Greens' ban could cost Sellafield pounds 1bn

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BRITAIN'S HUGE nuclear waste reprocessing plant at Sellafield in Cumbria was dealt a commercial body blow yesterday by Germany's decision to ban reprocessing of its own spent nuclear fuel from next year.

The decision, a victory for the Greens in the German coalition government, puts in jeopardy more than pounds 1bn of reprocessing contracts Sellafield has with German nuclear power stations.

Stephen Byers, the Secretary of State for Trade and Industry, reacted last night by asking for an urgent meeting with the German Environment Minister, Jurgen Trittin, a Green party member and the man behind the ban. They are likely to meet in London next Wednesday.

The German business is the third biggest of Thorp's current pounds 12bn of contracts and its loss is a considerable blow to the 7,000-job plant. It could cast doubt over recently discussed prospects for privatising Sellafield's owners, British Nuclear Fuels Limited (BNFL), a move that could raise pounds 3bn.

Although the Department of Trade and Industry and BNFL were taking a tough line last night, saying that the contracts were binding, it is clear both governments now have a problem of what to do with the 969 tonnes of German waste that the Thorp plant signed to deal with by 2004.

About 650 tonnes has already arrived in Cumbria, of which about 150 tonnes has so far been reprocessed. One possibility is that the unprocessed fuel might be stored permanently, although the DTI said that was unlikely.

A senior Whitehall source said: "The contracts might be binding, but it would be crazy politics to tell the Germans that they're not allowed to change their policy and we're going to reprocess ... anyway, whether they like it or not."

The consultant KPMG submitted a report to the DTI shortly before Christmas recommending that ministers proceed with a BNFL sell-off. One City source said yesterday that the view within the Government about a sell-off remained "pretty positive", with the Treasury still backing a flotation next year. He added: "The Germans will not derail privatisation. Rather it is a question of how much compensation they pay BNFL and what they want it to do with the waste."

Reprocessing of spent atomic power station fuel, once thought of as the best option because it recovers unused uranium and plutonium, is anathema to environmentalists because it increases the amounts and intensity of the final nuclear waste. It is not needed economically because there is now a world glut of both plutonium and uranium, and the preferred environmental option is merely to store it.

Sellafield has come under increasing fire for the radioactivity it discharges into the Irish Sea and at the meeting last July of the Ospar convention, which regulates marine pollution, Britain agreed to bring its discharges "close to zero" by 2020. The first follow-up to discuss this takes place in Dublin next week.

Last night environmental pressure groups were elated at the German initiative. The campaign group Greenpeace said it was the "death knell" for Thorp, while the Irish Green MEP Nuala Ahern said it was the plant's "death rattle".

The German move is the first stage in a complete phase-out of its nuclear power.