Electricity Market Reform represents the biggest shake-up of the utilities industry since privatisation. As the debate on how we produce our electricity rises up the political agenda again, politicians are debating the pros and cons of a new generation of nuclear power plants. The first new reactor to be built in the UK for over 20 years has been given the initial go-ahead at Hinkley Point.

But conspicuously absent is any debate about the hidden costs of nuclear power. Political leaders claim there will be no government subsidy for new nuclear power, but a new analysis by SpinWatch has revealed that nearly £100 billion is being proposed to be given to the industry in direct and indirect subsidies.

The truth is the taxpayer already pays at least £3.6 Billion per year1 to support the nuclear industry today. If eight new nuclear power stations are built, this subsidy - the hidden cost of providing electricity - will continue to grow. Contrast this to renewable energy sources,2 which carry no hidden costs because they have no long-term harmful health or environmental impacts.

It is also almost half what the government proposes to cut from the NHS budget over three years in its £20 Billion efficiency plan. That’s roughly 27,000 less nurses and doctors to pay for the various agencies that oversee the safety, security, regulation, transport and storage of waste, plus decommissioning of nuclear power plants.

Safety design and health costs

Last year, the Department for Work & Pensions received a £97 Million subsidy, two thirds of which goes to the Office for Nuclear Regulation (ONR), formerly the Nuclear Installations Inspectorate (NII). The ONR claims it recovers 98 per cent of its cost from industry. Yet, all costs associated with ensuring that “any new nuclear power stations built in the UK meet high standards of safety, security, environmental protection and waste management” remain with the Health and Safety Executive (HSE).

The Health Protection Agency (HPA) is an independent organisation set up by the government in 2003 to protect people against environmental hazards. Its Radiation Protection Division (formerly the National Radiological Protection Board) is a non- departmental public body whose operating costs were £362 Million in 2010, 3 of which nine per cent was spent by the Centre for Radiation, Chemical and Environmental Hazards.

Instead of carrying out epidemiological studies on cancer clusters near nuclear power stations in the UK, HPA funding last year was spent on a joint effort to update an analysis of mortality and morbidity from circulatory disease linked to radiation exposure among Russian nuclear facility workers.4 Another £3.3 million was spent on a US FDA licence for a childhood leukaemia drug for which Health Protection Agency is the sole manufacturer.5 This is an interesting link, given emissions from Sellafield have been associated with incidences of childhood leukaemia.6 A £73 billion toxic and dangerous legacy

But the enormous elephant in the room is the extra £73 Billion7 projected by the Nuclear Decommissioning Authorities (NDA) to safely tidy up the UK’s nuclear waste.8 Eleven per cent of this is covered by the Nuclear Liabilities Fund, which is financed by the utilities.

All nuclear waste is expected to be stored in a Geological Disposal Facility (GDF) once it is built. Its cost is estimated at £14 Billion. This will be either wholly or partly borne by the taxpayer. Yet no known technology can store waste for the period required (over 2000 years) - current technology can store only for 100 years. Despite past failures in reprocessing fuel by two MOX plants at Sellafield and an enormous legacy of the biggest stockpile of civilian plutonium globally,9 former chief scientific adviser to the government Sir David King has recommended a new MOX plant be built, costing another £3 Billion.(10)

Yet despite the costly regulatory infrastructure footed by UK taxpayers, Dr. Mike Weightman, HM Chief Inspector for Nuclear Installations at the HSE, revealed that more than 1750 leaks, breakdowns or other "events" have occurred at nuclear sites since 2004.  Almost half of these, or 858, were judged serious enough "to have had the potential to challenge a nuclear safety system” according to the International Nuclear Event Scale, a safety classification developed post-Chernobyl.(11)

And during 2008, Department for Transport figures recorded 38 accidents and incidents involving radioactive materials transported from, to or within the UK. This was a big jump on the 25 accidents and incidents in 2007 and 27 in 2006. In recent years, events involving radioactive material discovered in shipments thought to be nonradioactive have also increased. In total, 913 events are known to have occurred since 1958.(12)

Many energy experts wonder why the government is so determined to build new nuclear power plants when so many reports have been written by industry experts detailing strategies where our low carbon energy needs are met in 2050 without them.13

There is speculation that commitments were made to EDF when the French company rescued British Energy in 2007 by paying £12.5 Billion for its fleet of loss making nuclear power plants. At the time British Energy was losing approximately £400 million per year. In 2004, the UK government invested £3 billion in rescuing British Energy. When it was sold to EDF, the UK took over responsibility for British Energy’s nuclear fuel liabilities. The taxpayer lost £660 million on the sale of the government’s 450 million shares in British Energy.

The costs of decommissioning

In 2005, the government reorganised British Nuclear Fuels Ltd plc (BNFL). The decommissioning business was taken on by the newly established Nuclear Decommissioning Authority and the remaining businesses were sold off to other departments like the Ministry of Defence and DECC. BNFL’s assets included the £2.3 billion Thorp plant, which processes used fuel, and the £490 million Sellafield Mox plant (SMP), built to recycle fuel. Despite the failures of these two plants, three company directors received salary and bonuses of almost £5 Million in 2008 and 2009.14

BNFL plc’s 2010 accounts show it still has £417M in cash, although the company is essentially dormant. The cash is to cover potential liabilities associated with their management of Sellafield between 1 April 2005 and 24 November 2008.

Poor value for taxpayers, big profits for utility firms

BIS has spent £41Million on 20 research programmes to deal with nuclear power,15 while not a single recipient of the £450 Million Round 1 of the Regional Growth Fund was a cleantech or renewable energy company.

OFGEM estimates that up to £200 Billion16 is required over the next 10– 15 years to secure energy supplies and meet carbon targets. £400 Million is already earmarked for investment in the high voltage network that large nuclear plants require despite the fact that radiation associated with high voltage electrical cables is hazardous to the public health.

The UK operates 19 reactors that provided only 15.7 per cent of our energy needs in 2010.17 The cost of supplying this electricity is cheap. The big six electricity suppliers plan to make a fantastic profit from an industry that provides poor value for money to the taxpayer and leaves us with a toxic legacy that exceeds 1000 lifetimes.

The Climate Change Levy (CCL) is an energy tax to industry introduced by HMRC in April 2001. The government is undertaking a review of the CCL. Instigation of the review was encouraged by the nuclear industry’s desire for a carbon floor price. According to a government 2008 white paper, new nuclear power stations would not be economic unless the carbon price in the European Union Emissions Trading Scheme was higher than €36 per ton ($59 per ton).18 Modifying the CCL to accommodate a carbon floor price is essentially another subsidy to the nuclear industry.

1 Refer to Appendix 1 to this report

2 Energy generated by wind, solar, concentrated solar power, biomass, biogas, tidal, wave, micro/small hydropower, geothermal and biofuels or energy saved through efficiency measures or savings from encouraging the uptake of existing transport technologies like hybrid cars.

3 HPA Annual report 2010
4 HPA annual report and accounts 2010, page 23

5 HPA annual report 2010

6 Report of the Committee Examining Radiation Risks of Internal Emitters (CERRIE) Goodhead, Bramhall, Busby, Cox, Darby, Day, Harrison, Muirhead, Roche, Simmons, Wakeford and Wright. 2004

7 http://news.bbc.co.uk/1/hi/uk/7215688.stm

8 http://www.world-nuclear-news.org/WR/NDA_advised_on_soaring_costs_300108.html

9 113 tonnes

10 http://www.independent.co.uk/news/science/top-scientist-backs-1633bn-sellafield-plant-despite-1632bn­failure-on-same-site-2256766.html

11 “Nuclear Industry: Crumbling stores, leaky plants and the dangers of old age” Guardian, Terry Macalister, 20 October 2009. Five incidents came under the second-highest ranking, with 1292 on the lowest scale of risk

12 Radiological Consequences resulting from Accidents and Incidences Involving the Transport of Radioactive Materials in the UK 2008 Review, MP Harvey

13 WWF, Ecofys and OMA, PriceWaterhouseCoopers, Potsdam Institute for Climate Impact Research, International Institute for Applied System Analysis and the European Climate Forum, European Renewable Energy Council, ERECEuropean Climate Foundation, Centre for Alternative Technology, Danish Commission on Climate Change Policy, Advisory Council on the Environment (SRU), Boston Consulting Group, Energy Research Institute of the University of Melbourne and Beyond Zero Emissions.

14 Terry McAlister, The Guardian, 11 December 2008http://www.guardian.co.uk/world/2008/dec/11/nuclear­executive-salaries. Refer to BNFL annual accounts 2010.

15 http://www.rcukenergy.org.uk/what-were-funding/nuclear.html

16 Project Discovery, Energy Market Scenarios consultation October 2009, page

17 M. Schneider, A. Froggatt, S. Thomas, “World Nuclear Industry Status Report 2010-2011”, pg64

18 M. Schneider, A. Froggatt, S. Thomas World Nuclear Industry Status Report 2010-2011, pg 32

8/6/2012

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