DEPARTMENT OF ENERGY AND CLIMATE CHANGE

MAIN ESTIMATE 2015-16

SELECT COMMITTEE MEMORANDUM

Table of Contents

Section Page

1 Introduction 2

2 Summary of provision sought 2

3 Changes from 2014-15 and Spending Review 2013 4

4 Detailed breakdown of changes in DEL provision 8

5 Budget Exchange 10

6 Provisions and contingent liabilities 11

7 Nuclear Decommissioning Authority (NDA) 12

8 Annually Managed Expenditure (AME) 14

9 Net Cash Requirement 18

10 DEL and AME Budget comparison to prior and future years 19

Detailed breakdown of Part II table changes from 2014-15 Annex A

Explanation of Key Terms and Glossary of Abbreviations Annex B

In accordance with the wishes of Treasury Ministers and the Select Committee and as originally set out in the Treasury PES paper (2004) 14 Annex D we present the following Estimates Memorandum This Memorandum has been prepared with reference to guidance in Supply Estimates a guidance manual provided by HM Treasury and on the House of Commons Scrutiny Unit website The information in this Memorandum has been approved by Angie Ridgwell Director General Corporate Services on behalf of Stephen Lovegrove Permanent Head of Department and Accounting Officer of the Department of Energy and Climate Change

The final Main Estimate is attached

1 Introduction

11 The Department of Energy and Climate Change (DECC) Main Estimate (ME) for 2015-16 seeks the necessary resources and cash to support the continuing functions of the Department

12 The purpose of this Memorandum is to provide the Select Committee with an explanation of how the resources and cash sought in the Main Estimate will be applied to achieve the Departmentrsquos objectives This includes information on comparisons with the resources provided in earlier years in Estimates and Departmental Expenditure Limit (DEL) Budgets

13 An explanation of key terms used in the Memorandum is provided at annex B

14 Figures in this Memorandum are shown in millions rounded to one decimal place Rounded totals shown at the bottom of some tables may therefore differ slightly from the sum of individual rounded lines

2 Summary of provision sought

21 The DECC Main Estimate (ME) for 2015-16 requests total provision for the year of

Resource DEL pound14002m

Of whichshy

Administration Budget pound1960m

Depreciationimpairments pound48m

Capital DEL pound25202m

Total DEL pound39204m

Resource AME pound94478m

Capital AME pound(855)m

Total AME pound93623m

Total Resource Budget pound108480m

Total Capital Budget pound24347m

Net cash requirement pound50146m

2

22 Most items of departmental expenditure fall within DEL Budgets Detailed Annually Managed Expenditure (AME) Budgets are set out in Section 9 and relate to Contracts for Difference for funding energy infrastructure investment nuclear decommissioning provisions other NDA non-cash items adjustments to other provisions and the Renewable Heat Incentive

23 Within DECCrsquos DEL Budget provision is ring-fenced forshy

bull Official Development Assistance (ODA) - pound164m Resource DEL and pound3126m Capital DEL relating to the International Climate Fund

bull Nuclear Decommissioning Authority - pound3910m Resource DEL and pound17340m Capital DEL (see Section 8)

bull Measures to help bill-payers announced in the Autumn Statement 2013 and 2014 - pound3100m Resource DEL funding for a Government Electricity Rebate scheme and pound194m Capital DEL for energy efficiency incentives schemes for landlords and loans to the public sector

bull Carbon Capture and Storage (CCS) - pound347m Resource DEL and pound1673m Capital DEL

bull Oil and Gas - pound20m Resource DEL for seismic surveys bull Oil and Gas Authority - pound59m Admin DEL additional funding bull Shale Gas monitoring - pound17m Resource DEL (of which pound02m Admin) bull Innovative Modular Technologies - pound45m Resource DEL

24 The Part II table of the Estimate includes Armsrsquo Length Body (ALB) DEL and AME Budgets In accordance with the Estimates Manual those lines relating to the Coal Authority Committee on Climate Change Civil Nuclear Police Authority Low Carbon Contracts Company and Electricity Settlements Company are shown net of income in the gross expenditure column This reflects the greater level of autonomy for Arms Lengths Bodies with respect to the income they generate It should also be noted that non-cash items and the use of provisions in the ALBs are shown in Part II Resource to cash reconci liation table in the line entitled ldquoAdjustment for ALBs Remove voted Resource and Capitalrdquo

25 A new section has been added to the Estimate this year for the Oil and Gas Authority (OGA) an Executive Agency of the Department established on 1 April 2015 The forthcoming Energy Bill will contain provisions to formally establish the OGA as an independent regulator which will take the form of a government company

3

1 Introduction

11 The Department of Energy and Climate Change (DECC) Main Estimate (ME) for 2015-16 seeks the necessary resources and cash to support the continuing functions of the Department

12 The purpose of this Memorandum is to provide the Select Committee with an explanation of how the resources and cash sought in the Main Estimate will be applied to achieve the Departmentrsquos objectives This includes information on comparisons with the resources provided in earlier years in Estimates and Departmental Expenditure Limit (DEL) Budgets

13 An explanation of key terms used in the Memorandum is provided at annex B

14 Figures in this Memorandum are shown in millions rounded to one decimal place Rounded totals shown at the bottom of some tables may therefore differ slightly from the sum of individual rounded lines

2 Summary of provision sought

21 The DECC Main Estimate (ME) for 2015-16 requests total provision for the year of

Resource DEL pound14002m

Of whichshy

Administration Budget pound1960m

Depreciationimpairments pound48m

Capital DEL pound25202m

Total DEL pound39204m

Resource AME pound94478m

Capital AME pound(855)m

Total AME pound93623m

Total Resource Budget pound108480m

Total Capital Budget pound24347m

Net cash requirement pound50146m

2

22 Most items of departmental expenditure fall within DEL Budgets Detailed Annually Managed Expenditure (AME) Budgets are set out in Section 9 and relate to Contracts for Difference for funding energy infrastructure investment nuclear decommissioning provisions other NDA non-cash items adjustments to other provisions and the Renewable Heat Incentive

23 Within DECCrsquos DEL Budget provision is ring-fenced forshy

bull Official Development Assistance (ODA) - pound164m Resource DEL and pound3126m Capital DEL relating to the International Climate Fund

bull Nuclear Decommissioning Authority - pound3910m Resource DEL and pound17340m Capital DEL (see Section 8)

bull Measures to help bill-payers announced in the Autumn Statement 2013 and 2014 - pound3100m Resource DEL funding for a Government Electricity Rebate scheme and pound194m Capital DEL for energy efficiency incentives schemes for landlords and loans to the public sector

bull Carbon Capture and Storage (CCS) - pound347m Resource DEL and pound1673m Capital DEL

bull Oil and Gas - pound20m Resource DEL for seismic surveys bull Oil and Gas Authority - pound59m Admin DEL additional funding bull Shale Gas monitoring - pound17m Resource DEL (of which pound02m Admin) bull Innovative Modular Technologies - pound45m Resource DEL

24 The Part II table of the Estimate includes Armsrsquo Length Body (ALB) DEL and AME Budgets In accordance with the Estimates Manual those lines relating to the Coal Authority Committee on Climate Change Civil Nuclear Police Authority Low Carbon Contracts Company and Electricity Settlements Company are shown net of income in the gross expenditure column This reflects the greater level of autonomy for Arms Lengths Bodies with respect to the income they generate It should also be noted that non-cash items and the use of provisions in the ALBs are shown in Part II Resource to cash reconci liation table in the line entitled ldquoAdjustment for ALBs Remove voted Resource and Capitalrdquo

25 A new section has been added to the Estimate this year for the Oil and Gas Authority (OGA) an Executive Agency of the Department established on 1 April 2015 The forthcoming Energy Bill will contain provisions to formally establish the OGA as an independent regulator which will take the form of a government company

3

22 Most items of departmental expenditure fall within DEL Budgets Detailed Annually Managed Expenditure (AME) Budgets are set out in Section 9 and relate to Contracts for Difference for funding energy infrastructure investment nuclear decommissioning provisions other NDA non-cash items adjustments to other provisions and the Renewable Heat Incentive

23 Within DECCrsquos DEL Budget provision is ring-fenced forshy

bull Official Development Assistance (ODA) - pound164m Resource DEL and pound3126m Capital DEL relating to the International Climate Fund

bull Nuclear Decommissioning Authority - pound3910m Resource DEL and pound17340m Capital DEL (see Section 8)

bull Measures to help bill-payers announced in the Autumn Statement 2013 and 2014 - pound3100m Resource DEL funding for a Government Electricity Rebate scheme and pound194m Capital DEL for energy efficiency incentives schemes for landlords and loans to the public sector

bull Carbon Capture and Storage (CCS) - pound347m Resource DEL and pound1673m Capital DEL

bull Oil and Gas - pound20m Resource DEL for seismic surveys bull Oil and Gas Authority - pound59m Admin DEL additional funding bull Shale Gas monitoring - pound17m Resource DEL (of which pound02m Admin) bull Innovative Modular Technologies - pound45m Resource DEL

24 The Part II table of the Estimate includes Armsrsquo Length Body (ALB) DEL and AME Budgets In accordance with the Estimates Manual those lines relating to the Coal Authority Committee on Climate Change Civil Nuclear Police Authority Low Carbon Contracts Company and Electricity Settlements Company are shown net of income in the gross expenditure column This reflects the greater level of autonomy for Arms Lengths Bodies with respect to the income they generate It should also be noted that non-cash items and the use of provisions in the ALBs are shown in Part II Resource to cash reconci liation table in the line entitled ldquoAdjustment for ALBs Remove voted Resource and Capitalrdquo

25 A new section has been added to the Estimate this year for the Oil and Gas Authority (OGA) an Executive Agency of the Department established on 1 April 2015 The forthcoming Energy Bill will contain provisions to formally establish the OGA as an independent regulator which will take the form of a government company

3

3 Explanation of changes from Spending Review and 2014-15

Changes from 2013 Spending Review

31 The following table compares the provision requested in the Main Estimate with the 2013 Spending Review (SR)shy

Table S31

poundm 2015-16 ME 2015-16 at SR Change sinceSR

Resource DEL 14002 9600 4402

Of which Administration 1960 1770 190

Capital DEL 25202 23470 1732

Resource AME 94478 5337 89141

Capital AME (855) (765) (90)

32 The changes to Resource and Capital DEL are summarised in the table belowshy

Table S32

poundm RDEL CDEL

Additional funding for Government Electricity Rebate (2013 Autumn Statement) ndash to reduce the impact of DECC policies on energy bills

3100 -

Additional funding for Energy Efficiency (2013 Autumn Statement) ndash includes pound40m Administration

100 1660

Additional funding for Home Energy Efficiency (2014 Autumn Statement)

- 680

NDA Budget Exchangespecial flexibilities 556 -

Additional funding for Off Gas Grid heating (2014 Autumn Statement)

- 250

Additional funding for Oil and Gas for Seismic surveys (Budget2015)

200 -

Core DECC Budget Exchange- includes pound60m Administration 120 -

Other transfers tofrom OGDrsquos 50 53

4

poundm RDEL CDEL

Additional Administration funding for Oil and Gas Authority ahead of Levy implementation (2014 Autumn Statement)

59 -

Administration funding for Wood Review implementation (Budget 2014) ndash towards set up cost of Oil and Gas Authority

50 -

Additional funding for Innovative modular technologies (2014 Autumn Statement)

45 -

Additional funding for Shale Gas monitoring (2014 Autumn Statement) ndash includes pound02m Administration

17 -

Machinery of Government transfer from Defra ndash for Energy Using Products (including pound01m Administration)

17 -

Reduction in Budget reflecting change in VAT treatment of Legal Services

(09) -

Coal Authority Accounting Policy change ndash surrender of ringfenced Depreciation Budget

(32) -

Contribution to 2013 Autumn Statement savings (110) -

Contribution to DEL savings announced 4th June 2015 (273) (400)

Swap with DFID of Capital for Resource DEL for ringfenced International Climate Fund

165 (165)

CCS CDEL to RDEL switch - to reflect the type of expenditure involved in the FEED (Front End Engineering and Design) studies

347 (347)

Total DEL changes since 2013 Spending Review 4402 1732

RDEL a) a t ransfer of pound06m to UK Trade amp Investment towards the costs of the Milan Expo 2015 b) a 56m t ransfer from Security and Intelligence Agencies (SIA) from the Critical Capabilities Pool for Global Threat Reduction Programme (GTRP) Nuclear Safeguards Programme (NSP) UK Nuclear Forensics Library and International Physical Protection Advisory Service (IPASS) Mission project CDEL a pound53m transfer from Security and Intelligence Agencies (SIA) from the Critical Capabilities Pool for Global Threat Reduction Programme (GTRP)

33 In addition to the pound673m shown in the table above as part of DECCrsquos contribution to the savings announced by the Chancellor on 4th June the Department agreed to fund additional pressures of pound27m from within existing Budgets

34 Within Resource DEL pound22m has moved from Administration to Programme due to the reclassification of spend in relation to the services provided to the Department by Ofgem

5

35 AME Budgets for 2015-16 largely reflect the latest forecasts provided to the Office for Budget Responsibility in January Further details are set out in Section 8

36 Resource AME includes pound885bn for the fair value of liabilities incurred for Contracts for Difference expected to be signed under the Electricity Market Reform programme Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers A government counterparty company manages payments between generators and suppliers Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts The 2014-15 Main Estimate provided AME budget of pound289bn One contract included within that budget was delayed necessitating the reshytake up of cover in this Estimate

37 Other significant movements within Resource AME since the 2013 Spending Review are due to forecast increases to the original Budgets for depreciation (pound35m) and nuclear provision (pound11m) in the Nuclear Decommissioning Authority (NDA) and to Coal Health provisions (pound92m)

Changes from 2014-15 Supplementary Estimate

38 The following table compares the provision requested in the Main Estimate with the 2014-15 Supplementary Estimate

Table S33

poundm 2015-16 ME 2014-15 SE Change since 2014-15 SE

Voted resource DEL 25062 25844 (782)

Non-voted resource DEL (11060) (11160) 100

Resource DEL 14002 14684 (682)

Voted capital DEL 26212 23438 2774

Non-voted capital DEL (1010) (20) (990)

Capital DEL 25202 23418 1784

6

poundm 2015-16 ME 2014-15 SE Change since2014-15 SE

Resource AME 94478 352845 (258367) Capital AME (855) (984) 129 Net cash requirement 50146 51064 (918)

39 Explanations for changes from 2014-15 are shown by Estimate Line in Annex A

310 Changes in the Net Cash Requirement are discussed at Section 9

Changes to the Estimate Ambit

311 The Main Estimate includes two additions to the Ambit

bull ldquoOil and Gas Authorityrdquo has been added under both ldquoDepartmental Expenditure Limit Expenditurerdquo and ldquoAnnually Managed Expenditure Expenditurerdquo to provide cover for the expenditure of this new body

bull ldquoand levy receiptsrdquo has been added under ldquoDepartmental Expenditure Limit Incomerdquo This relates to the future levy on the industry to fund the Oil and Gas Authority

7

4 Detailed breakdown of changes in DEL provision

41 Net changes in DEL Budgets between the 2014-15 SE and this Estimateare shown in Annex A along with explanations of changes over 10

Administration Budget

42 The Administration Budget for 2015-16 (with 2014-15 shown for comparison) is broken down as followsshy

Table S41

poundm 2015-16 2014-15

Wages and Salaries 861 910

Purchase of Goods and Services 371 415

Purchase of Consultancy Services 20 07

Contract and Agency staff 17 13

Depreciation 14 01

Notional audit fee 03

Recovery of secondee costs (01)

Sales of Goods and Services (02) (16)

Income from OGDrsquos for Committee on Climate Change (14) (18)

Total Core Department Admin 1267 1314

Oil and Gas Authority expenditure 153 -

Oil and Gas Authority income (09) -

Total Oil and Gas Authority Admin 144 -

Nuclear Decommissioning Authority 470 430

Coal Authority 42 41

Committee on Climate Change 38 41

Total Arms Length Body Admin 550 512

Total Administration Budget 1960 1826

The figure for notional audit fee will be confirmed in the Supplementary Estimate Secondee recoveries are netted off under Wages and Salaries

8

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

poundm RDEL CDEL

Additional Administration funding for Oil and Gas Authority ahead of Levy implementation (2014 Autumn Statement)

59 -

Administration funding for Wood Review implementation (Budget 2014) ndash towards set up cost of Oil and Gas Authority

50 -

Additional funding for Innovative modular technologies (2014 Autumn Statement)

45 -

Additional funding for Shale Gas monitoring (2014 Autumn Statement) ndash includes pound02m Administration

17 -

Machinery of Government transfer from Defra ndash for Energy Using Products (including pound01m Administration)

17 -

Reduction in Budget reflecting change in VAT treatment of Legal Services

(09) -

Coal Authority Accounting Policy change ndash surrender of ringfenced Depreciation Budget

(32) -

Contribution to 2013 Autumn Statement savings (110) -

Contribution to DEL savings announced 4th June 2015 (273) (400)

Swap with DFID of Capital for Resource DEL for ringfenced International Climate Fund

165 (165)

CCS CDEL to RDEL switch - to reflect the type of expenditure involved in the FEED (Front End Engineering and Design) studies

347 (347)

Total DEL changes since 2013 Spending Review 4402 1732

RDEL a) a t ransfer of pound06m to UK Trade amp Investment towards the costs of the Milan Expo 2015 b) a 56m t ransfer from Security and Intelligence Agencies (SIA) from the Critical Capabilities Pool for Global Threat Reduction Programme (GTRP) Nuclear Safeguards Programme (NSP) UK Nuclear Forensics Library and International Physical Protection Advisory Service (IPASS) Mission project CDEL a pound53m transfer from Security and Intelligence Agencies (SIA) from the Critical Capabilities Pool for Global Threat Reduction Programme (GTRP)

33 In addition to the pound673m shown in the table above as part of DECCrsquos contribution to the savings announced by the Chancellor on 4th June the Department agreed to fund additional pressures of pound27m from within existing Budgets

34 Within Resource DEL pound22m has moved from Administration to Programme due to the reclassification of spend in relation to the services provided to the Department by Ofgem

5

35 AME Budgets for 2015-16 largely reflect the latest forecasts provided to the Office for Budget Responsibility in January Further details are set out in Section 8

36 Resource AME includes pound885bn for the fair value of liabilities incurred for Contracts for Difference expected to be signed under the Electricity Market Reform programme Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers A government counterparty company manages payments between generators and suppliers Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts The 2014-15 Main Estimate provided AME budget of pound289bn One contract included within that budget was delayed necessitating the reshytake up of cover in this Estimate

37 Other significant movements within Resource AME since the 2013 Spending Review are due to forecast increases to the original Budgets for depreciation (pound35m) and nuclear provision (pound11m) in the Nuclear Decommissioning Authority (NDA) and to Coal Health provisions (pound92m)

Changes from 2014-15 Supplementary Estimate

38 The following table compares the provision requested in the Main Estimate with the 2014-15 Supplementary Estimate

Table S33

poundm 2015-16 ME 2014-15 SE Change since 2014-15 SE

Voted resource DEL 25062 25844 (782)

Non-voted resource DEL (11060) (11160) 100

Resource DEL 14002 14684 (682)

Voted capital DEL 26212 23438 2774

Non-voted capital DEL (1010) (20) (990)

Capital DEL 25202 23418 1784

6

poundm 2015-16 ME 2014-15 SE Change since2014-15 SE

Resource AME 94478 352845 (258367) Capital AME (855) (984) 129 Net cash requirement 50146 51064 (918)

39 Explanations for changes from 2014-15 are shown by Estimate Line in Annex A

310 Changes in the Net Cash Requirement are discussed at Section 9

Changes to the Estimate Ambit

311 The Main Estimate includes two additions to the Ambit

bull ldquoOil and Gas Authorityrdquo has been added under both ldquoDepartmental Expenditure Limit Expenditurerdquo and ldquoAnnually Managed Expenditure Expenditurerdquo to provide cover for the expenditure of this new body

bull ldquoand levy receiptsrdquo has been added under ldquoDepartmental Expenditure Limit Incomerdquo This relates to the future levy on the industry to fund the Oil and Gas Authority

7

4 Detailed breakdown of changes in DEL provision

41 Net changes in DEL Budgets between the 2014-15 SE and this Estimateare shown in Annex A along with explanations of changes over 10

Administration Budget

42 The Administration Budget for 2015-16 (with 2014-15 shown for comparison) is broken down as followsshy

Table S41

poundm 2015-16 2014-15

Wages and Salaries 861 910

Purchase of Goods and Services 371 415

Purchase of Consultancy Services 20 07

Contract and Agency staff 17 13

Depreciation 14 01

Notional audit fee 03

Recovery of secondee costs (01)

Sales of Goods and Services (02) (16)

Income from OGDrsquos for Committee on Climate Change (14) (18)

Total Core Department Admin 1267 1314

Oil and Gas Authority expenditure 153 -

Oil and Gas Authority income (09) -

Total Oil and Gas Authority Admin 144 -

Nuclear Decommissioning Authority 470 430

Coal Authority 42 41

Committee on Climate Change 38 41

Total Arms Length Body Admin 550 512

Total Administration Budget 1960 1826

The figure for notional audit fee will be confirmed in the Supplementary Estimate Secondee recoveries are netted off under Wages and Salaries

8

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

35 AME Budgets for 2015-16 largely reflect the latest forecasts provided to the Office for Budget Responsibility in January Further details are set out in Section 8

36 Resource AME includes pound885bn for the fair value of liabilities incurred for Contracts for Difference expected to be signed under the Electricity Market Reform programme Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers A government counterparty company manages payments between generators and suppliers Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts The 2014-15 Main Estimate provided AME budget of pound289bn One contract included within that budget was delayed necessitating the reshytake up of cover in this Estimate

37 Other significant movements within Resource AME since the 2013 Spending Review are due to forecast increases to the original Budgets for depreciation (pound35m) and nuclear provision (pound11m) in the Nuclear Decommissioning Authority (NDA) and to Coal Health provisions (pound92m)

Changes from 2014-15 Supplementary Estimate

38 The following table compares the provision requested in the Main Estimate with the 2014-15 Supplementary Estimate

Table S33

poundm 2015-16 ME 2014-15 SE Change since 2014-15 SE

Voted resource DEL 25062 25844 (782)

Non-voted resource DEL (11060) (11160) 100

Resource DEL 14002 14684 (682)

Voted capital DEL 26212 23438 2774

Non-voted capital DEL (1010) (20) (990)

Capital DEL 25202 23418 1784

6

poundm 2015-16 ME 2014-15 SE Change since2014-15 SE

Resource AME 94478 352845 (258367) Capital AME (855) (984) 129 Net cash requirement 50146 51064 (918)

39 Explanations for changes from 2014-15 are shown by Estimate Line in Annex A

310 Changes in the Net Cash Requirement are discussed at Section 9

Changes to the Estimate Ambit

311 The Main Estimate includes two additions to the Ambit

bull ldquoOil and Gas Authorityrdquo has been added under both ldquoDepartmental Expenditure Limit Expenditurerdquo and ldquoAnnually Managed Expenditure Expenditurerdquo to provide cover for the expenditure of this new body

bull ldquoand levy receiptsrdquo has been added under ldquoDepartmental Expenditure Limit Incomerdquo This relates to the future levy on the industry to fund the Oil and Gas Authority

7

4 Detailed breakdown of changes in DEL provision

41 Net changes in DEL Budgets between the 2014-15 SE and this Estimateare shown in Annex A along with explanations of changes over 10

Administration Budget

42 The Administration Budget for 2015-16 (with 2014-15 shown for comparison) is broken down as followsshy

Table S41

poundm 2015-16 2014-15

Wages and Salaries 861 910

Purchase of Goods and Services 371 415

Purchase of Consultancy Services 20 07

Contract and Agency staff 17 13

Depreciation 14 01

Notional audit fee 03

Recovery of secondee costs (01)

Sales of Goods and Services (02) (16)

Income from OGDrsquos for Committee on Climate Change (14) (18)

Total Core Department Admin 1267 1314

Oil and Gas Authority expenditure 153 -

Oil and Gas Authority income (09) -

Total Oil and Gas Authority Admin 144 -

Nuclear Decommissioning Authority 470 430

Coal Authority 42 41

Committee on Climate Change 38 41

Total Arms Length Body Admin 550 512

Total Administration Budget 1960 1826

The figure for notional audit fee will be confirmed in the Supplementary Estimate Secondee recoveries are netted off under Wages and Salaries

8

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

poundm 2015-16 ME 2014-15 SE Change since2014-15 SE

Resource AME 94478 352845 (258367) Capital AME (855) (984) 129 Net cash requirement 50146 51064 (918)

39 Explanations for changes from 2014-15 are shown by Estimate Line in Annex A

310 Changes in the Net Cash Requirement are discussed at Section 9

Changes to the Estimate Ambit

311 The Main Estimate includes two additions to the Ambit

bull ldquoOil and Gas Authorityrdquo has been added under both ldquoDepartmental Expenditure Limit Expenditurerdquo and ldquoAnnually Managed Expenditure Expenditurerdquo to provide cover for the expenditure of this new body

bull ldquoand levy receiptsrdquo has been added under ldquoDepartmental Expenditure Limit Incomerdquo This relates to the future levy on the industry to fund the Oil and Gas Authority

7

4 Detailed breakdown of changes in DEL provision

41 Net changes in DEL Budgets between the 2014-15 SE and this Estimateare shown in Annex A along with explanations of changes over 10

Administration Budget

42 The Administration Budget for 2015-16 (with 2014-15 shown for comparison) is broken down as followsshy

Table S41

poundm 2015-16 2014-15

Wages and Salaries 861 910

Purchase of Goods and Services 371 415

Purchase of Consultancy Services 20 07

Contract and Agency staff 17 13

Depreciation 14 01

Notional audit fee 03

Recovery of secondee costs (01)

Sales of Goods and Services (02) (16)

Income from OGDrsquos for Committee on Climate Change (14) (18)

Total Core Department Admin 1267 1314

Oil and Gas Authority expenditure 153 -

Oil and Gas Authority income (09) -

Total Oil and Gas Authority Admin 144 -

Nuclear Decommissioning Authority 470 430

Coal Authority 42 41

Committee on Climate Change 38 41

Total Arms Length Body Admin 550 512

Total Administration Budget 1960 1826

The figure for notional audit fee will be confirmed in the Supplementary Estimate Secondee recoveries are netted off under Wages and Salaries

8

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

4 Detailed breakdown of changes in DEL provision

41 Net changes in DEL Budgets between the 2014-15 SE and this Estimateare shown in Annex A along with explanations of changes over 10

Administration Budget

42 The Administration Budget for 2015-16 (with 2014-15 shown for comparison) is broken down as followsshy

Table S41

poundm 2015-16 2014-15

Wages and Salaries 861 910

Purchase of Goods and Services 371 415

Purchase of Consultancy Services 20 07

Contract and Agency staff 17 13

Depreciation 14 01

Notional audit fee 03

Recovery of secondee costs (01)

Sales of Goods and Services (02) (16)

Income from OGDrsquos for Committee on Climate Change (14) (18)

Total Core Department Admin 1267 1314

Oil and Gas Authority expenditure 153 -

Oil and Gas Authority income (09) -

Total Oil and Gas Authority Admin 144 -

Nuclear Decommissioning Authority 470 430

Coal Authority 42 41

Committee on Climate Change 38 41

Total Arms Length Body Admin 550 512

Total Administration Budget 1960 1826

The figure for notional audit fee will be confirmed in the Supplementary Estimate Secondee recoveries are netted off under Wages and Salaries

8

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

Breakdown of Line C

43 In agreeing the Estimate structure for DECC in the 2011-12 Main Estimate the Committee asked for a breakdown of the provision under ldquoDrive ambitious action on climate change at home and abroadrdquo This is shown in the table belowshy

Table S42

Gross Programme DEL expenditure

Of which

pound231m

pound164mInternational Climate Fund

pound19m International Climate Change (including UNFCCC subscription)

International Energy Agency (IEA) subscription pound13m

pound08mCarbon Reduction Commitment administration costs (Environment Agency)

International amp EU Energy amp Security pound10m

pound07mInternational Renewable Energy Agency (IRENA) subscription

EU Emissions Trading administration amp set up costs pound09m (including Environment Agency)

Gross Capital DEL expenditure

Of which

pound3126m

pound3126mInternational Climate Fund

9

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

5 Budget Exchange

51 As agreed with HMT in the 2014-15 Supplementary Estimate the Department carried forward pound100m Resource DEL (of which pound50m is within Administration) None of the underspend or carry forward related to ring-fenced Budgets

52 HMT agreed in addition at the 2013-14 Supplementary Estimate that the Department could carry forward pound20m from Resource Budgets (of which pound10m is within Administration) from 2013-14 to 2015-16 to provide support to the shale industry

53 The NDArsquos 2015-16 budgets include pound356m Resource DEL carried over from 2014-15 The remaining pound20m Resource DEL surrendered in the 2014-15 Supplementary Estimate for carry over to 2015-16 has been surrendered as part of DECCrsquos contributions to the DEL savings announced on 4th June

10

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

6 Provisions and Contingent Liabilities

61 The Main Estimate includes resource AME budget of pound946m in relation to provisions including pound3720m for new provisions and increases to provisions notably pound2960m relating to the NDA Other charges relate to pound278m payments against the provision for coal health (pound255m) and coal privatisation (pound23m) which unlike other payments against provisions are charged to AME not DEL

Table S61

poundm Core ALBs TOTAL Department

New provisionschange to the value of existing provisions

670 3050 3720

AME payments for coal health and coal privatisation

278 - 278

Unwinding of discount 10 116 126 Utilisation of provisions (2969) (208) (3177) AME budget for provisions (2012) 2958 946

62 Also included in the Main Estimate is a pound2969m for cash utilisation of provisions This is matched by charges to DEL budgets or AME budgets in the case of coal health and coal privatisation payments A breakdown of provisions within the AME Budget including those in the ALBs is shown in Section 8 below

63 Full details of the Departmentrsquos Provisions as at 31 March 2014 are contained within pages 134 to 139 of the 2013-14 Annual Report and Accounts (HC 9)

64 The list of Contingent Liabilities remains as at the 2014-15 Supplementary Estimate and will be updated at the 2015-16 Supplementary Estimate to reflect those in the 2014-15 Consolidated Annual Report and Resource Accounts

11

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

- - - - -

7 Nuclear Decommissioning Authority (NDA)

71 Following updates in this Main Estimate NDA DEL Budgets are as follows for 2015-16 (with 2014-15 Budget and 2011-12 to 2013-14 Outturn shown for comparison)shy

Table S71

poundm 2011 12 2012 13 2013 14 2014 15 2015 16

Resource DEL expenditure 15313 12590 14132 15461 14970

Resource DEL income (9715) (7841) (8921) (11160) (11060)

Net Resource DEL 5598 4750 5211 4301 3910

of which Admin 363 364 399 430 470

Capital DEL expenditure 14297 17763 16978 18150 18350

Capital DEL income (2517) (549) (03) (20) (1010)

Net Capital DEL 11780 17214 16975 18130 17340

Total Net DEL 17378 21964 22186 22431 21250

72 In the 2014-15 Supplementary Estimate pound556m Resource DEL for the NDA was surrendered from 2014-15 Budgets The amount carried forward into 2015-16 was reduced by pound20m to pound356m as the NDA contribution towards the Resource DEL savings announced on 4th June 2015

73 The NDA contribution towards the Resource DEL savings announced in the 2013 Autumn Statement is pound40m in 2015-16 (all within Programme DEL)

74 In line with the decision by the Office for National Statistics to classify the Site Licence Companies (SLCs) that are responsible for the majority of the work on the NDA sites to the Central Government sector a breakdown of the spend between the NDA and the SLCs is given in Part III Note E of the Main Estimate

75 The latest NDA forecasts for AME for 2015-16 and 2016-17 are shown in the table overleafshy

12

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

- -

- - -

Table S72

poundm 2015 16 2016 17

Depreciation 590 590

Movement in Provisions 2960 5610

Total AME 3550 6200

76 For comparison purposes the NDA AME Budget outturn for 2011-12 2012-13 and 2013-14 is shown in the table belowshy

Table S73

poundm 2011 12 2012 13 2013 14

AME Depreciation 997 905 979 AME Impairment 416 01 10 AME Movement in provisions 36461 50372 52207 AME Movement in fair value of financial instruments (31) (19) (05) AME revaluations - 55 -AME deficit(surplus) on pension valuation 120 63 (95) AME income - (07) (09) Total AME 37963 51369 53087

13

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

8 Annually Managed Expenditure (AME)

81 AME budgets comprise movements in provisions utilisation of coal health and privatisation provisions and movements in coal pension scheme investments plus cash expenditure through the Renewable Heat Incentive The forecasts for 2015-16 to 2020-21 largely reflect those provided to the Office for Budget Responsibility (OBR) in January for the March 2015 economic and fiscal outlook to coincide with the Budget and will be reviewed during Autumn 2015 for the Supplementary Estimate

82 Resource AME includes from 2014-15 a new item for the fair value of liabilities incurred for Contracts for Difference (CfDrsquos) expected to be signed under the Electricity Market Reform programme Although there will in practice be no net liability to government accounting rules mean that the estimated net present value of future payments to generators has to be recognised as a liability by the Low Carbon Contracts Company As the matching receipts from electricity suppliers are classified as future taxation they cannot be recognised as an offsetting asset in the accounts However as unique contracts CfDrsquos are subject to complex accounting arguments which are sti ll being resolved for the 2014-15 annual accounts

83 The table overleaf shows forecasts for 2015-16 to 2020-21 together with outturn for 2013-14 and provisional outturn for 2014-15 for comparisonshy

14

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

-

-

-

-

-

-

-

-

Table S81

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

British Energy Liabilities Release of provision (2468) (2342) (2183) (2083) (1958) (1825) (1681) (1524) Movements in provision 338 664 320 455 440 210 120 100 Unwinding of discount 59 (210) 50 50 50 30 30 30 Coal Pensions Revaluation of Pension scheme investments unwinding discount

(2967)Res 2967 Cap

274 Res 92 Cap

(66) Res 66 Cap

(45) Res 45 Cap

(40) Res 40 Cap

(34) Res 34 Cap

(28) Res 28 Cap

(22) Res 22 Cap

Refund of Pension Surpluses (Capital) (7874) (6295) (921) (301) (301) (301) (301) (301) Coal Health liabilities

Release of provision (348) (308) (255) (289) (446) (325) (254) (124) Movements in provision 743 442 100 - - - - -Payment of provisions 348 308 255 289 446 325 254 124 Unwinding of discount 117 12 (15) (15) (15) (15) (15) (15) Impairment - 09 Miscellaneous income (24) Coal Privatisation Release of provision - - (23) - - - - -Movements in provision - (09) - - - - - -Payment of provisions - - 23 - - - - -Unwinding of discount (04) (01) - - - - - -Concessionary Fuel

Movements in provision 854 687 250 220 200 180 170 150 Release of provision (544) (523) (509) (483) (451) (420) (389) (350) Unwinding of discount (97) 53 (25) (25) (23) (20) (15) (15)

15

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Energy Efficiency Loans Write off of bad debt 04 06 20 02 00 00 - -Unwinding discount (18) (12) (03) 00 00 (01) (00) -CfD liabilities Movements in provision - 28129 - - - - - -Government Electricity Rebate Movements in provision - 3125 - - - - - -Green Deal Loans Impairment - 78 - - - - - -International Climate Fund Discount movements ndash promissory notes (197) 174 - - - - - -Investments write down (FX loss) - 39 - - - - - -Renewable Heat Incentive Subsidy 524 1589 4300 6290 8670 11460 14690 18420 Capital Grants 138 17 - - - - - -

Total core Department (8428) 25976 1384 4156 6652 9332 12637 16517

Nuclear Decommissioning Authority Depreciation 979 649 590 590 630 530 490 470 Impairment 10 (30) - - - - - -Deficit on pension valuation (95) 88 - - - - - -Movement in provisions 52207 55738 2960 5610 5290 2400 2470 1990 FRS26 Changes in Fair Value (05) (01) - - - - - -Income (09) - - - - - - -Low Carbon Contracts Company Movements in provision - 01 - - - - - -CfD liabilities - 185994 88499 - - - - -

16

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

-

-

-

-

-

-

-

-

Item poundm 2013 14 Outturn

2014 15 Outturn

2015 16 Forecast

2016 17 Forecast

2017 18 Forecast

2018 19 Forecast

2019 20 Forecast

2020 21 Forecast

Civil Nuclear Police Authority Movements in provision 10 01 01 01 01 01 01 01 Release of provision (23) (07) (03) (03) (03) (01) (01) (01) Unwinding of discount 01 01 - - - - - -Coal Authority Movements in provision 21 (669) 89 89 89 89 89 89 Release of provision (174) (167) (205) (205) (205) (205) (205) (205) Unwinding of discount 112 116 116 116 116 116 116 116 Impairments 56 67 56 61 80 78 74 70 TOTAL AME 49630 267756 93554 10415 12651 12239 15670 19047

pound500m Capital AME receipt for Coal Pension surplus was scored in AME Budget in 2014-15 as an accrual but in National Accounts in 2015-16 in line with the cash receipt

17

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

9 Net Cash Requirement

91 The Net Cash Requirement (NCR) in the Main Estimate is pound50146m

92 The breakdown of the NCR is shown in the following table with final 2014-15 Supplementary Estimate Budget numbers for comparison

Table S91

poundm 2015-16 2014-15

Non-ALB Resource DEL excl non-cash items 9814 10076

Non-ALB Capital DEL 7792 5221

AME Cash use of provisions 278 500

AME Renewable Heat Incentive 4300 2260

AME Coal Pension movements (855) (1203)

Other non-ALB AME - 196

TOTAL non-grant-in-aid 21328 17050

Grant-in-aid to ALBs 33818 33983

Movement in debtors (5000) -

TOTAL NCR 50146 51063

93 The large increase in Non-ALB Capital DEL is driven by the increase in International Climate Fund ring-fenced funds (pound974m) and Carbon Capture and Storage (pound1673m) Most of the Carbon Capture and Storage budget will be surrendered at the Supplementary Estimate due to changes in the phasing of work since the original budget was set

94 The Movement in debtors reflects the pound500m Coal Pension receipt within AME which was scored in 2014-15 but where the cash was received in 2015-16 and therefore reduces the cash required by the Department during 2015-16

95 Of the pound33818m grant-in-aid pound12070m reflects NDA income which is now paid over to the Consolidated Fund necessitating an offsetting increase in grant-in-aid

18

- - - - - - - - - -

10DEL and AME Budget comparison to prior and future years

101 The following table shows DEL and AME Budgets for 2015-16 (and outturn for 2012-13 2013-14 and provisional outturn for 2014-15) split by Resource and Capital (and showing Administration within Resource)

Table S101

poundm 2012 13 2012 13 2012 13 2013 14 2013 14 2013 14 2014 15 2014 15 2014 15 2015 16

Plans Outturn Variance

Plans Outturn Variance

Plans Provisional Outturn

Variance

Plans

Resource DEL 11917 11291 53 11858 11735 10 14684 14053 43 14001

Of which Administration

1755 1621 76 1846 1752 51 1825 1719 58 1960

Capital DEL 20969 20384 28 22725 22164 25 23418 22411 43 25202

Total DEL 32886 31675 37 34583 33899 20 38102 36464 43 39204

Resource AME 81829 53884 342 55238 49630 102 352845 273768 224 94478

Capital AME 915 (205) 1224 (4589) (4967) 82 (984) (6012) (5110) (855)

Total AME 82744 53679 351 50649 44664 118 351861 267756 239 93623

19

-

-

Annex A Net changes in DEL Budgets between the 2014-15 SE and this Estimate and explanations of changes over 10

Detail Line shown in Part II of the Estimate

Increase (decrease) in Resource compared to 2014 15 Supplementary Estimate (poundm)

A ndash Save energy with the Green Deal

and support vulnerable consumers

(DEL)

(194) 188

Decreases in expenditure of pound204m for Government Electricity

Rebate (pound100m) Green Deal (pound50m) Heat Strategy (pound37m)

Smart Meters (pound11m) and National Carbon Mark ets (pound05m)

partially offset by increases in National Energy Efficiency

(pound05m) Fuel Poverty (pound05m)

Increase in Green Deal (pound56m) and new Energy Efficiency

loans (pound40m) together with reduction in Energy Efficiency loan

repayments (pound107m) partially offset by reduction in Fuel

Poverty (pound15m)

B ndash Deliver secure energy on the

way to a low carbon energy future

(DEL)

(166) 1427

Decreases in Carbon Capt ure and Storage (pound291m) Energy

Market Reform (pound81m) New Nuclear (pound12m) and Renewable

Energy (pound07m) partially offset by increas es in Oil amp Gas

(pound181m) and Science and Innovation (pound45m)

Increase in Carbon Capture and Storage (CCS) (pound1673m

largely due to be surrendered in the Supplementary Estimate)

Off Gas Grid heating (pound25m) Energy Innovation (pound107m) and

Renewable Energy (pound06m) partially offset by reduction in

CCS Innovation (pound51m) and Energy Market Reform (pound99m)

Increase (decrease) in Capital compared to 2014 15 Supplementary Estimate (poundm)

20

C ndash Drive ambitious action on

climate change at home and abroad

(DEL)

Increase of pound121m reflecting additional International Climate

Fund scored as Resource compared to 2014-15 partially offset

by reductions in International Climate Change (pound18m) and

International and EU Energy and Security (pound11m)

92

(256)

Increase reflects profile in International Climate Fund

expenditure as set out in 2013 Spending Review

974

(26) D ndash Manage our energy legacy

responsibly and cost-effectively

(DEL)

Reductions in British Energy provision utilisation (pound166m) Non

Proliferation (pound52m) Concessionary Fuel (pound24m) provision

utilisation Global Threat Reduction (pound09m) and Nuclear

Security (pound06m)

93

Reduction in Global Threat Reduction Programme

07 E ndash Deliver the capability DECC

needs to achieve its goals (DEL)

pound47m decrease in Administration pound141m increase in

Programme reflecting increase in contingency held at the

centre

166

-

-F ndash Oil and Gas Authority (DEL)

New line for new Executive Agency for Oil and Gas (offset by

reduction in spend in Line B)

-

21

G ndash Nuclear Decommissioning (491) 200

Authority (DEL)

Decrease of pound491m gross expenditure together with pound10m

reduction in income shown on Line M giving net decrease of

pound391m reflecting Spending Review settlement plus pound556m

carried over from 14-15 offset by pound36m reduction as NDArsquos

contribution to Resource DEL savings announced in 2013

Autumn Statement and pound20m contribution to DEL savings

announced on 4th June 2015

Increase of pound20m gross expenditure plus pound99m increase in

income shown on Line M giving net decrease of pound79m

reflecting Spending Review settlement

H ndash Coal Authority (DEL) (04) 23

- Net Capital expenditure reduced in 2014-15 due to dispos als

and clawback

I - Civil Nuclear Police Authority (20) -

(DEL)

Decrease in expenditure reflecting decrease in provisions

utilisation for redundancies

-

J ndash Committee on Climate Change (03) -

(DEL)

- -

22

K ndash Low Carbon Contracts 00 -

Company (DEL)

- -

L ndash Electricity Settlements Company 00 -

(DEL)

- -

M - Nuclear Decommissioning 100 (990)

Authority Income (CFER) (DEL)

- Forec ast increase in Capital inc ome due to disposals

Total DEL changes (682) 1803

N ndash Save energy with the Green Deal (3389) -

and support vulnerable consumers

(AME)

14-15 numbers reflect creation of a Provision for Government

Electricity Rebate payments in 2015-16

-

23

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

-

-

Annex A Net changes in DEL Budgets between the 2014-15 SE and this Estimate and explanations of changes over 10

Detail Line shown in Part II of the Estimate

Increase (decrease) in Resource compared to 2014 15 Supplementary Estimate (poundm)

A ndash Save energy with the Green Deal

and support vulnerable consumers

(DEL)

(194) 188

Decreases in expenditure of pound204m for Government Electricity

Rebate (pound100m) Green Deal (pound50m) Heat Strategy (pound37m)

Smart Meters (pound11m) and National Carbon Mark ets (pound05m)

partially offset by increases in National Energy Efficiency

(pound05m) Fuel Poverty (pound05m)

Increase in Green Deal (pound56m) and new Energy Efficiency

loans (pound40m) together with reduction in Energy Efficiency loan

repayments (pound107m) partially offset by reduction in Fuel

Poverty (pound15m)

B ndash Deliver secure energy on the

way to a low carbon energy future

(DEL)

(166) 1427

Decreases in Carbon Capt ure and Storage (pound291m) Energy

Market Reform (pound81m) New Nuclear (pound12m) and Renewable

Energy (pound07m) partially offset by increas es in Oil amp Gas

(pound181m) and Science and Innovation (pound45m)

Increase in Carbon Capture and Storage (CCS) (pound1673m

largely due to be surrendered in the Supplementary Estimate)

Off Gas Grid heating (pound25m) Energy Innovation (pound107m) and

Renewable Energy (pound06m) partially offset by reduction in

CCS Innovation (pound51m) and Energy Market Reform (pound99m)

Increase (decrease) in Capital compared to 2014 15 Supplementary Estimate (poundm)

20

C ndash Drive ambitious action on

climate change at home and abroad

(DEL)

Increase of pound121m reflecting additional International Climate

Fund scored as Resource compared to 2014-15 partially offset

by reductions in International Climate Change (pound18m) and

International and EU Energy and Security (pound11m)

92

(256)

Increase reflects profile in International Climate Fund

expenditure as set out in 2013 Spending Review

974

(26) D ndash Manage our energy legacy

responsibly and cost-effectively

(DEL)

Reductions in British Energy provision utilisation (pound166m) Non

Proliferation (pound52m) Concessionary Fuel (pound24m) provision

utilisation Global Threat Reduction (pound09m) and Nuclear

Security (pound06m)

93

Reduction in Global Threat Reduction Programme

07 E ndash Deliver the capability DECC

needs to achieve its goals (DEL)

pound47m decrease in Administration pound141m increase in

Programme reflecting increase in contingency held at the

centre

166

-

-F ndash Oil and Gas Authority (DEL)

New line for new Executive Agency for Oil and Gas (offset by

reduction in spend in Line B)

-

21

G ndash Nuclear Decommissioning (491) 200

Authority (DEL)

Decrease of pound491m gross expenditure together with pound10m

reduction in income shown on Line M giving net decrease of

pound391m reflecting Spending Review settlement plus pound556m

carried over from 14-15 offset by pound36m reduction as NDArsquos

contribution to Resource DEL savings announced in 2013

Autumn Statement and pound20m contribution to DEL savings

announced on 4th June 2015

Increase of pound20m gross expenditure plus pound99m increase in

income shown on Line M giving net decrease of pound79m

reflecting Spending Review settlement

H ndash Coal Authority (DEL) (04) 23

- Net Capital expenditure reduced in 2014-15 due to dispos als

and clawback

I - Civil Nuclear Police Authority (20) -

(DEL)

Decrease in expenditure reflecting decrease in provisions

utilisation for redundancies

-

J ndash Committee on Climate Change (03) -

(DEL)

- -

22

K ndash Low Carbon Contracts 00 -

Company (DEL)

- -

L ndash Electricity Settlements Company 00 -

(DEL)

- -

M - Nuclear Decommissioning 100 (990)

Authority Income (CFER) (DEL)

- Forec ast increase in Capital inc ome due to disposals

Total DEL changes (682) 1803

N ndash Save energy with the Green Deal (3389) -

and support vulnerable consumers

(AME)

14-15 numbers reflect creation of a Provision for Government

Electricity Rebate payments in 2015-16

-

23

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

C ndash Drive ambitious action on

climate change at home and abroad

(DEL)

Increase of pound121m reflecting additional International Climate

Fund scored as Resource compared to 2014-15 partially offset

by reductions in International Climate Change (pound18m) and

International and EU Energy and Security (pound11m)

92

(256)

Increase reflects profile in International Climate Fund

expenditure as set out in 2013 Spending Review

974

(26) D ndash Manage our energy legacy

responsibly and cost-effectively

(DEL)

Reductions in British Energy provision utilisation (pound166m) Non

Proliferation (pound52m) Concessionary Fuel (pound24m) provision

utilisation Global Threat Reduction (pound09m) and Nuclear

Security (pound06m)

93

Reduction in Global Threat Reduction Programme

07 E ndash Deliver the capability DECC

needs to achieve its goals (DEL)

pound47m decrease in Administration pound141m increase in

Programme reflecting increase in contingency held at the

centre

166

-

-F ndash Oil and Gas Authority (DEL)

New line for new Executive Agency for Oil and Gas (offset by

reduction in spend in Line B)

-

21

G ndash Nuclear Decommissioning (491) 200

Authority (DEL)

Decrease of pound491m gross expenditure together with pound10m

reduction in income shown on Line M giving net decrease of

pound391m reflecting Spending Review settlement plus pound556m

carried over from 14-15 offset by pound36m reduction as NDArsquos

contribution to Resource DEL savings announced in 2013

Autumn Statement and pound20m contribution to DEL savings

announced on 4th June 2015

Increase of pound20m gross expenditure plus pound99m increase in

income shown on Line M giving net decrease of pound79m

reflecting Spending Review settlement

H ndash Coal Authority (DEL) (04) 23

- Net Capital expenditure reduced in 2014-15 due to dispos als

and clawback

I - Civil Nuclear Police Authority (20) -

(DEL)

Decrease in expenditure reflecting decrease in provisions

utilisation for redundancies

-

J ndash Committee on Climate Change (03) -

(DEL)

- -

22

K ndash Low Carbon Contracts 00 -

Company (DEL)

- -

L ndash Electricity Settlements Company 00 -

(DEL)

- -

M - Nuclear Decommissioning 100 (990)

Authority Income (CFER) (DEL)

- Forec ast increase in Capital inc ome due to disposals

Total DEL changes (682) 1803

N ndash Save energy with the Green Deal (3389) -

and support vulnerable consumers

(AME)

14-15 numbers reflect creation of a Provision for Government

Electricity Rebate payments in 2015-16

-

23

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

G ndash Nuclear Decommissioning (491) 200

Authority (DEL)

Decrease of pound491m gross expenditure together with pound10m

reduction in income shown on Line M giving net decrease of

pound391m reflecting Spending Review settlement plus pound556m

carried over from 14-15 offset by pound36m reduction as NDArsquos

contribution to Resource DEL savings announced in 2013

Autumn Statement and pound20m contribution to DEL savings

announced on 4th June 2015

Increase of pound20m gross expenditure plus pound99m increase in

income shown on Line M giving net decrease of pound79m

reflecting Spending Review settlement

H ndash Coal Authority (DEL) (04) 23

- Net Capital expenditure reduced in 2014-15 due to dispos als

and clawback

I - Civil Nuclear Police Authority (20) -

(DEL)

Decrease in expenditure reflecting decrease in provisions

utilisation for redundancies

-

J ndash Committee on Climate Change (03) -

(DEL)

- -

22

K ndash Low Carbon Contracts 00 -

Company (DEL)

- -

L ndash Electricity Settlements Company 00 -

(DEL)

- -

M - Nuclear Decommissioning 100 (990)

Authority Income (CFER) (DEL)

- Forec ast increase in Capital inc ome due to disposals

Total DEL changes (682) 1803

N ndash Save energy with the Green Deal (3389) -

and support vulnerable consumers

(AME)

14-15 numbers reflect creation of a Provision for Government

Electricity Rebate payments in 2015-16

-

23

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

K ndash Low Carbon Contracts 00 -

Company (DEL)

- -

L ndash Electricity Settlements Company 00 -

(DEL)

- -

M - Nuclear Decommissioning 100 (990)

Authority Income (CFER) (DEL)

- Forec ast increase in Capital inc ome due to disposals

Total DEL changes (682) 1803

N ndash Save energy with the Green Deal (3389) -

and support vulnerable consumers

(AME)

14-15 numbers reflect creation of a Provision for Government

Electricity Rebate payments in 2015-16

-

23

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

O ndash Drive ambitious action on (155) (196)

climate change at home and abroad

(AME)

pound155m decrease for accounting adjustments to International

Climate Fund investments

pound196m decrease for discounting and unwinding of discount for

Promissory Notes for International Climate Fund

P - Manage our energy legacy (2065) 348

responsibly and cost-effectively

(AME)

Reduction of pound1881m in movement in provisions and pound374m

reduction in movement in coal pensions investments partially

offset by pound190m increase arising from reduction in provisions

utilisation credit - see section 9 for further details of AME

Reduction in receipts from coal pensions investments - see

section 9 for further details of AME

Q ndash Renewable Heat Incentive (AME) 2063 (23)

Increase in Renewable Heat Incentive budget reflecting

expected uptake in this new scheme

Renewable Heat Premium Payment ndash scheme closed in 2013shy

14 with a small residual amount scored in 14-15

R - Nuclear Decommissioning (55350) -

Authority (AME)

Forec ast reduction in increase in nuclear provision compared to

14-15 See Section 8 for further details

-

S ndash Coal Authority (AME) 347 -

Forec ast increase in provision movement ndash see Section 9 -

24

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

T ndash Civil Nuclear Police Authority 06 -

(AME)

Decrease in credit arising from provisions utilisation for

redundancies

-

U ndash Low Carbon Contracts (155135) -

Company (AME)

Reduction in the inc reas e in provision for the fair value of

liabilities expected to be incurred for Contracts for Difference

under the Electricity Market Reform programme due to fewer

contracts expected to be signed - see Section 8

-

Deliver secure energy on the way to (44688) -

a low carbon energy future (AME)

Provision for the fair value of liabilities expected to be inc urred

for Contracts for Difference under the Electricity Market Reform

programme are budgeted for by the Low Carbon Contracts

Company since its formation in August 2014 - see Section 8

-

Committee on Climate Change (00) -

(AME)

- -

Total AME change s (258367) 129

25

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

Annex B

Explanation of Key Terms and Glossary of Abbreviations

Departmental Expenditure Limit (DEL) This is spending that is within the Departmentrsquos control and can therefore be planned over an extended period It is a Treasury budgetary control that is set for three or four-year periods Examples include administration costs payments for goods and services grant scheme payments and non-cash costs such as depreciation

Annually Managed Expenditure (AME) This is spending that is generally less predictable and controllable than expenditure in DEL It is a Treasury budgetary control that is reviewed twice a year with Departments via the Main and Supplementary Estimates

Virement The use of savings on one or more sections or subheads to meet excesses on another section or subhead within the same Request for Resources (RfR) of an Estimate

Administration Budget A Treasury control on the resources consumed directly by departments and agencies in providing those services which are not directly associated with frontline service delivery Includes such things as pay resource expenditure on accommodation utilities and services

Non-cash Costs where there is no cash transaction but which are included in a bodyrsquos accounts to establish the true cost of all the resources consumed eg depreciation

OSCAR OSCAR (Online System for Central Accounting and Reporting) is a Treasury database holding departmental public expenditure data (outturn and plans) for a run of years and is the replacement for COINS (Combined Online INformation System)

Arms Length Body (ALB) Public bodies which are outside of Departments but usually funded by a Department through the mechanism of grant-in-aid eg the Nuclear Decommissioning Authority and the Committee on Climate Change

Contracts for Difference (CfDrsquos) Contracts for Difference support investment in low carbon generation by providing a guaranteed price to generators (ldquothe strike pricerdquo) This will usually be a top-up to the market price but at times of high market prices generators will be required to pay back the difference between the market price and the strike price Differences between the market price and strike price are met by suppliers via electricity consumers

26

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought

Other Abbreviations

CA Coal Authority

CCC Committee on Climate Change

CNPA Civil Nuclear Police Authori ty

Defra Department for Environment Food and Rural Affairs

DFID Department for International Development

EMR Electricity Market Reform

ESC Electricity Settlements Company

FITs Feed-In Tariffs

GER Government Electricity Rebate

IAEA International Atomic Energy Agency

ICF International Climate Fund

LCCC Low Carbon Contracts Company

ME Main Estimate

MoD Ministry of Defence

NDA Nuclear Decommissioning Authority

OBR Office for Budget Responsibility

ODA Official Development Assistance

OGA Oil and Gas Authority

RHI Renewable Heat Incentive

RHPP Renewable Heat Premium Programme

SE Supplementary Estimate

SIA Security and Intelligence Agencies

UNFCCC United Nations Framework Convention on Climate Change

27

• 1 Introduction
• 2 Summary of provision sought
• 3 Changes from 2014-15 and Spending Review 2013
• 4 Detailed breakdown of changes in DEL provision
• 5 Budget Exchange
• 7 Nuclear Decommissioning Authority (NDA)
• 8 Annually Managed Expenditure (AME)
• 9 Net Cash Requirement
• 10 DEL and AME Budget comparison to prior and future years
• Detailed breakdown of Part II table changes from 2014-15
• Explanation of Key Terms and Glossary of Abbreviations
• 2 Summary of provision sought