substantially the liability to be taken on by operators," said Huhne. Higher liabilities mean finding insurance will be harder, and more expensive.
The 2008 Energy Act requires nuclear operators to pay into a Funding Decommissioning Programme (FDP), requiring them to set aside funds for clean-up. The government will acquire the spent fuel at a fixed unit price.
The shutdown schedule
Up to eight sites are up for grabs, with four consortia bidding. Output could total 19,000 MWe of new capacity (reactor details at the HSE, here). If all the proposed build-out occurs, nuclear could provide 35 to 40 per cent of UK electricity by 2030, higher than the 1990s peak of 30 per cent, according to an independent review conducted in 2009. Currently, the UK has 19 reactors, providing 18 per cent of our electricity – but all but one is scheduled to close by 2023.
The other problem is a skilled workforce that's older than in other sectors – and closer to retirement. Around 5 per cent of the nuclear workforce retires each year, at an accelerating rate, with 70 per cent projected to leave the industry by 2025.
"This will strip the industry of the most highly trained and experienced personnel. 2015 is a critical year when decommissioning of the current fleet overlaps with both the need to begin training the operators for new power plants and the decline in experienced staff from retirements," a report from technical skills council Cogent noted last year.
According to the Department of Energy and Climate Change, £40bn is pledged for investment into civilian nuclear energy, so perhaps a £1bn liability (for what is a very safe industry) isn't a deal-breaker. Investors are far more concerned that a floor price for carbon is established, guaranteeing a return.
Even if it is handicapped by a nuke-hostile minister, nuclear energy still looks more attractive to investors than renewables. Have a look at this Investors Chronicle piece, via Tony Newbury.
Compare what's in first place, at the top of the left hand column, with what's in last place, at the bottom of the right hand column. ®
Sponsored: Customer Identity and Access Management