Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what plans he has to introduce a Regulated Asset Based Model for large-scale green infrastructure projects.

In July 2019, the Government published a consultation on the viability of a Regulated Asset Base (RAB) model for financing new nuclear projects. The responses to this consultation were published in December 2020 alongside the Energy White Paper. At this time, the Secretary of State for Business, Energy and Industrial Strategy indicated that the RAB could help secure private investment in nuclear projects and cost consumers less in the long run. The Government is in negotiations with EDF in relation to the Sizewell C project and is continuing to explore a range of financing options, including the RAB model and the potential role of government finance during construction, provided there is clear value for money for consumers and taxpayers.

Furthermore, in August 2020, the Government published a response to the June 2019 consultation on Carbon Capture and Storage (CCUS) business models. CCUS is expected to decarbonise heavy industrial process and gas-fired power stations by capturing carbon dioxide emissions and transporting it via a network of pipelines to underwater stores. Government concluded that a RAB model would likely be the most effective way to provide value for money for taxpayers whilst also providing investors with confidence over the reliability and sustainability of a revenue stream. Government published further updates to the model in February, May and August 2021.