Both Congress and the U.S. Department of Energy (DOE) moved forward last week with significant programs to support the development of nuclear power in the United States. Congress took a critical step towards extending the Production Tax Credit (PTC) for nuclear power, and DOE announced nearly $67 million in new grants for nuclear power research.

On Thursday June 15, 2017, the House Committee on Ways and Means approved H.R. 1551, legislation designed to essentially remove the deadline on eligibility for the nuclear PTC. This bill is not only very important for the four AP1000 nuclear reactors under construction in Georgia and South Carolina, but potentially also for next-generation nuclear plants. These plants can take advantage of the remaining credits left over after the AP1000 projects are completed (from the 6,000 MW available under the current tax credit); the credits would normally expire on January 1, 2021. The bill can be found here.

The day before, on Wednesday June 14, DOE announced nearly $67 million in grants awarded towards advanced nuclear energy research from a series of funding programs. The grants include:

  • $37 million under the “Nuclear Energy University Program” to support “university-led nuclear energy research and development projects” and also fund “reactor and infrastructure improvements” towards the nation’s 25 university research reactors;
  • $11 million towards three “Integrated Research Projects,” which are complex research projects led by a coalition of “universities, industrial and international research entities, and the unique resources of the DOE national laboratories”;
  • $6 million in research towards “advanced sensors and instrumentation, advanced manufacturing methods, and materials for multiple nuclear reactor plant and fuel applications”; and
  • $12+ million towards projects taking advantage of “Nuclear Science User Facilities” to “investigate important nuclear fuel and material applications.” Five of these projects are industry-led and thus take advantage of the GAIN Initiative, which provides industry with a means to access facilities and resources “across the DOE complex and its National Laboratory capabilities.”

If you have any questions about the nuclear PTC or DOE research programs, please contact the authors.

Wednesday, the NRC staff held a public meeting related to emergency planning for SMRs and other new reactor technologies. Slides from the meeting can be found here.

A few observations from the meeting—

  • Although early in the process, if executed correctly, the NRC’s Emergency Planning rulemaking could significantly reduce costs for new small modular reactors, advanced reactors, and even medical isotope reactors.
  • There was significant discussion during the meeting on a number of areas, but in particular—
    • Whether the rule would be “risk-informed.”
    • How site-specific features would be factored into the rulemaking.
    • How proposed industrial facilities near a nuclear power plant would affect emergency planning.

The NRC staff made clear during the meeting that the rulemaking would be risk-informed and consequence-oriented, and would work to incorporate the safety advances provided by new reactor designs.

  • The NRC staff emphasized that it welcomes written comments as it moves forward with this rulemaking, and will lean on them in developing a proposed rule.  Comments on the regulatory basis document are due by June 27, 2017.

For additional discussion on the meeting, please contact the authors.

Published reports indicate that as many as 18 reactor designers are looking at the possibility of siting their first facility at Idaho National Laboratory, DOE’s lead laboratory for nuclear reactors. From time to time, there are similar expressions of interest in DOE’s Oak Ridge National Laboratory and Savannah River Site.

DOE facilities have much to recommend them for such an undertaking, including incredible nuclear expertise near-at-hand, locations that are both remote and friendly to nuclear undertakings, and plenty of open space. At the same time, it is important to recognize the unique challenges that come with such sites.

Entering into a site use permit with DOE requires an understanding of certain “immovables,” including: DOE mission requirements, present and future; DOE obligations to state regulators, particularly environmental regulators; past uses of the sites that may not yet be remediated, such as environmental contamination or unexploded ordnance; and appropriations law restrictions, which mean that DOE cannot spend money to address an issue until Congress appropriates the money for that purpose.

There are also discontinuities between nuclear safety, security and liability approaches applicable to DOE and the Nuclear Regulatory Commission that have to be accommodated. These could affect matters as diverse as site access, transfer of ownership and radiation exposure standards. Likewise, dealing with two federal agencies that have different roles will complicate compliance with certain laws that apply equally to both of them, such as the National Environmental Policy Act and the National Historic Preservation Act.

Finally, there are also unique financial considerations arising both out of sharing common services and buying services from DOE.

None of these issues are insoluble, but it will take time and flexibility in approach to reach agreement. A reactor designer looking at a DOE site should go into it with eyes open and a large measure of patience for the negotiation that will be required.

Hogan Lovells has experience with negotiating these types of unique agreements with DOE. For additional information please contact one of the authors below.

Mary Anne Sullivan
Dan Stenger
Amy Roma
Sachin Desai

Last week the U.S. Nuclear Regulatory Commission (NRC) and the U.S. Department of Energy held their third joint advanced reactor workshop.  The agenda focused on a variety of issues, including computer simulation of advanced reactors and updates from industry working groups.  Although a lot of insights were realized, four takeaways we wanted to discuss include:

  • The Need for a Test Reactor: Multiple panelists, including those designing simulation codes for advanced reactors, discussed a need for physical testing to validate new designs.  A new test reactor was suggested to be especially critical for validating new fuel designs.  We have recently discussed the importance for a test reactor for the advanced reactor community, as well as novel attempts to overcome the hurdles with building a new test reactor.
  •  NRC Acceptance of Vendor Codes: Panelists suggested at the conference that the NRC may be willing to use the same simulation codes as relied on by reactor designers for validation of new designs.  The viewpoint otherwise has been that the NRC would have to rely on or even create a totally separate simulation code to validate a particular design, which is both difficult and costly.
  • A Push for Consensus Standards: The importance of developing consensus standards, through organizations such as the American Society of Mechanical Engineers, was reemphasized at the workshop as a way for licensees to take the design of the regulatory framework into their own hands.  As one panelist noted, regulatory agencies in general are encouraged by statute and executive order to adopt consensus standards where possible.  It was also suggested that this approach could apply to simulation codes.
  • Licensing Technical Requirements Modernization: Southern Company is leading a team effort to identify aspects of the technical regulatory framework that need to be updated to support licensing of advanced reactors.  According to a description of the effort, in areas where gaps were identified the team would propose risk-informed and/or performance-based practices on a technology-inclusive basis.

At the conference it was explained that the result of this effort would be white papers that would eventually be turned into Nuclear Energy Institute-issued and NRC-approved guidance documents. The first such white paper will be on licensing basis events.

The speaker presentations can be found here.  If there are any questions on the above topics or other aspects of the regulatory framework for advanced reactors, please contact the authors.

Two long-awaited opportunities for public input into the development of advanced reactors are coming up – the third NRC-DOE Advanced Reactor Workshop, and a two-day NRC public meeting on advanced reactor regulatory policy.  We provide some information about both events below.

Next week, from April 25-26, is the third NRC-DOE Advanced Reactor Workshop, to be held in Rockville, Maryland.  The conference is focused on improving efficiency in the development and licensing of advanced reactors.  Specific topics will include:

  • Recent NRC and DOE initiatives;
  • Regulatory review process options and safety-focused reviews;
  • Modeling and testing in support of the reactor licensing process; and
  • Reactor vendor licensing strategies and issues.

The full workshop agenda can be found here.  Some interested pre-reading for attendees includes the NRC’s recently published advanced reactor design criteria guidance, as well as the summaries and presentations from the prior two NRC-DOE workshops (from September 2015 and June 2016).  Although online registration has closed, the workshop is open to the public and interested members can reach out to the agency contacts listed here to find out how to attend (note, the registration page says registration is encouraged but not required).

The following week, from May 3 to May 4, is the NRC’s Public Meeting/Webinar on Possible Regulatory Process Improvements for Advanced Reactor Designs.  The meeting will circle around the follow topics:

  • Physical security requirements;
  • Defining licensing basis events;
  • Probabilistic risk assessments (PRA) & containment performance criteria;
  • Prioritization of policy issues;
  • Potential use of standard design approvals; and
  • Issues arising from the NRC-DOE Advanced Reactor Workshop.

For the discussion on physical security scheduled for the morning of Wednesday, May 3, the NRC has provided a link to a Nuclear Energy Institute (NEI) white paper for a proposed revision to the NRC’s physical security requirements set forth in 10 C.F.R. Part 73.  The NEI white paper, which was issued in December 2016, argues that the new proposed Part 73 requirements should recognize the enhanced engineered safety and security features of many advanced reactor technologies, and enable these technologies to demonstrate to the NRC that they meet the new physical security “performance capabilities” set forth in the proposed rule.  Such a change, NEI argues, would make the NRC licensing process for these technologies more efficient.  Interested readers may also want to check out our summary of the NRC’s recently issued physical and cyber security draft guidance document.

The NRC has also provided a link to an April 2017 DOE-Southern Company white paper that seeks to modernize the technical requirements for licensing advanced reactors to be more risk-informed and performance-based.  The NRC intends to discuss this paper in the afternoon on Wednesday, May 3.  The NRC plans to address PRA on the morning of Thursday, May 4, and “various policy issues” in the afternoon of Thursday, May 4.  This meeting can be attended in person or through teleconference.

We strongly encourage the advanced reactor community to participate in these events.  As recently noted by the trade press, the regulatory framework for advanced reactors is being flushed out now, long before reactors will be built.  Major decisions such as development of design criteria and staged review processes are being made in the near term, unfortunately under tight budgets.  Engagement today can save years later by helping educate the NRC and DOE as to the most optimal regulatory path forward.

If there are any questions as to the above, please do not hesitate to contact the authors.

Last Thursday the Senate Energy and Natural Resources Committee reported out of committee the Nuclear Energy Innovation Capabilities Act of 2017 (bill S.97).  This legislation will “enable civilian research and development of advanced nuclear energy technologies by private and public institutions” and represents a significant opportunity for advanced reactors.  It is now one step closer to a full Senate floor vote.

This comes on the heels of a different advanced reactor bill, the Nuclear Energy Innovation and Modernization Act of 2017 (bill S.512), reporting out of the Senate Environment and Public Works Committee a week earlier.  Confused about the multiple advanced reactor-related bills moving forward in Congress?  Check out our prior post to learn more about them.

Scientists at MIT have put forward a novel idea for building a demonstration nuclear reactor—one that could limit licensing challenges with the U.S. Nuclear Regulatory Commission (NRC) while still providing useful testing opportunities for advanced reactors.  The MIT facility already operates a six megawatt light water reactor.  The proposal is to build a second molten salt reactor, but one that is subcritical and which would use neutrons from the existing reactor to power the fission process, avoiding the need for a new NRC license.  If it takes off, it could only cost an estimated $15 million to build before fueling.

A lack of demonstration reactors is a critical barrier to the progress of advanced reactors, as testing is key to validating new ideas in this generally risk-averse industry.  As identified by the Nuclear Innovation Alliance,  “[a] critical obstacle to financing innovative nuclear power technologies is that there is no clear pathway for a first pilot-scale demonstration.”  The idea proposed here, even if imperfect, presents a new approach to testing new reactor designs.

There is certainly lots of attention behind advanced reactors.  Last week a Senate committee passed 18 to 3 the Nuclear Energy Innovation and Modernization Act, a bill to modernize the NRC’s licensing framework for advanced reactors.  And interest in the industry continues to grow.  This past week, nuclear enrichment giant Urenco discussed that it is partnering with engineers at Amec Foster Wheeler to develop a U-Battery, which would generate approximately 10 MW of power or heat (1% of a modern reactor) in a compact battery form.  But new ideas require testing—and hopefully MIT’s plan can help the industry get past a critical hurdle to future growth.

On Monday, March 13, 2017, the U.S. Nuclear Regulatory Commission (NRC) issued preliminary draft guidance concerning how “advanced reactors should consider safety and security requirements together in the design process.”  The draft guidance notes that the Commission expects advanced reactor companies to incorporate security features early on into the design of the reactor that lessen the need for human actions.  The core of the draft guidance document is a table containing seven physical security design considerations (items 1-7 below), and three cybersecurity design considerations (items 8-10 below), concerning the following concepts:

  1. Intrusion detection systems.
  2. Intrusion assessment systems.
  3. Security communication systems.
  4. Security delay systems.
  5. Security response.
  6. Control measures protecting against land and waterborne vehicle bomb assaults.
  7. Access control portals.
  8. Defense model architecture.
  9. Cyber security defense-in-depth.
  10. Least functionality.

These design considerations pull from concepts found in 10 C.F.R. Part 73, “Physical Protection of Plants and Materials,” supplemented with cybersecurity insights.  The agency is seeking comment on the draft by April 27, 2017—not only on the specific design considerations listed, but also on “the scope of the security design considerations” generally, and on “general principles and good practices for designs of engineered [systems, structures, and components] to achieve physical and cyber security functions.”  We encourage the interested community to submit comments.

It is an exciting time for the advanced reactor community.  The same day as this guidance was released, GE Hitachi Nuclear Energy announced a cooperation agreement with Advanced Reactor Concepts LLC on “the development and licensing of an advanced small modular reactor (aSMR) based on mature Generation IV sodium-cooled reactor technology.”  Collaboration between small ventures and established entities hold significant promise for the industry.  But these collaborations are not only effective for improving technical prospects for commercialization; they also provide the new venture a means by which to better understand and influence the regulatory landscape, especially as it develops now for advanced reactors.

The NRC is actively seeking stakeholder input as it develops a regulatory framework for advanced reactors, including holding public meetings such as one planned for March 22, 2017 on “Possible Regulatory Process Improvements for Advanced Reactor Designs.”  The fact that established nuclear players are part of the advanced reactor community can provide a useful perspective to inform NRC guidance.  For example, on the issue on physical and cyber protection, established players can offer insights based on their experiences with the current regulatory framework and practical challenges that result, which can lead to a better guidance document for everyone.

Last Tuesday, February 21, Third Way held a summit in Washington, D.C. focused on the advanced reactor industry, the Advanced Nuclear Summit & Showcase.  Among the many notable events at the conference was the strong bipartisan participation by Members of Congress.  Senator Chris Coons gave a keynote speech at the summit, and noted remarks made earlier by Senators Murkowski, Booker, Scott, and Whitehouse, leaders of the Democratic and Republican parties.

Senator Murkowski’s remarks noted in particular the importance for advanced reactor legislation.  She, along with other Congressmen, including Senators Whitehouse and Booker, reintroduced in January the Nuclear Energy Innovation Capabilities Act (for more information about this and related legislation see our discussion of bills put forward in 2016 and 2017).  She pledged at the conference that she would push it forward and make it a priority in the new year.

We are excited to see advanced reactor legislation move forward in Congress this year, and will keep our readers updated.  For more on advanced reactor legislative and regulatory developments, please reach out to the authors.

Small modular reactors (SMRs) have seen some positive legal and policy developments recently.

A bill to provide tax exemptions for manufacturers of small modular reactors was introduced in the Washington state legislature.  Although in the early stages, this bill provides a new and potentially useful model for other states to follow to boost their advanced nuclear and SMR industries.  At a recent conference at Argonne National Laboratory, NuScale, the first SMR reactor to submit a design certification application to the U.S. Nuclear Regulatory Commission, highlighted the potential SMRs hold for creating U.S. manufacturing jobs. Washington state’s legislation is a timely effort to court NuScale and other SMR designers, with a mission to increase “the number of jobs in the small modular reactor industry in Washington.”

Public efforts to boost private-sector progress in developing next-generation nuclear reactors are essential to the growth of this societally important industry.  Recently, the U.S. Department of Energy’s (DOE’s) Gateway for Accelerated Innovation in Nuclear (GAIN) initiative, which seeks to leverage DOE laboratory facilities to benefit private reactor startups, was specifically called out by Secretary of Energy Perry in his confirmation hearing as an example of a successful public-private partnership.  In this vein, a recently launched organization, SMR Start, seeks to provide an additional targeted boost to policy reform efforts, with an aim towards “the successful commercialization of SMRs by enabling the establishment of supportive policies.”

Third Way, a strong promoter of policies to support the advanced nuclear industry, will likely discuss methods to provide public support for advanced reactors at its upcoming Advanced Nuclear Summit & Showcase being held this Tuesday, February 21 (and which can be livestreamed here).

For questions on encouraging public policy support for next-generation nuclear technologies, please contact the authors.