The document discusses nuclear decommissioning costs and financing. It covers types of decommissioning such as immediate vs deferred dismantling. It also analyzes challenges of long-term funding provision, emphasizing the importance of accurate cost estimating. Finally, it identifies the future of financing, such as the UK's Funded Decommissioning Plan requiring operators to secure funding for full decommissioning and waste management costs.

2. Agenda
1) Introduction
2) Enkom’s nuclear experience & capability
3) Nuclear Decommissioning costs & financing
 Types of decommissioning
 Analysing the challenges of long-term provision of funding
 Evaluating the importance of estimating costs
 Identifying the future of finance for decommissioning projects
Page 2 of 25July 2016

3. July 2016

4. Who we are, what we do & who we work with
 Enkom is an Independent consultancy offering
professional services to the Nuclear and Energy
sectors
 Lifecycle Baselines & Whole Life Costing
 Establish Programme Management Offices and
Project Controls teams with clients
 Develop Contract Strategies and Project
Execution Plans which are aligned with business
objectives
 Independently verify scope, schedule & costs at
Project, Programme & Enterprise level
 Provide Subject Matter Expertise and Assurance
for all phases of nuclear projects
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5. Timeline of projects our team has supported
July 2016 Page 5 of 25
Major Clients / Projects 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 10/11 11/12 12/13 13/ 14 14/ 15 15/ 16 16/ 17
Environmental Services (BNG)
Baseline Decommissioning Plans
(BDP)
British Nuclear Group Ltd
Preparation of LCBL /
NTWP
British Energy
Verification of
DWMP
Magnox North Limited
Consultancy support to central Project
Controls
Magnox South Limited
Consultancy support
Optimised Plan
Magnox Limited Strategic
Programmes
Cost Capture & Benchmarking
Magnox Limited (Business)
Consultancy support - Central Cost
Function
Nuclear Decom Authority
(NDA), Magnox & MWH
Benchmarking
Report
Cost
Reviews
Sellafield Limited and Tier 2
Contractors
Commercial
Assistance
Nuclear Decommissioning
Authority (NDA) – Special
Nuclear Services – Lot 6
SNS - GDF Estimate Review
NDA - IR & BCP - Deloitte
Review &
Benchmarking
NuGeneration Limited –
Assurance of DWMP
Cost &
Technical

6. Our story is one of evolution & strong relationships
The Enkom team has evolved from our work on;
 the development of early Baseline Decommissioning Plans,
 drafting procedures and processes to allow best practice to be applied,
 establishing SLC internal Integrated Assurance processes to allow challenge,
 developing Benchmarking methodologies to support value for money,
 providing Subject Matter Expertise on national decommissioning portfolios, and
 Advisors on Decommissioning Waste Management Plans for nuclear New Build
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7. July 2016

8. Decommissioning Costs and Financing
 Types of decommissioning
 Analysing the challenges of long-term provision of funding
 Evaluating the importance of estimating costs
 Identifying the future of finance for decommissioning projects
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9. Types of Decommissioning
July 2016

10. Types of decommissioning -
Immediate vs Deferred
 Immediate and deferred dismantling may be considered to present specific benefits
and disadvantages.
 National policies determine which approach is adopted and, for any selected
approach, adequate funding is required as well as;
 trained personnel
 regulatory oversight
 adequate waste storage and disposal facilities
 Regardless of the option selected it is vital that early and clear decisions are taken
about the timing of the closure of facilities and intended future use of the site.
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11. Immediate Decommissioning
Advantages Disadvantages
 availability of highly qualified workforce
and experience and knowledge on the
operational history of the specific facility
 easier radiological characterisation and
reduced effects of deterioration and ageing
 less risk of loss of knowledge and
corruption of records
 dilution of economic effects for the region
 earlier reuse of site
 responsibility for the decommissioning is
not transferred to future generations
 the motivation of personnel might be a
problem when demolishing a plant where
the workers will lose their jobs
 higher radiation exposure during
dismantling
 greater precautions needed during
dismantling
 larger volumes of decommissioning waste
classified as radioactive
July 2016 Page 11 of 25

12. Deferred Decommissioning
Advantages Disadvantages
 reduction of residual radioactivity due to
decay
 reduction of radiation hazard during
dismantling and reduction of volume of
radioactive waste
 possibility to wait for availability of disposal
routes for rad-waste or for expected
improvements in techniques (e.g. Robotics)
 possibility to co-ordinate the
decommissioning of different units in
multiple reactor sites
 time for decommissioning funds to grow or
to be additionally raised
 possibility to increase the size of the fund
though effective investments policies
 some materials or buildings, including
concrete and steel, may deteriorate
 costs for maintenance/disposition may
increase
 knowledge of operational history lost over
time
 new qualified staff required
 no foreseeable changes in boundary
conditions e.g. availability of waste disposal
routes or changes in the regulatory
framework
 leaves the burden to be borne by future
generations
 risk of losing fund value.
July 2016 Page 12 of 25

13. Challenges of long-term provision of funding
July 2016

14. Decommissioning funds - what they cover
 Preliminary decommissioning
planning
 Spent fuel management
 Site decommissioning and
restoration
 Waste management
 Long term storage / disposal of
waste materials
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15. Current vs future liabilities – who pays for what ?
State funding Operator funding
 UK existing legacy funded by
government
 UK New build funded by operators –
Funded Decommissioning Plan (FDP)
 Germany – ongoing dialogue
between Government & utilities
 Sweden – contributions to fund
 Finland – operators responsible
for all costs
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16. European position - revenue and investment
• Costs of decommissioning
generally paid for by
operators
• Influenced by factors such as;
• Electricity prices
• Subsides and taxes
• Political issues
• Final disposal costs
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17. Importance of Cost Estimating
July 2016

18. Key drivers for decommissioning cost estimates
• Decommissioning policy &
strategy.
• Regulatory involvement
• Dismantling techniques
• Waste management
• Oversight and management
costs (overheads)
• Management of Spent fuel
and operational waste
• Long term storage / disposal
of waste material
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• Uncertainty and contingency

19. Reactor shutdowns
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20. UK Nuclear Provision – previous 5 years
July 2016 Page 20 of 25

21. Estimating uncertainty application in Europe
Source - NEA (2016, p. 82). Costs of Decommissioning Nuclear Power Plants Paris: OECD
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22. Future of financing decommissioning
July 2016

23. UK Energy Act 2008 – Funded Decommissioning Plan
 Energy Act 2008 requires nuclear
operators have secure financing in place
to meet full Decom / waste costs
 The FDP must set out realistic, clearly
defined and achievable plans
 Decommissioning Waste Management
Plan (DWMP) the part of the FDP that
sets out and costs the steps involved in
decommissioning a Nuclear Power
Station.
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24. European - Funding Policy and Strategy
• Considerable variations between
countries in the details of funding
requirements.
• Need for planning, updating cost
estimates, collecting and securing the
funding and financial risks
management...
• Funding arrangements are vulnerable
to earlier than expected permanent
plant closures (e.g., political decisions,
or permanent market price declines),
• Practices vary widely among countries
Extract from The Financial Times : Guy Chazan Berlin 15th March‘16
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25. Contact Details
 Martyn Jenkins - Managing Director
 Email - martyn.jenkins@enkom.co.uk
 Website - www.enkom.co.uk
 Phone - 00 44 (0) 7968 756 695
Page 25 of 25July 2016