New Nuclear and the Regulated Asset Base (RAB)

In October 2021 the government introduced a Nuclear Energy (Financing) Bill, comprised of legislation to allow use of a model to finance the building of nuclear power stations, called the Regulated Asset Base (the RAB). Such a model would require all UK electricity customers to pay up front towards the financing costs of the construction of Sizewell C.

  • This would add a nuclear “tax” to all energy bills, regardless of whether customers have chosen a renewable tariff or a regular tariff.  The government has claimed that this would be on average £1/month, but has not published its calculations. It has however published an impact assessment for a putative nuclear project.  Although the government has not shared its calculations, Professor Steve Thomas has calculated that only under the most optimistic scenario in the impact assessment is the average of £1/month achievable. This conflicts with verbal assurances from officials that the midpoint of time, cost and rate of return were used to support the claim. Overall payments by households during construction could increase up to threefold between best and worst case scenarios – from £148 to £431 – and inflation has not been included.  Even using a very conservative figure of 2% inflation, the midpoint of time, construction cost and return comes out at well over £1/month.  If – as the government’s target of 24GW by 2050 (“a reactor a year”) appears to assume – 7 gigawatt dual stations were under construction simultaneously, the surcharge per household could peak at £115 per year.
  • This model places an unacceptable risk that consumers would be forced to continue to pay if there were delays and cost overruns, for which the EPR reactors (EDF’s design at Hinkley and proposed for Sizewell C) are notorious for. An abandoned nuclear project in the US, funded by a model similar to RAB, may leave utility bill payers collectively with debts of billions of dollars.
  • The RAB has never before been used for new nuclear and stalled for two years after a government consultation in 2019. The media reported that the Treasury was “not enthused” by the RAB but the Chancellor seems now to have been persuaded.

What You Can Do:

* Sign and share the petition by consumer campaign group Sum Of Us, saying you don’t want to pay for Sizewell C: https://actions.sumofus.org/a/no-energy-bill-surcharge-for-new-nuclear

* Write to your MP and ask them to oppose the Bill. Our evidence to the Public Bill Committee can be viewed here: Stop Sizewell C Evidence Nuclear Energy (Financing) Bill

* Write to your pension fund and ask them not to invest in Sizewell C www.stopsizewellc.org/pension-funds or via Sum of Us’s handy online tool

* Write to Business Secretary, Rt Hon Kwasi Kwarteng enquiries@beis.gov.uk and Chancellor of the Exchequer, Rt Hon Rishi Sunak public.enquiries@hmtreasury.gov.uk with your opposition to the RAB. Copy your MP.