Britain gets nuclear waste warning from energy chiefs

Britain must not go ahead with a new generation of nuclear power stations until it has a "clear and robust" plan in place for dealing with the twin problems of decommissioning and waste treatment, the world's leading energy body warned yesterday.

The International Energy Agency also said that any new nuclear programme must be funded entirely from the private sector, without any government subsidy or market intervention.

In its latest review of UK energy policy, the agency said that it supported the building of new nuclear stations as an important part of the country's future energy mix. However, it added that the Government's current proposals for dealing with issues such as planning and construction, long-term waste management and guidance for potential financial backers were "too vague to provide the required certainty".

Ministers have pledged to address this in the forthcoming energy White Paper. The document had been due to be published in the next fortnight but has been delayed until May after the environmental campaign group Greenpeace succeeded in a High Court action claiming that the Government had failed to consult properly last year on the twin issues of financing a new nuclear programme and waste management.

Introducing the IEA report, Claude Mandil, the agency's executive director, said: "The spent-fuel issue is the most critical one for nuclear. It will not develop if there is not a credible and satisfactory answer to the management of spent fuel and one which is convincing for the public."

At present, most low-level waste is disposed of at the state-owned Drigg depository in Cumbria while intermediate-level waste is stored on site. But the report says that Britain must move rapidly to select and implement a comprehensive national policy for radioactive waste disposal. To this end, it is "essential" that the Government puts in place schemes to ensure that adequate funds are available to cover decommissioning and waste disposal. These funds should come from either the industry itself or electricity consumers.

Mr Mandil said the agency was against any form of subsidy to enable new nuclear stations to be built because it increased uncertainty. But he said he was in favour of the idea of nuclear plant developers agreeing long-term supply contracts to ensure that their costs were covered, as was now happening with the construction of new capacity in Finland.

Lord Truscott, the UK energy minister, said there would be no subsidy, levy, nuclear obligation or market intervention to help launch a new nuclear programme. "Our position is unchanged. New nuclear will have to stand on its own feet. It will be for private business to make its own decisions on investing and for industry to decide whether it is viable. It will operate within the market as it stands."

Despite the minister's insistence that there will be no government intervention, many energy experts believe there will need to be some form of aid or guarantee to kick-start a new nuclear programme. Some observers even believe there will have to be some form of indemnity given to station builders to underwrite their costs should a future government reverse nuclear policy.

Elsewhere, the agency largely gave the UK a glowing report, saying its policies for supporting investment in new plant and energy efficiency were working well. However, it sounded a note of caution about the UK's growing dependence on gas, saying options should be kept open for the use of other fuels.