Greenpeace calls for new EU rule for nuclear power plant decommissioning funds

Greenpeace today published the results of an economic study exposing the uncertainties and complexities surrounding nuclear power plant decommissioning reserve funds across Member States and the market distortions created by the unrestrained access to these funds. The environmental organisation is now urging members of the European Parliament's Industry, Trade, Research and Energy (ITRE) committee to vote in favour of an amendment (1) which is in line with the conclusions of this study and which will contribute to the creation of a level playing field in the EU's emerging liberalised energy market.

Decommissioning fund models were designed at a time when monopolies existed. With the advent of a liberalised energy market the situation has significantly changed and now, according to Greenpeace, the rules governing decommissioning fund reserves must also be changed.

To date, Member States have adopted extremely different decommissioning fund management models - the main difference being the operator's access to them. The Greenpeace-commissioned economic study (2) exposes how excessive risks are taken with decommissioning funds in Europe and how this jeopardises their future availability for their intended purpose: the decommissioning of nuclear power plants. Some utilities, such as EDF (France) and E.on and RWE (Germany) use decommissioning funds to finance expansion.

"Access to these funds can cause a significant market distortion," said Frederic Marillier from Greenpeace France. "Decommissioning fund management must be based on public interest and not on private and short-term financial gain," he explained.

The study's conclusions underline the need for a democratic harmonisation of the rule of access to decommissioning funds. This must be implemented with a view to the separate management of these funds along with a revision of the control mechanisms involved.

Greenpeace has sent its recommendations to the members of the ITRE committee in advance of their vote on the internal electricity market directive. The Greenpeace recommendations put special emphasis on Amendment 24 (decommissioning fund management) as well as on Amendment 14 which obliges suppliers to provide information on the origin and on the environmental impact of the electricity that their consumers are purchasing. This vote will take place at the 2nd Parliamentary Reading of the directive on common rules for the internal market in electricity (3).

Notes: (1) Amendment 24, Article 18, paragraph 2 a (new)2a. In order to ensure the availability of funds for future decommissioning and to avoid obstacles to fair competition in the energy market, Member States must adopt separate accounting for the financing of future decommissioning or waste management activities. These funds must be reviewed and audited annually by an independent body, such as the regulator or regulatory bodies, to verify that the revenues and the associated interest raised for these future activities shall only be used for these purposes, that is for decommissioning or waste management activities and not used directly or indirectly to fund activities in the market.(2) «_Economie des modèles européens de gestion des provisions pour démantèlement des centrales nucléaires_», Flavien TCHAPGA and Jean-Michel GLACHANT, April 2003. (3) The ITRE committee is expected to vote on amendment 24 on Thursday, 24th April.The full study (in French) available at http://www.greenpeace.fr/energie/provisions.pdf English and French language summaries available at http://www.greenpeace.org/multimedia/download/1/219613/0/english.pdfhttp://www.greenpeace.org/multimedia/download/1/219615/0/french.pdf