Nuclear RAB industry code and licence modifications

Overview

The Nuclear Energy (Financing) Act 2022 (“the Act”) makes provision for the implementation of a Regulated Asset Base (RAB) funding model to finance new nuclear energy generation projects. The Nuclear Regulated Asset Base Model (Revenue Collection) Regulations 2023 (“the Regulations”) made under the powers in Part 2 of the Act, set out the detailed mechanics of how the revenue stream would operate under the model.

Section 29(1) of the Act gives the Secretary of State powers to make modifications to Transmission and Distribution Licences, and the industry codes maintained in accordance with these licences so that the revenue stream can function as intended.

In this consultation we are seeking views on the proposed modifications. The modifications proposed in the consultation are to the Balancing and Settlement Code (“BSC”). They seek to:

• Establish EMR Settlement Limited (EMRS) as the Settlement Services Provider to carry out nuclear RAB settlement functions (for example, calculate and settle Supplier payments) on behalf of the Revenue Collection Counterparty -  the Low Carbon Contracts Company (LCCC).
• Ensure EMRS, and the Revenue Collection Counterparty receive the BSC data that they need to carry out their functions.

Before making modifications using the powers in section 29(1) of the Act, the Secretary of State is required to consult with the persons named in section 29(4), these are:

• Scottish Ministers
• Welsh Ministers
• holders of any licence being modified
• electricity suppliers
• Ofgem

The Act also makes provision for the Secretary of State to consult any other persons it considers appropriate. Therefore, holders of Transmission and Distribution Licences, industry code administrators, LCCC, EMRS, BSC parties and the BSC Panel are also being consulted as the proposed modifications would be most relevant to them.

Although only the above bodies are being consulted, we have made this document available to aid transparency around the modification process.

Find the consultation document and draft proposals on GOV.UK.