Nuclear Policy, Regulation and Licensing in the UK - Case Study Example

Nuclear Policy, Regulation and Licensing in the UK Summary of main facts leading to the claim being made The British Nuclear Fuels plc (BNFL) started the construction of a mixed oxide fuel plant at Sellafield, so that it could start the business of manufacturing MOX fuel between 1994 and 1996. Later in 1996, BNFL, in accordance with the legal requirements, sought the approval and authorization of the Environment Agency (EA), which is the body mandated with the authorization of the variations in gaseous and liquid discharges1. Two years later, the EA published its report in 1998, concluding that on a provisional basis, the construction of the MOX fuel plant by BFL for the purpose of the manufacture of the MOX fuel was justified. However, owing to the sensitivity nature of the operations that BFL was seeking to undertake, which is an issue of high political and international interest, the EA referred the matter to the Secretaries of State for further policy issues consideration2. After its evaluation of the BFL MOX fuel production project in the SMP plant, the Secretaries of State therefore decided that the economic benefits that were obtainable from the plant were higher, in fact much higher than the detriments associated with the project. The Secretaries of State observed that being the only company that sought to establish such a plant then, and in the foreseeable future, then it was necessary to allow the project to proceed, since it derived economic benefits both nationally and locally, while the risk of radiation ionization risks posed by the project were found to be minimal. In this respect, the Secretaries of State provided the BFL with provisional consent, so it could continue preparing for its operations, although in a manner that would not jeopardize the justification process, pending the evaluation of the full economic benefits and thus issuance of full authority3. However should the commissioning be found to have been detrimental, the BFL was to cover the costs of the decommissioning. Nevertheless, the legal and factual issue that arose in the case is in regard to the effect of the sunk costs arising from the project. This is because, before seeking for authorization from EA, BFL had already spent £300 million as capital investment of the plant, and should the project fail to be approved, then, this would have resulted to wasted/sunk costs4. The second issue in the case, which was the EA’s major concern, was that the costs involved had to be disregarded, because the law did not provide for requirements that such project owners seek the approval of the project earlier. However, there was a white paper “Review of Radioactive Waste Policy” of July 1995” which had recommended that such project owners seek for the approval at early stages of the project initiation. Additionally, another document to the “Communication from the Commission concerning the implementation of Directive 96/29” member states had recommended that the member states have the justification of such projects done early, before the project consumed substantial resources. The third and most significant issue of contention in the case was the applicable process of justification. Whereas the member states had been recommended to apply generic approach in the approval of the practices that involved radiation activities, the UK had also provided for the site specific approach. Most importantly, the UK laws had not specified the application of the generic approach, and thus the contention was whether the justification approach should be generic or site specific5. These three major issues led to the legal action being taken, after ADL, an independent analyst was commissioned in 1999, to evaluate the economic costs of the BFL MOX fuel project, and the analyst responded favorably for the commencement of the project in April 2001. In response, the Friends of the Earth responded to the report by ADL, resulting to the judicial review challenge being lodged in October 20016. Grounds for claim, i.e. what is the legal basis for the claim being made The claimant and the appellant in this case have made different grounds for their claims. The legal basis made by the claimant in the case is that; first, the provisions of Article 6 afforded the claimants all the widest discretions possible to determine the benefits associated with the project7. According to the claimant, In this case, the BFL MOX fuel production project offered sufficient economic benefit both to the community and to the national economy, and as a result, the project ought to have been given a go ahead. The report produced by the independent analyst indicated that the NPV derived by the operation of the project was £216 million, the net present value of the economic interest derived from the project, compared to the cost of not running the project8. Additionally, the claimant also has a ground of claim that in addition to the NPV, the BFL MOX project would derive more benefit to the local community, through the provision of employment opportunities, where the project would have created 480 jobs locally. The other ground for the claimant is that; the detrimental effects of the project, in terms of the adverse effects to the health of the population were insignificantly small. Thus, with the detrimental effects and the risks associated with the project being that low, the ground for continuing the project was sufficient9. Finally, the claimant’s ground for claim was in relation to the justification of the practice, which was the most controversial aspect of the case, where claimant observed that the essence of the legal provisions of article 6 of the Radioactive Substances Act 1993 was to provide for the justification of the practice, as provided under the site specific justification approach, as opposed to the generic approach, since there was no requirement for justification under the article10. On the other hand, the appellant’s ground for claim included the fact that; a uniform implementation of the directive to the member states was expected. Thus, according to the international conventions and agreement, the method of justification that ought to have been applied was the generic justification approach, as opposed to the site specific approach11. According to this ground of claim, the appellant observed that the first and the most essential concept of justification was the justification of the practice, which has to do with the class or type of human activity, and not site specific justification, which was done in the case12. Secondly, the ground for claimant’s claims in the case was that, the capital costs that were incurred by the BFL MOX fuel project were not supposed to be considered in the decision-making, considering that all the costs involved in the establishment of a radiation project before its approval are sunk costs13. Therefore, the claimant observed that the consideration f the amount of resources that had been consumed by the project, to a tune of £470 million, was inconsiderable in the case14. Finally, the appellant was opposed to the timing of the costs incurred, arguing that the sum of £170 that was incurred after a provisional consent was given, pending the economic benefit evaluation was not to be included. Ratio decidendi and key obiter dicta Obiter dicta Obiter dicta represent hat by the way statement made during a ruling, which may not be part of a ruling, but it emphasizes a point15.The key obiter dicta in the case include, the statement by the judge to the effect that, while not conclusive, it is the judge’s opinion that the costs involved in setting up a plant to enable the type of practice, should not be set against the economic benefits16. Another key obiter dictum is the statement made by the judge who observes that, while he has been impressed by the previous judge’s argument, it is not conclusive, but he thinks that the economic benefit should be influenced by the time at which the application for the assessment has been made17. Ratio decidendi The ratio decidendi is the reasoning behind which the judge derives s the ruling18. The ratio decidendi applied by the judge in this case is that; the reasoning applied by the appellant was not rational, since it is not expected that the decision by the Secretaries of State in relation to the economic benefit would have been different, if the money spend in the preparation of the BFL MOX fuel plant was little than it was in this case. This is because, if that was the case, then, that would have amounted to an irrationality of making an adverse decision, which would have then been open to challenge by BFL19. Comments on the judgment-do you agree with the judge’s conclusions The judgment rendered in this case is rational and fair. This is because, considering the elaborate letter of decision that was presented by the Secretaries of State regarding the decision-making process that led to the approval of the project, all the necessary considerations had been made. This because, the Secretaries of State had considered the detrimental effects of the project and found them to be insignificant20. Additionally, the decision-making process had considered the economic benefits derived from the project both to the community and to the nation and found it to be substantial, compared to the associated detrimental costs. Finally, the decision reached was rational and fair, considering that, the provisions of Article 6 of the RSA did not provide for justification, thus leaving the approach plainly open to the Secretaries of State21. Bibliography 1. The Queen on the Application of Friends of the Earth Ltd & Another v Secretary of State for Environment Food and Rural Affairs & Others [2001] EWCA Civ 1847 2. Ratio decidendi. (Berlin: Duncker & Humblot, 2006). 3. Hedley Byrne & Co Ltd v Heller & Partners Ltd [1964] AC 465 4. Warren, Lynda M. The Law of Radioactive Waste Management. (E LR; 2005)130 5. Reay v British Nuclear Fuels [1994] 5 Med LR 1 6. Hope v British Nuclear Fuels [1994] PIQR P171; [1994] Env LR 320 7. Magnohard Ltd v UKAEA [2004] Env LR 19 8. Merlin v British Nuclear Fuels Plc [1990] 2 QB 557 Read More