Spent fuel from the Sizewell B PWR (pressurised water reactor) plant is stored on site. Spent fuel from the AGR plants is transferred to Sellafield for storage and reprocessing.
EDF Energy’s provisions for the back-end of the nuclear cycle concern obligations for reprocessing and storage of spent fuel and long-term storage of radioactive waste, required by the existing regulations in the UK approved by the Nuclear Decommissioning Authority (NDA). Their amount is based on contractual agreements or if this is not possible, on the most recent technical estimates.
| 31/12/2022 | 31/12/2021 | |||
|---|---|---|---|---|
| (in millions of euros) | Costs based on year-end economic conditions (1) | Amounts in provisions at present value | Costs based on year-end economic conditions (1) | Amounts in provisions at present value |
| Spent fuel management | 3,695 | 1,284 | 2,725 | 1,401 |
| Waste removal and conditioning | 1,867 | 373 | 2,154 | 639 |
| Long-term radioactive waste management | 5,158 | 1,066 | 5,126 | 1,415 |
| BACK-END NUCLEAR CYCLE EXPENSES | 10,720 | 2,723 | 10,005 | 3,455 |
(1) The costs based on year-end economic conditions include spent fuel and associated waste management over the operating life of the reactors (including future load fuel for Sizewell B only); the provisions are based on the fuel committed to date.
Provisions for decommissioning of nuclear plants cover the full cost of decommissioning and are measured on the basis of existing techniques and methods that are most likely to be used for application of current regulations.
As explained above, the Restructuring Agreements updated in June 2021 provide that once the AGR power plants have finished defueling that they will transfer to the NDA for subsequent decommissioning activities.
The signature of these agreements has no immediate accounting consequences for decommissioning provisions or the receivable representing reimbursements to be made by the NLF and the UK government. Nuclear decommissioning liabilities and the associated assets will be derecognised during the agreement’s operational implementation phase.
Phase 1 of the Decommissioning Plan Submission (DPS 20) submitted in early 2020 and approved by the NDA in June 2021, which was an update to the defueling liability, led to a €1.9 billion increase in the provision at 31 December 2019, notably reflecting i) the extension of the defueling period following risk and contingency modelling, ii) better definition of the costs covered, and iii) an updated estimate of the costs of preparing and removing fuel, following a review of the industrial scenario.
The Integrated Plan (IP) 22, approved by the NLA in December 2021, which updated the AGR defueling cost estimates previously submitted in 2020, led to a €0.9 billion increase in the provision at 31 December 2021. This increase is mainly explained by the unexpected early end of generation at Dungeness B in June 2021, previously expected to be 2028, leading in particular to a longer defueling duration (and hence an increase in costs) due to the unplanned nature of this shutdown.
Furthermore, in 2021 EDF Energy updated the cost estimates relating to phase 2 of the decommissioning plan submission (DPS 21) which includes the other decommissioning activities for the AGR plants, decommissioning of Sizewell B and an update to the UCLDP. The updated cost estimate represented an increase in the provision of €0.2 billion at 31 December 2021, which includes the upward effects of the unexpected early end of generation at Dungeness (previously planned for 2028) and the new assumptions regarding the closure of Heysham 2 and Torness AGR plants, scheduled for 2028 (previously 2030), as well as the downward effect of extension of the depreciation period of Sizewell B (PWR plant) at 31 December 2021. As mentioned above, phase 2 of the DPS 21 was approved by the NLA in August 2022.
The IP23 was approved by the NLA in December 2022, which updated the cost estimates from IP22 and DPS21.
| 31/12/2022 | 31/12/2021 | |||
|---|---|---|---|---|
| (in millions of euros) | Costs based on year-end economic conditions | Amounts in provisions at present value | Costs based on year-end economic conditions | Amounts in provisions at present value |
| PLANT DECOMMISSIONING EXPENSES | 20,875 | 11,206 | 19,864 | 12,494 |
The method used to determine the discount rate changed as follows from 31 December 2020:
Determined under this method, the real discount rate used to calculate provisions for the back-end of the nuclear cycle and decommissioning of nuclear plants is 2.9% (1.9% as at 31 December 2021).
