Nuclear Energy Policy

Transcription

1 Order Code RL33558 Nuclear Energy Policy Updated January 28, 2008 Mark Holt Specialist in Energy Policy Resources, Science, and Industry Division

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3 Nuclear Energy Policy Summary Nuclear energy policy issues facing Congress include the implementation of federal incentives for new commercial reactors, radioactive waste management policy, research and development priorities, power plant safety and regulation, nuclear weapons proliferation, and security against terrorist attacks. The Bush Administration has called for an expansion of nuclear power. For Department of Energy (DOE) nuclear energy research and development and infrastructure, the Administration requested $801.7 million for FY2008, nearly 30% above the FY2007 funding level. The request would have boosted funding for the Advanced Fuel Cycle Initiative (AFCI) from $167.5 million in FY2007 to $395.0 million in FY2008. The FY2008 omnibus appropriations act holds AFCI to $181 million and shifts the mixed-oxide (MOX) fuel program totaling $281 million to the nuclear energy program from the nuclear nonproliferation program. That brings the nuclear energy total to $970.5 million ($961.7 million with an across-theboard rescission), about 20% above the request. An additional $75.9 million provided in the Other Defense Activities account brings the Office of Nuclear Energy s total spending level to $1.046 billion ($1.037 billion with the rescission). Significant incentives for new commercial reactors were included in the Energy Policy Act of 2005 (P.L ), signed by the President on August 8, These include production tax credits, loan guarantees, insurance against regulatory delays, and extension of the Price-Anderson Act nuclear liability system. Together with higher fossil fuel prices and the possibility of greenhouse gas controls, the federal incentives for nuclear power have helped spur renewed interest by utilities and other potential reactor developers. Plans for about 30 reactor license applications have been announced, although no commitments have been made to build the plants. No reactor has been ordered in the United States since 1978, and all orders since 1973 were subsequently canceled. The September 11, 2001, terrorist attacks on the United States raised concern about nuclear power plant security. The Energy Policy Act of 2005 included several reactor security provisions, including requirements to revise the security threats that nuclear plant guard forces must be able to defeat, regular force-on-force security exercises at nuclear power plants, and the fingerprinting of nuclear facility workers. Disposal of highly radioactive waste has been one of the most controversial aspects of nuclear power. The Nuclear Waste Policy Act of 1982 (P.L ), as amended in 1987, requires DOE to conduct a detailed physical characterization of Yucca Mountain in Nevada as a permanent underground repository for high-level waste. DOE had planned to submit a license application for the Yucca Mountain repository to the Nuclear Regulatory Commission (NRC) by June 30, 2008, with the repository to open by 2017 at the earliest. However, a substantial budget reduction in FY2008 is likely to cause delays, according to program officials. This report will be updated as events warrant.

4 Contents Most Recent Developments...1 Nuclear Power Status and Outlook...2 Possible New Reactors...3 Federal Support...5 Global Climate Change...6 Nuclear Power Research and Development...7 Nuclear Power Generation IV...10 Fuel Cycle Research and Facilities...12 Nuclear Hydrogen Initiative...12 Nuclear Power Plant Safety and Regulation...13 Safety...13 Domestic Reactor Safety...13 Reactor Safety in the Former Soviet Bloc...14 Licensing and Regulation...14 Reactor Security...16 Decommissioning...16 Nuclear Accident Liability...17 Nuclear Waste Management...19 Nuclear Weapons Proliferation...20 Federal Funding for Nuclear Energy Programs...22 Legislation...24 List of Tables Table 1. Announced Nuclear Plant License Applications...4 Table 2. Funding for the Nuclear Regulatory Commission...23 Table 3. DOE Funding for Nuclear Activities...23

5 Nuclear Energy Policy Most Recent Developments The Bush Administration s FY2008 budget request, released February 5, 2007, included $801.7 million for Department of Energy (DOE) nuclear energy research and development and infrastructure, nearly 30% above the FY2007 appropriation. The request would have boosted funding for the Advanced Fuel Cycle Initiative (AFCI) from $167.5 million in FY2007 to $395.0 million in FY2008, as the primary component of the Administration s Global Nuclear Energy Partnership (GNEP). The House voted July 17, 2007, to cut AFCI to $120.0 million while providing a total funding level of $835.2 million for nuclear energy (H.R. 2641, H.Rept ). The Senate Appropriations Committee recommended $242.0 million for AFCI and $795.5 million for nuclear energy overall (S. 1751, S.Rept ). The FY2008 omnibus appropriations act, signed December 26, 2007 (P.L ), holds AFCI to $181 million and shifts the mixed-oxide (MOX) fuel program totaling $281 million to the nuclear energy program from the nuclear nonproliferation program. That brings the nuclear energy total to $970.5 million ($961.7 million with an acrossthe-board rescission), about 20% above the request. An additional $75.9 million provided in the Other Defense Activities account brings the Office of Nuclear Energy s total spending level to $1.046 billion ($1.037 billion with the rescission). The Administration requested $494.5 million for the civilian nuclear waste program in FY2008, $50 million above the FY2007 level. The House approved the full request, while the Senate Appropriations Committee voted to hold the program s funding to about the FY2007 level. The FY2008 omnibus appropriations act cuts the program s funding to $386.4 million. The program is developing a national nuclear waste repository at Yucca Mountain, Nevada. DOE announced on July 19, 2006, that it would submit a Yucca Mountain license application to the Nuclear Regulatory Commission (NRC) by June 30, DOE had hoped to begin shipping waste to Yucca Mountain by 2017, but the FY2008 funding reduction is likely to cause delays, according to program officials. NRC issued the first nuclear reactor Early Site Permit (ESP) March 15, 2007, to Exelon Generating Company for a potential new reactor at the company s Clinton, IL, nuclear plant. NRC authorized a second ESP on March 27, for the Grand Gulf site in Mississippi, and a third, for the North Anna site in Virginia, on November 20. The holders of those ESPs will not have to revisit site-related issues if they seek licenses for new reactors at those locations during the next 20 years. The first four applications for combined construction permits and operating licenses (COLs) for new nuclear power plants recently were submitted to NRC. On September 20, 2007, NRG Energy submitted an application for two new reactors at the South Texas Project site. The Tennessee Valley Authority (TVA), as part of a

6 CRS-2 consortium called NuStart, submitted an application for two new reactors at the Bellefonte site in Alabama on October 30, Dominion Energy submitted an application for a new unit at North Anna on November 27, and on December 13, Duke Energy submitted an application for a two-unit plant in Cherokee County, SC. A partial application for a new reactor at the Calvert Cliffs site in Maryland was submitted in July Half the costs of the NuStart and Dominion applications are being paid by DOE under the Nuclear Power 2010 program. NRC is anticipating COL applications for as many as 31 new reactors through None of the applicants have yet committed to actual plant construction, however. Nuclear Power Status and Outlook The future of nuclear power in the United States has long been uncertain. No nuclear power plants have been ordered in the United States since 1978, and more than 100 reactors have been canceled, including all ordered after The most recent U.S. nuclear unit to be completed was TVA s Watts Bar 1 reactor, ordered in 1970 and licensed to operate in But nuclear power is now receiving renewed interest, prompted by higher fossil fuel prices, possible carbon dioxide controls, and new federal subsidies and incentives. The U.S. nuclear power industry currently comprises 104 licensed reactors at 65 plant sites in 31 states and generates about 20% of the nation s electricity. 1 That number includes TVA s Browns Ferry 1, which restarted May 22, 2007, after a 22- year shutdown and $1.8 billion refurbishment. TVA s board of directors voted August 1, 2007, to resume construction on Watts Bar 2, which had been suspended in 1985; the project is to cost about $2.5 billion and be completed in Electricity production from U.S. nuclear power plants is greater than that from oil and hydropower, and about the same as natural gas, although it remains well behind coal, which accounts for about half of U.S. electricity generation. Nuclear plants generate more than half the electricity in six states. The near-record 823 billion kilowatt-hours of nuclear electricity generated in the United States during was more than the nation s entire electrical output in the early 1960s, when the first of today s operating U.S. commercial reactors were ordered. 3 Reasons for the 30-year halt in U.S. nuclear plant orders included high capital costs, public concern about nuclear safety and waste disposal, and regulatory compliance costs. 1 U.S. Nuclear Regulatory Commission, Information Digest , NUREG-1350, Vol. 19, August 2007, p World Nuclear Generation Sets Record in 2006, Nucleonics Week, February 15, 2007, p All of today s 104 operating U.S. commercial reactors were ordered from 1963 through 1973; see Historical Profile of U.S. Nuclear Power Development, U.S. Council for Energy Awareness, 1992.

7 CRS-3 High construction costs may pose the most serious obstacle to nuclear power expansion. Construction costs for reactors completed since the mid-1980s ranged from $2 to $6 billion, averaging more than $3,000 per kilowatt of electric generating capacity (in 1997 dollars). The nuclear industry predicts that new plant designs could be built for less than that if many identical plants were built in a series, but such economies of scale have yet to be demonstrated. Average operating costs of U.S. nuclear plants dropped substantially during the past decade, and costly downtime has been steadily reduced. Licensed commercial reactors generated electricity at an average of 89.8% of their total capacity in 2006, according to industry statistics. 4 Forty-eight commercial reactors have received 20-year license extensions from the Nuclear Regulatory Commission (NRC), giving them up to 60 years of operation. License extensions for more than a dozen additional reactors are currently under review, and many others are anticipated, according to NRC. 5 Industry consolidation could also help existing nuclear power plants, as larger nuclear operators purchase plants from utilities that run only one or two reactors. Several such sales have occurred, including the March 2001 sale of the Millstone plant in Connecticut to Dominion Energy for a record $1.28 billion. The merger of two of the nation s largest nuclear utilities, PECO Energy and Unicom, completed in October 2000, consolidated the operation of 17 reactors under a single corporate entity, Exelon Corporation, headquartered in Chicago. Existing nuclear power plants appear to hold a strong position in electricity wholesale markets. In most cases, nuclear utilities have received favorable regulatory treatment of past construction costs, and average nuclear operating costs are currently estimated to be competitive with those of fossil fuel technologies. 6 Although eight U.S. nuclear reactors were permanently shut down during the 1990s, none has been closed since Despite the shutdowns, annual U.S. nuclear electrical output increased by more than one-third from 1990 to 2006, according to the Energy Information Administration and industry statistics. The increase resulted primarily from reduced downtime at the remaining plants, the startup of five new units, and reactor modifications to boost capacity. Possible New Reactors The improved performance of existing reactors and the relatively high cost of natural gas the favored fuel for new power plants for most of the past 15 years have prompted renewed electric industry consideration of the feasibility of building 4 World Nuclear Generation Sets Record in 2006, Nucleonics Week, February 15, 2007, p [ 6 Energy Information Administration, Nuclear Power: 12 percent of America s Generating Capacity, 20 percent of the Electricity, July 17, 2003, at [ nuclear/page/analysis/nuclearpower.html].

8 CRS-4 new reactors. Electric utilities and other firms have announced plans to apply for combined construction permits and operating licenses (COLs) for about 30 reactors (see Table 1). However, no commitments have been made to build them if the COLs are issued. The Department of Energy (DOE) is assisting with some of the COL applications and site-selection efforts as part of a program to encourage new commercial reactor orders by Table 1. Announced Nuclear Plant License Applications Announced Planned Site Applicant Application Reactor Type Units Alternate Energy Bruneau (ID) 2008 Areva EPR 1 Ameren Callaway (MO) 2008 Areva EPR 1 Amarillo Power Near Amarillo (TX) 4Q 2008 Areva EPR 2 Dominion North Anna (VA) Submitted GE ESBWR 1 Nov. 27, 2007 DTE Energy Fermi (MI) 4Q 2008 Not specified 1 Duke Energy Cherokee (SC) Submitted Dec. 13, 2007 Westing. AP Energy Future (formerly TXU) Comanche Peak (TX) 4Q 2008 Mitsubishi US- APWR Entergy River Bend (LA) May 2008 GE ESBWR 1 Exelon Victoria County Sept GE ESBWR 2 (TX) FPL Turkey Point (FL) Early 2009 Not specified 2 Mid-American Payette (ID) 2008 Not specified 1 Nuclear Energy NRG Energy South Texas Project Submitted GE ABWR 2 Sept. 20, 2007 NuStart Grand Gulf (MS) Nov GE ESBWR 1 Bellefonte (AL) Submitted Oct. Westing. AP , 2007 PPL Susquehanna (PA) Late 2008 Areva EPR 1 Progress Energy Harris (NC) 2008 Westing. AP Levy County (FL) 2008 Westing. AP SCE&G Summer (SC) 2007 Westing. AP Southern Vogtle (GA) Mar Westing. AP UniStar (Constellation Calvert Cliffs (MD) Submitted July 2007 (Part 1) Areva EPR 1 Energy and Nine Mile Point EDF) (NY) 1 st half 2008 Areva EPR 1 Not specified 4Q 2008 Areva EPR 1 Total Units 33 Sources: NRC, Nucleonics Week, Nuclear News, Nuclear Energy Institute, company news releases. 2

9 CRS-5 Federal Support Strong incentives for building new nuclear power plants were included in the Energy Policy Act of 2005 (EPACT05, P.L ), signed by the President on August 8, Particularly significant is a 1.8-cents/kilowatt-hour tax credit for up to 6,000 megawatts of new nuclear capacity for the first eight years of operation, up to $125 million annually per 1,000 megawatts. The Treasury Department published interim guidance for the nuclear tax credit on May 1, Under the guidance, the 6,000 megawatts of eligible capacity will be allocated among reactors that file license applications by the end of 2008 or, after that date, until enough applications are filed to use the capacity. If license applications for more than 6,000 megawatts of nuclear capacity are submitted before the end of 2008, then the tax credit will be allocated proportionally among the proposed reactors. The Energy Information Administration (EIA) projects that the nuclear energy tax credit will stimulate construction of 9 gigawatts of nuclear generating capacity by That construction effort will reduce costs for future reactors and lead to 3.5 more gigawatts of capacity by 2030, according to EIA. However, those projections are highly sensitive to assumptions about growth in electricity demand, the price of competing fuels, and reactor construction costs. For example, if reactor construction costs do not decline, only the amount of new nuclear capacity eligible for the tax credit 6 gigawatts would be constructed, according to EIA. 8 Because the nuclear industry has often blamed licensing delays for past nuclear reactor construction cost overruns, EPACT05 authorizes the Secretary of Energy to pay for up to $500 million in costs resulting from NRC delays for each of the first two new reactors and up to $250 million for the next four. DOE published a final rule for the standby support program August 11, EPACT05 also authorized federal loan guarantees for up to 80% of construction costs for advanced energy projects that reduce greenhouse gas emissions, including new nuclear power plants. The EPACT loan guarantees are widely considered crucial by the nuclear industry to obtain financing for new reactors. DOE issued guidelines for the initial round of loan guarantees on August 8, However, the initial round is limited to $2 billion and does not include nuclear power plants. The FY2007 continuing resolution (P.L ) provided initial administrative funding for the program and authorized up to $4 billion in loan guarantees (twice the 7 Department of the Treasury, Internal Revenue Service, Internal Revenue Bulletin, No , Credit for Production From Advanced Nuclear Facilities, Notice , May 1, 2006, p Energy Information Administration, Annual Energy Outlook 2007, DOE/EIA-0383(2007), February 2007, p Department of Energy, Standby Support for Certain Nuclear Plant Delays, Federal Register, August 11, 2006, p

10 CRS-6 Administration request). DOE issued final rules for the program October 4, 2007, 10 and invited 16 proposals from the initial solicitation to submit full applications. DOE s proposed loan guarantee rules, published May 16, 2007, had been sharply criticized by the nuclear industry for limiting the guarantees to 90% of a project s debt. The industry contended that EPACT05 allows all of a project s debt to be covered, as long as debt does not exceed 80% of total construction costs. In its explanation of the proposed rules, DOE expressed concern that guaranteeing 100% of a project s debt could reduce lenders incentive to perform adequate due diligence and therefore increase default risks. In the final rule, however, DOE agreed to guarantee up to 100% of debt, but only for loans issued by the Federal Financing Bank. Possible DOE losses resulting from defaults are to be covered by payments collected up-front from project sponsors. The amount of loan guarantees to be available for nuclear power was the subject of considerable debate in the first session of the 110 th Congress. Under the Federal Credit Reform Act (FCRA), federal loan guarantees cannot be provided without an authorized level in an appropriations act. The Senate Appropriations Committee contended that, because default payouts would be covered by project sponsors rather than appropriations, FCRA would not apply to the EPACT loan guarantee program. In its version of the FY2008 Energy and Water Appropriations bill, the Senate panel provided that DOE could use such sums collected from project sponsors to pay the cost of the loan guarantees, without referring to FCRA (S. 1751, S.Rept ). The Senate-passed version of omnibus energy legislation (H.R. 6) would have explicitly eliminated FCRA s applicability to DOE s planned loan guarantees under EPACT (Section 124(b)). That provision raised considerable controversy, because it would have given DOE essentially unlimited loan guarantee authority under EPACT, but it was dropped from the final legislation (P.L ). In its version of the FY2008 Energy and Water Appropriations bill, the House approved $7 billion in loan guarantee authority but none for nuclear power plants (H.R. 2641, H.Rept ). The FY2008 omnibus funding act (P.L ) includes the Senate Appropriations Committee s bill language that does not refer to FCRA, providing such sums through FY The explanatory statement for the bill directs DOE to limit the loan guarantees for nuclear power plants to $18.5 billion through FY2009 enough for several large reactors. An additional $2 billion in loan guarantee authority is provided for uranium enrichment plants, and $18 billion in authority is provided for non-nuclear energy technologies. 12 Global Climate Change Global climate change that may be caused by carbon dioxide and other greenhouse gas emissions is cited by nuclear power supporters as an important reason 10 Published October 23, 2007 (72 Federal Register 60116). 11 Congressional Record, December 17, 2007, p. H Ibid., p. H15929.

11 CRS-7 to develop a new generation of reactors. Nuclear power plants emit relatively little carbon dioxide, mostly from nuclear fuel production and auxiliary plant equipment. This green nuclear power argument has received growing attention in think tanks and academia. As stated by MIT in its major study The Future of Nuclear Power: Our position is that the prospect of global climate change from greenhouse gas emissions and the adverse consequences that flow from these emissions is the principal justification for government support of the nuclear energy option. 13 However, most environmental groups contend that nuclear power s potential greenhouse gas benefits are modest and must be weighed against the technology s safety risks, its potential for nuclear weapons proliferation, and the hazards of radioactive waste. 14 They also contend that energy efficiency and renewable energy would be far more economical options for reducing fossil fuel use. 15 (For more on federal incentives and the economics of nuclear power, see CRS Report RL33442, Nuclear Power: Outlook for New U.S. Reactors, by Larry Parker and Mark Holt.) Nuclear Power Research and Development For nuclear energy research and development including advanced reactors, fuel cycle technology, nuclear hydrogen production, and infrastructure support DOE received $1.037 billion for FY2008. That amount is substantially higher than the FY2007 funding level and the Administration s request, but it includes large transfers from other accounts and eliminates most of the Administration s proposed increase for the Advanced Fuel Cycle Initiative (AFCI). The higher AFCI funding would have allowed DOE to continue developing a demonstration plant for extracting plutonium and uranium from spent nuclear fuel, as part of the Administration s Global Nuclear Energy Partnership (GNEP). The nuclear energy program is run by DOE s Office of Nuclear Energy, Science, and Technology. DOE requested $801.7 million for FY2008, nearly 30% above the FY2007 funding level. The request would have boosted funding for AFCI from $167.5 million in FY2007 to $395.0 million in FY2008. The FY2008 omnibus appropriation holds AFCI to $181 million and shifts the mixed-oxide (MOX) fuel program totaling $281 million to the nuclear energy program from the nuclear nonproliferation program. That brings the nuclear energy total to $970.5 million ($961.7 million with the rescission), about 20% above the request. An additional $75.9 million provided in the Other Defense Activities account brings the Office of Nuclear Energy s total spending level to $1.046 billion ($1.037 billion with the rescission). 13 Interdisciplinary MIT Study, The Future of Nuclear Power, Massachusetts Institute of Technology, 2003, p Gronlund, Lisbeth, David Lochbaum, and Edwin Lyman, Nuclear Power in a Warming World, Union of Concerned Scientists, December Thomas, Stephen, et al, The Economics of Nuclear Power, Greenpeace, 2007.

12 CRS-8 Overall, the House had provided a funding level of $835.2 million for nuclear energy, including $74.9 million from the Other Defense Activities account and $167.8 million transferred for the MOX program. The Senate Appropriations Committee had recommended $795.5 million for nuclear energy, including $75.9 million from Other Defense Activities, while opposing the MOX funding transfer. According to DOE s FY2008 budget justification, the nuclear energy R&D program is intended to secure nuclear energy as a viable, long-term commercial energy option, providing diversity in the energy supply. However, opponents have criticized DOE s nuclear research program as providing wasteful subsidies to an industry that they believe should be phased out as unacceptably hazardous and economically uncompetitive. Under the Administration s GNEP initiative, plutonium partially separated from the highly radioactive spent fuel from nuclear reactors would be recycled into new fuel to expand the future supply of nuclear fuel and potentially reduce the amount of radioactive waste to be disposed of in a permanent repository. Under the initial concept for GNEP, the United States and other advanced nuclear nations would lease new fuel to other nations that agreed to forgo uranium enrichment, spent fuel recycling (also called reprocessing), and other fuel cycle facilities that could be used to produce nuclear weapons materials. The leased fuel would then be returned to supplier nations for reprocessing. Solidified high-level reprocessing waste would be sent back to the nation that had used the leased fuel, along with supplies of fresh nuclear fuel. However, a GNEP Statement of Principles signed by the United States and 15 other countries on September 16, 2007, preserves the right of all participants to develop fuel cycle facilities while encouraging the establishment of a viable alternative to acquisition of sensitive fuel cycle technologies. 16 Although GNEP is largely conceptual at this point, DOE issued a Spent Nuclear Fuel Recycling Program Plan in May 2006 that provided a general schedule for a GNEP Technology Demonstration Program (TDP), 17 which would develop the necessary technologies to achieve GNEP s goals. According to the Program Plan, the first phase of the TDP, running through FY2006, consisted of program definition and development and acceleration of AFCI. Phase 2, running through FY2008, was to focus on the design of technology demonstration facilities, which then were to begin operating during Phase 3, from FY2008 to FY2020. The National Academy of Sciences in October 2007 strongly criticized DOE s aggressive deployment schedule for GNEP and recommended that the program instead focus on research and development. 18 Nuclear critics oppose GNEP s emphasis on spent fuel reprocessing, which they see as a weapons proliferation risk, even if weapons-useable plutonium is not completely separated from other spent fuel elements, as envisioned by the 16 See GNEP website at [ 17 DOE, Spent Nuclear Fuel Recycling Plan, Report to Congress, May National Academy of Sciences, Review of DOE s Nuclear Energy Research and Development Program, prepublication draft, October 2007.

13 CRS-9 Administration. As the research of DOE scientists makes clear, the reprocessing technologies under consideration would still produce a material that is not radioactive enough to deter theft, and that could be used to make nuclear weapons, according to the Union of Concerned Scientists. 19 The omnibus appropriation cuts the Administration s GNEP request to $181 million, including $30 million for upgrades to existing facilities. The remaining $151 million is for research, development, and design activities, with no funds for constructing facilities for technology demonstration or commercialization. The GNEP budget totals, as well as the remaining nuclear program numbers cited below, do not reflect the 0.91% across-the-board DOE rescission. Nuclear Power President Bush s specific mention of clean, safe nuclear power in his 2007 State of the Union address reiterated the Administration s interest in encouraging construction of new commercial reactors for which there have been no U.S. orders since DOE s efforts to restart the nuclear construction pipeline have been focused on the Nuclear Power 2010 Program, which will pay up to half of the nuclear industry s costs of seeking regulatory approval for new reactor sites, applying for new reactor licenses, and preparing detailed plant designs. The Nuclear Power 2010 Program, which includes the Standby Support Program authorized by the Energy Policy Act of 2005 (P.L ) to pay for regulatory delays, is intended to encourage near-term orders for advanced versions of existing commercial nuclear plants. Two industry consortia are receiving DOE assistance over the next several years to design and license new nuclear power plants. DOE awarded the first funding to the consortia in DOE requested $114.0 million for Nuclear Power 2010 for FY2008, more than 40% above the FY2007 funding level of $80.3 million. The omnibus act provided a $21.0 million increase from the budget request, as recommended by the Senate Appropriations Committee, for a total of $135.0 million. The funding increase is intended to accelerate progress on the new reactor licenses. The House had approved flat funding for the program, contending that funds should not be provided for reactor design work. The nuclear license applications under the Nuclear Power 2010 program are intended to test the one-step licensing process established by the Energy Policy Act of 1992 (P.L ). Under the process, NRC may grant a combined construction permit and operating license (COL) that allows a completed plant to begin operation if all construction criteria have been met. Even if the licenses are granted by NRC, the industry consortia funded by DOE have not committed to building new reactors. The following two consortia are receiving COL assistance under the Nuclear Power 2010 program:! A consortium led by Dominion Resources that is preparing a COL for an advanced General Electric reactor. The proposed reactor 19 Union of Concerned Scientists, U.S. Nuclear Fuel Reprocessing Initiative, [ ucsusa.org/global_security/nuclear_terrorism/us_nuclear_fuel_reprocessing_initiative.html].

14 CRS-10 would be located at Dominion s existing North Anna plant in Virginia, where the company received an NRC early-site permit with DOE assistance. Dominion Energy submitted a COL application for a new unit at North Anna on November 27, 2007.! A consortium called NuStart Energy Development, including Exelon and several other major nuclear utilities, which announced on September 22, 2005, that it would seek a COL for two Westinghouse reactors at the site of TVA s uncompleted Bellefonte nuclear plant in Alabama and for a General Electric design at the Grand Gulf plant in Mississippi. The Nuclear Power 2010 Program is providing funding for review and approval of the Bellefonte COL, which was submitted to NRC on October 30, The advanced Westinghouse reactor selected by NuStart, the AP-1000, may first be built in China. Under a contract signed December 16, 2006, four of the Westinghouse reactors are to be constructed at two sites, with the first two units to begin operating by The contract could help pay for detailed engineering and demonstrate the commercial viability of the new design, which received final design certification from NRC effective February 27, A preliminary commitment to provide almost $5 billion in financial support for the China reactor sale was approved on February 18, 2005, by the Export-Import Bank of the United States. Critics contend that the Ex-Im financing could provide unwarranted subsidies to the nuclear power industry and unwisely transfer U.S. nuclear technology to China. The Nuclear Power 2010 Program also helped three utilities seek NRC Early Site Permits (ESPs) for potential new reactors in Illinois, Mississippi, and Virginia. NRC issued the first of these on March 15, 2007, to Exelon Generating Company for a potential new reactor at the company s Clinton, Illinois, nuclear plant. Under Nuclear Power 2010, DOE paid half the $15 million cost of the Clinton ESP. NRC authorized a second ESP on March 27, 2007, for the Grand Gulf site in Mississippi, and a third, for the North Anna site in Virginia, on November 20, The holders of those ESPs will not have to revisit site-related issues if they seek licenses for new reactors at those locations during the next 20 years. Generation IV. Advanced commercial reactor technologies that are not yet close to deployment are the focus of DOE s Generation IV Nuclear Energy Systems Initiative, for which $36.1 million was requested for FY2008 about the same as the FY2007 funding level. The omnibus measure nearly tripled the request to $116.0 million, with $74 million devoted to the Next Generation Nuclear Plant (NGNP). At least $38 million of the NGNP funding is to be spent for developing a conceptual design and baseline cost estimate, and $36 million is for NRC pre-licensing activities. Under DOE s current plans, NGNP will use Very High Temperature Reactor (VHTR) technology, which features helium as a coolant and coated-particle fuel that can withstand temperatures up to 1,600 degrees celsius. 20 Westinghouse Wins China Contract; Chinese Look at Next Expansion, Nucleonics Week, December 21, 2006, p Federal Register 4464, January 27, 2006.

15 CRS-11 The Energy Policy Act of 2005 authorizes $1.25 billion through FY2015 for NGNP development and construction (Title VI, Subtitle C). The authorization requires that NGNP be based on research conducted by the Generation IV program and be capable of producing electricity, hydrogen, or both. Phase I research on the NGNP is to continue until 2011, when a decision will be made on moving to the Phase II design and construction stage, according to the FY2008 DOE budget justification. In conjunction with the GNEP Technology Demonstration Program, the Generation IV Program will also focus on developing a sodium-cooled fast reactor (SFR). Existing U.S. commercial nuclear reactors use water to slow down, or moderate, the neutrons released by the fission process (splitting of nuclei). The relatively slow (thermal) neutrons are highly efficient in causing fission in certain isotopes of heavy elements, such as uranium 235 and plutonium Therefore, fewer of those isotopes are needed in nuclear fuel to sustain a nuclear chain reaction (in which neutrons released by fissioned nuclei then induce fission in other nuclei, and so forth). The downside is that thermal neutrons cannot efficiently induce fission in more than a few specific isotopes. In contrast, fast neutrons, which have not been moderated, are less effective in inducing fission than thermal neutrons but can induce fission in a much wider range of isotopes, including all major plutonium isotopes. Therefore, nuclear fuel for a fast reactor must have a higher proportion of fissionable isotopes than a thermal reactor to sustain a chain reaction, but a larger number of different isotopes can constitute that fissionable proportion. A fast reactor s ability to fission most heavy radioactive isotopes, called transuranics (TRU), makes it theoretically possible to repeatedly separate those materials from spent fuel and feed them back into the reactor until they are entirely fissioned. In a thermal reactor, the buildup of non-fissile isotopes sharply limits the number of such separation cycles before the recycled fuel can no longer sustain a nuclear chain reaction. Given the benefits of continuous recycling, at this time GNEP-TDP is focused on the development of fast reactor technologies, recognizing that fast reactor operating experience is much more limited than thermal reactor operating experience, and that fast burn reactor fuels, or transmutation fuels, are not fully developed, according to the DOE Program Plan. 23 The House Appropriations Committee report directed DOE to make the gascooled NGNP a higher priority than fast reactors for GNEP and begin a competitive solicitation for a commercial demonstration plant at the Idaho National Laboratory. The Senate panel also emphasized gas-cooled reactors in the Generation IV program. 22 Isotopes are atoms of the same chemical element but with different numbers of neutrons in their nuclei. 23 Spent Nuclear Fuel Recycling Program Plan, p. 8.

16 CRS-12 The Generation IV program is also monitoring international research on leadcooled fast reactors, gas-cooled fast reactors, and supercritical water-cooled reactors, according to the FY2008 budget justification. Fuel Cycle Research and Facilities. The omnibus act places the Advanced Fuel Cycle Initiative within the new category of Fuel Cycle Research and Facilities, along with Mixed-Oxide Fuel Fabrication, which was transferred from the nuclear nonproliferation account. Funding for the new category totals $462.3 million. The FY2008 funding request of $395 million for AFCI, the primary component of GNEP, was more than double the FY2007 funding level of $167.5 million, which in turn was more than double the FY2006 appropriation. The omnibus act reduced AFCI to $181.0 million, as discussed above. According to the DOE budget justification, AFCI will develop and demonstrate nuclear fuel cycles that could reduce the long-term hazard of spent nuclear fuel and recover additional energy. Such technologies would involve separation of plutonium, uranium, and other longlived radioactive materials from spent fuel for reuse in a nuclear reactor or for transmutation in a particle accelerator. Much of the program s research will focus on a separations technology called UREX+, in which uranium and other elements are chemically removed from dissolved spent fuel, leaving a mixture of plutonium and other highly radioactive elements. Proponents believe the process is proliferationresistant, because further purification would be required to make the plutonium useable for weapons and because its high radioactivity would make it difficult to divert or work with. FY2008 funding was also to have been used for conceptual design work on an Advanced Fuel Cycle Facility (AFCF) to provide an engineering-scale demonstration of AFCI technologies, according to the budget justification. At the same time, industry design teams were to complete conceptual designs for nuclear fuel recycling demonstration facilities to be used for GNEP. However, the omnibus measure specifically rejected funding for development of AFCF in FY2008. Removing uranium from spent fuel would eliminate most of the volume of spent nuclear fuel that would otherwise require disposal in a deep geologic repository, which DOE is developing at Yucca Mountain, Nevada. The UREX+ process also could reduce the heat generated by nuclear waste the major limit on the repository s capacity by removing cesium and strontium for separate storage and decay over several hundred years. Plutonium and other long-lived elements would be fissioned in accelerators or fast reactors (such as the type under development by the Generation IV program) to reduce the long-term hazard of nuclear waste. Even if technically feasible, however, the economic viability of such waste processing has yet to be determined, and it still faces significant opposition on nuclear nonproliferation grounds. Nuclear Hydrogen Initiative. In support of President Bush s program to develop hydrogen-fueled vehicles, DOE is requesting $22.6 million in FY2008 for the Nuclear Hydrogen Initiative, about 10% above the FY2007 funding level but below the FY2006 appropriation. The omnibus measure provides $10 million for the program. The House had provided flat funding for the program, and the Senate

17 CRS-13 Committee had approved the full request. According to DOE s FY2008 budget justification, the program will continue laboratory-scale experiments to allow selection by 2011 of a hydrogen-production technology for pilot-scale demonstration by Safety Nuclear Power Plant Safety and Regulation Controversy over safety has dogged nuclear power throughout its development, particularly following the March 1979 Three Mile Island accident in Pennsylvania and the April 1986 Chernobyl disaster in the former Soviet Union. In the United States, safety-related shortcomings have been identified in the construction quality of some plants, plant operation and maintenance, equipment reliability, emergency planning, and other areas. In a relatively recent example, it was discovered in March 2002 that leaking boric acid had eaten a large cavity in the top of the reactor vessel in Ohio s Davis-Besse nuclear plant. The corrosion left only the vessel s quarterinch-thick stainless steel inner liner to prevent a potentially catastrophic loss of reactor cooling water. Davis-Besse remained closed for repairs and other safety improvements until NRC allowed the reactor to restart in March NRC s oversight of the nuclear industry is an ongoing issue; nuclear utilities often complain that they are subject to overly rigorous and inflexible regulation, but nuclear critics charge that NRC frequently relaxes safety standards when compliance may prove difficult or costly to the industry. Domestic Reactor Safety. In terms of public health consequences, the safety record of the U.S. nuclear power industry in comparison with other major commercial energy technologies has been excellent. During approximately 2,800 reactor-years of operation in the United States, 24 the only incident at a commercial nuclear power plant that might lead to any deaths or injuries to the public has been the Three Mile Island accident, in which more than half the reactor core melted. Public exposure to radioactive materials released during that accident is expected to cause fewer than five deaths (and perhaps none) from cancer over the subsequent 30 years. A study of 32,000 people living within 5 miles of the reactor when the accident occurred found no significant increase in cancer rates through 1998, although the authors noted that some potential health effects cannot be definitively excluded. 25 The relatively small amounts of radioactivity released by nuclear plants during normal operation are not generally believed to pose significant hazards, although 24 Nuclear Engineering International, Country averages as at end September 2006, March 2007, p Evelyn O. Talbott et al., Long Term Follow-Up of the Residents of the Three Mile Island Accident Area: , Environmental Health Perspectives, published online October 30, 2002, at [

18 CRS-14 some groups contend that routine emissions are unacceptably risky. There is substantial scientific uncertainty about the level of risk posed by low levels of radiation exposure; as with many carcinogens and other hazardous substances, health effects can be clearly measured only at relatively high exposure levels. In the case of radiation, the assumed risk of low-level exposure has been extrapolated mostly from health effects documented among persons exposed to high levels of radiation, particularly Japanese survivors of nuclear bombing in World War II. The consensus among most safety experts is that a severe nuclear power plant accident in the United States is likely to occur less frequently than once every 10,000 reactor-years of operation. (For the current U.S. fleet of about 100 reactors, that rate would yield an average of one severe accident every 100 years.) These experts believe that most severe accidents would have small public health impacts, and that accidents causing as many as 100 deaths would be much rarer than once every 10,000 reactor-years. On the other hand, some experts challenge the complex calculations that go into predicting such accident frequencies, contending that accidents with serious public health consequences may be more frequent. Reactor Safety in the Former Soviet Bloc. The Chernobyl accident was by far the worst nuclear power plant accident to have occurred anywhere in the world. At least 31 persons died quickly from acute radiation exposure or other injuries, and thousands of additional cancer deaths among the tens of millions of people exposed to radiation from the accident may occur during the next several decades. According to a 2006 report by the Chernobyl Forum organized by the International Atomic Energy Agency, the primary observable health consequence of the accident was a dramatic increase in childhood thyroid cancer. The Chernobyl Forum estimated that about 4,000 cases of thyroid cancer have occurred in children who after the accident drank milk contaminated with high levels of radioactive iodine, which concentrates in the thyroid. Although the Chernobyl Forum found only 15 deaths from those thyroid cancers, it estimated that about 4,000 other cancer deaths may have occurred among the 600,000 people with the highest radiation exposures, plus an estimated 1% increase in cancer deaths among persons with less exposure. The report estimated that about 77,000 square miles were significantly contaminated by radioactive cesium. 26 Greenpeace issued a report in 2006 estimating that 200,000 deaths in Belarus, Russia, and Ukraine resulted from the Chernobyl accident between 1990 and Licensing and Regulation For many years, a top priority of the nuclear industry was to modify the process for licensing new nuclear plants. No electric utility would consider ordering a nuclear power plant, according to the industry, unless licensing became quicker and 26 The Chernobyl Forum: , Chernobyl s Legacy: Health, Environmental and Socio-Economic Impacts, International Atomic Energy Agency, April Greenpeace. The Chernobyl Catastrophe: Consequences on Human Health, April 2006, p. 10.

19 CRS-15 more predictable, and designs were less subject to mid-construction safety-related changes required by NRC. The Energy Policy Act of 1992 (P.L ) largely implemented the industry s licensing goals, but no plants have been ordered. Nuclear plant licensing under the Atomic Energy Act of 1954 (P.L ; U.S.C ) had historically been a two-stage process. NRC first issued a construction permit to build a plant and then, after construction was finished, an operating permit to run it. Each stage of the licensing process involved complicated proceedings. Environmental impact statements also are required under the National Environmental Policy Act. Over the vehement objections of nuclear opponents, the Energy Policy Act of 1992 provides a clear statutory basis for one-step nuclear licenses, which would combine the construction permits and operating licenses and allow completed plants to operate without delay if construction criteria were met. NRC would hold preoperational hearings on the adequacy of plant construction only in specified circumstances. DOE s Nuclear Power 2010 initiative (discussed above) is paying up to half the cost of combined construction and operating licenses for two advanced reactors. Also as discussed above, Section 638 of the Energy Policy Act of 2005 authorizes federal payments to the owner of a completed reactor whose operation is delayed by regulatory action. A fundamental concern in the nuclear regulatory debate is the performance of NRC in issuing and enforcing nuclear safety regulations. The nuclear industry and its supporters have regularly complained that unnecessarily stringent and inflexibly enforced nuclear safety regulations have burdened nuclear utilities and their customers with excessive costs. But many environmentalists, nuclear opponents, and other groups charge NRC with being too close to the nuclear industry, a situation that they say has resulted in lax oversight of nuclear power plants and routine exemptions from safety requirements. Primary responsibility for nuclear safety compliance lies with nuclear plant owners, who are required to find any problems with their plants and report them to NRC. Compliance is also monitored directly by NRC, which maintains at least two resident inspectors at each nuclear power plant. The resident inspectors routinely examine plant systems, observe the performance of reactor personnel, and prepare regular inspection reports. For serious safety violations, NRC often dispatches special inspection teams to plant sites. In response to congressional criticism, NRC has reorganized and overhauled many of its procedures. The Commission has moved toward risk-informed regulation, in which safety enforcement is guided by the relative risks identified by detailed individual plant studies. NRC s risk-informed reactor oversight system, inaugurated April 2, 2000, relies on a series of performance indicators to determine the level of scrutiny that each reactor should receive For more information about the NRC reactor oversight process, see [ NRR/OVERSIGHT/ASSESS/index.html]