Taxpayers face bill for nuclear reactors: A leaked report revealing the cost of demolishing old plant has added to pressure for a government review of the industry. Tom Wilkie reports

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The Independent Online
PRESSURE is increasing for the Government to hold a wide-ranging review of the nuclear industry, after a leaked report from the National Audit Office warned that taxpayers may have to meet part of the pounds 18bn bill to demolish old nuclear reactors and reprocessing plants.

The nuclear industry maintains that it is putting enough money aside from its current earnings to meet the cost of decommissioning its facilities.

Details from the NAO report confirm estimates that the cost of demolishing facilities owned by British Nuclear Fuels will amount to some pounds 6bn; Nuclear Electric's reactors will cost about pounds 7bn, and Scottish Nuclear's reactors pounds 1.5bn to demolish.

The balance, nearly pounds 3.5bn, represents the cost of decommissioning reactors and other radioactive plants owned by the United Kingdom Atomic Energy Authority. Almost all of the UKAEA's figure will have to be met by the taxpayer.

However, a spokesman for Nuclear Electric said it would only need to put aside pounds 2.5bn by 1998 to meet its long-term liabilities - not the full pounds 7bn. Nuclear Electric intends to decommission its reactors over a period of 100 years or more. The first stage would be to remove highly radioactive fuel; the second would be to make the plant weatherproof and secure then to leave it for up to a century for residual radioactivity to die away.

The third, and most expensive stage, of knocking down the plant and disposing of any radioactive waste, would thus be deferred long enough for the money presently set aside to accrue interest. The Nuclear Electric spokesman said: 'You pay your money into a pension fund and when you need it, it's there and it's grown because it has earned interest.' He ruled out the possibility that the company would be asking for an extension beyond 1998 of the 'nuclear levy' on all electricity consumers in England and Wales to meet the nuclear industry's liabilities.

The issue of decommissioning destroyed the Government's attempts to privatise nuclear power with the rest of the electricity supply industry. The cost of dealing with the fuel manufacturing and reprocessing facilities finally broke hopes of privatisation.

Estimates of the cost of demolishing BNF's buildings rose 10-fold overnight: from pounds 450m to pounds 4.5bn. Most of the costs had to be met by the Central Electricity Generating Board and its Scottish counterpart, not BNFL. They have been inherited by Nuclear Electric and Scottish Nuclear.

It also became clear that the CEGB had not put aside enough money to meet its own decommissioning costs - pounds 400m- pounds 500m per station. The then secretary of State for Energy, John Wakeham, promised that no new reactors would be built pending a full review of the industry in 1994.

Michael Heseltine, President of the Board of Trade, disclosed recently that, following the review of the coal industry, he was bringing forward the nuclear review to later this year. His department would like to limit its scope to an assessment of the market for new nuclear power stations.

However, Dr Patrick Green, from Friends of the Earth, said: 'It is absurd to talk about new nuclear power stations when we haven't decided what to do with the present ones. The leak of this report from the National Audit Office underlines the need for the Government to stick by its commitment to a wide-ranging review.'