Commission Recommendation of 24 October 2006 on the management of financial resources for the decommissioning of nuclear installations, spent fuel and radioactive waste
Date: 2006-10-24
Institutions: European Commission
Subjects: decommissioning of power stations, management, nuclear fuel, nuclear power station, nuclear safety, private-sector liquidity, radioactive waste

28.11.2006

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Official Journal of the European Union

L 330/31

COMMISSION

COMMISSION RECOMMENDATION

of 24 October 2006

on the management of financial resources for the decommissioning of nuclear installations, spent
fuel and radioactive waste

(2006/851/Euratom)

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Atomic
Energy Community, and in particular Article 124 thereof,

Whereas:

(1)

(2)

(3)

(4)

(5)

The preamble to the Treaty recognises that the Member
States are anxious to create the conditions of safety
necessary to eliminate hazards to the life and health of
the public.

in
Article 2(b) of the Treaty calls on the Community,
particular,
to
to establish uniform safety standards
protect the health of workers and the general public
and ensure that they are applied.

Chapter III of
the Treaty lays down basic standards
allowing the Community to ensure the protection of
the health and safety of workers and the general public
against the dangers arising from ionising radiation.

Council Directive 96/29/Euratom lays down basic safety
standards for the protection of the health of workers and
the general public against
the dangers arising from
ionising radiation (1).

Council Directive 85/337/EEC of 27 June 1985 on the
assessment of the effects of certain public and private
projects on the environment (2), calls on the Member
States to ‘adopt all measures necessary to ensure that,
before consent is given, projects likely to have significant
effects on the environment by virtue, inter alia, of their
nature,
to an
location are made
assessment with regard to their effects.’

size or

subject

(6)

(7)

(8)

(9)

(10)

Ionising radiation from radioactive materials can have
consequences beyond the service life of nuclear instal-
lations and beyond national frontiers.

The safety of workers and of the general public against
those risks is of paramount importance to the European
Communities. High safety standards should therefore be
observed to guarantee that
these risks are addressed
during and beyond the service life of nuclear installations.

and

European

Parliament,

the Council

the
The
‘the need for Member
Commission have underlined (3)
States to ensure that adequate financial resources for
activities,
decommissioning
which are audited in Member States,
are actually
available for the purpose for which they have been estab-
lished and are managed in a transparent way,
thus
avoiding obstacles to fair competition in the energy
market’.

and waste management

and waste management

The Commission has also noted ‘the importance of
the purpose of
ensuring that
funds established for
decommissioning
activities,
which relate to the objectives of the Euratom Treaty,
are managed in a transparent way, and used only for
the said purpose. In this context, it intends, within the
scope of
its responsibilities of the Euratom Treaty to
publish an annual report on the use of decommissioning
and waste management
It shall pay particular
funds.
attention to ensuring the full application of the relevant
provisions of Community law’ (4).

In its Communication to the European Parliament and
the Council (5),
the Commission noted the need for
harmonisation in the
increased
management
The
resources.
Commission has also expressed its intention to present
a recommendation in 2005.

transparency
of

financial

these

and

(1) OJ L 159, 29.6.1996, p. 1.
(2) OJ L 175, 5.7.1985, p. 40. Directive as last amended by Directive
2003/35/EC of the European Parliament and the Council (OJ L 156,
25.6.2003, p. 17).

(3) Interinstitutional statement of OJ L 176, 15.7.2003, p. 56.
(4) Commission statement of OJ L 176, 15.7.2003, p. 56.
(5) COM(2004) 719, Report on the use of financial resources earmarked
for the decommissioning of nuclear power plants, 26.10.2004.

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(11) Decommissioning operations themselves can also pose
potential risks to public health and the environment,
particularly if the measures necessary to deal with the
radiological
risks of decommissioning operations are
not taken in time.

(12)

In order to address all these risks, safe decommissioning
of nuclear installations, including long-term management
of radioactive waste and spent fuel, should be ensured.

(13)

(14)

(15)

fuel,

calls

Safe decommissioning of nuclear installations, including
radioactive waste and
the long-term management of
spent nuclear
financial
for
resources. A lack of these resources at the time they
are needed may adversely affect the decommissioning
process. Sufficient financial resources at the appropriate
time should be available to allow complete decommis-
sioning at nuclear installations in conformity with safety
standards.

substantial

In accordance with the polluter-pays principle, nuclear
operators should set aside adequate financial resources
for
the
future decommissioning
productive life of those installations.

costs during

the

In the context of the specificities of the accession nego-
tiations, the issue of early shutdown of nuclear power
reactors deemed not to be economically upgradeable was
addressed. Accordingly, the Community has, on its own
initiative, taken part in the raising of financial resources
to certain
and provides
conditions,
in
certain new Member States.

to various decommissioning projects

economic support,

subject

that

‘each Contracting Party shall

(16) Article 26 of the Joint Convention on the Safety of Spent
Fuel Management and on the Safety of Radioactive Waste
Management, which entered into force on 18 June 2001,
specifies
take the
appropriate steps to ensure the safety of decommis-
sioning of a nuclear facility. Such steps should ensure,
inter alia,
that qualified staff and adequate financial
resources are available.’ Article 22(ii) of the Convention
calls on each Contracting Party to take the appropriate
‘adequate financial resources are
steps to ensure that
facilities for spent
the safety of
available to support
fuel and radioactive waste management during their
operating lifetime and for decommissioning.’

(17) Article 2(c) of the Treaty calls on the Community to
facilitate investment and ensure the establishment of
the basic installations necessary for the development of
nuclear energy in the Community. The development of

such investments or

such energy cannot be dissociated from the process of
the decommissioning of
instal-
lations. Article 41 of
the Treaty requires investment
projects relating to nuclear energy to be communicated
to the Commission for examination. Council Regulation
(Euratom) No 2587/1999 of 2 December 1999 defining
the investment projects to be communicated to the
the
Commission in accordance with Article 41 of
Treaty
Energy
Community (1)
includes decommissioning activities as
investment projects
communicated to and
discussed with the Commission. Consequently, persons
and undertakings (2) should inform the Commission of
decommissioning funding arrangements in respect of
newly built nuclear installations.

European Atomic

establishing

to be

the

(18)

(19)

(20)

financial

resources when needed
Ensuring sufficient
requires a sound and prudent analysis of both the
sources for such financing and the costs linked to the
decommissioning of such installations. The method of
funding for decommis-
determining the amounts of
technological aspects
sioning has to take account of
and nuclear safety constraints.

importance;

In order to ensure the availability of resources when
needed for the purposes of decommissioning nuclear
installations, transparent management with appropriate
external supervision of such financial resources is of
paramount
this will also help to avoid
obstacles to fair competition in the energy market.
Various appropriate management possibilities could be
in place in order to ensure such objectives. A dedicated
national body should be put in place so as to provide an
expert
concerning fund management and
decommissioning cost matters.

judgment

In this

context, State

This Recommendation does not create derogations from
State aid rules.
intervention
concerns issues covered by the Treaty establishing the
European Atomic Energy Community and therefore has
to be assessed accordingly. However, to the extent that it
is not necessary for or goes beyond the objectives of this
Treaty or distorts or threatens to distort competition in
the internal market, it has to be assessed under the Treaty
establishing the European Community.

(21)

The manner
resources are
in which these financial
invested should be carefully addressed so as to avoid
any possible misuse. The investments should be long-
term and have a secure risk profile, while at the same
time providing adequate protection of the real value of
the funds.

(1) OJ L 315, 9.12.1999, p. 1.
(2) Persons and undertakings engaged in industrial activities listed in

Annex II to the Euratom Treaty.

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(22) With a view to ensuring safety, the gathering of appro-
priate resources to guarantee the decommissioning of
nuclear
the
should take
specific circumstances of certain installations.

into account

installations

(23)

Experience shows that exchange of information between
national experts concerning the various approaches to
and financial arrangements for decommissioning and
waste management is an excellent way of facilitating a
common response to safety challenges. In an effort to
increase cooperation between the Commission and the
Member States, the Commission therefore announces its
intention to establish a permanent group on decommis-
sioning funding. The Commission should be assisted by
this Decommissioning Funding Group in its proceedings
in the context of this Recommendation.

(24) Without prejudice to the general principle of subsidiarity,
a certain degree of harmonisation should be suggested
with regard to the concepts used in decommissioning
matters. Such harmonisation should be progressed
through the Decommissioning Funding Group where
commonly agreed interpretations of
this Recommen-
dation should be reached for its practical implementation
and in particular with a view to harmonisation of meth-
calculation of decommissioning
odologies
activities.

cost

for

(25)

installations,

The Joint Research Centre, set up on the basis of Article
8 of the Treaty, carries out research programmes in the
nuclear field, which may involve ionising risks after the
life service of its installations. To guarantee the safety of
the Commission should ensure
those
this Centre with the recommendations
compliance of
contained herein. In particular, the Commission should
the
verify the adequacy of
for
purposes of decommissioning the installations of
the
Centre. The Commission departments responsible for
nuclear and budgetary matters are the best placed to
carry out such tasks,

financing resources

HEREBY RECOMMENDS:

SECTION 1

AIM

In view of the safety objectives of the Treaty, this Recommen-
dation proposes measures to ensure that adequate financial
resources are available at the scheduled time for all decommis-
sioning
the
management of spent fuel and radioactive waste.

of nuclear

installations

activities

and

for

(a) ‘decommissioning’

shall mean all activities

covering the
technical decommissioning of
installation
(decontamination, dismantling and demolition) and waste
management
radioactive
(management and disposal of
waste and spent fuel) leading to the release of the nuclear
installations from radiological restrictions;

the nuclear

(b) ‘decommissioning fund’ shall mean any type of

resources intended specifically to cover
necessary for decommissioning nuclear installations;

financial
the expenditure

(c) ‘external decommissioning fund’ shall mean a decommissioning
in its

fund managed by a dedicated body independent
decisions from the contributors to the fund;

(d) ‘internal decommissioning fund’ shall mean a decommissioning

fund managed by the operator;

(e) ‘segregated decommissioning fund’ shall mean a decommis-
sioning fund either internal or external, which is identified
separately;

(f) ‘operator’ shall mean the legal person who operates the
nuclear installation and has the prime responsibility for
nuclear safety;

(g) ‘nuclear installation’ shall mean any civilian facility and its
land, buildings
in which radioactive
materials are produced, processed, used, handled, stored or
disposed.

and equipment

SECTION 3

DECOMMISSIONING OF NUCLEAR INSTALLATIONS

1. All nuclear installations should be decommissioned after
shutdown and the management of waste

permanent
should be properly addressed.

2. Decommissioning activities should be carried out without
undue risk to the health and safety of workers and the
general public.

should be

3. The polluter pays principle

fully applied
throughout the decommissioning of nuclear installations.
In this regard, the primary concern of nuclear operators
should be to ensure the availability of adequate financial
resources
safe decommissioning by the time the
respective nuclear installation is permanently shut down.

for

SECTION 2

DEFINITIONS

For the purpose of this Recommendation, the following defi-
nitions shall apply:

4. The financial

resources available should be aimed at
from
the installation to waste

covering all aspects of decommissioning activities,
technical decommissioning of
management.

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Official Journal of the European Union

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SECTION 4

SECTION 6

INSTITUTIONAL AND PROCEDURAL ASPECTS

ESTIMATION OF DECOMMISSIONING COSTS

5. Without prejudice to the provisions of Article 41 of the
Treaty and the Regulations in force with regards to its
implementation (1), persons
should
report on the planned decommissioning funding regime
in the context of
the procedure provided for under
Article 41 of the Treaty concerning the construction of
new nuclear installations.

undertakings

and

In the review of the proposed decommissioning funding
regime the Commission will — subject to the requirements
of Article 44 of the Treaty — consult the Decommissioning
Funding Group.

6. Where not already provided for, Member States should set
up or appoint a national body capable of providing an
expert
judgment on fund management and decommis-
sioning cost matters. This body should be independent as
regards the contributors to the fund.

The national body should annually review the financial
least every five
resources gathered and periodically, at
years, the decommissioning cost estimates. Any shortfall
between cost estimates and resources gathered should be
addressed in good time.

Member States should report annually on the conclusions
of the proceedings of the relevant national body mentioned
above to the Commission.

SECTION 5

DECOMMISSIONING FUNDS

7. Nuclear installations should set up adequate decommis-
sioning funds on the basis of the revenues obtained from
their nuclear activities during the designed lifetime.

8. A segregated fund with appropriate control on prudent use
should be the preferred option for all nuclear installations.
The review of
the national body provided for in this
Recommendation should play a key role in ensuring
proper management and use of the funds.

9. New nuclear installations should set up segregated decom-
missioning funds with appropriate control on prudent use.

(1) Council Regulation (Euratom) No 2587/1999 of 2 December 1999
defining the investment projects
to be communicated to the
Commission in accordance with Article 41 of the Treaty establishing
the European Atomic Energy Community (OJ L 315, 9.12.1999,
p. 1) and Commission Regulation (Euratom) No 1352/2003 of 23
July 2003 amending Regulation (EC) No 1209/2000 determining
procedures
for effecting the communications prescribed under
Article 41 of the Treaty establishing the European Atomic Energy
Community (OJ L 192, 31.7.2003, p. 15).

10. In view of the differences in the use of the decommis-
sioning funds gathered, technical decommissioning of the
installation, on the one hand, and waste management, on
the other, should be addressed separately, on the basis of
separate cost calculations.

cost

11. In order to ensure that adequate financial resources are
available,
should be based upon a
prudent choice from the realistically available alternatives
and subject to the external supervision and agreement of
the national body foreseen in this Recommendation.

calculations

12. All cost estimates should be site-specific and based upon

best available estimates.

13. If during implementation the decommissioning project
proves to be more expensive than the approved cost
additional
estimates,
expenses. This
addressed
should the operator change during or beyond the lifetime
of the nuclear installation.

the
carefully

should cover

the operator

should be

aspect

14. Due attention should be paid to cases arising for historical
reasons where a special solution is the most appropriate.
This case-by-case approach should be transparent and with
the full involvement of the national body provided for in
this Recommendation.

SECTION 7

USE OF DECOMMISSIONING FUNDS

15. Financial resources should be used only for the purpose for
which they have been established and managed.
In this
context, due consideration should be given to transparency.
All commercially non-sensitive information should be
publicly available.

16. A secure risk profile should be sought in the investment of
the assets, ensuring that a positive return is achieved over
any given period of time.

17. As

financial
the operator has no influence on the
the
management of an external decommissioning fund,
value of
the investments should be guaranteed by the
State in order to ensure that adequate funds are available
when required, even if a nominal
loss is made by the
the invested amounts by the
independent manager of
time these financial resources are to be used.
In such
cases,
the funds should not be supplemented with an
amount higher than the loss in the investment.

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18. If the management of an internal fund underperforms, the
operator should be responsible for ensuring that adequate
funds are available when needed.

absence of such a national body, Member States may
request the Commission to provide advice concerning the
measures to be taken.

19. In the case of nuclear installations whose main purpose is
other than the sale of products or services, decommis-
sioning should be properly planned and budgeted so as
to allow adequate funding to be available for the safe
and timely decommissioning of such installations.

20. Budgetary planning should be subject to the review of the
national body provided for in this Recommendation. In the

Done at Brussels, 24 October 2006.

For the Commission

Andris PIEBALGS
Member of the Commission