Shareholder Executive

United Kingdom Atomic Energy Authority (UKAEA)

Purpose

The main role of the United Kingdom Atomic Energy Authority (UKAEA) is the decommissioning and, where appropriate, regeneration of its nuclear sites and applying its expertise in competitive markets.

UKAEA also leads the UK programme on nuclear fusion R&D and hosts Europe's fusion R&D facility.

Legal Status and Ownership

The UKAEA is a non-departmental public body (NDPB) of BERR. It was incorporated as a statutory corporation under the Atomic Energy Act 1954.

Government's Objectives

• enabling an efficient, competitive market in UK nuclear clean-up
• a UKAEA restructured to include creation of a successful clean-up business capable of competing in the global market
• Site Licence Company structures licensed and fully established by 31 March 2008 with the necessary Site Management Company structure to manage these through to competition
• contribution to the UK and European Fusion research programmes
• development of the Harwell Science and Innovation Campus in support of Government's science and innovation agenda.

Financial Performance

£m	2008	2007	20061
Turnover	375	378	361
Operating Profit	7	14	0
Profit/(Loss) for the year	11	15	3
Net Cash flow	9	(67)	15
Net Operating Assets	87	126	55
RONA	8.0%	11.1%	0.0%
Shareholders' Funds	63	89	74
Dividends	-	-	-

¹ The 2006 figures are as restated for transfer of assets and liabilities to other organisations within the UK public sector under the Energy Act 2004.

Commentary

Turnover for the year amounted to £374.8m. The fee received from the NDA in relation to performance has been used to finance the ongoing restructuring of UKAEA and to fund certain costs outside the contract. This resulted in an operating profit of £7.3m (2006-07: £14.3m). The decrease in operating profit was due to greater restructuring expenditure funded from profit and a reduction in the fee earned from NDA. The retained profit for the year, after financing and tax, was £10.7m.

UKAEA delivered 98% of the 2007-08 clean-up programmes agreed with the NDA for Dounreay, Harwell, Winfrith and Windscale, including a significant tranche of additional work which the NDA requested UKAEA to undertake at Windscale. The work was delivered at 9% (over £20m) below estimated cost.

Highlights included the draining of all remaining sodium from the Prototype Fast Reactor at Dounreay; the first demolition of a Category 1 nuclear facility in Scotland (in the form of a former fuel fabrication plant at Dounreay); removal of the last isotopes from the Windscale Pile 2 reactor; the decommissioning and demolition of a major active handling building at Winfrith and of a radiochemical research facility at Harwell. Alongside this UKAEA achieved its best ever safety performance, continuing the trend of year on year improvement.

MAST (Culham's Fusion research platform) systems were improved during a planned engineering break to allow sustained heating of fusion plasmas. The Engineering and Physical Sciences Research Council awarded a new two year grant to Culham's programme, with indicative funding for the following four years.

The year saw fundamental changes in UKAEA's structure, to meet Government objectives for a competitive nuclear clean-up industry. Transfer Schemes were completed so that, from 1 April 2008, UKAEA Ltd was formed as a decommissioning services company to operate in the commercial market, while Dounreay Site Restoration Ltd became a separate Site Licence Company (SLC). Subject to regulatory approval, Harwell and Winfrith will become an SLC in 2008- 09. These SLCs are managed by UKAEA Ltd under contract to the NDA ahead of wider competition. Also from 1 April 2008, the Windscale site and most local UKAEA staff transferred to Sellafield Ltd.

At Harwell, UKAEA, together with the Science and Technology Facilities Council, are finalising a joint venture with a leading private sector developer, to deliver the Government's ambitious vision for the campus as an internationally competitive exemplar of science, technology and innovation.