Regulated Asset Base
Where private investment is needed in public projects, a regulated asset base model (RAB) can be used. This allows investors to receive a guaranteed return on investment for the lifetime of the asset. It is commonly used in large scale infrastructure projects such as water, gas and electricity networks.
The Nuclear Energy (Financing) Act 2022 received Royal Assent on 31st March 2022 and allows for the implementation of a Regulated Asset Base (RAB) model for nuclear energy generation.
LCCC performs the role of revenue collection counterparty, managing payments between electricity suppliers and relevant licensed nuclear companies. Ofgem, as the economic regulator, will confirm to LCCC on the payments to be made to or received from the relevant licensed nuclear company, in line with the terms of the revenue collection contract (referred to as the ‘RAB payment’).
On 22nd July 2025, the Secretary of State for Energy Security and Net Zero signed the final investment decision for Sizewell C Limited, the first nuclear project to be funded by the RAB model. For further information on the announcement, see here.
Following this, on 12th August 2025, LCCC announced the Interim Levy Rate and Total Reserve Amount for the first obligation period under the Nuclear RAB scheme, set to begin in Q4 2025. For further information on this, see here.
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