Source · Select Committees · Public Accounts Committee
Recommendation 11
11
EDFE has recently brought forward the closure date for five out of the seven AGR...
Conclusion
EDFE has recently brought forward the closure date for five out of the seven AGR stations. EDFE told us it expects the stations to stop operating at their current closure dates but acknowledged that early closure was always a risk. Dungeness B was due to close in 2028 but due to technical reasons shut in 2021. EDFE estimates that this early and unplanned closure will cost an additional £0.5 billion to £1.0 billion to defuel. The impact of this early closure was not included in the estimate of decommissioning costs of £23.5 billion reported at the end of 202–21. The Department confirmed that it expected the impact of the closure to be reflected in the next revision to the decommissioning estimates.17 13 Committee of Public Accounts, The Nuclear Decommissioning Authority’s management of the Magnox contract, Twenty-Eighth Report of Session 2019–21, HC 653, 27 November 2020 14 Qq 12, 64 15 Qq 12, 31–32; C&AG’s Report paras 10, 15 16 Qq 34, 85; C&AG’s report para 10 17 Qq 6–8, 38–39; C&AG’s report paras 6, 10, 2.7, 3.13 12 The future of the Advanced Gas-cooled Reactors Financial incentives for decommissioning
Government Response
Not Addressed
HM Government
Not Addressed
2: PAC conclusion: The estimated cost of decommissioning has nearly doubled since 2004–05 and there remains a significant risk that the costs will rise further. 2: PAC recommendation: As part of the 2022 revaluation of the decommissioning liabilities, the Department, working with the trustees of the Fund, should ensure the estimates make explicit allowance for the risk of optimism bias. The Department should report back to the Committee on the new estimates when they are available. 2.1 The government agrees with the Committee’s recommendation. Target implementation date: July 2023 2.2 The department accepts the Committee’s recommendation and will respond by July 2023. This will reflect the revised costs for defueling/deconstruction and uncontracted liabilities. 2.3 As noted to the Committee, Électricité de France’s (EDF) strategies, plans and the estimated costs are scrutinised, challenged, and approved by the Non-NDA liabilities assurance team (NLA) under the terms of the revised funding agreement. EDF’s estimated costs of decommissioning is now to be presented as a range of costed scenarios reflecting risk and uncertainty and this is contractually updated on an annual basis. 2.4 EDF’s liabilities from 2020 onwards have utilised a new methodology based upon “top down” scenario evaluation specifically designed to improve understanding, make external scrutiny easier, and counter optimism bias. This has created a much wider range of costs (recognised in the liabilities numbers). HM Government’s Government Actuary Department (GAD) was involved in assessing this methodology.