Decommissioning Agreement Reached On Advanced Gas Cooled Reactor AGR Nuclear Power Stations
24th June 2021
The UK government and EDF have agreed improved arrangements to safely and efficiently decommission Britain's 7 AGRs, due to reach the end of their operational lives this decade.
New decommissioning arrangements reached with EDF for 7 advanced gas cooled reactors (AGRs) due to come offline by 2030
deal reached for Nuclear Decommissioning Authority to work with EDF to ensure AGR nuclear sites remain safe and secure for future, with no impact on the UK's energy supply.
British taxpayer is estimated to save upwards of £1 billion thanks to new streamlined arrangement.
The UK government and EDF have agreed improved arrangements to deliver the safe and efficient decommissioning of Britain's 7 AGR stations, due to reach the end of their operational lives this decade.
The deal, negotiated by the government with EDF and signed today (Wednesday 23 June), will save the taxpayer an estimated £1 billion, as EDF and the Nuclear Decommissioning Authority (NDA) forge a new partnership.
The UK's AGR power stations have long been scheduled to reach the end of their working lives on a rolling basis by 2030, with EDF announcing that the first, Dungeness B power station, has now closed.
Their closure will not affect the UK's energy supply, as energy from renewables has more than quadrupled since 2010. The UK government has also committed to making a final investment decision on at least one large-scale nuclear power station by the end of this Parliament, alongside harnessing new and advanced nuclear technology.
Today's arrangement comes as the Business and Energy Secretary, Kwasi Kwarteng, exercises an option to deliver better value for money for the taxpayer in the decommissioning of AGR nuclear reactors. It will mean EDF will aim to shorten the time they take to safely remove the fuel from the power stations as they come offline, before working closely with the NDA to transfer ownership of the stations to the NDA.
With the Nuclear Decommissioning Authority currently decommissioning older Magnox stations, their expertise and the economies of scale of working on these and the AGR nuclear reactors combined, will ensure the long-term clean-up of these sites is done more efficiently - helping save the taxpayer an estimated £1 billion.
Minister of State for Energy, Anne Marie Trevelyan, said:Today's deal marks an important milestone in managing the legacy of our older nuclear power stations, ensuring these stations are decommissioned safely and efficiently. By using the unique expertise of both EDF and the Nuclear Decommissioning Authority, we will ensure costs are reduced, saving the taxpayer an estimated £1 billion.
It forms part of our wider commitment to the future of nuclear energy, including looking to reach a final investment decision on at least one nuclear power station by the end of this Parliament, alongside harnessing new and exciting advanced nuclear technology.
Chief Executive of EDF, Simone Rossi, said:We are committed to delivering value to the taxpayer via the NLF and the revised arrangements provide the certainty we need to plan and deliver safe and cost-effective defueling. The arrangements also provide our employees and supply chain partners important clarity over jobs for the coming years.
We look forward to building on our collaborative partnership with the NDA to ensure successful defueling with Sellafield and a seamless transfer of the AGR stations to Magnox.
Once a nuclear station closes, the first stage of clean up requires all the nuclear fuel to be removed from the station (defueling), before the second phase of decommissioning begins. This involves the initial dismantling and removal of contaminated parts, before the stations enter abeyance - care and maintenance to allow radioactive materials in reactors to decay.
EDF had originally been responsible for total lifetime decommissioning of the AGR stations, which comprise Torness and Hunterston B in Scotland, Dungeness B in Kent, Hartlepool in Teesside, Heysham 1 and Heysham 2 in Lancashire and Hinkley Point B in Somerset. The revised arrangements will retain their involvement, while making the most of the expertise of the Nuclear Decommissioning Authority. It will also enhance the government's oversight of the long-term decommissioning programme and save the taxpayer money.
Chief Executive of the Nuclear Decommissioning Authority, David Peattie, said:We are delighted to have been directed by government to take on the future ownership of the 7 EDF advanced gas reactor sites for future decommissioning. The work will be undertaken by our subsidiary Magnox Ltd and this decision is a testament of the skills, knowledge and experience held in the NDA and Magnox.
This work is of national importance and we now look forward to working with EDF to ensure the seamless transfer of stations in the coming years.
Chair of the Nuclear Liabilities Fund, Richard Wohanka, said:These revised arrangements will form a sound basis for the safe decommissioning of the AGR stations and we welcome the renewed focus on collaboration between all parties. The Trustees of the NLF look forward to a continuing strong and supportive working relationship with BEIS, EDF and NDA over the course of the decommissioning programme.
This arrangement does not cover other nuclear power stations. As part of the investment agreement, operators of new nuclear sites such as Hinkley C are legally obliged to meet the full costs of decommissioning and their full share of waste management and disposal costs, ensuring taxpayers never have to pick up the cost.
Written Ministerial Statement made on 23 June 2021 by Minister for Energy, Clean Growth and Climate Change, Anne-Marie Trevelyan.
Statement
The Government is today entering into a new set of arrangements to deliver safe, lower cost and more efficient decommissioning of the UK's operating nuclear power stations, once they stop generating power.
Those nuclear power stations are all owned and operated by EDF, and the new arrangements have been negotiated by the Government to provide significant cost savings for the taxpayer, with the potential to achieve upward of £1bn of savings without compromising on safety and security. They will also provide the Government with enhanced oversight of the decommissioning costs.
The new commercial arrangements relate to the fleet of seven Advanced Gas Cooled Reactor (AGR) stations (Hunterston B, Hinkley Point B, Dungeness B, Hartlepool, Heysham 1, Heysham 2 and Torness). EDF last year announced the end of generation of Hunterston B and Hinkley Point B in 2022 and recently, Dungeness B with immediate effect. The other four are all scheduled to close on a rolling basis by 2030.
The new arrangements do not relate to the Sizewell B station, which is of a different technology (Pressurised Water Reactor) and is due to continue operating until at least 2035. The new arrangements also do not cover the Hinkley Point C station, which is currently under construction.
Once a nuclear station closes the nuclear fuel from that station must first be removed (defueling) before it can be prepared for deconstruction. Then, following deconstruction, the site can be remediated.
The new arrangements we have negotiated will incentivise EDF to achieve the defueling of the AGR stations in a cost-effective and timely manner and include real risk share. EDF Energy have agreed to up to a total of £100m in charges for underperformance in return for the potential to earn up to a total £100m for good performance across the AGR fleet.
Shortly after EDF has completed the defueling activity, and subject to regulatory approval, the ownership of the AGR stations will transfer to the Nuclear Decommissioning Authority (NDA), on a station-by-station basis, to prepare for and manage the long-term decommissioning. The NDA will deliver this mission alongside their ongoing mission to decommission the first-generation Magnox nuclear power stations. This will allow the NDA to employ their unique expertise and experience of nuclear decommissioning and seek synergies with their wider mission to achieve savings for the taxpayer.
These new arrangements will harness the best of both organisations: EDF's in defueling as an extension of its operational activity; NDA's in decommissioning as the nation’s civil nuclear decommissioning authority - in order to deliver best value for the taxpayer, whilst maintaining strong regulatory oversight on, safety, security, environmental and health matters.
The NDA and EDF will cooperate to help ensure a seamless transfer of the AGR sites and to enable efficiencies and identify and realise cost savings across the AGR decommissioning programme.
Under previous arrangements, EDF was responsible for the full defueling and deconstruction of the AGR stations, using funding provided by the Nuclear Liabilities Fund (NLF), a segregated fund managed by trustees and underwritten by Government. EDF’s AGR defueling and decommissioning work will continue to be funded by the NLF.
To facilitate these revised arrangements, Designation Directions have been laid in Westminster and jointly with Scottish Ministers in Holyrood (for Scottish Stations) which provide the appropriate vires for the NDA to undertake their pre-transfer work and obligations on these stations.
Rt Hon Anne-Marie Trevelyan MP
Anne-Marie Trevelyan is the Conservative MP for Berwick-upon-Tweed, and has been an MP continuously since 7 May 2015. She currently holds the Government post of Minister of State (Business, Energy and Industrial Strategy) (Energy and Clean Growth).
PHOTO
Torness Nuclear Power Station
Torness nuclear power station is a nuclear power station located approximately 30 miles (50 km) east of Edinburgh at Torness Point near Dunbar in East Lothian, Scotland. It was the last of the United Kingdom's second generation nuclear power plants to be commissioned. Construction of this facility began in 1980 for the then South of Scotland Electricity Board (SSEB) and it was commissioned in 1988. It is a local landmark, highly visible from the A1 trunk road and East Coast Main Line railway.
