A new authority to take on the liabilities of British Nuclear Fuels will be proposed by the British government tomorrow in a move industry experts view as a first step towards selling off the state-run operator.
A government source said Energy Minister Mr Brian Wilson will publish a written parliamentary answer proposing a Liabilities Management Authority to assume the £35 billion (€56 billion) liabilities of BNFL.
The body is expected to tackle a backlog of nuclear waste and absorb the cost of decommissioning old plants.
“What we are announcing is the setting up of a strategic body to take on the liabilities,” the source said. “It's been in the pipeline for a long time.“
Analysts and critics of the scheme said the move could make a second wave of nuclear privatisation more attractive to investors by ring-fencing the liabilities in the public sector.
BNFL's 11 Magnox plants were mainly built in the 1950s and 1960s. Due to their age and high running costs they were kept in state hands along with BNFL's fuel reprocessing arm when the rest of Britain's nuclear industry was sold to private investors in 1996 as British Energy Plc.
Four have been closed, along with the only two that were built outside Britain. Magnox stations use reactor rods of pure uranium metal, while most types of modern nuclear power station use uranium oxide and produce more electricity per plant.
Two years ago, the British government said BNFL's poor safety record meant plans for a partial privatisation could not be pursued until late 2002 at the earliest and may not happen at all.
Nuclear fuel is being returned to BNFL from Japan after a scandal in 1999, when Kansai Electric Power Co discovered BNFL had falsified data on the fuel it had shipped to the company.
BNFL has also faced several legal challenges over its planned nuclear fuel manufacturing plant at Sellafield in north-west England.
The Government, Environmental groups Grenpeace and Friends of the Earth have all tried and failed to block the plant from opening via the courts.
A serparate legal action by the Government is ongoing.
PA