Energy Bill

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Q 108Mr. Binley: So you have the people and the robust programmes in place. What should our Minister do now to make sure he is monitoring and reporting to the people that all is well and the decommissioning programme is going as it should, because reassurance about the whole process will be vital? What should the Minister be doing to ensure that you are doing what you say you will do?
Dr. Mike Weightman: I would not be doing the decommissioning; I would be regulating.
Mr. Binley: I did not mean you personally; I meant anybody who wished to answer the question.
Dr. Mike Weightman: It depends. If I was, with some trepidation, to advise the Minister on this matter—
Mr. Binley: Please do. He will be delighted.
Dr. Mike Weightman: I would ask, first, whether you were going for a prescriptive or a goal-setting regime, because it matters greatly how you go about monitoring and it also matters greatly what sort of people do that monitoring. You can do it in various ways. If you go for detailed prescriptive regulation, with a lot of guidance saying what they must do at each stage, clearly you need a lot of people to monitor adherence to that. Perhaps you do not need the same calibre of people if you take a higher-level approach to looking at the management arrangements and various programme aspects they put in place. That is the way that we operate the nuclear regulatory system now. It is a goal-setting regime. We use highly experienced and high-calibre people—mid-career normally; very well qualified engineers or scientists—who understand how projects run and can ask the really penetrating questions about that.
It depends on how the Minister wants to approach it, but there might be synergies with the way in which we consider decommissioning programmes, because there are legal requirements to follow decommissioning programmes, too.
The Chairman: Dr. Stephen Ladyman wants to come in briefly on that precise point.
Q 109Dr. Ladyman: The opponents of the nuclear power industry will say that the Government are the funder of last resort when safety matters are concerned, which is true of all industries—the Government are always the funder of last resort. The question that the industry must answer, and we must answer for the Bill, is, when a costed programme is put together, what assurance can we give the public that it will meet the absolute costs of decommissioning, so that it is unlikely that the Government would ever have to step in and become a funder of last resort?
The Chairman: Who would like to answer that? Dr. Roxburgh?
Dr. Ian Roxburgh: I am not going to answer it; I shall refer to something that I said earlier. That issue is readily addressed in the White Paper, where the Government recognise that they must provide that assurance, hence the advisory group, which would consider the minutiae of that warranty—for want of a better expression—that you rightly require. I am comfortable that there is enough skill in the marketplace for that committee to be well advised and to come up with practical, deliverable solutions.
Dr. Mike Weightman: One principle that you might need to secure is openness and transparency in the monitoring function, so that there is a wider view on it, too. That would provide some of the assurance that you seek.
Q 110Dr. Whitehead: The purpose of the White Paper, among other things, was to set out the facilitative action that the Government propose to take to reduce regulatory uncertainty, particularly on nuclear decommissioning and potential nuclear new build. To Mr. Parker and Mr. Spence in particular, do you not think that although regulatory uncertainty may have been thereby reduced, the amount of regulation, justification, site searching and generic design assessment, not to mention the planning and building processes, means that it will take so long to build new nuclear power stations that the energy gap will have been filled by other forms of energy, and that therefore nuclear might have missed the bus? Would you prefer less regulation and more speed in the process, or do you think that the balance is about right?
Paul Spence: In summary, the balance is about right, provided we work through the regulations efficiently and effectively. If I look back to the experience of Sizewell and project it forward to where we might be today if we tried to go through a programme for it without the changes that are laid out in the White Paper, I would be very worried about the timetable. The proposals give me the clarity, which I look for as an investor, about what we need to do, the order in which we need to do it and the hurdles that we need to go over, and it allows me to see a way in which I am asked once about national need, rather than being re-asked in several places—similarly, on the questions about siting. So, from our perspective, it looks a sensible and appropriate approach that can fill the gap appropriately, rather than miss the boat.
Q 111Dr. Whitehead: To Dr. Roxburgh and Dr. Weightman, do you consider that the prospective regulations on clean-up and new build, particularly those in the Bill, such as the generic design assessments and the number of people employed to undertake them, will evidently lead to substantial delays? Do you consider the full weight of the regulator process to be imperative, or is there a balance to be struck between time scale and the weight of regulation as the process moves forward?
Dr. Mike Weightman: Our duty is to protect people in society in the UK. We will not shortcut the process if it means that we will not deliver that. We have reviewed our approach and we now have the generic design assessment. We have decided to go ahead with that and believe that it will deliver safe reactors on a fleet basis across the UK. We are not about rubber-stamping things or shortcutting to meet a programme; we must ensure that things are seen and demonstrated to be safe. We would be failing in our duty were we not to do so.
That is not to say that we do not look to be more efficient and effective, and we look for ways in which we can better serve the public. However, we will ensure that the public have confidence in the safe future of any new reactor programme. That means that we must work hard, as we are doing, and that we intend to resource appropriately going forward.
It is not about shortcutting things and doing things in a slapdash fashion, but it is also not about not learning from nuclear regulators around the world and acting in co-ordination with them. We are active with that at the moment. Indeed, we have done some inspection with colleagues in France, Canada and the US, to look at their design organisations. Interestingly, they did not do things that way in any of those countries, but ensuring that designers of reactors have appropriate quality management systems and systems for securing long-term resources, and that they have good control over changes in design, is obvious for us. We work with others, but there are things that we must do to ensure that the programme is safe for UK people and society.
Q 112Martin Horwood: Given your confident reassurances and the Minister’s robust comments on Second Reading, I am clear that things such as basic decommissioning, initial disposal, safety monitoring and site clean-up are all covered within the funded decommissioning programmes in the Bill. I wish to ask about three specific costs, and I want you to tell me whether you are absolutely sure that they are covered. First, is all long-term waste management covered? Given that we are talking about nuclear waste, we are talking about the very long term. Secondly, are the costs of any accidents or insurance against accidents, if indeed they are insurable, covered? Thirdly, is the cost—I suppose that this question is for Dr. Roxburgh and Dr. Weightman—of your authorities and inspectorates covered?
Dr. Ian Roxburgh: Sorry, could you rephrase that last question?
Martin Horwood: Are the costs of running your inspectorates and authorities, which are, in a sense, a cost of the nuclear industry, going to be covered by the funded decommissioning programmes, or by the industry through any other mechanism in the Bill?
Dr. Ian Roxburgh: As I understand the White Paper, it intends that the advisory body will include the cost of waste disposal along with the cost of decommissioning, so the complete life cycle cost would have to be recovered.
Q 113Martin Horwood: Sorry, just to be clear, we are talking about the Bill and not the White Paper. By long-term life cycle, do you mean thousands of years in the future, potentially?
Dr. Ian Roxburgh: In the sense that once waste is placed in a deep geological repository, I assume that it becomes a property of the Government, or at least that it is on some sort of lease. That issue is yet to be addressed, but the reality is that once the waste is in a repository, it should be in a passive, safe form. I will not say that age is immaterial, but that is the point about the repository: age can be accommodated there.
Q 114Martin Horwood: So you are expecting there to be no costs attached to that that will not be covered?
Dr. Ian Roxburgh: You will have to ask the Government about that.
Martin Horwood: Okay, I will.
Dr. Ian Roxburgh: In terms of the recovery of costs, that is an interesting perspective. I do not know whether the advisory committee will be asked to consider that. If it is, naturally we would respond to any request for information that it made to us.
Q 115Martin Horwood: And accidents?
Dr. Mike Weightman: There are provisions already for insurance requirements under those conventions and treaties. Under current nuclear installation legislation, BERR has to ensure that sufficient insurance provision is available to meet those treaties. There are some limitations to those insurance requirements, which is an issue that perhaps the Minister might answer, as you say.
Keith Parker: On a general point about insurance, the operators are obliged to secure insurance to cover against third-party liability from accidents under those international conventions.
Martin Horwood: I am not talking about somebody tripping over a railing.
Keith Parker: No, the limits are about to be raised under amendments to the convention.
Q 116Martin Horwood: According to the risk assessment by the Government’s own assessors, the key concern was that there was still a risk that sufficient funds would not in practice be available and that, in particular in a company undergoing a restructuring programme, the assets could be diverted and be made unavailable to fund a liability. It goes on to talk about issues such as liquidation and in effect making the funds unavailable. Is that still a risk? The TUC and the EEF this morning felt that, in the last resort, it still was.
Paul Spence: As I understand the Bill, there are terms in there to cover a situation in which there was insolvency and to ensure that the funds that have been set aside for decommissioning and management of waste are protected from the other creditors. I would, therefore, see them as being secure.
Q 117Martin Horwood: But what if the funds are not actually there?
Paul Spence: The requirement is to put them there during or at the start of the operation of the station to ensure that they are.
Q 118Martin Horwood: So none of it would be dependent on cash flow, as you understand it?
Paul Spence: The component that would be put there during subsequent operation would be to cover the increasing amount of waste generated and potentially grow to cover the decommissioning liabilities as required, so replacing insurance with cash over time.
Q 119John Robertson: I wonder whether I could develop the waste management point a bit further, because it is probably one of the most contentious parts of nuclear energy. Do we think as a group that the waste from new build should be separated from the old waste? Do you think that reprocessing should form an important part of disposing of or reusing waste? Furthermore, when disposing of waste, should we use deep geological burial or put it in the ground so that it can be retrieved and used for energy in the future, which some people believe will become possible as technology becomes more efficient?
Paul Spence: May I take the last part of those questions first? Dr. Roxburgh talked about what is being done to ensure sufficient skills for decommissioning and waste management. I could have echoed that by talking about what we are doing as a company and as an operator of existing stations to ensure that we have the graduate skills and craft skills available to operate the current fleet of stations and be ready to operate new build. We have recruited something of the order of 1,000 additional people into British Energy in the past three years. Within that there are at least 150 apprentices whom we are bringing in from around our stations, because we know that we need those skills for existing operation and to allow us to be ready when we need them for new build.
As a company, we are looking forward and asking what skills we believe will be needed and how many of those skills will be needed as construction programmes start to happen, we hope, over the coming decade. We are looking to build that pipeline to ensure that the local colleges are gearing up and that GCSE courses in engineering at local schools are starting to happen. Like the NDA, we are also building links to universities. From where I am, we are laying the right foundations. There is still more to be done, but there is time to do it as well.
Dr. Ian Roxburgh: Can I add a small point to that on skills? I mentioned that we wanted everything that we were involved in to be demand-led. If there were more demand, I would like to think that those institutions that I just described would be flexible enough to accommodate that new demand.
On the other questions, you first asked whether it should be separate from the legacy wastes. By definition, given what is set out in the White Paper, it would be for a period, because the planning presumption is that it would be stored on site for a significant period. There would be no question of mixing it back with the legacy waste, either theoretically or in fact.
You talked about retrieving waste. One decision that would need to be made about a geological repository is what element of retrieval would be appropriate. That might well be one issue that a community considering volunteering would want to reflect upon.
You then asked about reprocessing, and I think that that ties back into the point that I have just made—that you do not need to decide on reprocessing in advance. If the fuel is stored and kept in good order, at any stage, provided that it is retrievable, you can come back and see it as a national resource at some time in the future. From the NDA’s point of view—I suspect that the question is mine because we are the only part of the UK that carries out reprocessing—our clear understanding has always been that any new initiatives for reprocessing would be a matter for the Government, and the Government in turn have made it clear that they would want to consult widely on any such proposal.
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