Justification Decision (Generation of Electricity by the EPR Nuclear Reactor) Regulations 2010

My Lords, in moving the draft Justification Decision (Generation of Electricity by the EPR Nuclear Reactor) Regulations 2010, I shall speak also to the draft Justification Decision (Generation of Electricity by the AP1000 Nuclear Reactor) Regulations 2010, and the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order 2010. The House should consider these three instruments, which I laid before it on 18 October, together. Two of them contain the decision of my right honourable friend the Secretary of State for Energy and Climate Change, as justifying authority under the Justification of Practices Involving Ionising Radiation Regulations 2004, that the generation of electricity from two nuclear reactor designs—Westinghouse’s AP1000 and Areva’s EPR—is justified. The third, the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order, specifies which technical matters, in addition to those already in the Energy Act 2008, are to be ““designated technical matters””. First, I will consider the two regulatory justification decisions. Regulatory justification is derived from the recommendations of the International Commission on Radiological Protection, the ICRP, which are used around the world as the basis for radiological protection. The ICRP’s recommendations form the basis of the European basic safety standards directive and, in the UK, of the Justification of Practices Involving Ionising Radiation Regulations 2004. The regulations provide that the Secretary of State, as justifying authority, must decide whether a new class or type of practice resulting in exposure to ionising radiation is justified, in advance of it being first adopted or approved, by its economic, social or other benefits in relation to the health detriment that it may cause. Regulatory justification is an initial, high-level process. It is the first step in the radiological protection regime and is made on a generic, not a site-specific, basis. Following a regulatory justification decision, there are further processes involving more detailed examinations by regulators of reactor designs and of the impact on specific sites of proposals to build nuclear power stations separately and after the regulatory justification process. A justification decision does not mean that the reactor design and the nuclear power station will pass through these further processes successfully. These further processes are based on the principle of optimisation, a requirement to keep all exposures as low as reasonably achievable, and dose limitation, the principle that the total dose to any individual from regulated sources in planned exposure situations—other than medical exposure of patients—should not exceed the appropriate recommended limits. Regulatory justification decisions are made in advance of full information on the benefits and detriments of the practice which might emerge from operational experience. They therefore seek to identify the potential detriment from the reactor designs by making assumptions based on the best information currently available, including information arising from the operational experience of similar classes or types of practice and the expert opinion of regulators and others. If new and important evidence about the efficacy or consequences of the class or type of practice comes to light, the 2004 Justification Regulations allow the Secretary of State to reassess any regulatory justification decisions. Last year, my department published a consultation on proposed decisions that two reactor designs should be justified—Westinghouse’s AP1000 and Areva’s EPR. After considering responses to that consultation, on 18 October my right honourable friend the Secretary of State for Energy and Climate Change announced his decision that the two designs are justified. I will outline our reasons for making those decisions. We see a clear need for the generation of electricity by the AP1000 and EPR through the contribution they can make to securing the UK’s energy supplies, helping the UK decarbonise and meet legal low-carbon obligations and benefiting the economy more widely. Against this, the radiological detriment to health from these nuclear reactor designs and their associated waste facilities will be low compared to naturally occurring levels of radiation and effectively controlled by the regulatory regime. The AP1000 and EPR will be able to produce large quantities of electricity over an extended period, making a significant contribution to the electricity supply. Nuclear power has long been our most significant source of low-carbon energy and can continue to contribute to our energy mix. It will be for companies to fund and build any new nuclear power stations and to determine whether they provide sufficiently attractive returns. Nuclear power is economically competitive with other forms of generating technology, and developments in the UK market have made clear that energy companies are investing significantly in the prospect of new nuclear power stations. We are confident that there will be economic benefits for the UK from new nuclear power stations. Beyond direct investment and employment, we can benefit through the development of a globally competitive nuclear supply chain and improvement in the quality of a skilled UK workforce. Further, we believe that, if nuclear power stations are not part of the UK’s future energy mix, the UK would face significantly higher costs in meeting the transition to a low-carbon economy. Against these benefits, there is the potential for detriment. However, the safety features of the designs and the regulatory regime, which sets limits to the release of radiation and monitors compliance, will ensure that emissions will be minimised. The radiation to which members of the public would be exposed, as a proportion of the overall radiation to which they are exposed from all sources—including medical procedures and background radiation—would therefore be very small and the risk of health detriment very low. The decisions apply to the operation and decommissioning of new nuclear power stations and also the management and disposal of the radioactive waste they will produce. In making the decision, we are therefore satisfied that the regulatory regime will limit health detriment from waste management and disposal, that the interim storage of waste can be carried out in a way that causes a very low level of health detriment and that a robust process is in place to identify a site for, and build, a geological disposal facility. We also concluded that the potential environmental detriments arising from new nuclear power stations are likely to be avoided or adequately mitigated by the licensing and planning regime. We considered the risk of detriments from an accident or terrorist incident. This potential detriment already exists and the risk of such incidents would be seen in the context of the regulatory regime which is intended to prevent accidents and protect against terrorist attack. We are confident in the regulatory regimes for safety and security of civil nuclear installations and materials in the UK and consider that the likelihood of an accident or other incident giving rise to a release of radioactive material is small. My right honourable friend the Secretary of State for Energy and Climate Change therefore concluded that these significant potential benefits outweigh the potential detriments, and that the generation of electricity by the AP1000 and EPR should be justified. I now consider the draft Nuclear Decommissioning and Waste Handling (Designated Technical Matters) Order. The purpose of the draft order is to support the requirement under the Energy Act 2008 for nuclear operators to make financial provision in their funded decommissioning programmes for those designated technical matters. The Energy Act 2008 contains only one category of designated technical matters—decommissioning a nuclear power station and cleaning up the site. The Energy Act provides that the Secretary of State specifies by order the other matters which are to be designated technical matters. The order is, therefore, necessary to give operators clarity over what are the designated technical matters that they must provide for. The order specifies that the construction and maintenance of an interim fuel store used for storage; any activity preparatory to the decommissioning of a relevant nuclear installation; and the cleaning up of the site are designated technical matters. This means that these costs also have to be funded through funds set aside as part of the funded decommissioning programme. It might be claimed that the operator could pay for these costs out of operational expenditure and that designation is unnecessary. However, this may put the costs in competition with other demands on revenue and if the operator was unable to meet these costs when they fell due, there would be a risk that they could fall to the taxpayer. It is therefore appropriate to designate these costs to limit the risk to the taxpayer by ensuring that funds are set aside to carry out the relevant work. The order will be complemented by the Nuclear Decommissioning and Waste Handling (Finance and Fees) Regulations, which will be laid before Parliament once this order completes its passage. Following a consultation on the provision of the draft order earlier this year and responses received, the Government do not propose to extend the definition of ““designated technical matters”” beyond interim stores and activities preparatory to decommissioning and cleaning up the site. I believe that the order will benefit both industry and the public. It clarifies the obligations of the nuclear industry and therefore reduces uncertainty and helps investment. The order, together with the Act, ensures that the costs of waste management, disposal and decommissioning do not fall on to the taxpayer. I commend these regulations and the two other instruments to the House.