NDA stayed within budget in 2016/17

24 July 2017

The latest annual report from the UK National Decommissioning Authority (NDA), published on 19 July, says that the organisation stayed within its allocated budget despite the additional financial burden of around £100m ($130m) “in legal and settlement costs arising from the litigation over the placing of the Magnox contract”.  The NDA was established in 2004 to ensure the safe and efficient clean-up of the UK’s nuclear legacy.

The litigation arose from a procurement process run by the NDA in 2012 that resulted in a £6.1bn, 14-year management and decommissioning contract being awarded in 2014 to the Cavendish Fluor Partnership (a joint venture between the UK-based Cavendish Nuclear, a subsidiary of Babcock International, and the US company Fluor Inc). The contract related to 12 redundant Magnox nuclear sites and was challenged by US-headquartered engineering companies Energy Solutions and Bechtel, which lost out in the tender. The Department for Business, Energy and Industrial Strategy settled the case paying for £85m and £12.5m to the companies respectively, and the government announced a public inquiry into the procurement.

The report said the total NDA spend was £3.2bn in 2016/17, with £2.2bn coming from government and £1bn through commercial revenue. Running costs remained below £40m, or approximately 1.2% of the overall budget. Sellafield accounted for 60% of the spending. The report said: “The NDA’s decision to make Sellafield Ltd an NDA subsidiary is helping the site to focus on providing better value for money,” with savings of more than £200m in 2016/17.  The change is also enabled work “to be prioritised on cleanup rather than commercial incentives”.

In his summary, David Peattie, CEO and Accounting Officer stressed the importance of safety and said he was “disappointed" to see a number of incidents in the estate last year. (An incident occured at a fuel reporcessing facility in January)

He added, “I am working with the sites to understand and resolve any issues to ensure the dip in our strong safety record is short-lived. We will continue to build an excellent safety culture and will not tolerate anything less.”

A milestone in the Sellafield cleanup was achieved in March when the Office for Nuclear Regulation (ONR) approved the cutting of six access holes in the Pile Fuel Cladding Silo. “This is a huge step forward in preparing to retrieve waste from one of the site’s most hazardous facilities.” The report said the primary focus at Sellafield over the next two years “will increasingly be cleanup and decommissioning, as the site moves nearer to the planned end of reprocessing”. Excellent operational performance levels at the THORP and Magnox Reprocessing plants last year “mean that they are on track to close in 2018 and 2020 respectively, as set out in the NDA Strategy”.

In Scotland, the 10-year programme at the Dounreay Fast Reactor, has concluded. Toxic sodium potassium (NaK) alloy used to cool the reactor has been successfully destroyed. The last of the higher activity liquid, generated by reprocessing the reactor fuel, has been grouted into drums for safe long-term storage.

As to the 12 Magnox sites, “excellent progress in delivering the NDA Strategy is being made”. The NDA is on track to complete all near-term decommissioning at Bradwell, enabling it to become the first site to enter a phase of ‘Care and Maintenance’ (C&M) in 2019. Only two Magnox plants are now left to defuel.

The year also saw the opening of Nucleus, near Dounreay, as a single secure location for historical records. “Tens of thousands of plans, photographs and other materials from across our sites will eventually be housed in this facility.”

Peattie said he was impressed by the deep level of commitment and by the professionalism of NDA staff. However, he identified some key areas for action: simplifying processes, encouraging innovation, developing talent and harnessing motivation. “Simply put, I am working towards a simpler, more focused, more disciplined and standardised NDA. I also plan to improve the way we measure, report and deliver performance across the estate."


Photo: Most of the NDA's spending in 2016/17 was on Sellafield (site photo from 2008)



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