From 2 December 2025, the UK’s “excluded disposal sites” regime will take effect. The Energy Act 2023 (Commencement No. 4) Regulations 2025, made on 6 November, switch on section 304 of the Act, creating a route for qualifying radioactive‑waste disposal installations to sit outside the nuclear third‑party liability regime. The underlying provisions are set out on legislation.gov.uk.

What counts as an excluded disposal site? Section 304 inserts new sections 7C and 7D into the Nuclear Installations Act 1965. An operator can apply to the Secretary of State if the site has the right environmental permit, has not accepted prohibited higher‑activity material in the past, and meets any further prescribed conditions. If approved, the Secretary of State issues a written notice confirming exclusion.

Government’s policy paper fills in the practical test. The permit must bar waste above specified radioactivity concentration limits; the operator must evidence past consignments stayed below those thresholds; the expected dose to a member of the public must not exceed 1 mSv in all reasonably foreseeable scenarios; and the risk of criticality must be negligible. Those thresholds mirror the OECD NEA’s 2016 decision on low‑level waste.

Exclusion changes the liability playbook. Once a site is excluded, it sits outside the Nuclear Installations Act’s strict, channelled nuclear‑liability regime; ordinary tort and environmental law continue to apply alongside the site’s environmental permit and regulator oversight. That combination typically lowers the cost of specialist nuclear cover while keeping scrutiny in place, according to practitioner analysis.

Scale is modest but meaningful. The GOV.UK statement notes six UK facilities currently take low‑level radioactive waste of nuclear origin, with four in England likely to qualify, and one to three potential new sites over the next decade. The department’s rationale is to keep disposal capacity available and reduce operator costs as decommissioning activity rises through the 2020s–2080s.

Why insurers and lenders care: UK nuclear operators carry mandatory financial security aligned to international treaties. In 2025 ministers aligned the cap for CSC‑related claims with Paris‑Convention claims at €700 million, with access to an international pooled fund under the CSC. Taking low‑risk disposal sites outside that regime can trim premiums and surety requirements for those specific facilities.

Safeguards are explicit. If “disqualifying matter” above the permitted radioactivity limits is ever accepted, the operator must notify the Secretary of State within 21 days and remove it within 90 days or the site loses excluded status. For Scottish sites, the Secretary of State must notify Scottish Ministers of exclusion decisions. The carve‑out remains tightly limited to low‑risk material.

For the SMR pipeline, the effect is indirect but useful. Cheaper, predictable routes for disposing of low‑level waste help model end‑of‑life cash flows and reduce friction in financing packages. This does not change liabilities for power stations, spent fuel or higher‑activity wastes, which remain under the Nuclear Installations Act and associated conventions.

Process from here is document‑heavy. Operators will need an updated permit with the radioactivity limits, a radiation‑dose assessment demonstrating the 1 mSv test under foreseeable scenarios, evidence on site history, and criticality analysis before applying. DESNZ decisions are case‑by‑case, drawing on REPPIR and environmental safety case documentation already familiar to the sector. Insurers are likely to refresh wordings once the first exclusions are granted.

What to watch: first‑wave applications, any conditions attached to approvals, and how lenders and ratings analysts treat the shift in residual risk. For finance teams, this is a chance to revisit policy limits and covenants that reference “nuclear installation” or the NIA 1965. For communities near candidate sites, regulator oversight and safety limits are unchanged, even as the insurance mechanics evolve.