The Nuclear Decommissioning Authority is a non-departmental public body of the Department for Business, Energy and Industrial Strategy, formed by the Energy Act 2004. It evolved from the Coal and Nuclear Liabilities Unit of the Department of Trade and Industry. It came into existence during late 2004, and took on its main functions on 1 April 2005. Its purpose is to deliver the decommissioning and clean-up of the UK's civil nuclear legacy in a safe and cost-effective manner, and where possible to accelerate programmes of work that reduce hazard. The NDA does not directly manage the UK's nuclear sites. It oversees the work through contracts with specially designed companies known as Site Licence Companies. The NDA determines the overall strategy and priorities for managing decommissioning. Although the NDA itself employs only 300 staff, its annual budget is £3.2 billion. The vast majority of the NDA budget is spent through contracts with Site Licence Companies, who also sub contract to other companies which provide special services. The NDA aims to do this by introducing innovation and contractor expertise through a series of competitions similar to the model that has been used in the United States. In April 2017, the NDA lost a legal case in the Supreme Court regarding the procurement of a sizeable contract for the decommissioning of 12 different Magnox nuclear facilities when EnergySolutions EU Ltd. challenged a decision in connection with ATK's unsuccessful bid. In February 2018 the UK parliament's Public Accounts Committee concluded that the NDA had "dramatically under-estimated" costs and "completely failed" in the procurement and management of the Magnox Ltd contract, which was one of the highest value contracts let by the government. An independent inquiry into the deal was set up.
Activities
Objectives
The main objectives of NDA are to:
eliminate site hazards and develop waste solutions;
ensure the highest standards in safety, security and environmental management;
build an effective world class industry;
gain full approval and support from stakeholders ; and
make best use of assets and maximise value-for-money.
Structure
Responsibility for operating the sites has been restructured into five Site Licence Companies. The management of the SLCs is contracted out to different Parent Body Organisations, which are owned by private companies.
Sellafield Ltd was previously BNFL's British Nuclear Group subsidiary. It comprises Sellafield nuclear chemical facility, Calder Hall and Windscale. It also previously managed the Capenhursturanium enrichment plant, which is now owned by Urenco. Its PBO was formerly Nuclear Management Partners Ltd, a consortium of URS, Amec Foster Wheeler and Areva. However, Sellafield Ltd has been under the direct control of the NDA since April 2016.
Dounreay Site Restoration Ltd comprises the Dounreay site. Its PBO is Cavendish Dounreay Partnership Ltd, a consortium of Babcock International, CH2M HILL and URS.
On its creation, the NDA also took over ownership of Direct Rail Services, the rail freight operating company set up by BNFL in 1995 to transport nuclear materials. The NDA is also the owner of International Nuclear Services, which operates services on behalf of the NDA for the management and transportation of nuclear fuels. The NDA is also the owner of Radioactive Waste Management Ltd, which is responsible for implementing a geological disposal facility in the UK and provide radioactive waste management solutions. In February 2017 a national archive for the UK civil nuclear industry, named Nucleus, was opened in Wick, Caithness, Scotland.
Costs
In 2005 the cost of decommissioning these sites was planned at £55.8 billion, with Sellafield requiring £31.5 billion. However, in 2006 the NDA reported that the cost of cleaning up existing waste was higher than previously thought, and gave a new estimated decommissioning cost of about £72 billion over a 100-year period. In 2008 estimated decommissioning costs increased to £73.6 billion, or after taking account of discount rates, £44.1 billion. A 2006 estimate foresaw £14bn of offsetting income from reprocessing fuel at Sellafield. In 2009 the NDA sold land near three existing reactor sites for expected new nuclear power stations, for over £200m. In 2013, a critical Public Accounts Committee report stated that the private consortium managing Sellafield has failed to reduce costs and delays. Between 2005 and 2013 the annual costs of operating Sellafield increased from £900 million to about £1.6 billion. The estimated lifetime undiscounted cost of dealing with the Sellafield site increased to £67.5 billion. Bosses were forced to apologise after projected clean-up costs passed the £70 billion mark in late 2013. In 2014, the undiscounted decommissioning cost estimate for Sellafield was increased to £79.1 billion, and by 2015 to £117.4 billion. The annual operating cost will be £2 billion in 2016. In 2018 the discount rate used in evaluating future spending was changed from a HM Treasury determined real terms discount rate to a rate that combined a nominal discount rate and an implied inflation rate based on Consumer Price Index forecasts. This nearly halved the estimate of the remaining cost of decommissioning and clean-up.
In 2006, the then Secretary of State for Trade and Industry announced his support for a National Nuclear Laboratory to be based on the British Technology Centre at Sellafield and Nexia Solutions. The NDA, as the owner of Sellafield site and the funder of majority of research required across the nuclear estate, was involved establishing the NNL in 2009. The NNL complements other initiatives to develop a sustainable workforce such as the National Skills Academy for Nuclear network, including the development of Energus in West Cumbria, alongside complementary research and development facilities such as the .
