Nuclear Energy Overview - Nuclear Energy Institute

Jan. 30–Feb. 5, 2015
A report to members of the
Nuclear Energy Institute
Sen. Alexander Steps to the Forefront on Nuclear Energy
In This Issue
Sen. Alexander Steps
To the Forefront
On Nuclear Energy
President’s Budget
Emphasizes Fuel Cycle,
Used Fuel Programs
NRC Says No Technical
For Yucca Mountain
NRC Staff
Recommends COL
For Fermi 3 ESBWR
Security Experts Urge
Flexible Approach
On Foreign Ownership
Senator urges U.S. to learn lessons from other nations
Warns of rising prices, lower standard of living without nuclear
NEI: Major energy speech comes at “perfect time”
Feb. 5, 2015—Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Appropriations
Subcommittee on Energy and Water Development, made a major energy policy speech today
at the Nuclear Energy Institute. Painting a grim picture of “The United States Without Nuclear
Power,” Alexander outlined policy prescriptions to keep nuclear energy a vital element of a
diverse U.S. energy portfolio.
NEI President and CEO Marvin Fertel and Sen. Lamar Alexander at NEI
“A United States without nuclear power—or with very little nuclear power—is a very real
possibility. It’s a possibility we should not want, if we want a strong country and a strong
economy,” Alexander said. To address the issue, his subcommittee “will begin expanded
oversight” of nuclear energy issues with budget hearings in February and March, followed by
hearings on “the future of nuclear power in our country.”
Jan. 30–Feb. 5, 2015
Page 2
Alexander said the United States should learn from the examples of Japan and
Germany, where the shutdown of nuclear power plants has led to soaring electricity
costs and reduced energy security.
“The cost of generating electricity in Japan has increased 56 percent since they began
shutting down their reactors in 2011,” Alexander said. He said three major Japanese
business organizations have called for restart of the nuclear power plants so the
country can “return to inexpensive and stable supplies of electricity.”
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Alexander referred to a Wall Street Journal article that said the electricity austerity in
Japan is so severe that the emperor and empress have been seen “wandering around
the Imperial Palace at night with flashlights and candles.”
He described the situation in Germany as “an energy mess.” Until 2011, nuclear
energy generated about 25 percent of the nation’s electricity. Then the government
decided to phase out nuclear energy and replace it with wind and solar power, at an
estimated cost of $1.2 trillion. Average electricity prices have risen 60 percent in the
past five years, he said, and are among the highest in the European Union.
Germany is filling the gaps in its own energy supply by importing nuclear electricity
from France and natural gas from Russia, which is “a very unreliable partner.”
“And in a remarkable turn of events, Germany started building coal plants,”
Alexander said.
The United States faces the same troubled energy future as Japan and Germany
unless it takes steps now to ensure that nuclear energy remains part of the nation’s
electricity portfolio, Alexander said. He outlined six key steps, including building more
nuclear plants, ending the stalemate over used nuclear fuel and avoiding
NEI’s Alex Flint, senior vice president for governmental affairs, said the senator “hit it
out of the park today. His clarion call for policies to ensure that America can continue
to depend on reliable, carbon-free nuclear energy comes at a perfect time.” Alexander
“effectively made the point that there is a lot at stake, and that the energy decisions
we make today will shape our nation’s future for generations to come,” Flint said.
The full text of the senator’s speech is available on NEI’s website, and an archived
video recording will be on NEI’s YouTube channel. << NEI Staff, [email protected]
President’s Budget Emphasizes
Fuel Cycle, Used Fuel Programs
Includes funds for consent-based siting of used fuel storage
Continues support for small reactor development cost-share project
Industry urges congressional oversight of NRC operations
Feb. 5, 2015—The Department of Energy’s fiscal 2016 budget proposal seeks to
re-impose a multi-billion dollar tax for the cleanup of three DOE-owned uranium
enrichment facilities, a move the nuclear energy industry deplores as redundant and
unfair. But other aspects of the budget are more in line with industry goals.
Jan. 30–Feb. 5, 2015
Page 3
This year marks the sixth time the Obama administration has requested
reinstatement of the decontamination and decommissioning tax, even though
Congress has consistently turned it back.
“We recognize that the federal government has significant budget pressures, but
reinstating unjustified taxes on utility rate payers who have met their funding
obligation while the government has failed to meet its own is outrageously unfair,” NEI
Senior Vice President for Governmental Affairs Alex Flint said. “The uranium
enrichment D&D tax proposal should be dead on arrival in Congress.”
In other areas, the budget requests $62 million to continue supporting certification
and licensing assistance for the small reactor design being developed by NuScale under
a cost-share public-private partnership with DOE.
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The overall fiscal 2016 budget proposal for DOE’s Office of Nuclear Energy is
$907.5 million. The request is 9 percent higher than the $863 million requested for
fiscal 2015 and slightly below the $913.5 million enacted by Congress.
The Nuclear Regulatory Commission budget proposal of $1.03 billion is 1.7 percent
higher than the enacted budget. Ninety percent of DOE’s budget is recouped via fees
from the nuclear energy industry.
Flint said the NRC’s oversight priorities merit “close scrutiny” by Congress, given the
industry’s strong safety performance and the fact that utilities’ plans for new nuclear
generating capacity are still being shaped by the recession’s lingering effects.
“We urge Congress to insist upon NRC adherence to its principles of good regulation
so that nuclear energy facilities can most safely and effectively meet their customers’
need for reliable, clean air power supplies,” Flint said. The industry’s priority to ensure
public safety “is being challenged by the surplus of nonessential regulations and
directives the NRC has imposed over the past decade,” he said.
Most DOE programs only saw modest changes. However, the administration
requested $217.7 million for fuel cycle R&D, a $20.7 million increase from the
$197 million enacted for fiscal 2015.
The budget also zeroes out DOE and NRC programs to train the next generation of
nuclear industry workers and advance nuclear energy education, a move Flint said
makes “no sense.” It would eliminate university programs that support scholarships,
fellowships and junior faculty at four-year institutions and community colleges. The
administration has consistently cut these programs, though Congress has just as
consistently provided about $5 million annually.
The administration is requesting $108 million to develop one or more facilities for
used fuel and high-level radioactive waste management using consent-based siting as
recommended by the Blue Ribbon Commission on America’s Nuclear Future in 2012.
This represents a significant boost from the $79 million proposed for fiscal 2015. An
additional $3 million is proposed to fund research into disposal options for some of
DOE’s high-level waste and used fuel. The administration included no funds to
continue the Yucca Mountain licensing process but proposes using $24 million from
Page 4
Jan. 30–Feb. 5, 2015
the Nuclear Waste Fund for generic process development and other non-R&D activities
related to used fuel storage, transportation and disposal.
Co-organized by NEI and
World Nuclear Association,
World Nuclear Fuel Cycle
2015 provides a top-level
international forum for
senior industry leaders to
discuss the issues affecting
the commercial nuclear fuel
cycle today, with a focus on
enhancing the economic
competitiveness of the
nuclear fuel cycle and
nuclear energy.
This year’s conference also
features a technical visit to
Temelin Nuclear Power Plant.
For more information and
to register visit:
The administration requests $345 million to continue construction of DOE’s Mixed
Oxide Fuel Fabrication Facility in South Carolina, a turnabout from the fiscal 2015
proposal to put the facility into cold standby while DOE researched options for disposal
of surplus plutonium. Congress last year turned back the idea and funded the facility’s
continued construction. The MOX fuel, which would be fabricated from recycled
surplus defense-origin plutonium and uranium, is potentially a fuel for the domestic
nuclear energy industry.
Jan. 30–Feb. 5, 2015
Page 5
Funding for DOE’s loan guarantee program remains consistent in this budget request,
with $18.5 billion authority. Last year DOE finalized the first nuclear energy-specific
loan guarantee of $6.5 billion to Southern Co. and its partners to help finance the
construction of two new reactors at the Plant Vogtle site in Georgia.
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Loan guarantees are not an actual appropriation and, therefore, do not represent an
outlay of taxpayer dollars when the projects they support are successfully completed.
The guarantees aim to boost investor confidence and allow worthy projects to obtain
financing on more reasonable terms that ultimately will lower the cost of electricity
generated by the projects. For nuclear power projects, recipients must pay a
substantial origination fee, negotiations over which delayed final approval for the
Southern Co. loan guarantee.
The accompanying chart shows DOE’s budget numbers in categories relevant to the
nuclear energy industry. It will appear in Nuclear Energy Overview periodically, revised
to follow the federal appropriations process through the year. << Mark Flanagan,
[email protected]
NRC Says No Technical Showstoppers for Yucca Mountain
Issuance of Volumes 2 and 5 of Yucca evaluation completes technical review
Overall conclusion is that NRC safety requirements have been met
Next steps on adjudicatory process will require additional funding
Feb. 4, 2015—The U.S. Nuclear Regulatory Commission in late January issued the last
two of five volumes of its safety evaluation report on the proposed geologic repository
for spent nuclear fuel at Yucca Mountain in Nevada. The action completed the first half
of a two-part licensing process to determine whether the repository can be built.
“This milestone completes the NRC staff’s technical review of the Department of
Energy’s safety analysis of the proposed repository,” NEI Senior Director for Used Fuel
and Decommissioning Programs Rodney McCullum said.
“The NRC’s independent experts have concluded in these reports that DOE’s
proposed repository as designed will be capable of safely isolating used nuclear fuel
and high-level radioactive waste for the 1-million-year period specified in the
regulations and that the repository design assures operational safety in the period
before its permanent closure,” McCullum said.
Repository safety before permanent closure, the subject of Volume 2 of the safety
evaluation report, concludes that DOE’s license application meets the NRC’s regulatory
requirements in that area. Post-closure safety for the 1-million-year period was the
subject of Volume 3, which was completed last October. Volume 5, also issued last
week, contains the staff’s overall conclusion that, except for the administrative items
in Volume 4 noted below, the NRC’s applicable safety and regulatory requirements
have been met.
Jan. 30–Feb. 5, 2015
Page 6
Volume 4, on administrative and programmatic requirements, was published in
December. That report identified land and water access rights that DOE would have to
acquire before a construction authorization could be issued. McCullum said that these
items could be addressed if Congress and the administration fully funds and
reconstitutes a viable project organization for the Yucca Mountain program. Because
DOE has not yet acquired these rights, the safety evaluation report stopped short of
recommending that a construction authorization be issued.
Volume 1 was completed in August 2010 after DOE moved in 2009 to withdraw its
2008 Yucca Mountain license application but before the NRC suspended licensing
review in 2011. The remaining volumes were completed after a federal court ordered
the agency in 2013 to resume its review using available Nuclear Waste Fund money.
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Before a final licensing decision can be made, the second step of the licensing
process requires that DOE’s safety analysis and the NRC’s safety evaluation undergo
adjudicatory scrutiny, where intervening parties are given the opportunity to challenge
the conclusions before an NRC Atomic Safety and Licensing Board panel composed of
three impartial judges. McCullum noted that this step also will require additional
In addition, a supplement to the Department of Energy’s environmental impact
statement will need to be completed—the NRC says it “is prepared” to also complete
this document, an option allowed in the regulations, since DOE has declined to do so.
All five volumes are available on the NRC website as NUREG-1949, Safety Evaluation
Report Related to Disposal of High-Level Radioactive Wastes in a Geologic Repository
at Yucca Mountain, Nevada. << Chris Charles, [email protected]
NRC Staff Recommends COL for Fermi 3 ESBWR
Fermi 3 will be the reference COL for the ESBWR design
DTE Energy will make construction decision at future date
Decision to grant license awaits final NRC vote
Feb. 5, 2015—Nuclear Regulatory Commission staff recommended this week that the
agency grant a combined construction and operating license (COL) to DTE Energy Co.
for an Economic Simplified Boiling Water Reactor (ESBWR) at the Fermi site in Monroe
County, Mich.
“We [NRC staff] have provided an adequate basis for making the necessary finding …
supporting the issuance of the combined license for Fermi 3,” Glenn Tracy, director of
the NRC’s Office of New Reactors, said at a Feb. 4 NRC public hearing. “We are similarly
confident that … we will be able to confirm that the plant will be built and operated in
conformance with the license.”
DTE Energy said that while the utility has not made a final decision on whether to
move forward with the project, it anticipates a timely decision from the NRC on the
license application.
Jan. 30–Feb. 5, 2015
Page 7
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“We’re looking forward to being the first ESBWR license holder,” said Peter Smith,
director of nuclear development at DTE Energy. “We believe our application and the
staff’s work provide the basis for you making the statutory findings necessary to
approve the license.”
Tracy said the NRC has devoted substantial time and resources to reviewing the
license application since its 2008 submittal.
“The staff has expended approximately 52,000 hours on the safety review and
another 17,000 hours on the environmental review, which involved well over 1,000
engineers, scientists and technical specialists, many of them here today.”
On the applicant side, Smith noted that DTE and its key contractors have spent “more
than a quarter-million man-hours” on the project.
GE Hitachi Nuclear Energy’s passive safety design features on the ESBWR—the
reactor can safely cool itself with no AC electrical power or human intervention for
more than seven days—helped the new plant to meet post-Fukushima safety
enhancements, Smith said. NRC staff agreed with DTE Energy’s assessment.
“The applicant met all applicable standards in implementation of post-Fukushima
near-term task force recommendations,” Tracy said.
Smith mentioned the substantial support the Fermi plant has from the local
“We have really good relations with our local and state officials and we spend time
educating them about our company,” Smith said. “We’re a major employer in the local
community. The area’s used to having the plant there. ... We work very hard with the
relationships and our presence in the community.”
The NRC commission must cast a final vote on whether to approve the COL
application and DTE Energy has not yet decided whether to go forward with the
project, but Smith said that it would be “good to have the option to build.”
NRC Chairman Stephen Burns said the NRC would issue a final decision on the COL
application for Fermi 3 “promptly with due regard for the complexities before it.”
The meeting agenda and slides are available on the NRC website.
Security Experts Advise Flexible Approach
On Foreign Ownership
NRC gathers feedback from security experts in non-nuclear industries
Globalized technology markets call for updated FOCD regime
Panel cautions against using single criterion to measure risk
Feb. 4, 2015—Experts in the security field last week encouraged the U.S. Nuclear
Regulatory Commission to modernize the agency’s approach to its Cold War-era rules
concerning the foreign ownership, control or domination of U.S. nuclear energy
Jan. 30–Feb. 5, 2015
Page 8
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At a Jan. 29 briefing for NRC commissioners on the issue, known by the acronym
FOCD, a panel of government and corporate experts outside the nuclear energy field
made several important points that support rationalizing the NRC’s process to
recognize the globalization of the nuclear technology marketplace.
The panelists each noted that foreign investment, technology and expertise are
essential to innovation and national security in their fields and will be crucial in
sustaining America’s role as a leader in the global nuclear power industry.
“Today we live in a world of global supply chains, international consortia of
producers and a world of global and instantaneous communications,” the Center for
Strategic and International Studies’ president and CEO, John Hamre, said. “Capital is
global, and complex projects are funded on an international basis. The rules
appropriate for 1955 are completely inappropriate for 2015.”
The Nuclear Energy Institute has asked the NRC to offer clearer, more predictable
guidance on FOCD. In November, NEI urged the commission to clarify the criteria used
in FOCD reviews, to provide “necessary stability to what is now an unpredictable
review process” (see Nuclear Energy Overview, Dec. 4, 2014).
“Nuclear technology is no longer limited to the United States and a few select other
nations—power reactor technology is now owned and controlled by international
companies,” NEI’s letter noted.
NEI said the acceptability of foreign participation or investment in a nuclear project
should not depend on an arbitrary percentage of ownership by a foreign entity.
The panel also said the NRC should not let decades-old concerns regarding nuclear
proliferation and technology transfer stand in the way of foreign investment in nuclear
plants today. William Lynn III, CEO of Finmeccanica North America, said Cold War-era
regulations to prevent the loss of technology to a potential adversary may no longer be
relevant. Today, he said, companies investing in U.S. projects are from nations that
already have the technology to be deployed.
The panelists suggested that excessive or unacceptable control or domination could
be mitigated by using a graded, flexible approach that is limited to the specific matter
of concern. This is consistent with the graded approach to FOCD assessments that NEI
has advocated.
Slide presentations and an archived webcast of the Jan. 29 briefing are available on
the NRC website. << Thaddeus Swanek, [email protected]
Sizewell B Approved to Operate Until 2025
Sizewell B, the United Kingdom’s only pressurized water reactor, has been cleared by
the U.K. Office for Nuclear Regulation to continue generating electricity until 2025.
Nuclear power plants in the U.K. are required to undergo a periodic safety review
(PSR) every 10 years. The reviews look at the previous 10 years of a plant’s operating
history and consider processes to ensure safe operation for the next decade.
Jan. 30–Feb. 5, 2015
Page 9
The current PSR said that ONR had identified “no issues of nuclear safety significance
that could impact generation at Sizewell B to the next date of review (2025).” ONR said
it will publish the assessment “in due course.”
Plant operator EDF Energy said that the review had highlighted “opportunities for
improvement,” which will be carried out during the plant’s refueling outages every 18
months. The plant’s current stated lifetime is until 2035, although EDF is aiming for a
20-year life extension, to 2055.
Ringhals 4 Gets 18 Percent Power Uprate
Sweden’s Radiation Safety Authority (SSM) has approved a power increase for the
Ringhals 4 pressurized water reactor. The uprate, partly achieved by replacing one of
the reactor’s three steam generators, will increase the reactor’s thermal output by 18
percent, from 2,783 megawatts-thermal to 3,300 MWt. The resulting increase in
generating capacity will be 175 megawatts-electric.
The reactor is one of four on the Ringhals site, 35 miles from Göteborg, and is owned
by Vattenfall and E.On. The plant will be operated at the higher output on a trial basis,
until it passes an audit by SSM. << Chris Charles, [email protected]
France, China Sign More Cooperation Agreements
During a meeting of French Prime Minister Manuel Valls and Chinese premier Li
Keqiang last week, French and Chinese energy companies signed bilateral nuclear
cooperation agreements.
French utility EDF and China General Nuclear Power Group signed an agreement to
share expertise in plant operation and engineering support for existing nuclear power
plants. The aim of the agreement is to preserve the highest safety levels and “maintain
consistency between French and Chinese procedures and standards.”
AREVA Group and China National Nuclear Corp. signed a memorandum of
understanding for a joint venture that will supply used nuclear fuel transportation and
logistics services in China, “by road, train and sea.” The agreement extends the
“strategic partnership” announced in March 2014 between the two companies to
advance cooperation to the entire fuel cycle, beyond reactors and services.
Argentina, China to Build Fourth Reactor
Argentina and China have ratified a 2014 agreement to work jointly on building a
fourth nuclear power reactor. The 800-megawatt CANDU will be built at the existing
Atucha site near Buenos Aires. The accord was signed by Argentinian federal planning
minister Julio De Vido and Nur Bekri, president of China's National Energy
Administration and vice president of China National Nuclear Co.
Plant operator Nucleoeléctrica Argentina S.A., which has rights to CANDU
technology, will be designer, architect-engineer, builder and operator of the new
reactor. CNNC, which operates two CANDU 6 reactors at Qinshan in Zhejiang province,
will provide equipment, goods and services. << Chris Charles, [email protected]
Jan. 30–Feb. 5, 2015
Page 10
The U.K.’s Office for Nuclear Regulation, or ONR, has named Deputy Chief Executive
Officer Les Philpott as the agency’s interim CEO effective March 1. The current CEO,
John Jenkins, announced he would be leaving the post after having accomplished his
mission to “successfully set up the ONR as a public corporation.” ONR was previously
an internal agency of the Health and Safety Executive—Jenkins was tasked by HSE in
2012 to help ONR become an independent nuclear regulator.