Nuclear Safeguards (Fissionable Material and Relevant International Agreements) (EU Exit) (Amendment) Regulations 2021

This concerns primarily the role and responsibility of the UK’s nuclear regulator, the Office for Nuclear Regulation. One of the Office for Nuclear Regulation’s statutory purposes is to ensure that the UK complies with relevant international agreements. These regulations ensure the protocol is captured as such an agreement. Failure to pass this statutory instrument would therefore mean that the Office for Nuclear Regulation’s role would not include any reference to what has been agreed in the protocol, leaving the UK at risk of breaching this agreement. That, clearly, is not acceptable.

The second change effected by this statutory instrument is the inclusion of the protocol under the definition of “specified international agreement” for the purposes of the Nuclear Safeguards (EU Exit) Regulations 2019. This is achieved by extending the requirement in the Nuclear Safeguards (EU Exit) Regulations 2019 for operators to provide information to the Secretary of State relating to qualifying nuclear material or other relevant items in respect of the protocol.

For the purposes of the Energy Act 2013 and the Nuclear Safeguards (EU Exit) Regulations 2019, the Office for Nuclear Regulation and operators are currently required to fulfil certain reporting obligations relating to the UK-Japan nuclear co-operation agreement. Operators are therefore already required to provide information on nuclear material to the Office for Nuclear Regulation, and information on non-nuclear material and equipment to the Department for Business, Energy and Industrial Strategy. As a result, there are existing reporting mechanisms that will allow them to meet the additional obligations detailed in these regulations, specifically on information. We therefore expect the administration costs associated with implementing new requirements under the protocol to be very low.

There is a statutory requirement to consult the Office for Nuclear Regulation and others that the Government consider appropriate on these regulations. The Government have therefore worked closely with the Office for Nuclear Regulation and the civil nuclear industry to implement the new domestic safeguards regime and to ensure that the appropriate mechanisms are in place to implement obligations contained in international nuclear agreements such as this protocol. It has been of utmost importance to ensure that their interests and concerns were reflected throughout the policy process.

Moving forwards, we will continue to work closely with the Office for Nuclear Regulation and to engage regularly with the civil nuclear industry, highlighting the guidance available and addressing any questions and concerns. The Government have also engaged with the Business, Energy and Industrial Strategy Committee, the Lords EU Environment Sub-Committee, and the Lords EU International Agreements Sub-Committee, informing them of the protocol and the changes it makes.

The territorial extent and application of the statutory instrument is England and Wales, Scotland and Northern Ireland. The Government have shared it with our colleagues in the devolved Administrations so that they are aware of the obligations it creates.

I conclude by emphasising that I see the measures contained in these regulations as important but uncontroversial, since they will ensure that the United Kingdom can comply with the provisions of the protocol to the UK-Japan nuclear co-operation agreement. I hope that noble Lords will support these measures.

As the Minister is aware, Wylfa is perhaps the best available site for a nuclear power station in the country, if not in Europe. Is she also aware that Hitachi waited some 18 months after its decision to suspend the project before cancelling it, and that if the Government had come forward with additional financial support and a committed operator within that time, the project might have been rescued as a tripartite UK-Japan-US project? Would that not also have sent a very positive message about our trade and investment relationship with Japan, coming hard on the heels of the signing of the CEPA, and provided strong support for our tilt towards the Indo-Pacific, so important for the success of global Britain?

Does the Minister also agree that it is important that, where possible, major investors in our nuclear energy projects should be from countries whose security and defence interests are aligned with our own? What steps are the Government taking to revive the Horizon project? Does she agree that it is in our interests for them also to support other UK-Japan nuclear projects such as that on which Penultimate Power is collaborating with the JAEA to commercialise its high-temperature gas-cooled reactor technology in this country?

Both noble Lords mentioned the Wylfa project. We recognise that Hitachi’s decision to pull out of the proposed project at Wylfa and wind up Horizon Nuclear Power was disappointing for local communities, and personally for me as the spokesperson for Wales. Ultimately, though, these were commercial decisions, and the future of the site is a matter for Hitachi. However, as my noble friend Lord Trenchard rightly pointed out, the energy White Paper is clear that nuclear remains an important part of the UK’s energy mix. We have committed to at least one more 1 gigawatt power plant and we will continue to discuss new projects with other viable companies and investors wishing to develop sites, including the one in north Wales. The civil nuclear sector continues to be of key strategic importance to the UK and we welcome foreign investment in our infrastructure, subject to thorough scrutiny and the need to satisfy our robust legal, regulatory and national security requirements. I point my noble friend to the National Security and Investment Bill that is going through the House this week.

In relation to the question on high-temperature gas-cooled reactors, in 2019 the UK and Japan signed a memorandum of co-operation on energy innovation. This is the beginning of discussions on what the UK-Japan collaboration on advanced nuclear might look like. The joint NNL and JAEA report was published in October 2020 to provide a technical basis to establish and agree the next phase of collaboration, which will be welcome.

In response to my noble friend Lady McIntosh of Pickering, I will say that the UK Government are considering NCAs with other countries. We cannot comment on any ongoing negotiations, but we are of course keen to put in place NCAs with any country where such an agreement would be mutually beneficial. All the NCAs that the UK has in place are operable and we review them regularly.

With reference to the change in the UK’s overall weapons stockpile, the UK Government have consistently stated that we will both keep our nuclear posture under constant review, in light of the international security environment and the actions of potential adversaries, and maintain the minimum destructive power needed to guarantee that the UK’s nuclear deterrent remains credible and effective against the range of state nuclear threats from any direction. We regret that the security environment has necessitated this change, but we must recognise that the security situation has worsened since the previous Government’s declaration of their intended nuclear warhead stockpile ceiling in 2010, since when we have seen an increase in nuclear challenges. Against this backdrop, the UK must ensure that its nuclear deterrent remains credible and effective against the full range of state nuclear threats from any direction.

I thank the noble Lord, Lord Grantchester, for his question about the interests of the IAEA in relation to this SI. The IAEA seeks to promote the safe, secure and peaceful use of nuclear technologies. The nuclear co-operation agreement between the UK and Japan seeks to do the same. As a former chair of the Nuclear Suppliers Group, I am sure that IAEA director-general Grossi will be pleased to see that we have brought our agreement up to date and in line with NSG guidelines.

To close, I will underline that the protocol, and by extension these regulations, reaffirm the importance that the Government place on ongoing co-operation with the UK’s international partners in the civil nuclear sector. It highlights the continued value we place on mutually beneficial co-operation on the peaceful uses of nuclear energy. I commend these regulations to the Committee.