Urenco Annual Report 2022

48 Urenco Annual report and accounts 2022 Strategic report 01 Inability to meet demand for next generation fuels Description Impact How we are managing the risk Advanced Reactors (AR) hold the promise of future, clean and reliable energy, but they represent the cutting edge of nuclear technology and there may be unexpected delays toAR deployments or fuel supply chain capability/components development. Delayed customer demand and/or incomplete supply chain tomeet customer requirementsmay generate losses from investment in LEU+ or HALEU capacity whichmaterialises later than expected. • We are supporting both the US andUK governments to de-risk this investment area • We have deployed specialist resource to focus on next generation fuels and ensure Urenco is engaged in the development of AR projects, creating dedicatedHALEU teams in both the US andUK • We are investing in deconversion capability tomeet long-term sustainability requirements Long-term nuclear liabilities ‒ Tails deconversion and disposal Description Impact How we are managing the risk The estimated cost and timing of our long-termnuclear liabilities are based on a number of management estimates relating to operational parameters and long-termcost assumptions associated with eventual decommissioning of the enrichment plants and disposal of nuclear materials. These are subject to external factors that we can influence but not control, for example, government policy for long-term disposal costs of depleted uraniumoxide (U 3 O 8 ). Achange to government policy could result in significant impact on balance sheet liabilities and future cash flows as well as potentially forced cessation of operations in the event that physical tails storage runs out. • A triennial reviewof provision rates is conductedwhich is externally audited • We aremanaging physical storage capacity for UF 6 tails andU 3 O 8 across the Group • We are actively de-convertingmaterial both using our own technology (TMF) and third party contracts where necessary • We have established a Nuclear DecommissioningTrust in the US to meet our regulatory requirement to provide financial assurance over our nuclear liabilities (including tails) at Louisiana Energy Services (LES) Risks and risk management