nuclear-news

The News That Matters about the Nuclear Industry Fukushima Chernobyl Mayak Three Mile Island Atomic Testing Radiation Isotope

  What is Regulatory Asset Base and how will it affect future energy charges for Scots?

THE UK Government is set on using a Regulatory Asset Base (RAB) model to fund
nuclear projects south of the Border. This will directly result in Scots
paying more on their energy bills. Here, former Scottish Office chief
statistician Jim Cuthbert explains what an RAB model is, and the problems
behind it. There are two main problems.

First, the construction phase of
nuclear projects is extremely long. Further, nuclear construction is
notoriously beset by technical difficulties. Midway through a nuclear
construction project, it will be extremely difficult for the regulator to
resist pressure for the RAB base to be inflated to overcome any technical
problems or uncertainties.

Secondly, the operating life of nuclear projects
is again very long, with the UK Government’s current working assumption
being about 60 years. This means that any surplus which is built into the
stream of future RAB payments will be available to be capitalised over this
long period – which will greatly increase the potential windfall profits
to be extracted by the original equity investors.

 The National 23rd Oct 2022

https://www.thenational.scot/politics/23071054.rab-will-affect-future-energy-charges-scots/

Advertisement

October 23, 2022 - Posted by | business and costs, politics, UK

No comments yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: