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 will perform the role of revenue collection counterparty, channeling funds between electricity suppliers and relevant license nuclear companies. Ofgem will confirm to us (as the revenue collection counterparty) what payments we should make to (or receive from) the relevant licensee nuclear company in accordance with their revenue collection contract (i.e. ‘RAB payment’).