The Nuclear Decommissioning Authority will take control of the Sellafield nuclear site in Cumbria from Nuclear Management Partners.
In the new arrangements, ownership of Sellafield reverts to the NDA from NMP, a consortium made up of URS, Areva and AMEC, which took control of Sellafield as part of a £22bn contract in 2008.
The Sellafield board will continue to consist of existing non-executive directors and key members of the current executive team, but over time will now also see the introduction of NDA appointed directors.
Reporting to this board will be the Sellafield executive team which will continue to have day-to-day management responsibilities for the site. The transition will take around 15 months.
A statement from the Department for Energy & Climate Change said that a "strategic partner" from the private sector would be sought to advise and assist the Sellafield executive team.
NMP was awarded a five-year contract by the NDA in 2008, and was granted a £9bn five-year extension in 2013.
However, a report from the Public Accounts Committee in 2014 said that progress on the clean-up of Sellafield had been "poor" and estimated the overall cost of decommissioning had reached around £70bn. The report requested that the NDA review NMP's contract if performance did not improve.
The NDA said that it anticipated the full co-operation of NMP during the handover process.
Iain Irving, general manager at NMP, said: "The NDA has advised us of its decision to make changes to its current contractual model for running the Sellafield site. We are surprised and naturally disappointed, especially in light of the considerable progress made at Sellafield since NMP was awarded the contract in 2008. NDA has made it very clear that it is the contractual model that it is being revised and has acknowledged the progress made by NMP over the last six years.
"Accordingly, we would like to highlight that since the NDA extended our contract to lead Sellafield in October 2013 extensive progress has been achieved by NMP and the site licence company, of which we are extremely proud. Also, the last 12 months have seen some of the site's highest levels of performance, whilst, over the last two years we have consecutively achieved the site's best overall safety records."
Sellafield has been owned by the NDA since 2005. The clean-up process is expected to take around 100 years. The Sellafield sites include Capenhurst in Cheshire and Risley near Warrington.