Department of Energy and Climate Change
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New Nuclear Funding Watchdog appointed
Government plans to protect the taxpayer from the costs of cleaning up new nuclear power stations took a step forward today with the appointment of a watchdog to oversee the decommissioning and waste disposal funding arrangements.
Energy and Climate Change Minister Mike O'Brien announced the appointment of Lady Balfour of Burleigh as the Chairman of the new Nuclear Liabilities Financing Assurance Board (NLFAB).
As part of any application to build a new nuclear power station, operators will have to submit plans for decommissioning and waste management which will include arrangements for financing those plans. The NLFAB will provide independent scrutiny and advice on the financing arrangements of those plans which will have to be approved by the Secretary of State.
Energy and climate change minster Mike O'Brien said:
"Nuclear energy is an affordable, low carbon, dependable and safe technology that is important for our low carbon future. But we've always said the taxpayer should be protected from the costs of decommissioning and waste disposal arising from new nuclear power stations. The NLFAB will be another piece of armour to help ensure they get that protection.
"Lady Balfour's considerable skills and experience within the nuclear industry will play an important part in leading the Nuclear Liabilities Financing Assurance Board."
Lady Balfour said:
"The NLFAB will be providing independent scrutiny of the financing arrangements that will last decades into the future. The work of the NLFAB will require hard thinking and robust negotiation. This will help ensure that energy companies pay for the full costs of decommissioning and full share of costs associated with nuclear waste management and disposal I look forward to this challenge."
The Office for Nuclear Development also issued the first of three discussion papers today. These papers will enable people to feed in their views on the development of estimates of the costs of decommissioning and waste management. These estimates will assist NLFAB in its work by providing a benchmark against which operators' own estimates can be assessed
Notes to Editors
1. The Nuclear Liabilities Financing Assurance Board (NLFAB) is being set up to provide assurance that appropriate financial arrangements will be put in place by the operators of any new nuclear power stations in England, Wales or Northern Ireland to meet the costs of decommissioning and waste management arising from these stations. It is anticipated that the first meeting of the Nuclear Liabilities Financing Assurance Board will take place in January 2009.
2. This will involve scrutinising the Funded Decommissioning Programme submitted by potential operators, and making recommendations to Ministers on the suitability of the financial arrangements within the programme.
3. Once approved, the Nuclear Liabilities Financing Assurance Board will also provide advice to the Secretary of State on the regular reviews and ongoing scrutiny of financial arrangements.
4. The policy objectives behind the formation of the Nuclear Liabilities Financing Assurance Board were set out in the 'Consultation on Funded Decommissioning Programme Guidance for New Nuclear Power Stations' which can be found on the BERR website at http://www.berr.gov.uk/files/file44486.pdf.
5. This appointment has been made in accordance with the requirements of the Office for the Commissioner for Public Appointments. Lady Balfour declared no political activity but it is noted that she is also Chair of the Nuclear Liabilities Fund.
6. The selection process for members of the Nuclear Liabilities Financing Assurance Board is in progress. Interviews take place at the end of November.
7. The Chair of the Nuclear Liabilities Financing Assurance Board receives remuneration of £750 per diem. This is a three year appointment starting from the 1 November 2008.
8. The discussion paper, Pre-consultation discussion paper No. 1: on a methodology to determine how the fixed costs of building a geological disposal facility should be apportioned to and shared between operators of new nuclear power stations can be found at: http://www.berr.gov.uk/files/file48571.pdf
9. Biographical details of Lady Balfour are below:
Lady Balfour is currently the Chair of the Nuclear Liabilities Fund, Stagecoach plc's Safety and Environment Committee and Murray International Trust plc's Remuneration Committee. She is also a non-executive Director of the Scottish Oriental Smaller Companies Trust and Close Enterprise VCT and brings a wealth of experience in senior roles to the post. She taught politics and modern history at Oxford University before moving to the Central Policy Review staff in the Cabinet Office. She has worked for governments in many countries and for a number of public bodies.
