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EU needs to address nuclear decommissioning inconsistencies

Capgemini, the energy consultancy, has produced a report recommending more regulation for the EU’s nuclear decommissioning sector.

Their annual energy market report has pinpointed the discrepancies in the costs of decommissioning nuclear power plants across member states and says greater transparency is required.
Capgemini said gross provisions for decommissioning and long-term spent fuel management at nuclear power plants work out at €4.7bn per reactor in Germany, compared to just €1.2bn in France and €3.38bn in Britain.

Even if France’s nuclear fleet of 58 reactors is much bigger than Germany’s 17 reactors, economies of scale from the standardisation of processes look too big to account for such a difference by themselves, according to the consultancy.

“Establishing what methodology is used to estimate the overall cost is essential, but it is never explained in annual reports, with each player relying on the estimates of their own experts in that area,” Capgemini said in the 17th edition of its market report.

Nuclear operators like France’s EDF, Germany’s E.ON and RWE and Sweden’s Vattenfall all use different discount and inflation rates to calculate the present value of long-term liabilities and the parameters for these calculations are left to individual companies to decide, the consultancy said.

“For obvious reasons to do with transparency, it is urgent that a process be instituted at European levelà‚ … similar to the international regulatory framework for banksà‚ (Basel III) following the financial crisis that affected most European countries.”

The report also identifies strong disparities with regards to nuclear operators’ legal obligations in terms of covering these future costs, it said.