Documents considered by the Committee on 10 January 2018 Contents

3EU Contribution to a reformed ITER project

Committee’s assessment

Politically important

Committee’s decision

Not cleared from scrutiny; further information requested; drawn to the attention of the Business, Energy and Industrial Strategy Committee

Document details

Commission Communication—EU contribution to a reformed ITER project

Legal base

Department

Business, Energy and Industrial Strategy

Document Number

(38849), 10434/17 + ADD 1, COM(17) 319

Summary and Committee’s conclusions

3.1Launched in 2005 and now involving seven global partners (Euratom,11 US, Russia, Japan, China, South Korea and India), ITER (International Thermonuclear Experimental Reactor) is a project to build and operate an experimental facility to demonstrate the scientific viability of fusion as a future sustainable energy source. ITER is being built at the Cadarache research centre in southern France and originally aimed to complete construction with so-called “First Plasma” in 2020.12 That stage is now expected to be reached only by December 2025. Progress to full performance operation is foreseen by 2035.

3.2Following an overhaul of ITER management, the Commission’s Communication seeks ad referendum approval (i.e. non-binding and subject to finalisation at a later date) to agree with other partners a new baseline budget for the project post-2020. The total EU contribution to ITER between 2021 and 2035 is estimated at €7.1 billion (£6.2 billion).13 No change is foreseen to the EU’s contribution of €6.6 billion (£5.8 billion) by 2020. There are no new funding commitments at this stage as any funding post-2020 is subject to wider discussions about the EU budget from 2020 and negotiations about the UK leaving the EU.

3.3The Minister of State for Universities, Science, Research and Innovation (Jo Johnson) notes that the proposal demonstrates the EU’s continued commitment to ITER in principle, although the approval sought by the Commission is non-binding.

3.4The Minister re-iterates past Government statements to the effect that the UK would like to find a way to continue to participate in ITER once it has withdrawn from the EU, but this will be dependent on negotiations. In its September 2017 future partnership paper on “Collaboration on science and innovation”,14 the Government confirmed that the UK hopes to find a way to continue working with the EU on nuclear research and development, including the ITER programme and its predecessor, JET (Joint European Torus).

3.5The JET programme contributes to the preparatory work for ITER. It is based in the UK and is largely funded by Euratom, although an EU decision is pending on whether to extend the existing contract, which expires in 2018, to 2020. The Government has confirmed that, should the Commission agree to extend the JET contract, the UK will underwrite its share of JET contract costs after it leaves the EU.15

3.6The over-run of the ITER project means that the costs of this already very expensive project are escalating. We note that Euratom’s contribution post-2020 is subject to a number of factors, including the UK’s withdrawal from the EU, but we also note that the preferred UK position is to continue its involvement in ITER. In that light, we seek the Minister’s assurance that he is as convinced as the Commission that the management and governance challenges faced by ITER have been overcome and that the likelihood of a further extension of the initial “First Plasma” stage beyond 2025, and full performance operation by 2035, is minimal.

3.7The Minister’s preference is to find a way to continue to participate in ITER post-Brexit. Would the Minister prefer to participate as a global partner or in association with Euratom? What is the Minister’s assessment of the impact on the UK of non-participation in the future?

3.8In the shorter term, the Government’s future partnership paper on science and innovation drew attention to the required EU decision as to whether to extend the existing JET contract beyond December 2018. We note that Austria—one of the least supportive Member States towards nuclear power—will hold the Presidency in the second half of 2018. We would welcome the Minister’s reflection on the desirability, and likelihood, of securing agreement to the JET contract extension before the launch of the Austrian Presidency.

3.9Some of the uncertainty regarding future funding relates to continued question marks over the UK’s financial settlement with the EU as part of the UK’s exit from the EU. The provisional agreement on phase one of those negotiations has in principle safeguarded Euratom-related funding (including JET and ITER) until the end of 2020—subject to a satisfactory overall withdrawal agreement—but any contributions thereafter to programmes such as Euratom are referred to only in the statement that the UK “may wish to participate in some Union budgetary programmes of the new [Financial Framework] post-2020 as a non-Member State.” This highlights the inter-relationship between negotiations on the financial settlement and the UK’s future strategic priorities.

3.10We retain the document under scrutiny and draw it to the attention of the Business, Energy and Industrial Strategy Committee, given that Committee’s interest in the impact of Brexit on the civil nuclear sector. We look forward to a response to our queries by 2 February 2018.

Full details of the documents

Commission Communication—EU contribution to a reformed ITER project: (38849), 10434/17, COM(17) 319.

Background

3.11The EU is the single largest contributor to ITER and provides 45% of ITER’s construction costs. Of that contribution, 80% comes directly from the EU budget and 20% from France as the host country.

3.12In 2010, the EU approved the current ITER baseline budget which assumed ITER construction would be complete by 2020. At that time, the Council capped the EU financial contribution to ITER at €6.6 billion (£5.8 billion) up to 2020. The Commission is clear that the new baseline agreement requires no increase in that cap to 2020.

3.13Following a recent overhaul of the ITER management and an independent review, in June 2016 the ITER Council endorsed an updated schedule for ITER construction that anticipates that construction (“First Plasma” stage) will complete in 2025. The Communication describes the rationale behind the new schedule and the measures being taken to ensure the project stays on track. The Commission recognises that the ITER project reforms have had a positive impact on progress and recommends that the new baseline is agreed.

3.14This Communication provides estimates of the EU funding and resources needed to meet the ITER construction schedule beyond 2020 (total EU contributions to ITER between 2021 and 2035 are estimated at €7.1 billion (£6.2 billion) and seeks the support of the European Parliament and Council for the Commission to approve these new assumptions at a planned ITER Council meeting later in 2017.

3.15No non-EU members of the European Economic Area participate in ITER. Switzerland participates in ITER through an association to the Euratom Research and Training Programme but is not a member of the EEA.

The Minister’s Explanatory Memorandum of 11 July 2017

3.16The Minister observes that the proposal demonstrates the EU’s continued commitment to ITER in principle, but the approval sought by the Commission is ad referendum and therefore non-binding. The paper makes clear, he says, that any approval will be without prejudice to further proposals from the Commission, the outcome of negotiations on the withdrawal of the United Kingdom from the EU, and decisions on the Multiannual Financial Framework post-2020. As such the Minister judges that the action has no direct policy implications beyond sending a positive signal regarding continued EU involvement in ITER.

3.17On Brexit, the Minister says:

“The paper references the fact that the UK exit negotiations may affect future Euratom funding available for ITER but does not take any specific view other than UK withdrawal will not affect the EU’s overall financial obligations to ITER specified in the ITER Agreement.

“The UK Government has stated previously that the UK would like to find a way to continue to participate in ITER following EU exit, but this will be dependent on negotiations. These papers do not alter that position, although the long-term ITER budget assumptions will be a consideration.”

3.18The paper comments that ITER membership is a positive investment for the EU, with European industry (an estimated 300 companies including SMEs) having benefitted from ITER construction contracts worth around €3.8 billion (£3.3 billion) since the beginning of ITER activities in January 2008. Future contract opportunities are noted as promising.

Previous Committee Reports

None.


11 The European Atomic Energy Community, comprising all members of the EU as well as Switzerland which participates in some of the research activities, including ITER.

12 First Plasma represents the stage in the construction of the fusion machine that will allow testing the essential components of the machine; under the terms of the ITER Agreement, it is the point where the construction phase is formally completed and the operation phase starts.

13 £1 = €1.336, or £0.8821 = €1 as at 31 October.




12 January 2018