Gummer's refusal to let work begin on Britain's nuclear waste site is the industry's worst blow since Chernobyl
Last Week, almost unnoticed in the brouhaha surrounding the election announcement, Britain's environmentalists scored their greatest victory and international nuclear power suffered one of its biggest set-backs since Chernobyl.

The surprise decision by John Gummer, Secretary of State for the Environment, to refuse the go-ahead for initial work on Britain's planned nuclear waste site (which was taken partly on the basis that it would disturb badgers) will send a cascade of consequences through the nuclear industry both here and abroad.

It will almost certainly end Britain's two decades as the world's "nuclear dustbin", and force it to send vast amounts of waste back to Japan and Germany, where a relatively minor shipment this month caused the greatest mobilisation of troops since the Second World War to force a path through protesters. It is expected to end the search for a dump in this country for at least a generation and threatens fatally to undermine the profitability of Sellafield's Thorp processing plant.

Mr Gummer's decision, resisted by Michael Heseltine, the Deputy Prime Minister, marks the first time an environmental group has won a planning inquiry against the nuclear industry. Both Nirex, the waste-disposal company owned by the nuclear industry, and Friends of the Earth, which, with Cumbria County Council was the main objector, confess themselves "gobsmacked".

It marks a stunning vindication, after several demoralising defeats, of the strategy by Friends of the Earth (FOE) of fighting the industry on its own ground, through the planning system, with scientific research and argument, against overwhelming odds: Nirex spent more than pounds 200m in trying to justify the site's safety; FOE spent a thousand times less. The credibility of Nirex has been demolished and its survival is in doubt.

Nirex's proposal at first seemed unexceptional - to dig a pounds 195m underground laboratory at Longlands Farm, Gosforth, near Sellafield: that would test the suitability of the site for 275,000 cubic metres of waste. But FOE said it would have been a Trojan horse: spending money and time on it would create an unstoppable momentum for the full dump.

The decision is the culmination of a long series of lesser set-backs in the Nirex's attempts to find somewhere to put intermediate level nuclear waste, which remains deadly for a quarter of a million years (low-level waste is dumped at another site near Sellafield, while the most dangerous, high-level waste is being stored there for at least 50 years in the hope that someone will come up with an idea for what to do with it).

In 1984 Nirex had to drop its first choice, at Billingham on Teesside, after local protest. It next drew up a list of four other sites, all in Conservative constituencies: similar popular campaigns erupted and they were abandoned on the eve of the 1987 election. So it staked everything on Sellafield, on political rather than scientific grounds. It knew the site was far from being the safest in the country, but the natives were thought to be friendly because the nuclear industry is the area's major employer.

A White Paper in 1991 by Chris Patten, the then Secretary of State for the Environment, instructed Nirex to "speed up its investigations" to make a proposal "as soon as possible". But the site was soon looking even less safe than had been thought, making planning permission unlikely. So Nirex changed tactics, applying instead for permission for the laboratory in the hope that this first step might be approved. Cumbria council still refused, leading to a five-month inquiry which ended last year.

Meanwhile Mr Gummer, almost unnoticed, made two crucial decisions. He changed government policy from Mr Patten's urgency to an insistence that safety was more important than speed. And he let what was technically a local inquiry, allowed to consider only planning matters (like the effects on landscape, local traffic and the badgers), scrutinise the safety of the site itself.

That was becoming increasingly dubious. As the Independent on Sunday reported last month, the Government's own pollution inspectors said radioactivity would rise to the surface to contaminate Cumbria. Nirex tried to stop the inspectorate's work and suppress its report.

One of Nirex's own confidential reports, which is in our possession, shows the site is riddled with geological faults, but that, even now, the company does not known precisely where they are. Last month, a leaked internal Nirex memorandum revealed major safety concerns, prompting Sir John Knill, past chairman of the Government's Radioactive Waste Advisory Committee, to warn Mr Gummer of an "extremely unsatisfactory situation".

None of this appeared to shake Nirex's complacency, both about the site's suitability and about its expectation of getting the go-ahead. It seemed to draw confidence from the outcome of the two previous major nuclear planning inquiries, over the Thorp reprocessing plant in the 1970s and the new power station at Sizewell, Suffolk. The industry won both, though FOE was thought to have put the better case.

This time was different. The inquiry inspector, though bound by law to decide mainly on planning grounds, which could include the effect on the badgers, described the site as "overwhelmingly not suitable", and roundly condemned Nirex's "inadequate knowledge", "undue optimism" and lack of a "rational procedure". Mr Gummer, who would have given his approval if the inspector had upheld the proposal, successfully insisted on rejecting it before the election: Labour might have been more inclined to approve it, partly because the local MP is the pro-nuclear member of the Shadow Cabinet, Jack Cunningham.

The result, say experts on both sides, is that the search for a dump has probably been put back at least 30 years. That has huge international consequences. Sellafield produces vast amounts of intermediate level waste by reprocessing foreign used fuel, mainly from Japan and Germany.

Government policy is to return nuclear waste, but it plans to save transport costs by sending back a very much smaller amount of high-level waste, of the same radioactivity. That depends, however, on having a working dump and now tens of thousands of cubic metres of intermediate waste will probably have to be returned, causing political havoc, particularly in Germany. The increased costs are likely to undermine the already shaky profitability of the Thorp plant, though British Nuclear Fuels denies that, and the Germans and other foreign customers might well decide to stop sending their used fuel for treatment there.

As a result, both environmentalists and senior nuclear industry figures describe last week's announcement as the most devastating single blow to the industry since Chernobyl. Waste strategies in Britain and some other nuclear countries will have to be rethought and there will be pressure to replace Nirex with an independent agency with a prime remit to "protect the environment".