Recently, the Hill has been taking a flurry of legislative actions that impact the advanced reactor community across all spectra.  We provide a summary of some of the major bills going through Congress below, including a couple which have recently become law or may become so soon.

Nuclear Energy Innovation Capabilities Act (NEICA) (S. 97). This bill, which has a long history before Congress, finally passed both the House and Senate on September 24, and was signed by the President into law Friday September 28.  The text of the enrolled bill (the bill that has passed both chambers of Congress in identical form and sent to be signed) can be found here.

NEICA tackles a number of issues, but as a theme largely directs the US Department of Energy (DOE) to move forward on a number of actions long advocated for by the advanced reactor community—including opening up the labs more for private sector use, advancing a test reactor plan, and increasing collaboration with the US Nuclear Regulatory Commission (NRC).  As provided in the bill summary, DOE is instructed to:

  • Determine the need for a versatile reactor-based fast neutron source, which shall operate as a national user facility, and put forward a plan to construct and operate such a facility by the end of 2025.
  • Enhance its high-performance computation modeling and simulation techniques for advanced reactors.
  • Lead a program for testing of advanced reactor concepts (including physical testing), with a focus on removing licensing and technical uncertainty.  As part of this, the DOE is to work closely with the NRC to share technical expertise developed from this testing program and grant NRC staff access to the program and related sites to learn from any testing.  The goal of this is to help ensure the NRC has sufficient resources to license any reactor designs being tested.
  • Submit a budget proposal to Congress to perform the above activities.
  • Submit a report to Congress on fusion technologies under development (fusion is included within the bill’s broad definition of “advanced reactor”), with a focus on those technologies that can provide net energy production within 15 years after the start of construction of test or prototype facilities.
  • Develop an “Advanced Nuclear Energy Cost-Share Grant Program” to assist in paying NRC licensing fees for new reactor designs, including early stage activities such as development of a licensing plan.

NEICA was signed Friday along with H.R. 589, the DOE Research and Innovation Act, which also aims to shape DOE’s research agenda and use of the national laboratories to improve research collaboration and technology commercialization.

Energy-Related Appropriations Legislation (H.R. 5895). The President signed a broad appropriations bill on September 21, which covered funding for DOE.  The text of the enrolled bill can be found here, but summaries of the bill’s core DOE funding provisions can be found in a conference report, and a summary provided by the American Institute of Physics (AIP) here.  As represented in the AIP summary, the bill is largely a victory for DOE, with funding increases seemingly across the board, including a 10% increase in funding to the Office of Nuclear Energy and $65 million set aside for the versatile fast-neutron test reactor described above.

Nuclear Utilization of Keynote Energy Act (H.R. 1320). This bill passed the House on September 25.  The text of the bill can be found here.  It is targeted at NRC reform, and seeks among other things to:

  • Codify that up to $10.3M of the NRC’s work for advanced reactor readiness is to be removed from fee recovery (it also puts a cap on many other licensees’ annual fees).
  • Study the effect of removing the Atomic Energy Act’s restriction on foreign ownership, control, or domination of nuclear licenses (primarily affecting reactor licenses).
  • Study the elimination of the mandatory hearing requirement for uncontested reactor license applications.
  • Allow for the adoption of more informal hearing requirements for licensing proceedings.
  • Instruct the NRC as to more efficiently processing license applications, with a 42 month timeline for issuing safety and environmental reports after docketing of the application.
  • Establish community advisory boards in areas where plants are undergoing decommissioning.

Nuclear Energy Leadership Act (S. 3422). This bill was introduced into the Senate earlier this month, with 9  The text of the bill can be found here, and we provide a thorough summary in our past blog entry.  This bill would build on the Nuclear Energy Innovation Capabilities Act to, among other things:

  • Direct the U.S. government to enter into long-term power purchase agreements with nuclear reactors.
  • Promote the development of advanced reactors and fuel by strategically aligning U.S. government and industry interests, which is intended to enable U.S. developers to compete with their state-sponsored competitors from Russia and China.
  • Further push DOE to construct a fast neutron-capable research facility, which is crucial to test important new nuclear technologies and demonstrate their safe and reliable operation. Currently the only two facilities in the world like this are in Russia and China.
  • Develop a source of high-assay low-enriched uranium, which is the intended fuel for many advanced reactor designs, from U.S. government stockpiles. Again, both China and Russia have these capabilities domestically, but the U.S. does not.

This bill recognizes the national security implications that come with the long-term neglect of our nuclear industry, which is outlined in our recent paper published by Center for Strategic and International Studies, entitled  “Back from the Brink: A Threatened Nuclear Energy Industry Compromises National Security.”

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This review only highlights some of the nuclear-related bills currently before Congress—others of which also touch on reform to, e.g., our national nuclear export controls regime.  For further information on the bills described above or on other nuclear legislation, please contact the authors.

A bipartisan group of nine U.S. senators has introduced the Nuclear Energy Leadership Act (NELA) (S 3422), a bill designed to help the United States return to its lead in nuclear energy technology.  The bill sponsors explain that the U.S. has yielded this position to Russia and China–weakening our energy security, economic competitiveness, and national security.  The blog authors, in collaboration with the Center for Strategic and International Studies, have recently published on just this issue in “Back from the Brink: A Threatened Nuclear Energy Industry Compromises National Security” (Jul. 2018).

The bill covers a range of activities to fund research, development and accelerated deployment of advanced nuclear energy technologies.  The one-page summary of the bill issued by the Senate Committee on Energy and Natural Resources explains–

To reestablish global leadership, the U.S. must have a healthy nuclear industry capable of designing and deploying the most advanced reactor concepts in the world at a competitive price. As we look for clean, safe, reliable, flexible, and diverse power sources to meet the nation’s energy needs, advanced reactors will play a critical role in that mix.

Notably, the bill would:

  • Direct the U.S. government to enter into long-term power purchase agreements (PPAs) with nuclear reactors.
  • Promote the development of advanced reactors and fuel by strategically aligning U.S. government and industry interests, which is intended to enable U.S. developers to compete with their state-sponsored competitors from Russia and China.
  • Construct a fast neutron-capable research facility, which is crucial to test important new nuclear technologies and demonstrate their safe and reliable operation. Currently the only two facilities in the world like this are in Russia and China.
  • Develop a source of high-assay low-enriched uranium, which is the intended fuel for many advanced reactor designs, from U.S. government stockpiles. Again, both China and Russia have these capabilities domestically, but the U.S. does not.

Section by Section Breakdown

The Senate Committee on Energy and Natural Resources also released a section-by-section analysis of NEAL, which we summarize below, paying particular attention to the PPA provision, which could be a near-term game changer for the advanced reactor industry.

  • S. Government Power Purchase Agreements (Sections 2 and 3). Notably, the bill would create a pilot program for the U.S. government to enter into long-term PPAs with commercial nuclear reactors.  Under the bill—
    • The Secretary of Energy must consult and coordinate with other Federal departments and agencies that could benefit from the program, including the Secretary of Defense and the Secretary of Homeland Security.
    • At least one PPA has to be in place with a commercial nuclear reactor by the end of 2023.
    • The maximum length of the PPA is extended from 10 to 40 years, and the PPAs can be scored annually. Currently, nuclear energy is at a disadvantage when competing for federal PPA, due to a law that pre-dates commercial nuclear power and limits PPAs to 10 years. Initial capital costs for nuclear reactors are paid for over a period beyond ten years, which means 10-year PPAs do not work for nuclear projects, so this change would be an important development for the industry.
    • In carrying out the pilot program, the Secretary of Energy must give special consideration to PPAs for “first-of-a-kind or early deployment nuclear technologies that can provide reliable and resilient power to high-value assets for national security purposes or other purposes…in the national interest, especially in remote off-grid scenarios or grid-connected scenarios that can provide capabilities commonly known as ‘islanding power capabilities’ during an emergency scenario.”

The other provisions of the bill, as described in the section-by-section analysis are summarized below.

  • Advanced Nuclear Reactor Research and Development Goals (Section 4). In order for the American nuclear industry to compete with state-owned or state-sponsored developers in rival nations – especially China and Russia – significant collaboration between the federal government, National Labs, and private industry is needed to accelerate innovation. This provision directs the Department of Energy (DOE) to establish specific goals to align these sectors and send a strong and coherent signal that the U.S. is re-establishing itself as a global leader in clean advanced nuclear technology.
  • Nuclear Energy Strategic Plan (Section 5). There has not been a cohesive long-term strategy for the direction of U.S. nuclear science and engineering research and development policy across administrations.  This section requires DOE’s Office of Nuclear Energy to develop a 10-year strategic plan that supports advanced nuclear R&D goals that will foster breakthrough innovation to help advanced nuclear reactors reach the market.
  • Versatile, Reactor-Based Fast Neutron Source/Facilities Required for Advanced Reactor R&D (Section 6). For the U.S. to be a global leader in advancing nuclear technology, we need the ability to test reactor fuels and materials. Currently, the only machines capable of producing a fast neutron spectrum are located in Russia and China. This measure directs DOE to construct a fast neutron-capable research facility, which is necessary to test important reactor components and demonstrate their safe and reliable operation – crucial for licensing advanced reactor concepts.
  • Advanced Nuclear Fuel Security Program/High-Assay Low-Enriched Uranium Availability (Section 7). A healthy domestic uranium mining, enrichment, and fuel fabrication capability that meets industry needs is another prerequisite for reestablishing U.S. nuclear leadership. Many advanced reactors will rely on high-assay low-enriched uranium (HALEU), but no domestic capability exists to produce it. This section establishes a program to provide a minimum amount of HALEU to U.S. advanced reactor developers from DOE stockpiles, until a long-term domestic supply is developed.
  • University Nuclear Leadership Program/Workforce Development (Section 8). The nuclear energy industry, the Nuclear Regulatory Commission, and the National Nuclear Security Administration all require a world-class, highly-skilled workforce to develop, regulate, and safeguard the next generation of advanced reactors. This section creates a university nuclear leadership program to meet these workforce needs.

The bill was introduced by  Sens. Lisa Murkowski (R-Alaska), Cory Booker (D-N.J.), James Risch (R-Idaho), Shelley Moore Capito (R-W.Va.), Mike Crapo (R-Idaho), Richard Durbin (D-Ill.), Joe Manchin (D-W.Va.), Sheldon Whitehouse (D-R.I.) and Chris Coons (D-Del.).

For questions on the bill or the links between national security and the commercial nuclear power industry, please contact one of the authors listed below.

This month, the NRC published an early draft regulatory guide on the content of license applications for non-LWRs.  The document is designed to help license applicants apply the NRC’s movement towards a risk-informed/performance-based regulatory approach towards the drafting of an actual license application.

The document is in part the result of the Southern Company-led Licensing Modernization Project, which has resulted in the issuance of a number of informal reports discussing licensing reform for non-LWR reactors.  This draft regulatory guide is designed to more formally capture the results of those reports and follow-on discussions.   It addresses the designation of licensing basis events; safety classification and performance criteria for structures, systems, and components; and evaluation of defense in depth adequacy.  importantly, it largely adopts detailed draft industry guidance set forth in March of this year, although with certain clarifications.  One area of particular NRC focus concerns probabilistic risk analyses (“PRA”), where the agency appears to show a little hesitancy with the broad use of PRA proposed in the industry guidance.

The draft guidance is being issued to support future discussions, in particular an Advisory Committee on Reactor Safeguards meeting tentatively scheduled for October 30, 2018.  For more about the Licensing Modernization project, or recent NRC and industry guidance on contents for non-LWR license applications, please contact the authors.

In today’s international nuclear marketplace, foreign investment is a significant source of capital for U.S. next-generation nuclear ventures. However, about-to-be signed legislation has the potential to broadly expand the ability of the Committee on Foreign Investment in the United States (“CFIUS”) to review foreign investment into the United States directed towards the nuclear industry, as well as the ability of the U.S. government to control exports of emerging nuclear technologies.

The new legislation, expected to be signed today, will among other things: (1) increase the number of transactions falling under CFIUS jurisdiction, (2) make some CFIUS reviews mandatory, (3) and give CFIUS the ability to suspend pending investments.  The legislation will also (4) expand export controls for “emerging and foundational technologies.”  The advanced reactor community should be aware of the legislation as it could impact future investment plans.  The community may also want to involve itself in expected rulemakings that will clarify important parts of the legislation.

As background, CFIUS is a multi-agency committee, led by the Treasury Department, which has the ability to review foreign investments into the United States that pose a threat to national security. Under the current law, CFIUS is able to review transactions that allow a foreign entity to gain “control” over a US business that poses a national security risk—including U.S. businesses holding or involved in critical infrastructure and critical technologies, which includes nuclear power.  CFIUS works aside a separate, complex nuclear export control regime to police efforts by foreign powers to infiltrate critical infrastructure and technologies in a manner harmful to U.S. national interests.

The about-to-be-signed legislation, entitled the Foreign Investment Risk Review Modernization Act of 2018 and the Export Controls Act of 2018, have both been inserted into the John S. McCain National Defense Authorization Act for Fiscal Year 2019.  Hogan Lovells’ International Trade Practice has summarized key elements of the legislation in two client alerts (here and here).  The legislation has many components, but a few of which are worth calling out in more detail:

(1) Increasing the Scope of CFIUS Jurisdiction: Currently, the touchstone of CFIUS jurisdiction is whether any transaction would give a foreign entity control of a US business.   However, CFIUS will now be able to review many other types of transactions, including “any other investment[s]” (to be clarified by CFIUS by rulemaking) that concern critical infrastructure, critical technologies, or sensitive personal data of U.S. citizens.

Depending on how future CFIUS rulemaking efforts proceed, this could capture many types of investments in advanced reactor start-ups or fusion ventures, regardless if control is at stake—potentially even if the transaction just results in the foreign entity gaining access to material non-public technical information. CFIUS will also now be able to review changes to existing investor rights that could lead to the same result, as well as certain investments designed to get around CFIUS review.  Certain limited carve-outs exist for private equity and venture investments, but these are still to be clarified further.

(2)Making CFIUS Submissions Mandatory: Currently, while CFIUS can itself seek review of a transaction, generally no entity is required to submit a transaction to CFIUS for review (i.e., submissions are voluntary). However, businesses seeking investment involving foreign government backing will now have to submit “declarations” to CFIUS, and CFIUS would have 30 days to take a number of potential actions (again, to be clarified further by rulemaking). This piece of the legislation, like many others parts, is in response to increasing concerns around Chinese state-owned investment into sensitive US businesses.

(3) Allowing CFIUS to Suspend Transactions:  Currently, CFIUS can only recommend to the President that a transaction be blocked, making it in practice very hard and rare for a transaction actually to be blocked.  However, now CFIUS can suspend a proposed/pending transaction that appears to pose a threat to national security while it conducts its review.  This gives the committee a strong new tool to effectively kill transactions it does not favour.

(4)Intensifying U.S. Government Export Controls:  Alongside CFIUS reform, new legislation will allow the U.S. government to intensify how it controls exports of “emerging and foundational technologies.”  Currently such exports are controlled by a variety of regulators, including the U.S. Departments of Commerce and State, and in the case of nuclear power, also the U.S. Department of Energy and the U.S. Nuclear Regulatory Commission, under well-defined but also sometimes slow-to-change regimes.

This broad, new legislation appears designed to gives the Executive Branch important new mechanisms to quickly apply export controls to emergent fields that concern U.S. economic interests.  Within the nuclear space, this could impact both novel fission and fusion technologies that are either not covered or loosely regulated under current export control regimes—although its actual impact will follow only after this legislation is applied in practice.

While certain parts of this legislation may come into effect immediately, both CFIUS and the Executive Branch will have to undertake rulemakings and additional actions to fully implement its new powers.  This will provide opportunities for potentially affected parties to get their voice known, especially as the role of (and concern with) foreign investment in U.S. nuclear innovation is only expected to grow.

For more about CFIUS and nuclear export controls, as well as the above-described legislation, please contact the authors.

A recent headline in the energy trade press would not likely have caught the attention of the advanced nuclear industry: “Trump’s DOE punishes Obama-era solar success story.” A casual reader might quickly dismiss the story as indicative of a Trump Administration bias against renewable energy. The details reported in the story, however, convey a far different message—one that is great significance to the many advanced nuclear technology companies that are responding to DOE’s funding opportunity announcement for advanced nuclear development.

The E&E News article reports that a company by the name of 1366 Technologies accepted millions of dollars in DOE funding to develop a process to reduce the cost of producing silicon wafers. In return, it made certain commitments routinely required of recipients of DOE technology funding: to engage in substantial U.S. manufacture of the technology, to disclose to DOE patents produced with DOE financial assistance, to give DOE a royalty-free license for government use, and to give DOE so-called “march-in rights” to license the technology to others if the funding recipient fails to use the technology itself.

According to the published story, DOE has sought to enforce the commitment 1366 Technologies made to build its solar wafer manufacturing plant incorporating the DOE-funded technology in the U.S., specifically in upstate New York. Delays in obtaining a wholly separate DOE loan guarantee are said to account for a decision by 1366 to instead build its first plant in Asia. E&E News reports that DOE has responded with a submission to the United States Trade Representative suggesting that the failure to comply with the U.S. manufacture commitment should be weighed in considering a request by 1366 for exemption from the 30 percent tariff that generally applies to foreign manufacturers of solar panels. DOE is also reportedly evaluating its options with respect to 1366’s failure to disclose patents it filed while it was accepting DOE financial assistance. Under DOE intellectual property (IP) rules, the failure to make a required disclosure could result in a loss of rights in those patents.

This is not fairly characterized as an instance of the Trump Administration attacking the solar industry. Rather, it represents a continuation of the practice that the Obama Administration and others before it pursued (albeit with varying degrees of ardor) of ensuring that the American taxpayer gets the benefit of its bargain for assisting in the advancement of energy technologies. That funding is designed to advance U.S. competitiveness in energy technology and energy manufacturing. In DOE’s view, allowing the IP that results from the taxpayer investment to be shipped abroad for commercialization can defeat the purpose of the taxpayers’ investment. DOE’s views are supported by statute (in particular, this is the intent behind the Bayh Dole Act, 35 U.S.C. §§ 200 – 212).

This is why the advanced nuclear technology industry should be paying close attention to the 1366 case. The FOA for advanced nuclear technology puts great emphasis on the desire to rebuild U.S. nuclear manufacturing capability. DOE has recently announced its first round of awards under the FOA. Additional applicants have submitted in the second round, and many others are preparing to submit one or more applications over the five years that DOE has said the FOA will remain open. The FOA represents a great opportunity to make important advances in nuclear technology prowess and to restore the U.S. nuclear supply chain to its past pre-eminence. That is what DOE expressly seeks to do. Therefore, it is important to understand and to put in place a program to assure compliance with the “strings” that are attached to the DOE money.

More than 10 pages of the lengthy FOA are devoted to the applicable IP rules. The eyes of an enthusiastic applicant might easily glaze over when they get to those 10 pages, but that would be a mistake. The rules reflect the implementation of statutory requirements, and they are unique to government-funded IP. They may be unfamiliar to those schooled in standard IP rules and practices associated with filing for patent rights. The ultimate commercial success of developing a great new technology may depend on understanding the obligations, managing the risks, engaging with DOE candidly when unanticipated challenges arise, and of course internalizing what we all already know: there really is no free money.

Applicants for DOE funding worry a lot about the government royalty-free license and the march-in rights (which the government has never exercised). However, the story about 1366 Technologies shows that those who accept federal funding to develop their technologies should have far greater concern about meeting the commitments they make to manufacture the technology in the U.S. and to disclose the patents they develop with government funds. In our experience, DOE is open to discussion and negotiation, within the constraints of its statutory obligations. However, DOE has demonstrated its willingness to employ at least some of the powerful enforcement tools it has at its disposal to enforce those obligations if it concludes the circumstances warrant such action.

In short, it is important to understand and take seriously the substantial U.S. manufacture and patent disclosure obligations that come with a financial assistance, because DOE does.

For more information, please contact Mary Anne Sullivan.

The start of the month has proven to be an exciting one for nuclear innovation in D.C.  A number of legal and regulatory activities have taken place which have implications for the next-generation nuclear industry, just a few of which are noted below.  (And for those at the ARPA-E conference, see our blog author Amy Roma speak today at the 2:15 panel “Quantifying Technical Risk for Advanced Nuclear Reactors”).

  • Last week was “Nuclear Innovation Week” in D.C. It consisted of three events highlighting both nuclear innovation and legal/regulatory reform: (i) Third Way’s Annual Advanced Nuclear Summit, (ii) the Nuclear Energy Institute’s (NEI’s) Nuclear R&D Summit, and (iii) a joint symposium hosted by the Gateway for Accelerated Innovation in Nuclear, NEI, and the Electric Power Research Institute.  Recordings of events from the Third Way summit are available online, and Amy spoke there on the topic of “Will the US Be a Global Leader in Advanced Nuclear Energy.”
  • In Congress, the Nuclear Energy Innovation Capabilities Act (S.97) passed the Senate.  The legislation would help move advanced reactor concepts forward by encouraging the creation of a fast neutron test reactor, as well as a user facility called the National Reactor Innovation Center.  While it is unclear how money will follow, it is a step in the right direction and recognizes the critical need for test facilities for next-generation nuclear reactors. Of its other more notable elements, the bill would also push forward an “Advanced Nuclear Energy Cost-Share Grant Program,” under which DOE can make cost-share grants to applicants for the purpose of funding a portion of NRC licensing fees, including both pre-application and application reviews.
  • The NRC issued Regulatory Guide 1.232, “Guidance for Developing Principal Design Criteria For Non-Light-Water Reactors.” As we discussed when the draft regulatory guide came out, this is a critical guidance document for non-light water reactors.  Appendix A to 10 CFR Part 50 sets for the general design criteria for NRC-licensed reactors, which are essentially the bounding safety requirements every new reactor has to meet.  These requirements, however, are designed for light-water reactors and do not apply well to non-light water designs (e.g., Criterion 14 sets requirements concerning reactor “pressure” boundaries, but many advanced reactors would not operate above atmospheric pressure).  There are three appendices to the report, which set forth general “advanced reactor design criteria,” as well as specific design criteria for sodium-cooled fast reactors and modular high-temperature gas-cooled reactors.  This guidance document, which attempts to update the NRC’s general design criteria to address this disconnect, is the product of a years-long DOE-NRC effort, paired with industry and public input.

And the month is not letting up.  This week is the NRC’s annual Regulatory Information Conference, where advanced reactors are taking center stage.  This week is also the ARPA-E Energy Innovation Summit, with Amy speaking on the panel, “Quantifying Technical Risk for Advanced Nuclear Reactors” (2:15 Tuesday).  ARPA-E has established a program to fund enabling technologies for next-generation reactors, called “MEITNER.”  The program seeks to help nuclear innovators leapfrog in development by providing advanced modeling and simulation tools, access to subject matter experts from nuclear and non-nuclear disciplines, and collaborative design assistance.  APRA-E is in itself an novel concept for how to commercialize technology research, and uses unique funding mechanisms to more efficiently fund energy innovation.

For more on any of the above topics, or on what else is going on in the nation’s Capital in support of nuclear energy, please contact the authors.

Nuclear power has had a busy year in 2017.  One of the most important trends for preserving the existing fleet of operating nuclear power plants has been the financial commitment  by US states to support nuclear power operating in their states and preserve their largest source of carbon-free power—and the thousands of jobs that go with it. This represents a significant reversal in state policy towards nuclear power, which traditionally has been left out of state programs promoting low or carbon free power—despite the fact that 60 percent of the carbon free power in the U.S. is generated by nuclear power. And the new state involvement has the potential to be a game-changer for next-generation reactors.

To highlight some of the key state activities from this year:

  • New York’s Clean Energy Standard and Illinois’s SB 2814, with their Zero-Emissions Credit (ZEC) programs, came into effect this year.  These programs represent among the first significant state efforts to  compensate nuclear power for its environmental benefits, and has helped keep a large number of nuclear power plants operational. Ohio has also introduced legislation to implement similar ZEC-type programs.
  • Federal district courts separately upheld both New York’s and Illinois’s ZEC programs against federal pre-emption and Constitutional challenges. Both decisions have been appealed, but nonetheless allow the state programs to continue in the interim.
  • Connecticut passed legislation that would allow nuclear power to compete directly against other zero-carbon resources in certain circumstances.
  • New Jersey introduced and advanced legislation to support nuclear power through “nuclear diversity certificates,” which would support the nuclear reactors for their environmental and fuel diversity attributes.

The core of many of these programs is valuing the benefits of nuclear power using the “social cost of carbon” framework. The social cost of carbon represents a potential measure of the harms caused by carbon emissions (and therefore, the value of carbon avoided by zero emissions generation). It was developed by a federal government interagency working group and has found itself increasingly referenced as part of state climate initiatives.

Although these programs directly benefit the current light water reactor fleet, it also signifies a larger trend by states to put nuclear power on an equal footing to other forms of low or zero-carbon generation sources.  This trend cannot be ignored by the advanced reactor industry. Just as renewable energy grew through state-level efforts to support the industry through renewable energy credit programs and portfolio standards, next generation reactor developers may want to look to states along with the federal government as potential sponsors for first-of-a-kind reactor projects.

These activities also explore the myriad different legal routes states can pursue to support the environmental and societal benefits of nuclear power. The U.S. energy grid is an ecosystem with many state, regional, and federal actors all working together to provide electricity at low cost and in accordance with legitimate policy goals. Disputes are likely to arise (and have arisen) as to where the borders between state and federal involvement. But that does not change the fact that states have always had a role in the in the promotion and regulation of nuclear power. An opportunity now exists to redefined that relationship, and for a new generation of state leaders to reengage with a new generation of reactor developers, for the benefit of all involved.

For more on state legislative activities affecting nuclear power, please contact the authors.

On Wednesday, November 15, the US Nuclear Regulatory Commission (NRC) staff published a revised and final regulatory basis document in support of its rulemaking to reform emergency planning requirements for small modular and advanced reactors, including medical isotope reactors.  This rulemaking promises to significantly reduce costs for next generation nuclear plants by employing individualized, risk-informed requirements as opposed to rigid deterministic ones.

Fifty-seven individuals, companies, and organizations commented on the draft regulatory basis document.  The NRC staff made a number of edits to respond to the comments, including further incorporating risk-informed concepts into the text of the regulatory basis, and increasing discussion of the agency’s framework for establishing the size of emergency planning zones for new reactor designs.  According to the NRC’s rulemaking schedule, a proposed rule is due to be published early 2019, with a final rule in 2020.

This action by the NRC coincides with exciting developments for the US Department of Energy.  This week the Transient Reactor Test Facility (TREAT) at Idaho National Laboratories successfully completed low-power operations after being brought out of standby since 1994.  As explained in industry press, the restart of TREAT is a big success story for the agency, which refurbished the facility a year ahead of schedule and $20 million under budget.  TREAT specializes in testing new reactor fuels under heavy irradiation conditions, to see how they perform particularly in accident scenarios.  Testing new fuel designs is a linchpin to commercializing new reactor designs, as many of them rely on completely new concepts for nuclear fuel.

TREAT may also be getting company.  This same week, the House of Representatives Committee on Science, Space, and Technology approved an exciting new bill markup, HR 4378, the “Nuclear Energy Research Infrastructure Act of 2017.”  This piece of legislation tries to deliver on repeated calls to build a new test reactor in the United States.  It calls for a fast-neutron test facility to be completed in the mid-2020s that supports (among other things) high-temperature testing, testing of different coolant types, medical isotope production, and which is designed to be upgrade-able over time.  Funding is set aside, with $35 million in 2018, scaling up to $350 million from 2023 to 2025.

For more on any of these topics, feel free to contact the authors.

Last week China announced the launch of a company to build twenty (20) floating nuclear power stations.  Russia continues to move forward with its floating nuclear power station, which are to be mass-produced at shipbuilding facilities and then towed to areas in need of power.  In fact, it is working towards initial fuel load on its first floating reactor.  Politics aside, these developments highlight a trend in nuclear power, which is the growing interest to power our cities with smaller, more flexible  reactors—which could be located offshore.

China and Russia are not the first to suggest the concept of sea-based reactors.  The world’s first operational nuclear reactors were naval reactors for submarines, and nuclear reactors continue to power submarines and aircraft carriers around the world.  In the commercial power space, a floating nuclear reactor effort called the Offshore Power System project was explored in the 1970s to provide power onshore, although it eventually did not move forward.  Since then, Russia has taken a lead role, constructing the Akademik Lomonosov, a floating reactor that will be towed to Pevek in Russia’s Eastern half for power generation.  Private enterprise has also taken interest in the concept.  For example, a company called ThorCon is proposing a molten salt reactor power that would be located on a ship and deploy-able around the world, called the ThorConIsle.  However, China’s effort may ultimately prove to be one of the more extensive ones.  The company will be formed by five entities including the China National Nuclear Power Corporation, and will have an initial capital of $150 million.

The legal, policy, and regulatory issues posed by floating reactors are as interesting as the technology.  The location of the floating reactors next to other countries is of course a key concern. The Akademik Lomonosov had to change where it would be fueled due to concerns by Norway.  Some are alleging that the Chinese reactor project is part of an effort to help boost control of the South China Sea.  The transit of floating nuclear reactors–which do not propel the vessels they are on–by neighboring countries raises legal issues that would need to be navigated.  In addition, just as the siting of wind turbines offshore has at times generated strong local opposition, similar grass-roots opposition could arise to challenge the siting of floating reactors located offshore.  These challenges can be overcome, but should be considered early on in project development.

The regulatory framework in which a private company would construct a reactor would also need to be examined.  For example, in the United States, the U.S. Nuclear Regulatory Commission’s (NRC’s) Standard Review Plan for examining the safety of nuclear reactors does not necessarily envision floating reactors.  That does not mean a floating reactor could not get licensed in the United States, however, and in fact the Offshore Power System, and the licensing of the NS Savannah provide some useful precedent.  The NS Savannah was licensed by the U.S. Atomic Energy Commission, the predecessor agency of the NRC, and although this was built to be a “goodwill ship,” a goal in the construction of the ship was to meet civilian safety requirements so the vessel could be usable by the public.  Moreover, the NRC works with the Department of Energy (DOE) to provide technical support for DOE’s oversight of the U.S. Nuclear Navy.

Extending civilian use of nuclear power to the ocean presents questions, but also significant opportunities, for both the developed and developing world.  Please do not hesitate to contact the authors if you wish to learn more.

The House of Representatives quickly passed HR 1551 Tuesday, after its approval out of committee last week.  This bill represents a bipartisan effort to promote nuclear power development in the United States by removing the deadline on the nuclear Production Tax Credit, and allowing tax credits to be transferred in certain cases.  The text of the bill can be found here.

If there are any questions on the legislation, please contact the authors.