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Major uncertainties in financing of nuclear waste management

The Swedish National Audit Office audit shows that it is not certain whether the fees paid by the nuclear power industry for future management of nuclear waste will be sufficient – or whether taxpayers will have to share the bill.

Tunnels for final disposal of nuclear waste.

Audit background

Up to now the costs in Sweden for dismantling, research and management of nuclear waste and spent nuclear fuel have amounted to about SEK 43 billion. In 2016 Svensk Kärnbränslehantering AB (SKB) estimated the remaining costs to be about SEK 106 billion. The Nuclear Waste Fund currently holds capital of about SEK 65 billion and the financial guarantees issued in the period 2015–2017 total about SEK 30 billion. The financing system thus covers large costs and according to the preparatory work that led to the legislation, the risks of the State having to pay for management of spent nuclear fuel and nuclear waste must as far as possible be minimised.

The central government financing system for management of nuclear waste must cover costs for decommissioning and waste management until the 2080s, according to SKB’s timeframe. The system is based on the licence-holders paying in nuclear waste fees to the Nuclear Waste Fund. The licence-holders must also issue financial guarantees for approved fees decided that have not yet been paid in (funding amount) and for unplanned events (supplementary amount). Decisions on the size of nuclear waste fees and guarantees are based on the cost estimates that the licence-holders must present.

Svensk Kärnbränslehantering AB is jointly owned by the licence-holders that are the reactor owners and every third year it draws up cost estimates on their behalf. The calculations are examined by the Swedish Radiation Safety Authority, which makes proposals to the Government on the size of fees and guarantees for one three-year period at a time. The Government then determines fees and guarantees for the reactor owners. The Swedish Radiation Safety Authority determines fees and guarantees for other licence-holders liable to pay fees based on their submitted cost estimates. The National Debt Office examines the guarantees to be issued and approves guarantees for other licence-holders. The reactor owners' guarantees are approved by the Government after a statement by the National Debt Office. The difference between estimated future costs and the funds committed to date in the Nuclear Waste Fund are to be covered partly by the continued fees from the licence-holders to the Fund and partly by return on the assets in the fund. The licence-holders are entitled to receive compensation from the Fund for some specific costs.

The three-year periods of the financing system are to ensure that the system is predictable and robust, in that changes in estimated costs and revenues are identified every third year and the system is then balanced by means of decisions on fee levels and financial guarantees for the subsequent period. The fee decisions are to be based on well-founded estimates of future costs and expected electricity production.

Press contact: Olle Castelius, phone: +46 8-5171 40 04.

Presskontakt: , telefon: 08-5171 42 06.

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Updated: 28 March 2018

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