Given the demonstrated unwillingness of private investors to take on all of the construction risk of gigawatt scale nuclear plants through the CfD model, it is inevitable that a public-private risk sharing model should be contemplated if new gigawatt-scale plants are to be constructed. The Regulated Asset Base (RAB) model— which has been given Royal Assent in the Nuclear Energy (Financing) Act is one such. However, the model entails significant uncertainties and downsides. Chief among these i...

Given the demonstrated unwillingness of private investors to take on all of the construction risk of gigawatt scale nuclear plants through the CfD model, it is inevitable that a public-private risk sharing model should be contemplated if new gigawatt-scale plants are to be constructed. The Regulated Asset Base (RAB) model— which has been given Royal Assent in the Nuclear Energy (Financing) Act is one such. However, the model entails significant uncertainties and downsides. Chief among these is that although the financing of a plant should be cheaper in headline terms than a model in which the private sector shoulders all construction risk, th Type: conclusion | Number: 39 | Paragraph: 217 | Response status: under_consideration Government response: • In establishing the RAB model for use on nuclear projects, we have followed the recommendation of the National Audit Office, that models like RAB, which share more construction risk with consumers, could provide better value for money tha