British Energy plc (BE) is the only privately owned nuclear generator in the UK. It owns and operates 8 nuclear power stations,
with a combined capacity of 9,600 megawatts, and 1 coal fired power station generating almost 2,000 megawatts. BE produces
around one fifth of the UK's electricity.
Following a sudden deterioration in its financial situation, the private sector nuclear electricity generator, BE approached
the Government in early September 2002 seeking immediate financial support and discussions about longer term restructuring.
Government provided BE with a short-term credit facility of up to £650m rescue aid, approved by the European Commission, which
has been fully repaid.
A solvent restructuring plan was put in place and agreed with creditors. Government played its part by:
- Taking responsibility for BE's historic nuclear fuel liabilities managed by BNFL at an average cost of £100-200m pa for the
next 10 years, falling thereafter.
- Underwriting the Nuclear Liabilities Fund Limited (NLF), a subsidiary of the DTI which will meet British Energy's costs of
decommissioning and other uncontracted nuclear liabilities, in the event that its assets fall short of those liabilities.
The restructuring of BE was completed in early 2005. BE has undertaken to make certain payments into the NLF. These include
payments which give the NLF a majority economic interest in BE. At the direction of the Secretary of State, the NLF may convert
this economic interest, in whole or in part, into shares in BE.
In July 2006 Alistair Darling, the Secretary of State for Trade & Industry, said in a written statement to Parliament: "The
Chancellor stated in his Budget 2006 announcement that the Government would be prepared to consider selling part of their
stake in British Energy. I confirm that the Government will actively consider a sale of part of their stake in British Energy
via a capital markets transaction." Consideration will need to be given to the interests of the taxpayer, the company and
other stakeholders before any transaction is progressed.
The main objectives for the Government have been and continue to be nuclear safety and security of supply.
Further information on BE can be found on their website (see 'External Links').
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