Greenpeace today condemned the European Competition Commission for allowing billions of pounds of taxpayers money in state aid for the restructuring of the private nuclear company, British Energy (BE). The company applied for state aid in 2002, when it almost went bankrupt following a fall in electricity prices.
The commission decision allows for 4-5 billion pounds to be given to British Energy to cover its reactor decommissioning and nuclear waste liabilities. When BE was privatised in 1996 it was meant to set up a fund to cover liabilities but failed to properly fund it.
Greenpeace nuclear campaigner Jean McSorley said: "It is scandalous that the commission has allowed subsidies to British Energy. Although the commission has set some conditions, such as limiting British Energy's nuclear generating activities, these do nothing to compensate for the fact that billions of pounds of taxpayers money will be squandered on an unsafe energy system which not capable of making itself viable without a massive financial prop. This decision will open the floodgates for other European governments to give state aid to their nuclear sectors."
McSorley added: "Every pound that goes on nuclear power is a pound that could have gone to renewable energy or energy efficiency. This will significantly impact on the government's aim to have 20% of the UK's electricity from renewables by 2020. The decision to allow state aid funding to cover British Energy's liabilities also contradicts the UK government's claims that a privatised nuclear industry can pay its own way and effectively compete in the UK and Europe."
Because the commission's decision has not been published in full it is not clear exactly how the decision will impact on the subsidised contracts between British Energy and state-owned British Nuclear Fuels, but it looks as though these will be fully funded also. Greenpeace legal advisors will be reading the decision and advising whether there are grounds to challenge it.
NB Notes to editors
1. November 2002: Greenpeace won permission to challenge the government for failing to get EC approval before it gave British Energy rescue aid. The commission subsequently agreed that the government's payment had been unlawful and insisted that the government had to get commission approval for the BE restructuring plan.
2. July 2003: the government and BE fail to get commission approval for restructuring plan. The commission's preliminary decision is that the restructuring plan is unlawful and they open it for investigation. Greenpeace commissioned leading EC competition law expert, Paul Lasok QC, for its formal submission to the commission. Greenpeace agrees that the restructuring would be unlawful, not only for the reasons given by the commission but also because the deal involved help from BNFL which would also count as state aid. The Greenpeace submission to the Commission
3. February 2004: Greenpeace presented evidence to the EC on the costs of the BE-BNFL reprocessing contracts from leading nuclear and energy economist Gordon McKerron.
4. April 2004: Greenpeace presented a legal opinion to the EC on the potential unlawfulness of the legislation covering the Nuclear Decommissioning Authority. The opinion focussed on the potential for the NDA to give state aid to BE in addition to the £3.5bn for decommissioning and radioactive waste proposed in the restructuring package.
For more information please contact the Greenpeace Press Office on 0207 865 8255.
