Select Committee on Trade and Industry Written Evidence


Supplementary memorandum by the Environment Agency

  1.  This memorandum provides information to support the Environment Agency's oral evidence given on 13 June 2006. During that session, in a response to a question (Q315) from Mr Bone on the level of costs associated with the Environment Agency's pre-licensing activities, Dr McHugh offered to provide this information in a written note. This memorandum provides that information.

  2.  Normal regulatory mechanisms which apply to cost recovery for site applications would not be applicable to generic pre-licensing work. That is, work that precedes our formal site-specific regulation of nuclear sites. However, we would recover our costs through a legal agreement with the developer, vendor or utility that is making the pre-licensing submission (referred to in this note as "the proponent'). For assessment of candidate designs we would use the broad general power under section 37 of the Environment Act as the basis for these cost recovery agreements.

  3.  An example of this type of agreement is the one we have entered into with Nirex. Under this agreement we carry out assessments of Nirex's design and safety case work, and provide advice to Nirex on its work.

  4.  We anticipate that under a legal agreement for nuclear power plant, we would assess a design of plant and its environmental impact to a scope and timescale agreed with the proponent. In return for this assessment we would recover reasonable costs for our staff including overheads, plus costs for external consultants.

  5.  There is potentially a wide range of costs associated with such work. This is because the amount of work will depend on:

    —  the quality and complexity of the design and its impacts;

    —  the quality of the initial submission describing the design and how it would meet UK regulatory requirements;

    —  the number and extent of any iterations of questions to the proponent which could be needed to obtain additional information;

    —  the availability and relevance of any assessments of the design already carried out by overseas regulators; and

    —  the degree to which overseas regulators would wish to interact with UK regulators to discuss their assessments.

  6.  We estimate that the overall costs of our assessment to a proponent of a single generic design would most likely be in the range £1 million-£3 million, falling over 2-3 years. However the costs may be outside of this range due to a combination of the reasons set out in paragraph 5. This estimate excludes the costs of HSE's assessment work.

Environment Agency

June 2006

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Prepared 21 December 2006