Nuclear Energy Generation Projects: Regulated Asset Base Model
The RAB model for nuclear energy generation projects would give an eligible nuclear company the right to a regulated revenue stream throughout the design, construction, commissioning and operations phase of a new nuclear project. This will be funded by a charge placed on electricity suppliers, with the expectation that this will ultimately come from consumers through their electricity bills.
	The Act allows for the Secretary of State to designate a nuclear company that is eligible to receive the benefit of the RAB special licence conditions. They can do so only if the company meets the criteria for designation and having undertaken consultation with named persons.
	Once the Secretary of State has served and published a notice to designate a nuclear company, they have the power to amend that company’s existing electricity generation licence accordingly. This allows the Secretary of State to insert the special conditions to implement the RAB model for the company and set out how the Project will be regulated and its allowed revenue calculated. Amendments may also be made to the licence terms.
	The designation of a nuclear company ceases to have effect either when the company enters into a revenue collection contract to receive payments in relation to its allowed revenue (provided this occurs before the expiry date), 5 years from the date of the designation notice (subject to any extensions by the Secretary of State), or if the designation notice is revoked or lapses in accordance with conditions attached to it. The Secretary of State is required to consult named persons before making modifications to a nuclear company’s licence whilst the designation is in effect. Once a company has its licence modified to provide for the RAB model, and it has entered into a revenue collection contract, the Secretary of State is only able to modify its licence in very limited, specific circumstances.
	As the current electricity regulator for Great Britain, the Authority will regulate the nuclear company in accordance with the terms and conditions of its modified licence. The Authority will do so in keeping with its existing statutory duties including its principal objective of protecting the interests of existing and future electricity consumers.
	The Secretary of State can use their power to designate and then modify the licences of multiple nuclear companies to benefit from a nuclear RAB model, provided that in each case the designation criteria and procedural requirements are met.