Future of the Advanced Gas-cooled Reactors

Public Accounts Committee Closed Inquiry
Opened: 12 Jan 2022 Closed: 2 Sep 2022 Parliament page
The UK’s nuclear power is generated primarily by seven advanced gas-cooled reactor (AGR) stations, owned by EDF Energy. The AGRs are scheduled to stop generating electricity during this decade, at which point fuel will be removed and transferred to Sellafield for safe storage. The AGRs will then be transferred to … Read more
10 Recommendations
21 Conclusions
1 Report
1 Oral session
1 Letter
1 Event
Activity timeline 5 events
2 Sep
2022
Report published
20 May
2022
Report published
28 Feb
2022
Correspondence
7 Feb
2022
Oral evidence
7 Feb
2022
Formal meeting (oral evidence session) · The Grimond Room, Portcullis House
Oral evidence sessions 1 session
7 Feb 2022
View on parliament.uk
Future of the Advanced Gas-cooled Reactors
David Peattie · Nuclear Decommissioning Authority Jerry Haller · EDF Energy Sarah Munby · Department for Business, Energy and Industrial Strategy Umran Nazir · Department for Business, Energy & Industrial Strategy
Title HC No. Published Items Response
Third Report - The future of the Advanced Gas-cooled Reactors HC 118 20 May 2022 31 Responded
Recommendations & Conclusions
31 results
2 Recommendation Accepted
Third Report - The future of the A…
The estimated cost of decommissioning has nearly doubled since 2004–05 and there remains a significant...
The estimated cost of decommissioning has nearly doubled since 2004–05 and there remains a significant risk that the costs will rise further. The estimated cost of decommissioning the AGR stations, plus the PWR at Sizewell B, has increased from £12.6 … Read more
Government Response
The Department, working with the trustees of the Fund, should ensure the estimates make explicit allowance for the risk of optimism bias and report back to the Committee on the new estimates when they are available. They will reflect the revised costs for defueling/deconstruction and uncontracted liabilities.
HM Treasury
View details
3 Recommendation Accepted
Third Report - The future of the A…
The terms of the 2009 sale of the nuclear stations agreed by the Department with...
The terms of the 2009 sale of the nuclear stations agreed by the Department with EDFE placed a disproportionate amount of risk for meeting future decommissioning costs on the taxpayer. The negotiations surrounding the sale of the stations to EDFE … Read more
Government Response
The department agrees to respond by August 2022, but states that FDP policies for new nuclear stations already build upon lessons learned from the AGR stations, highlighting the Energy Act 2008 requirements and periodic reviews of sufficiency.
HM Treasury
View details
4 Recommendation Deferred
Third Report - The future of the A…
EDFE’s timetable for the closure of the stations will result in a significant reduction in...
EDFE’s timetable for the closure of the stations will result in a significant reduction in the UK’s generating capacity until new capacity comes online. In 2020, nuclear power accounted for 16% of UK electricity generation. The closure of seven nuclear … Read more
Government Response
The government disagrees with the recommendation as drafted, stating that extensions of station lifespans are a matter for EDF and the relevant regulator (ONR). They will ask EDF to set out their plans for how they will work with the regulator to see if extensions are possible and will aim to provide further detail to the Committee by the end of 2022.
HM Treasury
View details
5 Recommendation Accepted
Third Report - The future of the A…
We are not convinced the Department has struck the right balance in incentivising the NDA...
We are not convinced the Department has struck the right balance in incentivising the NDA and EDFE to deliver safe and efficient defueling of the AGR stations on time while reducing costs. The Department has introduced financial incentives to encourage … Read more
Government Response
The government agrees to write to the Committee by November 2022 outlining the governance and oversight for monitoring the impact of the incentive on delivery and how that indicates effectiveness of the mechanism.
HM Treasury
View details
6 Recommendation Accepted
Third Report - The future of the A…
Arrangements for transferring nuclear stations to NDA are worryingly under- developed, and there is a...
Arrangements for transferring nuclear stations to NDA are worryingly under- developed, and there is a risk that transfer negotiations between EDFE and NDA could drag on and increase the costs to the taxpayer. The first of the stations could transfer … Read more
Government Response
The government agrees to provide a detailed transfer plan for Hunterston B by May 2023 and will share it with the committee, along with a summary of progress for other stations.
HM Treasury
View details
7 Recommendation Not Addressed
Third Report - The future of the A…
Given the scale and complexity of decommissioning the AGR stations, we are concerned that the...
Given the scale and complexity of decommissioning the AGR stations, we are concerned that the Department’s oversight of a complex set of governance arrangements is itself not subject to sufficient scrutiny and challenge. The Department is performing a variety of … Read more
Government Response
The Clerk of the House and Clerk of Parliament will oversee the programme and manage short-term risks to value for money to avoid nugatory expenditure.
HM Treasury
View details
1 Conclusion Acknowledged
Third Report - The future of the A…
On the basis of a report by the Comptroller and Auditor General, we took evidence...
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Business, Energy & Industrial Strategy (the Department), the Nuclear Decommissioning Authority (NDA) and EDF Energy (EDFE) on the decommissioning of the … Read more
Government Response
The response provides background information on the UK's nuclear power stations, the Nuclear Liabilities Fund, and the decommissioning process, but does not address any specific recommendation.
HM Treasury
View details
8 Conclusion Acknowledged
Third Report - The future of the A…
The Committee has previously identified significant uncertainty regarding the estimation of decommissioning costs.
The Committee has previously identified significant uncertainty regarding the estimation of decommissioning costs. We examined, for example, the NDA’s management arrangements for decommissioning the Magnox nuclear power stations in 2020 and identified significant difficulties estimating decommissioning costs. We concluded that … Read more
Government Response
The department agrees that there remains a significant risk that decommissioning costs will rise further and refers to their response to recommendation 2.
HM Treasury
View details
9 Conclusion Not Addressed
Third Report - The future of the A…
The estimated cost of decommissioning the AGR stations, plus the PWR at Sizewell B, increased...
The estimated cost of decommissioning the AGR stations, plus the PWR at Sizewell B, increased from £12.6 billion in 2004–05 to £23.5 billion in 2020–21 in real terms. We asked the Department why the estimated cost of decommissioning the AGRs … Read more
Government Response
The government notes the cost increases and refers to its response to recommendation 2.
HM Treasury
View details
10 Conclusion Accepted
Third Report - The future of the A…
There remain significant uncertainties which if managed poorly could increase decommissioning costs further.
There remain significant uncertainties which if managed poorly could increase decommissioning costs further. The estimated cost of defueling the seven stations, for example, ranges between £3.1 billion and £8 billion depending upon how quickly they can be defueled and how … Read more
Government Response
The government agrees with the recommendation to ensure estimates make explicit allowance for the risk of optimism bias as part of the 2022 revaluation. The department will respond by July 2023.
HM Treasury
View details
11 Recommendation Accepted
Third Report - The future of the A…
EDFE has recently brought forward the closure date for five out of the seven AGR...
EDFE has recently brought forward the closure date for five out of the seven AGR stations. EDFE told us it expects the stations to stop operating at their current closure dates but acknowledged that early closure was always a risk. … Read more
Government Response
The government agrees to ensure the 2022 revaluation of decommissioning liabilities makes explicit allowance for the risk of optimism bias and will report back to the Committee on the new estimates by July 2023.
HM Treasury
View details
12 Conclusion Accepted
Third Report - The future of the A…
In 2015, the then Shareholder Executive, on behalf of the Department undertook a review of...
In 2015, the then Shareholder Executive, on behalf of the Department undertook a review of the arrangements with EDFE for decommissioning the AGR stations. It concluded that the existing agreements did not incentivise EDFE to look at more innovative or … Read more
Government Response
The government agrees with the Committee’s recommendation and will respond to the Committee by November 2022, outlining the governance and oversight for monitoring the impact of the incentive on delivery and how that indicates effectiveness of the mechanism.
HM Treasury
View details
13 Conclusion Accepted
Third Report - The future of the A…
A review commissioned by the Department during the negotiations suggested that the £100 million potential...
A review commissioned by the Department during the negotiations suggested that the £100 million potential fee might not be enough incentive for EDFE to place greater focus on the AGR stations given the potential value of its other UK interests.20 … Read more
Government Response
The government agrees with the Committee’s recommendation and will respond to the Committee by November 2022, outlining the governance and oversight for monitoring the impact of the incentive on delivery and how that indicates effectiveness of the mechanism.
HM Treasury
View details
14 Recommendation Accepted
Third Report - The future of the A…
The Department told us it did have other rights to direct EDFE, for example it...
The Department told us it did have other rights to direct EDFE, for example it has the power to change decommissioning plans. If the Department, for example, identified material cost saving opportunities of more than £5 million it told us … Read more
Government Response
The government refers to its response to recommendation 5, stating it needs to assure itself that the incentives are working and will act accordingly.
HM Treasury
View details
15 Conclusion Acknowledged
Third Report - The future of the A…
The assets of the Fund have been created from the contributions made by the station...
The assets of the Fund have been created from the contributions made by the station operators, income from investments, capital injections from government and the proceeds from the sale of the Fund’s shares in British Energy. Despite EDFE extending the … Read more
Government Response
The department agrees that the terms of the 2009 sale of the nuclear stations agreed by the Department with EDFE placed a disproportionate amount of risk for meeting future decommissioning costs on the taxpayer and refers to their response to recommendation 3.
HM Treasury
View details
16 Conclusion Accepted
Third Report - The future of the A…
We asked why, given the amount of uncertainty surrounding the costs, and concerns about the...
We asked why, given the amount of uncertainty surrounding the costs, and concerns about the adequacy of the Fund to cover this, the risks of decommissioning were being entirely borne by the taxpayer. The Department said that the £100 million … Read more
Government Response
The government refers to its response to recommendation 3, stating that the terms of the 2009 sale placed a disproportionate amount of risk on the taxpayer.
HM Treasury
View details
17 Conclusion Accepted
Third Report - The future of the A…
The Department emphasised that it was applying significant learning from the experience of decommissioning the...
The Department emphasised that it was applying significant learning from the experience of decommissioning the Magnox and AGR stations. For new nuclear stations a funded decommissioning plan has to be in place before construction begins. The Department told us that … Read more
Government Response
The department agrees with the committee’s recommendation and will respond by August 2022 and states that the funded decommissioning plan (FDP) policies in place to support the development of new nuclear stations already build upon what was learnt from the AGR stations. It highlights aspects of the Energy Act 2008 and the requirements for operators of new nuclear power stations.
HM Treasury
View details
18 Conclusion Accepted
Third Report - The future of the A…
Nuclear power contributed around 16% of the UK’s electricity in 2020.
Nuclear power contributed around 16% of the UK’s electricity in 2020. As at January 2022, five of the seven AGR stations and the Pressurised Water Reactor at Sizewell B are the only nuclear power stations in the UK currently generating … Read more
Government Response
The government refers to its response to recommendation 3, stating that the FDP policies in place to support the development of new nuclear stations already build upon what was learnt from the AGR stations.
HM Treasury
View details
19 Conclusion Rejected
Third Report - The future of the A…
The Department acknowledged there will be a production gap between existing nuclear stations closing and...
The Department acknowledged there will be a production gap between existing nuclear stations closing and new ones coming online. However, it told us that it was not concerned about a lack of generating capacity during that period. It told us … Read more
Government Response
The government disagrees with the recommendation to urgently review extending the lives of operating stations, stating that this is a matter for EDF and the relevant regulator. However, the department will ask EDF to set out their plans for how they will work with the regulator to see if extensions are possible in a safe, secure and cost-effective way, and will aim to provide further detail to the Committee by the end of 2022.
HM Treasury
View details
20 Conclusion Rejected
Third Report - The future of the A…
We asked whether there could be value in reusing the AGR sites, given the existing...
We asked whether there could be value in reusing the AGR sites, given the existing support in those communities for nuclear power. In particular, we asked the Department what work it was doing to give more clarity to the providers … Read more
Government Response
The government disagrees with the recommendation to urgently review extending the lives of operating stations, stating that this is a matter for EDF and the relevant regulator. However, the department will ask EDF to set out their plans for how they will work with the regulator to see if extensions are possible in a safe, secure and cost-effective way, and will aim to provide further detail to the Committee by the end of 2022.
HM Treasury
View details
21 Recommendation Accepted
Third Report - The future of the A…
After the AGR stations are defueled EDFE will transfer the stations to NDA who will...
After the AGR stations are defueled EDFE will transfer the stations to NDA who will be responsible for completing the rest of the decommissioning process. The first 30 Qq 3, 7; C&AG’s Report para 1.2–1.3 31 Qq 3–5 32 Q … Read more
Government Response
The government agrees to complete a feasibility study within 12 months and report back to the Committee regarding the future use of nuclear land.
HM Treasury
View details
22 Conclusion Deferred
Third Report - The future of the A…
There are still some important aspects of transfer that are yet to be agreed.
There are still some important aspects of transfer that are yet to be agreed. The NDA and EDFE recognise there are issues around transfer that will need to be agreed but believe they have sufficient time to sort out the … Read more
Government Response
The department agrees with the recommendation to provide a detailed plan and timetable for the transfers, with a target implementation date of May 2023, and proposes sharing the Hunterston B plan with the Committee.
HM Treasury
View details
23 Conclusion Deferred
Third Report - The future of the A…
The Department’s business case estimates that the transfer of the stations will cost £300 million,...
The Department’s business case estimates that the transfer of the stations will cost £300 million, but given the uncertainties the cost and liabilities could be as large as £1.8 billion. The uncertainties include a potential need to update IT systems, … Read more
Government Response
The department agrees with the recommendation to provide a detailed plan and timetable for the transfers, with a target implementation date of May 2023, and proposes sharing the Hunterston B plan with the Committee.
HM Treasury
View details
24 Conclusion Deferred
Third Report - The future of the A…
We were concerned by the number of issues still to be resolved in the time...
We were concerned by the number of issues still to be resolved in the time available. We enquired about progress regarding Hunterston B, the first station expected to transfer, especially as discussions around pension contributions can take time to sort … Read more
Government Response
The department requests a revised implementation date of May 2023 for the delivery of detailed transfer plans for AGR stations, starting with Hunterston B, and proposes sharing the Hunterston B plan with the Committee when completed, along with a summary of progress for the remaining stations.
HM Treasury
View details
25 Conclusion Deferred
Third Report - The future of the A…
We wrote to the Department and HM Treasury number of times (see Annex 1) after...
We wrote to the Department and HM Treasury number of times (see Annex 1) after our evidence session and asked it to clarify what it had agreed with EDFE in terms of the land and buildings that will be transferred … Read more
Government Response
The department requests a revised implementation date of May 2023 for the delivery of detailed transfer plans for AGR stations, starting with Hunterston B, and proposes sharing the Hunterston B plan with the Committee when completed, along with a summary of progress for the remaining stations.
HM Treasury
View details
26 Conclusion Not Addressed
Third Report - The future of the A…
The long-term benefits of transferring the AGR stations into public ownership will depend on the...
The long-term benefits of transferring the AGR stations into public ownership will depend on the ability of Magnox Ltd to deliver efficiencies from combining the stations with its existing portfolio of nuclear stations. The NDA told us it expected to … Read more
Government Response
The government refers to its response to recommendation 6 regarding the risk that transfer negotiations between EDFE and NDA could drag on and increase costs.
HM Treasury
View details
27 Conclusion Not Addressed
Third Report - The future of the A…
Delivering the benefits intended from the new arrangements will require a clear long- term delivery...
Delivering the benefits intended from the new arrangements will require a clear long- term delivery strategy. The current EDFE approach for these stations involves putting reactor buildings into a state of care and maintenance lasting some decades to allow radioactivity … Read more
Government Response
The government refers to its response to recommendation 6 regarding the risk that transfer negotiations between EDFE and NDA could drag on and increase costs.
HM Treasury
View details
28 Conclusion Acknowledged
Third Report - The future of the A…
The AGR decommissioning programme is complex, and key organisations already have substantial portfolios of work.
The AGR decommissioning programme is complex, and key organisations already have substantial portfolios of work. The NDA, for instance, already has a very heavy workload decommissioning the Magnox fleet and parts of the Sellafield site to which the AGRs will … Read more
Government Response
The department agrees that arrangements for transferring nuclear stations to NDA are worryingly under-developed, and there is a risk that transfer negotiations between EDFE and NDA could drag on and increase the costs to the taxpayer and refers to the response to recommendation 6.
HM Treasury
View details
29 Conclusion Acknowledged
Third Report - The future of the A…
The Department told us that following its experience of the Magnox contract, it had undertaken...
The Department told us that following its experience of the Magnox contract, it had undertaken a full review to establish whether it had the right governance and it was now confident that this was the case. It also told us … Read more
Government Response
The department agrees that its oversight of a complex set of governance arrangements is not subject to sufficient scrutiny and challenge and refers to the response to recommendation 7.
HM Treasury
View details
30 Conclusion Acknowledged
Third Report - The future of the A…
Decommissioning the AGR stations is an unusual programme compared with others in government as no...
Decommissioning the AGR stations is an unusual programme compared with others in government as no single organisation has complete responsibility and authority for performance overall. The success of the programme will depend significantly on the ability of the Department, NDA … Read more
Government Response
The department agrees that its oversight of a complex set of governance arrangements is not subject to sufficient scrutiny and challenge and refers to the response to recommendation 7.
HM Treasury
View details
31 Recommendation Acknowledged
Third Report - The future of the A…
Given the centrality of its role we asked the Department whether its own role was...
Given the centrality of its role we asked the Department whether its own role was subject to sufficient scrutiny and whether AGR decommissioning should be included in the Government Major Projects Portfolio. The Department told us that similar concerns had … Read more
Government Response
The government agrees and states that monitoring, reporting, and assurance processes were put into place and will revert with further details and how these processes provide appropriate oversight and facilitate the necessary scrutiny and challenge. The department will also approach the IPA for their support.
HM Treasury
View details
Government Response AI assessment · 31 of 10 classified
Accepted 13
Acknowledged 7
Deferred 5
Not Addressed 4
Rejected 2
Total 10 recs + 21 conclusions
Correspondence 1 letter
28 Feb 2022 Correspondence from Sarah Munby Permanent Under-Secretary of State, Department for Business, Energy & Industrial Strategy, re PAC hearing on “Future of the Advanced Gas-Cooled Reactors”, dated 21 February 2022
Parliament page