[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]



  A REVIEW OF THE DEPARTMENT OF ENERGY'S YUCCA MOUNTAIN PROJECT, AND 
       PROPOSED LEGISLATION TO ALTER THE NUCLEAR WASTE TRUST FUND

=======================================================================

                                HEARING

                               before the

                 SUBCOMMITTEE ON ENERGY AND AIR QUALITY

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                                   on

                        H.R. 3429 and H.R. 3981

                               __________

                             MARCH 25, 2004

                               __________

                           Serial No. 108-70

                               __________

       Printed for the use of the Committee on Energy and Commerce


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house



                               __________

93-300              U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 2003
____________________________________________________________________________
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                    ------------------------------  

                    COMMITTEE ON ENERGY AND COMMERCE

                      JOE BARTON, Texas, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
RALPH M. HALL, Texas                   Ranking Member
MICHAEL BILIRAKIS, Florida           HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RICK BOUCHER, Virginia
PAUL E. GILLMOR, Ohio                EDOLPHUS TOWNS, New York
JAMES C. GREENWOOD, Pennsylvania     FRANK PALLONE, Jr., New Jersey
CHRISTOPHER COX, California          SHERROD BROWN, Ohio
NATHAN DEAL, Georgia                 BART GORDON, Tennessee
RICHARD BURR, North Carolina         PETER DEUTSCH, Florida
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
CHARLIE NORWOOD, Georgia             ANNA G. ESHOO, California
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               ELIOT L. ENGEL, New York
HEATHER WILSON, New Mexico           ALBERT R. WYNN, Maryland
JOHN B. SHADEGG, Arizona             GENE GREEN, Texas
CHARLES W. ``CHIP'' PICKERING,       KAREN McCARTHY, Missouri
Mississippi, Vice Chairman           TED STRICKLAND, Ohio
VITO FOSSELLA, New York              DIANA DeGETTE, Colorado
STEVE BUYER, Indiana                 LOIS CAPPS, California
GEORGE RADANOVICH, California        MICHAEL F. DOYLE, Pennsylvania
CHARLES F. BASS, New Hampshire       CHRISTOPHER JOHN, Louisiana
JOSEPH R. PITTS, Pennsylvania        TOM ALLEN, Maine
MARY BONO, California                JIM DAVIS, Florida
GREG WALDEN, Oregon                  JANICE D. SCHAKOWSKY, Illinois
LEE TERRY, Nebraska                  HILDA L. SOLIS, California
MIKE FERGUSON, New Jersey            CHARLES A. GONZALEZ, Texas
MIKE ROGERS, Michigan
DARRELL E. ISSA, California
C.L. ``BUTCH'' OTTER, Idaho
JOHN SULLIVAN, Oklahoma

                      Bud Albright, Staff Director

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

                 Subcommittee on Energy and Air Quality

                     RALPH M. HALL, Texas, Chairman

CHRISTOPHER COX, California          RICK BOUCHER, Virginia
RICHARD BURR, North Carolina           (Ranking Member)
ED WHITFIELD, Kentucky               TOM ALLEN, Maine
CHARLIE NORWOOD, Georgia             HENRY A. WAXMAN, California
JOHN SHIMKUS, Illinois               EDWARD J. MARKEY, Massachusetts
  Vice Chairman                      FRANK PALLONE, Jr., New Jersey
HEATHER WILSON, New Mexico           SHERROD BROWN, Ohio
JOHN B. SHADEGG, Arizona             ALBERT R. WYNN, Maryland
CHARLES W. ``CHIP'' PICKERING,       GENE GREEN, Texas
Mississippi                          KAREN McCARTHY, Missouri
VITO FOSSELLA, New York              TED STRICKLAND, Ohio
GEORGE RADANOVICH, California        LOIS CAPPS, California
MARY BONO, California                MIKE DOYLE, Pennsylvania
GREG WALDEN, Oregon                  CHRIS JOHN, Louisiana
MIKE ROGERS, Michigan                JIM DAVIS, Florida
DARRELL E. ISSA, California          JOHN D. DINGELL, Michigan,
C.L. ``BUTCH'' OTTER, Idaho            (Ex Officio)
JOHN SULLIVAN, Oklahoma
JOE BARTON, Texas,
  (Ex Officio)

                                  (ii)




                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Berkley, Hon. Shelly, a Representative in Congress from the 
      State of Nevada............................................     5
    Card, Hon. Robert H., Under Secretary of Energy; accompanied 
      by Margaret S.Y. Chu, Director, Office of Civilian 
      Radioactive Waste Management, U.S. Department of Energy....    32
    Diaz, Hon. Nils J., Chairman, U.S. Nuclear Regulatory 
      Commission.................................................    48
    Duquette, David J., U.S. Nuclear Waste Technical Review Board    53
    Ervin, Hon. Sam J., IV, Commissioner, North Carolina 
      Utilities Commission, on behalf of the National Association 
      of Regulatory Utility Commissioners........................    65
    Gibbons, Hon. Jim, a Representative in Congress from the 
      State of Nevada............................................     2
    Howard, Angelina S., Executive Vice President, Nuclear Energy 
      Institute..................................................    72
    Mitchell, John T., President and General Manager, Bechtel 
      SAIC, LLC..................................................    78
    Porter, Hon. John C., a Representative in Congress from the 
      State of Nevada............................................     7

                                 (iii)

  

 
  A REVIEW OF THE DEPARTMENT OF ENERGY'S YUCCA MOUNTAIN PROJECT, AND 
 PROPOSED LEGISLATION TO ALTER THE NUCLEAR WASTE TRUST FUND (H.R. 3429 
                             AND H.R. 3981)

                              ----------                              


                        THURSDAY, MARCH 25, 2004

                  House of Representatives,
                  Committee on Energy and Commerce,
                    Subcommittee on Energy and Air Quality,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:30 a.m., in 
room 2123, Rayburn House Office Building, Hon. Ralph M. Hall 
(chairman) presiding.
    Members present: Representatives Hall, Burr, Norwood, 
Shimkus, Wilson, Walden, Otter, Sullivan, Barton (ex officio), 
Boucher, Allen, Markey, and Green.
    Also present: Representative Greenwood.
    Staff present: Mark Menezes, special counsel; Dwight Cates, 
professional staff; Peter Kielty, legislative clerk; Bruce 
Harris, minority counsel; and Sue Sheridan, minority counsel.
    Mr. Hall. All right. The subcommittee will come to order. I 
want to welcome everyone to today's hearing on the status of 
the Yucca Mountain Project, and Proposed Legislation to Alter 
the Nuclear Waste Trust Fund. Without objection, the 
subcommittee is going to proceed pursuant to Committee Rule 
4(e), which governs opening statements by Members, and the 
opportunity to defer them for the extra questioning time.
    Because we know of the time demands on our first panel, and 
in respect to them, Congressman Boucher has agreed to defer 
opening statements until we have the testimony of you three.
    And at this time, we are honored to have you. I think your 
appearance here today and the testimony that you are going to 
give will reflect the fact that you are representatives that we 
represent. We represent a district, and you are here doing a 
good job of representing yours.
    And at this time I would rather recognize Mrs. Berkley, but 
I will go in the order of seniority, or the most handsome, or 
the oldest. How do you want to proceed?
    Mr. Gibbons. I qualify on 2 out of 3 of those, one being 
the oldest.
    Mr. Hall. I recognize Congressman Gibbons.

  STATEMENTS OF HON. JIM GIBBONS, A REPRESENTATIVE IN CONGRESS 
FROM THE STATE OF NEVADA; HON. SHELLY BERKLEY, A REPRESENTATIVE 
IN CONGRESS FROM THE STATE OF NEVADA; AND HON. JOHN C. PORTER, 
     A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEVADA

    Mr. Gibbons. Thank you, Mr. Chairman.
    Mr. Hall. Take as long as you need.
    Mr. Gibbons. Well, thank you, Mr. Chairman, and I will try 
to be brief, and I want to again thank you for allowing me to 
testify again before this important committee on this very 
critical issue that affects Nevada.
    Now, Mr. Chairman, I represent every county in the State of 
Nevada, including Nye County, which includes Yucca Mountain, 
and this sensitive issue has long been one of my gravest 
concerns in my representation of the people of Nevada.
    In fact, the proposed high-level nuclear waste repository 
at Yucca Mountain and the ongoing fight against it, is 
absolutely the No. 1 grievance that Nevadans have with the 
Federal Government.
    And despite my sincere appreciation for being invited here 
today to present my side of the Yucca Mountain case, I must 
make it clear from the outset that my views on this proposed 
repository are in stark contrast with those of the majority of 
the members of the committee.
    However, as long as the voters elect me to public office, I 
will continue to fight to prevent the Yucca Mountain repository 
from ever becoming our Nation's nuclear waste storage dump.
    My reasons for opposing the Yucca Mountain waste repository 
are manifold. These reasons range from security concerns 
regarding possible terrorist sabotage of the waste shipments, 
to fiscal concerns with continuing to burden the hardworking 
taxpayers of this Nation with the ever-rising costs of this 
Department of Energy boondoggle.
    At issue before the subcommittee today are two topics; 
progress on the Yucca Mountain project overall, and 
consideration of legislation aiming to dramatically alter the 
nuclear waste trust fund, and to take the Yucca Mountain 
project off the budget completely.
    Regarding progress on the nuclear waste repository overall, 
I firmly believe that forward progress on this project is 
impossible. With every dollar spent in an attempt to make the 
Yucca Mountain waste repository feasible, additional flaws that 
should render the project unsuitable for licensing have been 
and continue to be exposed.
    The scientific safety, and health, and environment concerns 
surrounding the proposed waste repository are well documented, 
and I will not spend my time here today reiterating them before 
the subcommittee.
    However, I would ask that you take these concerns seriously 
before making any decision on the future progress of Yucca 
Mountain. I would like to take this opportunity, Mr. Chairman, 
to address the second issue at hand before the subcommittee 
today, which is consideration of two bills designed to alter 
the nuclear waste trust fund, H.R. 3429 and H.R. 3981.
    Mr. Chairman, I don't think it is ambiguous that I strongly 
oppose any language that would eliminate Congressional 
oversight over the annual Yucca Mountain funding process, and 
both of these bills would have that effect.
    H.R. 3981 and H.R. 3481 would both allow utility company 
contributions to be credited to the nuclear waste fund as 
offsetting collections, and thus severely limiting Congress' 
ability to oversee and manage how DOE spends these funds 
annually.
    As I previously stated, I have serious concerns with the 
DOE's management of the Yucca Mountain project, and annual 
Congressional oversight of the funding appropriated for this 
project is absolutely key in executing our duty of ensuring 
that every cent of American taxpayer dollars is spent 
responsibly and efficiently.
    Certainly the unanswered scientific question of public 
safety and health concerns, and the unresolved issue of how 
nuclear waste will be shipped across the country to Yucca 
Mountain warrant further examination before Congress allows our 
oversight of this proposed repository to be rescinded.
    At a time when Congress should be tightening its spending 
belt, it would be irresponsible for us to allow funding to 
increase at an astronomical rate for a project that may very 
well be proven unfeasible before it is even licensed.
    I strongly encourage this subcommittee not to move forward 
on these legislative proposals. Instead, Congress must work to 
identify an alternative to the Yucca Mountain plan. The idea of 
burying one of the most toxic substances known to man 
underground and isolating it for 10,000 years was devised 
nearly 20 years ago.
    Over the past two decades scientific advances have 
demonstrated that the geologic burial of nuclear waste is just 
that, a waste. Congress cannot provide for the squandering of 
our Nation's limited resources on a project that has been 
proven over, and over again, to be a disaster both 
scientifically and fiscally.
    Congress should not and cannot abdicate its oversight 
responsibilities of a billion dollar project. Such a decision 
would be a disservice to every taxpayer in America. And with 
that said, I once again register my opposition to continuing 
along the disastrous path of burying our Nation's nuclear waste 
in my Congressional district.
    I offer my strongest support for working together toward a 
modern alternative solution to geologic burial of high level 
nuclear waste, and propose that Congress maintain its 
constitutional authority over spending and the use of taxpayer 
dollars.
    Mr. Chairman, with that said, again I would ask that the 
committee rebuff the proposals that are continuing in these two 
bills, H.R. 3429 and 3981, and I would yield back the balance 
of any time that I may have remaining, and I thank you again 
for the courtesy of allowing me to testify. And I would be open 
for any questions that you may have.
    [The prepared statement of Hon. Jim Gibbons follows:]
 Prepared Statement of Hon. Jim Gibbons, a Representative in Congress 
                        from the State of Nevada
    Mr. Chairman, thank you for inviting me to testify at this 
important hearing today.
    This issue has always been of the utmost concern to me and to many 
of my constituents.
    I represent every county in Nevada, including Nye County which 
includes Yucca Mountain.
    In fact, the proposed high-level nuclear waste repository at Yucca 
Mountain, and the ongoing fight against it, is absolutely the number 
one grievance Nevadans have with the federal government.
    Despite my sincere appreciation for being invited to present my 
side of the Yucca Mountain case here today, I must make it very clear 
from the outset that my views on this proposed repository contrast 
quite severely with those of the majority of the Members of this 
Committee.
    However, as long as the voters in Nevada elect me to public office, 
I will continue to fight to prevent the Yucca Mountain repository from 
ever becoming our nation's nuclear waste storage dump.
    My reasons for opposing the Yucca Mountain waste repository are 
manifold, ranging from an urgent need to protect the health and safety 
of all Americans, to serious concerns regarding possible terrorist 
sabotage of the waste shipments, to fiscal concerns with continuing to 
burden the hardworking taxpayers of this nation with the ever-rising 
costs of this Department of Energy boondoggle.
    At issue before the Subcommittee today are two topics: progress on 
the Yucca Mountain Project overall, and legislation aiming to 
dramatically alter the Nuclear Waste Trust Fund and take the Yucca 
Mountain project off-budget completely.
    Regarding progress on the proposed nuclear waste repository 
overall, I hold the firm belief that forward progress on this project 
is impossible.
    With every week that goes by and with every dollar spent in an 
attempt to make the Yucca Mountain waste repository feasible, 
additional flaws that should render the project unsuitable for 
licensing are exposed.
    The scientific, public safety, health, and environmental concerns 
surrounding the proposed waste repository are well-documented and I 
will not spend my time here today reiterating them to the Subcommittee.
    I am assured that you are all well aware of these issues and I 
would entreat you to take these concerns as seriously as do the 
Nevadans who will most likely affect be affected by this misguided 
policy.
    However, I would like to take this opportunity to address a fairly 
immediate concern, one that is gaining more attention as the DOE works 
towards licensing the repository.
    While the DOE continues to spend millions upon millions of dollars 
on the Yucca Mountain project--we have yet to begin to address the 
dangers the transportation of high-level nuclear waste poses to our 
national security and our citizens' health and safety.
    The issue of transporting 77,000 metric tons of high level nuclear 
waste through thousands of American neighborhoods, across our nation's 
rugged terrain, and through our busy city scapes, past schools and 
hospitals, out to Yucca Mountain has raised the ire of Americans all 
across the country.
    Truthfully, I have seen no evidence to prove that the deadliest 
material known to man can be safely and securely transported across the 
nation to Yucca Mountain.
    Just one accident could result in the loss of thousands of lives 
and unimaginable devastation to communities and the environment.
    And yet, even more worrisome than an accident is a malicious 
terrorist act to derail a shipment or worse--sabotage these shipments 
with an explosive device in order to create a dirty bomb.
    This is an issue for all Americans nation-wide and it is up to 
Congress to oversee and scrutinize the Department of Energy's work in 
this which is, in my opinion, a flawed and potentially tragic scheme.
    The second issue at hand before the Subcommittee today is 
consideration of two bills designed to alter the Nuclear Waste Trust 
Fund, H.R. 3429, and H.R. 3981.
    As I have stated before, I strongly oppose any language that would 
eliminate Congressional oversight of the annual Yucca Mountain funding 
process, and both of these bills would have that effect.
    H.R. 3981 and H.R. 3481 would both allow utility company 
contributions to be credited to the Nuclear Waste Fund as offsetting 
collections, thus severely limiting Congress' ability to oversee and 
manage how DOE spends these funds annually.
    As my above statement outlines, I have serious concerns with the 
DOE's management of the Yucca Mountain Project, and annual 
Congressional oversight of the funding appropriated for this project is 
key in executing our duty of ensuring that every cent of American 
taxpayers' dollars is spent responsibly and efficiently.
    Certainly, the unanswered scientific questions, public safety and 
health concerns, and unresolved issue of how the nuclear waste will be 
shipped across country to Yucca Mountain warrant further examination 
before Congress allows our oversight of this proposed repository to be 
rescinded.
    At a time when Congress should be tightening its spending belt 
whenever and wherever possible, it would be ill-considered for us to 
allow funding to increase at an astronomical rate for a project that 
may very well be proven unfeasible before it is even licensed.
    While I understand that Chairman Barton of the full Energy and 
Commerce Committee is the lead sponsor on H.R. 3981, I strongly 
encourage this Subcommittee not to move forward on these legislative 
proposals.
    In conclusion, Congress must work to identify an alternative to the 
Yucca Mountain plan.
    The idea of burying one of the most toxic substances known to man 
underground and isolating it for ten thousand years was devised nearly 
20 years ago.
    Over the past two decades, scientific advances have demonstrated 
that the geologic burial of nuclear waste is just that: a waste.
    Congress cannot provide for the squandering of our nation's limited 
resources on a project that has been proven over and over again to be a 
disaster both scientifically and fiscally.
    Congress should not and can not abdicate its oversight 
responsibility of a billion dollar project.
    Such a decision would be a disservice to every taxpayer in America.
    With that, I once again register my opposition to continuing along 
the disastrous path of burying our nation's nuclear waste in my 
Congressional District.
    I offer my strongest support for working together towards an 
alternative solution to the geologic burial of high-level nuclear 
waste, and propose that Congress maintain its Constitutional authority 
over spending and the use of taxpayer dollars.

    Mr. Hall. Thank you, and at this time we recognize Mrs. 
Berkley.

                STATEMENT OF HON. SHELLY BERKLEY

    Mrs. Berkley. I want to thank Chairman Hall and Ranking 
Member Boucher for allowing me to testify before you today. 
Yucca Mountain remains the single most important issue of 
concern to me and to my constituents.
    Almost every week new information comes to light about the 
dangers of the Yucca Mountain project. Just to say a few. Nuke 
experts says Yucca Mountain unsafe. Federal officials, Yucca 
Mountain workers exposed to cancer-causing dust. Concerns about 
Yucca Mountain leaks echoed.
    Yet the administration and the nuclear industry, in 
defiance of the well-founded fears of Nevada citizens, rushes 
recklessly ahead to build a high-level nuclear dump in Nevada. 
Since the horrific attacks of September 11 on our nation, we 
are living in a far more dangerous world, but the Department of 
Energy has neglected to conduct tests assessing the risks of 
potential terrorist attacks, not only on the Yucca Mountain 
project, but on the transportation routes.
    The Department of Energy's nuclear programs have a singular 
record of ineptitude and indifference to the health and well-
being of the general public and their own workers. Recently it 
was established that the DOE allowed thousands of miners, 
scientists, and technicians at the Yucca Mountain project to be 
exposed to the toxic dust silici, which has resulted in the 
cause of fatal illnesses of silicosis.
    This negligent attitude toward the well-being of its own 
workers does not instill confidence in the Department of 
Energy's ability to protect Americans from the dangers of 
transporting high-level nuclear waste to Yucca Mountain.
    This agency continues to tell us to trust them and that 
they know what they are doing. It is a line Nevadans, and the 
people across the Nation, can no longer afford to buy. Nevada 
is not alone. Across the country, wherever DOE operates a 
nuclear facility, radioactive contamination has ravaged the 
environment and caused unacceptable risks to public health.
    And I need only mention the name Savannah Ridge, Oakwood, 
and Rocky Flats, to emphasize what I am talking about. My 
constituents know first-hand the human toll taken by the 
Department of Energy nuclear projects in Nevada.
    The cancer, the catastrophic lung diseases, the pain, the 
suffering, the deaths. They have too often heard and believed 
the DOE's assurances that its nuclear projects are entirely 
safe, only to later see their friends, neighbors, and loved 
ones sicken and die as a direct result of the DOE's activities.
    Now there is an additional threat. I would like to draw 
your attention to the alarming terrorism and homeland security 
issues inherent in the Yucca Mountain project, issues that the 
Department of Energy has negligently refused to confront.
    Despite spending over $9 billion so far on the problem-
ridden Yucca Mountain project, DOE has made no effort to 
seriously address the target rich environment that over 100,000 
shipments of deadly nuclear waste would create.
    Just 2 weeks ago, we witnessed the tragic terrorist attacks 
on the rail lines in Madrid, Spain, and just yesterday the 
danger of moving high level waste from existing storage 
facilities was underscored by the news from France that 
explosives were found planted under a rail bed.
    Imagine what would have happened if these trains had been 
carrying high level radioactive waste. The threat of attack is 
real. With the deplorable record of the DOE in mind, and 
outstanding homeland security issues, I testify today in the 
strongest terms against the administration's proposal to 
sharply increase funding for the Yucca Mountain project, and to 
reject any proposal that would circumvent the appropriations 
process, tieing the hands of leading Members of Congress.
    In its latest budget the White House has proposed an 
unprecedented increase in funding for the Yucca Mountain 
project to $880 million, despite multiple lawsuits challenging 
the site.
    The Nuclear Waste Technical Review Board, not traditionally 
a friend to the State of Nevada's position, established 
recently that the storage canisters that the DOE says will keep 
radiation out of the environment will--and not may, but will--
in fact corrode and release massive radioactive contamination.
    It is unconscionable that this administration is requesting 
$880 million for the construction of this repository while we 
are running $551 billion deficits. Yet, they cannot give the 
State of Nevada $5 million, only one-half of 1 percent of this 
budget request, for scientific oversight.
    This is not the first time that Nevada has had to fight for 
oversight funding. Even though it is clearly stated in the 
Nuclear Waste Policy Act that Nevada must be given Federal 
funding to pay for oversight activities at Yucca Mountain, the 
State of Nevada has been denied adequate oversight funding 
again.
    This past week the State of Nevada, frustrated by what has 
become an annual ritual, was forced to file suit to seek 
payment of this oversight funding. Clearly the DOE does not 
want anyone looking over its shoulders, whether it is the State 
of Nevada exercising its legally required watchdog role, or 
Congress overseeing its budget.
    The Department of Energy has continually failed to make 
safety and security a top priority, and instead remains focused 
on accelerating this ill-conceived project in order to meet 
some artificial 2010 deadline that was established years ago.
    This project is unprecedented in its scope, and its 
potential harmful consequences for Nevadans and thousands of 
communities across our nation. It is important that we 
recognize this project as risky, and it should not be rushed, 
and should be scientifically sound to ensure the safety of our 
public.
    I urge the members of this committee to reject any proposal 
that would skirt the appropriations process, and tie the hands 
of the Members of Congress. Funds for the Yucca Mountain 
project should have to be compete with our needs to expand 
clean energy sources and to break our dependence on foreign 
oil.
    At a time when oil markets are volatile and the cost of gas 
has skyrocketing, our Nation must scrutinize every dollar spent 
on the Yucca Mountain project, and invest our resources to 
strengthen and diversify clean energy sources.
    And I can tell you with assurance that should this project 
go forward, should we jeopardize the lives of millions of 
Americans on these transportation routes, to put nuclear waste 
in a hole in the middle of the Nevada desert, which will do 
nothing, nothing to help this Nation with its energy needs, I 
can assure you that the civil disobedience will be 
extraordinary.
    There are thousands of Nevadans that have already pledged 
to lay across those railroad tracks to prevent future 
generations of Nevadans from being exposed to toxic radioactive 
waste, and I can assure you that I will be one of those 
thousands of Nevadans that are protecting my State, and 
thousands of generations of Nevadans to come.
    I thank you very much for your kind attention, and I 
appreciate the opportunity to be here.
    Mr. Hall. And we thank you for your able presentation.
    We recognize Mr. Porter.

               STATEMENT OF THE HON. JON C. PORTER

    Mr. Porter. Thank you, Mr. Chairman, for providing me the 
opportunity to testify today. As you know, the Yucca Mountain 
issue has for over two decades been a very intense personal 
issue for the citizens of the State of Nevada and they have 
consistently shown their opposition.
    I understand the concerns of the utility companies and 
States with nuclear reactors, and many of my colleagues are 
feeling increasing pressure from the nuclear energy industry, 
and their constituencies to remedy the situation.
    And I agree that they are in a difficult situation, and a 
difficult position. Unfortunately the answers coming out of 
past Congresses, and this one, do not provide the right 
solutions. They only serve to further intensify the problem.
    Political expediency has prevailed over sound science and 
just common sense. As Nevadans have learned over the past 20 
years, when an answer does not suit the Department of Energy or 
the nuclear industry, they simply change the question. When an 
earthquake hits just 8 miles from Yucca Mountain, the DOE tells 
us not to worry about it. The rock is solid. Don't worry about 
it, Nevada.
    When one of their own scientists raises the possibility of 
water percolating up through the proposed repository level from 
the water table, his theories are dismissed. Mr. Chairman, 
instead of admitting their mistakes, successive 
administrations, both Republicans and Democrats, decided to 
continue dumping billions of dollars into studies to turn a 
molehill into a mountain recipient of nuclear waste.
    To date our government has spent about $9 billion on this 
fiasco. The nuclear industry is fond of pointing out how much 
money has been spent studying Yucca Mountain as if the amount 
already spent somehow justifies spending more, but has anyone 
said to you how much the site will cost from this point on?
    It is estimated that the Yucca Mountain project will cost 
over and above the industry fees of $60 billion. This body 
knows that it is not sunk costs that matter in decisionmaking. 
It is the future costs.
    The nuclear industry is demanding that you and your 
constituents, the American taxpayer, flip the bill for an 
unnecessary, but more importantly, unsafe project. As a 
legislator, like all of you here today, I need to be fully 
informed about the effects of legislation and issues will have 
on my constituents.
    As Members of Congress, we consistently seek evidence 
before rather than later when making decision. How can we be 
expected to do less now, yet that is exactly what the nuclear 
industry expects you to do.
    They have once again come to Congress for help and asked 
you to eliminate congressional oversight of funding which has 
been paid by the American taxpayer. The bill before this 
committee, H.R. 3981, would effectively remove the Yucca 
Mountain project from Congress' budgetary authority and 
eliminate any congressional oversight of the project for future 
Congresses.
    The passage of such legislation poses a great danger to my 
State, but to the Nation. Not just the State of Nevada, but the 
Nation on a physical level and on a symbolic level.
    As you know the transport of nuclear waste to the Yucca 
Mountain site requires the greatest deal of oversight. For this 
reason, I, on behalf of the people of Nevada, insist that this 
body maintain its oversight authority over such potentially 
dangerous projects.
    On a more abstract scale, I worry that such legislation 
will serve as a dangerous precedent of abdicating our 
Congressional authority over interstate commerce. Mr. Chairman 
and the committee, with all of the problems that have plagued 
the Yucca Mountain project since its inception, and the 
hundreds and hundreds of scientific questions still left 
unanswered, why would we even give such a budgetary gimmick a 
consideration; when now more than ever this project, the 
Federal agencies involved, and the people of Nevada, need the 
strong support of Congressional authority.
    The American people deserve more from us than wasting our 
time throwing billions of dollars at an industry that has spent 
too long already at the public trough.
    A couple of weeks ago, my colleagues and I, with the 
Railroad Subcommittee, held a hearing in Las Vegas to examine 
the Department of Energy's plan to ship nuclear wastes to the 
proposed Yucca Mountain repository.
    Any assessment of Yucca Mountain's suitability as a 
national nuclear waste repository must look at the feasibility 
of transporting waste to that site. This is just not a Nevada 
issue. It is impacting every town in the country.
    Taking 77,000 metric tons of dangerous radioactive nuclear 
waste, removing it from the reactor sites around the country, 
and putting it on trucks, trains, and barges, and moving it 
through cities, towns, and waterways across America is a 
dangerous scheme.
    On September 11, we witnessed the single-most horrific 
event in our Nation's history. Instantly, we became all too 
aware of our country's vulnerability to threats from outside of 
our borders.
    Even more recently the terrorist train bombing in Madrid, 
Spain, and yesterday the discovery of a bomb concealed under 
railroad tracks in France, have brought renewed attention to 
this very dangerous railroad processing and transportation 
system, and mass transit, face in our country post-9/11.
    The idea of transporting tens of thousands of tons of 
nuclear waste across the country was not a good idea before 
September 11, and it is certainly not a good idea today.
    We had never thought of a fully fueled passenger plane as a 
weapon.
    Let us not make the same mistake with the trucks, the 
trains, and barges that will be transporting nuclear waste past 
Chicago, Toledo, Los Angeles, Dallas, Pittsburgh, and Denver, 
just to name a few.
    At the end of the day, all Yucca Mountain will do is create 
one more large storage facility and millions of new security 
threats on every road, rail, and water mile this waste will 
travel along.
    We were all elected and sent to Washington to represent 
millions of people around the country. These constituents have 
instilled their faith in each of us to make tough decisions to 
protect their interests and their hard earned tax dollars.
    What interests are really being served here today, the 
health and public safety of our citizens, or the balance sheets 
of the nuclear utility companies?
    Again, Mr. Chairman, thank you for allowing me to testify 
today. I, with my colleagues, Mrs. Berkley and Mr. Gibbons, 
along with our Senators, will continue to stand united and 
fight to protect our homes and our livelihoods from this ill 
thought-out scheme, and we believe the rest of the Nation 
should share that concern. Thank you.
    [The prepared statement of Hon. Jon C. Porter follows:]

Prepared Statement of Hon. Jon C. Porter, a Representative in Congress 
                        from the State of Nevada

    Mr. Chairman, thank you for providing me the opportunity to testify 
today. As you know, the Yucca Mountain issue has for over two decades 
been of intense personal interest to Nevadans.
    I understand the concerns of the utility companies and States with 
nuclear reactors. Many of my colleagues are feeling increasing pressure 
from the nuclear energy industry and their constituencies to remedy the 
situation. I agree that they are in a difficult position. 
Unfortunately, the answers coming out of past Congresses and this one 
do not provide the right solutions, and only serve to further intensify 
the problem. Political expediency has prevailed over sound science and 
common sense.
    As Nevadans have learned over the past twenty years, when an answer 
does not suit the Department of Energy or the nuclear industry, they 
simply change the question. When an earthquake hits just eight miles 
from Yucca Mountain, the DOE tells us not to worry, the rock is so 
solid. When one of their own scientists raises the possibility of water 
percolating up through the proposed repository level from the water 
table, his theories are dismissed. When an analyst acknowledges the 
possibility of criticality, his theories are discredited. Instead of 
admitting their mistakes, successive Administrations, Republican and 
Democrat, decided to continue dumping billions of dollars into studies 
to turn a molehill into a mountain recipient of nuclear waste. To date, 
our government has spent about $9 billion on this fiasco.
    The nuclear industry is fond of pointing out how much money has 
been spent studying Yucca Mountain, as if the amount already spent 
somehow justifies spending more. But has anyone told you how much the 
site will cost from this point on? It is estimated the Yucca Mountain 
Project will cost over and above industry fees of $60 billion. This 
body knows that it is not sunk costs that matter in decision making; it 
is future costs. The nuclear industry is demanding that you and your 
constituents, the American taxpayer, foot the bill for an unnecessary 
and unsafe project.
    As a legislator, like all of you, I need to be fully informed about 
the effects legislation and issues will have on my constituents. As 
Members of Congress, we consistently seek evidence before rather than 
later, when making decisions. How can we be expected to do less now?? 
Yet, that is exactly what the nuclear industry expects you to do. They 
have once again come to Congress for help and asked you to eliminate 
congressional oversight of funding which has been paid by the American 
taxpayer.
    The bill before this Committee, H.R. 3981 would effectively remove 
the Yucca Mountain Project from Congress' budgetary authority and 
eliminate any congressional oversight of the Project for future 
Congresses. The passage of such legislation poses a great danger to my 
state and the nation on a physical level and on a symbolic level. As 
you know, the transport of nuclear waste to the Yucca Mountain site 
requires the greatest deal of oversight. For this reason, I, on behalf 
of the people of Nevada, insist that this body maintain its oversight 
authority over such potentially dangerous projects. On a more abstract 
scale, I worry that such legislation will serve as a dangerous 
precedent of abdicating our Congressional authority over Interstate 
Commerce.
    With all the problems that have plagued the Yucca Mountain Project 
since its inception and the hundreds of scientific questions still left 
unanswered, why would we even give such a budgetary gimmick 
consideration, when now more than ever, this Project, the federal 
agencies involved, and the people of Nevada need the strong support of 
Congressional authority. The American people deserve more from us than 
wasting our time throwing billions of dollars at an industry that has 
spent too long already at the public trough.
    A couple of weeks ago, I held a hearing in Las Vegas to examine the 
Department of Energy's plan to ship nuclear waste to the proposed Yucca 
Mountain repository. Any assessment of Yucca Mountain's suitability as 
the national nuclear waste repository must look at the feasibility of 
transporting waste to the site. Taking 77,000 metric tons of dangerous 
radioactive nuclear waste, removing it from reactor sites around the 
country, and putting it on trucks, trains and barges, and moving it 
through cities, towns and waterways across America is a disastrous 
scheme.
    On September 11th, we witnessed the single-most horrific event in 
our nation's history. Instantly we became all too aware of our 
country's vulnerability to threats from outside our borders. Even more 
recently, the terrorist train bombings in Madrid, Spain, and the 
discovery of a bomb concealed under railroad tracks in France have 
brought renewed attention to the very danger railroads and mass transit 
face in our country in a post-9/11 world. The idea of transporting tens 
of thousands of tons of nuclear waste across the country was not a good 
idea before September 11th, and it's certainly not a good idea now. We 
had never thought of a fully fueled passenger plane as a weapon. Let's 
not make the same mistake with the trucks, trains, and barges that will 
be transporting nuclear waste past Chicago, Toledo, Los Angeles, 
Dallas, Pittsburg, and Denver. Just to name a few.
    At the end of the day, all Yucca Mountain will do is create one 
more large storage facility and millions of new security threats, one 
for every road, rail, and water mile this waste will travel along. We 
were all elected and sent to Washington to represent millions of people 
around the country. These constituents have instilled their faith in 
each of us to make tough decisions to protect their interests and their 
hard earned tax dollars. What interests are really being served here 
today, the health and public safety of our citizens or the balance 
sheets of the nuclear utility companies?
    Again, thank you Mr. Chairman for the opportunity to testify today. 
We in Nevada, Mr. Gibbons and Mrs. Berkley, along with our Senators, 
will continue to stand united and fight to protect our homes and our 
livelihoods from this ill thought-out scheme.

    Mr. Hall. I thank you, and I assure you that every member 
of this subcommittee, and I think every member of this 
Congress, recognizes how capable, and how determined, and how 
sincere you are. If I were in your State, I would be sitting by 
your side, and I admire you for what you are doing.
    If either of you other two have thought of something that 
you didn't think of when you were testifying and you want to 
add to it, we recognize you at this time. If not----
    Mrs. Berkley. I do.
    Mr. Hall. All right. I never saw you when you did not have 
something to say.
    Mrs. Berkley. My husband says I always have to get the last 
word in.
    Mr. Hall. And it will be worthwhile.
    Mrs. Berkley. Thank you very much. I was going to ask for 
an extra minutes, and I would appreciate your courtesy. I think 
it is important--I mean, we live with this stuff. I mean, 83 
percent of the people we represent in the State of Nevada 
collectively are opposed to this program, and you will see that 
Republicans and Democrats alike for the last 20 years that have 
represented the State of Nevada have taken a strong stand 
against this Yucca Mountain project.
    But I think it is important to just briefly go over the 
history. The reason that Yucca Mountain was originally selected 
is because it was supposed to be a natural geologic barrier. 
The mountain was supposed to collapse on top of the nuclear 
waste, and encase it for hundreds of thousands of years.
    That turned out not to be the case. Then they realized that 
they had to come up with--had to invent canisters that could 
contain the waste that could go into Yucca Mountain. Now we 
know that there is no canister in existence that would not 
corrode, and we just got that word in the last month-and-a-
half.
    So then they came up with an additional idea that they are 
going to put the nuclear waste in the mountain, covered by a 
canister, and then covered over by a titanium shield. There is 
no way to safely store nuclear waste anywhere, let alone Yucca 
Mountain, with the ground water problems, the seismic activity, 
and volcanic activity that exists.
    Now, I read something in our papers today regarding one of 
our colleagues who in my opinion insulted the State of Nevada 
and our people, and said that it is time that they just roll 
over and let us do this project.
    This is not an ill-founded concern that Nevadans have, and 
let me just remind all of you that Nevada has done its duty. We 
had the atomic testing at the Nevada Test Site in the 1950's 
and the 1960's, where the precursor of the Department of Energy 
told Nevadans that it was perfectly safe to resume these above-
ground tests.
    All you had to do is take a shower and there would be no 
danger of radioactivity or radioactive contamination. Well, let 
me tell you. About 2 years ago when I met with the Nevada test 
site workers from the 1950's and the 1960's, and one of the 
questions--and there are about 200 people in this room.
    I was just an observer at this hearing. And the moderator 
said will all of you who were workers in the 1950's and 1960's 
at the Nevada Test Site, who are suffering from some form of 
cancer, please stand up.
    Every single person in that room stood up. All 200 of the 
workers that showed up, and that are able, as many are dead 
now.
    Nobody can apologize to the State of Nevada 100 years from 
now when those canisters start leaking, and we can all have the 
best of intentions sitting here.
    But which one of us will be here 100 years from now to 
apologize to the people of Nevada when their ground water is 
contaminated, and when the environment is devastated, when 
people are dying because of radioactive poisoning, and Las 
Vegas is a ghost town.
    Not one of us can make that assurance and until we can, we 
should not go forward with this program. There are 
alternatives, alternatives to Yucca Mountain that are less 
expensive, less dangerous, and that we should be exploring as a 
civilized Nation, and as an intelligent group of people. Thank 
you very much, Mr. Chairman.
    Mr. Hall. We thank you. Your title is United States 
Representatives, and you represent us well. I have no 
questions. I think the ranking member has no questions. Does 
any member of the committee have any questions or any 
statements that they want to make? If not--yes, Mr. Porter.
    Mr. Porter. Thank you, Mr. Chairman. If I could add a very 
brief comment.
    Mr. Hall. All right, sir.
    Mr. Porter. Again, for 20 years Nevada has been fighting 
this,a nd I realize that it appears at times that it is not in 
my backyard argument. Our hearing in Las Vegas a few weeks ago, 
a Rail Subcommittee, was very telling.
    And as Nevada has been crying foul as we should, I really 
think the fact of the transportation through other communities 
has been discounted in this debate. If it is on trucks, it is 
going to be hauled on trucks 220 feet long, with 6 or 7 
shipments a day through many of these communities across the 
country just like Nevada.
    So I guess as we testify today and talk about Nevada's 
concerns, we are concerned for the Nation also. That these 
transportation routes, whether they be by rail, by truck, they 
will be passing your schools, your churches, your shopping 
centers, and your homes, just as it will be in Nevada.
    If it is on rail, it may be next to produce. It may be next 
to chickens, or cars on a rail car traveling through your 
community. So again we say thank you very much, but please 
consider the impacts on your own communities as you make a 
decision. Thank you.
    Mr. Hall. Thank you.
    Mr. Norwood. Mr. Chairman, can I ask a question of counsel?
    Mr. Hall. I recognize you for 5 minutes.
    Mr. Norwood. I don't need 5 minutes. I just need an 
explanation. How long in this country have we been transporting 
nuclear waste?
    Mr. Hall. The best estimate we have is about 40 years.
    Mr. Norwood. Has there ever been an incident, one incident, 
of a disaster by nuclear waste being transported?
    Mr. Hall. The Chair is not advised.
    Mr. Norwood. Counsel.
    Mr. Hall. We will have witnesses who can answer that on the 
second and third panels.
    Mr. Norwood. To my knowledge, there has not been one, but 
we will ask the experts when they come. Thank you.
    Mr. Hall. I knew you knew the answer before you asked the 
question.
    Mr. Porter. Mr. Chairman, can I respond? I mean----
    Mr. Hall. The Chair recognizes the gentleman.
    Mr. Porter. Thank you, Mr. Chairman. As we talk about the 
tragedy of 9/11, we have not had an airplane used as a weapon 
in this country prior to 9/11. What we are saying is let us not 
allow our train systems to be used as a weapon also and we 
can't do business as usual in this country.
    And I appreciate that we may not have had a major 
catastrophe. There has been problems with casks leaking today 
on our highways, but please, as we look forward to the future, 
it is not about yesterday. It is about tomorrow.
    And we have experienced things in this country unlike we 
have ever seen before. Thank you.
    Mr. Hall. Mr. Gibbons, do you have any closing statement?
    Mr. Gibbons. Well, I was not going to add anything, but I 
feel compelled to do it now. Mr. Chairman, we are continuing a 
blind process. The process started in the 1970's that said we 
will have no other course before us but cheap, inexpensive, 
geologic burial of this material.
    Since that time, a quarter of a century later, technology 
has proven that this is an unneeded and unnecessary continued 
process. There are alternatives, and after all, we are here to 
make the wisest decisions today. Not continue the decisions of 
1970 and 1980.
    If we make the wisest decision of today in the 21st century 
looking at technology, there are alternative fuels that are 
being developed that produce less waste. There is reprocessing 
that should be considered.
    And 95 percent of the energy in each one of these rods will 
remain in this rod when it is buried. We need to start thinking 
of alternatives and technology is providing us with new 
innovative, creative answers to the waste problems, such as 
transmutation, et cetera.
    If we start investing in those processes, we do not need to 
ship this material across our Nation. We can handle the waste 
onsite, reduce the few waste-generating capacities of these 
systems.
    It is not one where we need to be blindly going down a path 
where we have been going down for 20 years if we do it right, 
and if we make the right decisions, this committee, this 
Congress, should take the right steps and move forward with a 
vision for how to properly solve this problem, rather than 
simply following a blind path of geologic burial.
    Mr. Hall. We have heard from the three of you, and----
    Mrs. Berkley. Could I answer Mr. Norwood's question? It 
will just take a second. But he asked a question and he is 
entitled to answer.
    Mr. Hall. Go ahead.
    Mrs. Berkley. Mr. Norwood, according to the Department of 
Energy's own environmental impact statement, with over a 
130,000 estimated shipments over a 38 year period, there will 
be statistically speaking a minimum of 300 accidents, and that 
is DOE's own estimate.
    Mr. Markey. Mr. Chairman.
    Mr. Hall. Yes, the Chair recognizes the gentleman from 
Massachusetts.
    Mr. Markey. May I ask a round of questions?
    Mr. Hall. We are not open to questions at this time.
    Mr. Markey. Oh, you are not?
    Mr. Hall. No.
    Mr. Markey. Well, how can I be----
    Mr. Hall. Are you asking for unanimous consent? Do you want 
to ask for unanimous consent?
    Mr. Markey. Can I ask for unanimous consent?
    Mr. Hall. I object to it. Is that clear?
    Mr. Markey. What?
    Mr. Hall. Does that satisfy your question?
    Mr. Markey. What is that?
    Mr. Hall. You asked for unanimous consent, and there is 
objection.
    Mr. Markey. No, I mean--well, what motion did Mr. Norwood 
make? That is the only motion that I want to make.
    Mr. Hall. He asked for unanimous consent for something and 
it was granted.
    Mr. Markey. May I ask unanimous consent to proceed out of 
order?
    Mr. Hall. All right. The gentleman has asked for unanimous 
consent to proceed out of order. Is there objection? The Chair 
recognizes you for 3 minutes.
    Mr. Markey. I thank you very much, Mr. Chairman, and it is 
only just to interject and compliment the panel for their 
excellent testimony. And to remind people that North Carolina 
was originally on the list of States that was going to be 
considered.
    But Jim Broyhill was the ranking Republican on this 
committee, and he insisted that it be taken off the list. And 
Louisiana wa originally on the list, but Bennett Johnson 
insisted that it be taken off the list.
    And New Hampshire was originally on the list, but John 
Sinunu insisted that it be taken off the list. And Washington 
State was on the list, and Tom Foley insisted that it be taken 
off the list.
    And Texas was on the list, and Jim Wright insisted that it 
be taken off the list. And there must be a reason why all of 
those very powerful Congressmen and Senators insisted that it 
be taken off the list.
    And there is a concept in the law called res ipsa loquitur; 
the thing speaks for itself. But none of these people wanted 
all this nuclear waste traveling through their States on trains 
like a mobile-Chernobyl.
    And all you really have to know is that it is some of the 
most powerful, influential and respected Members of Congress 
used their power to make sure that their States would not be 
targeted, and you are doing an excellent job in representing 
your State, and making that point to this committee. Thank you, 
Mr. Chairman.
    By the way, Mr. Chairman, you look very comfortable on that 
side of the aisle. I just want to tell you that you look very, 
very comfortable over there.
    Mr. Hall. Do you yield back your time now, please?
    Mr. Markey. Yes, thank you.
    Mr. Hall. All right. We want to thank this panel and 
appreciate you very much. All right. We are ready for opening 
statements for those who want to make them. What is the 
pleasure of the ranking member?
    Mr. Boucher. Yes, I have a brief statement.
    Mr. Hall. All right. You have a brief statement and I will 
make a brief opening statement. I recognize myself for 3 
minutes, and I want to thank Rick Boucher and Chairman Barton, 
and Ranking Member Dingell of the full committee for their help 
setting up this hearing.
    Neither this hearing, nor our interests in Yucca Mountain, 
are partisan, and on May 8, 2002 the House voted 306 to 117 to 
override the objection of the Nevada Governor and approve the 
Yucca Mountain site for development as a long term depository 
for high level nuclear waste.
    The Senate passed it on a voice vote and the President 
signed it into law. Yucca Mountain clearly has the bipartisan 
support of a strong majority of this subcommittee, this 
committee, this House, and this Congress.
    So we meet today to discuss the next step in the Yucca 
Mountain project, and to review legislation to make the Nuclear 
Waste Fund more available to pay for this important project. 
The Department of Energy is working with the contractor on a 
license application to the Nuclear Regulatory Commission.
    DOE has said publicly and consistently that it will 
complete the license application in December 2004, and open 
Yucca Mountain in 2010. We have before us today Under Secretary 
Bob Card, and the Director of the Office of Civilian 
Radioactive Waste Management of the Department of Energy, 
Margaret Chu. Her office will be managing the license 
application process.
    We also have before us the Chairman of the Unclear 
Regulatory Commission, Nils Diaz. The NRC is responsible for 
reviewing and approving the license application, and is said to 
be working with DOE on an ongoing basis to explain what the NRC 
requires.
    Additionally, we have on the last panel the President and 
General Manager of Bechtel, Mr. John Mitchell. His company, 
hired by DOE as the contractor on the Yucca Mountain project is 
conducting much of the work.
    In addition to the legislative nature of this hearing, 
members should take this opportunity to learn about the 
progress of Yucca Mountain, how the work site is going, and 
will Bechtel and DOE complete the license application on time.
    Is the NRC providing the assistance that Bechtel and DOE 
needs. If the license application deadline is missed will the 
project open in 2010. Will the delay cost utilities and 
consumers more money in fuel storage costs.
    We will review two bills, H.R. 3429, and H.R. 3981, both of 
which seek to reclassify fees paid into the Nuclear Waste Fund 
as, quote, offsetting the collections. For too long the Nuclear 
Waste Fund expenditures have competed with other discretionary 
programs, and it is high time to make these funds more readily 
available to pay for what they were intended to pay for, the 
development of a geologic repository for radioactive waste.
    The American consumers have contributed almost $23 billion 
into the Nuclear Waste Trust Fund. Yet, these dedicated monies 
can at times be difficult for the project to tap because of the 
unfortunate budget rules and politics in the appropriations 
process.
    This subcommittee does not write appropriations bills, nor 
does it write budget legislation, but we do understand energy 
policy and the importance of fully funding this commitment of 
Congress, and this important part of the Nuclear Waste Policy 
Act.
    Witnesses today representing the State regulators and the 
nuclear energy industry can address the importance of funding 
Yucca Mountain at appropriate levels. Approximately 45,000 
metric tons of spent nuclear fuel from past and ongoing 
commercial nuclear power operations is currently stored at 77 
sites throughout the country.
    The General Accounting Office recently completed a study 
and continuing study indicating that our spent fuel would be 
more secure in one secure place compared to being spread 
throughout the country.
    No one is saying that the current situation is unsafe, but 
it is also clear that opening Yucca Mountain will improve our 
national security. Congress passed the Nuclear Waste Policy Act 
of 1982, and in 1987, Congress selected the Yucca Mountain site 
in Nevada as a single site to be characterized by DOE for long 
term geologic disposal of the Nation's high level radioactive 
waste inventories.
    We are well into the third decade of work on a nuclear 
waste repository. The progress has been good, but we have 
already been hit with operation delays. It is time to make sure 
that the Federal authorities are doing their job responsibly, 
make sure that this project is funded appropriately, and do 
whatever needs to be done to satisfy the two decade old vision 
of storing our high level waste in a repository.
    Finally, I am pleased to welcome members of the Nevada 
House delegation today, and I was pleased to have them here. 
They did their job well, and they were true to their 
representation. Their voices are welcome today as we discuss 
the status of this nationally important project.
    [The prepared statement of Hon. Ralph Hall follows:]

Prepared Statement of Hon. Ralph Hall, Chairman, Subcommittee on Energy 
                            and Air Quality

    I want to thank Ranking Member Rick Boucher, and Chairman Barton 
and Ranking Member Dingell of the full committee, for their help on the 
hearing. This is my first hearing as the Chairman of this subcommittee, 
and I am pleased that we can come together in a bipartisan spirit on 
this topic.
    On May 8, 2002, the House voted 306 to 117 to approve the Yucca 
Mountain site for development as a long-term depository for high-level 
nuclear waste. The Senate passed it on a voice vote, and the President 
signed it into law. Yucca Mountain clearly has the bipartisan support 
of a strong majority of this Subcommittee, this Committee, this House, 
and this Congress.
    We meet today to discuss the next step in the Yucca Mountain 
project, and to review legislation to make the Nuclear Waste Fund more 
available to pay for this important project. The Department of Energy 
(DOE) is working with its contractor, Bechtel, on a license application 
to the Nuclear Regulatory Commission (NRC). DOE has said publicly and 
consistently that it will complete the license application in December 
2004, and open Yucca Mountain in 2010.
    Today, Undersecretary Bob Card, and the Director of the Office of 
Civilian Radioactive Waste of the Department of Energy (DOE), Margaret 
Chu, have joined us. Her office will be managing the license 
application process. Also joining us is the Chairman of the Nuclear 
Regulatory Commission (NRC), Nils Diaz. It is my understanding that the 
NRC and the DOE are working together on an ongoing basis to review and 
approve the license application. Additionally, we have on the last 
panel the President and General Manager of Bechtel, Mr. John Mitchell. 
The DOE hired his company as a contractor on the Yucca Mountain project 
to conduct much of the work.
    In addition to the legislative nature of this hearing, Members 
should take this opportunity to learn about the progress at Yucca 
Mountain.

 How is work at the site going?
 Will Bechtel and DOE complete the license application on time?
 Is the NRC providing the assistance that Bechtel and DOE need?
 If the license application deadline is missed, will the project open 
        in 2010?
 Will a delay cost utilities and consumers more money in fuel storage 
        costs?
    We will review two bills, HR 3429 and HR 3981, both of which seek 
to reclassify fees paid into the Nuclear Waste Fund as ``offsetting 
collections.'' For too long, Nuclear Waste Fund expenditures have 
competed with other discretionary programs, and it is time to make 
these funds more readily available to pay for what they were intended--
the development of a geologic repository for radioactive waste.
    American consumers have contributed almost $23 billion into the 
Nuclear Waste Trust Fund. Yet those dedicated monies can at times be 
difficult for the project to tap, because of unfortunate budget rules 
and politics in the appropriations process.
    This Subcommittee does not write appropriations bills, nor does it 
write budget legislation. But we do understand energy policy and the 
importance of fully funding Congress' commitment to the Nuclear Waste 
Policy Act.
    Witnesses today representing state regulators and the nuclear 
energy industry can address the importance of funding Yucca Mountain at 
appropriate levels.
    Approximately 45,000 metric tons of spent nuclear fuel from past 
and ongoing commercial nuclear power operations is currently stored at 
77 sites throughout the country. The General Accounting Office (GAO) 
recently completed a study indicating that our spent fuel would be more 
secure in one location, rather than spread throughout the country. 
While the current situation is safe, it is clear that opening Yucca 
Mountain will improve our national security.
    Congress passed the Nuclear Waste Policy Act (NWPA) of 1982. In 
1987, Congress selected the Yucca Mountain site in Nevada as the single 
site to be characterized by DOE for long-term geologic disposal of the 
nation's high-level radioactive waste inventories. We are well into the 
third decade of work on a nuclear waste repository. The progress has 
been good, but we have already been hit with delays. It is time to make 
sure the Federal authorities are doing their job responsibly, make sure 
this project is funded appropriately, and do what needs to be done to 
satisfy the two-decades-old vision of storing our high-level waste in a 
repository.
    I am pleased to welcome Members of the Nevada House Delegation 
today. We welcome their input as we discuss the status of this 
nationally important project.

    Mr. Hall. At this time, I recognize the gentleman from 
Virginia, Mr. Boucher, for an opening statement.
    Mr. Boucher. Well, thank you very much, Mr. Chairman. I 
want to begin my comments this morning by welcoming you back to 
the subcommittee in your new capacity as Chairman, and let me 
say while we will miss you on our side of the aisle.
    I have always over the years very much enjoyed my work with 
you, and I very much look forward to a continuation of our work 
together as you assume these new responsibilities.
    I also appreciate the Chairman convening this morning's 
hearing on the subject of the status of the Yucca Mountain 
waste repository program, and our legislative proposals to 
modify the program's funding.
    The Nuclear Waste Policy Act of 1982 gives the Federal 
Government the responsibility for providing a facility for the 
permanent disposal of nuclear waste. As stipulated by the Act, 
nuclear generators of electricity are responsible for the costs 
of both disposal and interim storage at utility reactor sites 
around the Nation.
    The funding for the storage and disposal of nuclear waste 
is provided by an assessment that is charged to customers who 
receive electricity generated by nuclear power. Those fees are 
collected and placed in the Nuclear Waste Fund and are 
administered by the Department of Energy.
    The Act also provided that the money would be held in the 
fund until needed to support peak spending years during the 
license application process, and during construction of the 
permanent repository, and during the placement of waste for 
permanent storage in the repository in all three of those 
phases.
    Those phases are beginning now, with the license 
application expected to be filed for the repository during the 
course of this calendar year. Approximately $9 billion has been 
expended on the program to date, and approximately $14 billion 
remains in the fund.
    But the current balance in the fund has been used 
historically for purposes other than advancing the goals of 
this program, and the program must now compete for funding with 
other unrelated programs at the Department of Energy.
    The fund needs to be legislatively altered in order to 
ensure that the rate payer contributions are going for the 
purpose for which these contributions were intended and that 
the Yucca Mountain project receives the funding that it needs 
in order to move forward as outlined in the current schedule.
    Our witnesses today will comment on two of the proposals 
that have been set forth to address this concern. One by our 
colleagues, Mr. Shimkus, and Mr. Rush, and the other introduced 
by Chairman Barton at the request of the administration.
    Both of these legislative proposals would serve to ensure 
prospectively that the money collected from utility customers 
for the Nuclear Waste Fund is used for the purpose for which it 
is intended.
    And I strongly support a policy change that would ensure 
the dedication of future collections to the furtherance of the 
Yucca Mountain program. But let me also say that I am 
interested in making sure that the funds currently on deposit, 
the $14 billion presently retained within the Nuclear Waste 
Fund, will also be dedicated toward the purpose of advancing 
the goals of this program.
    And so I think a very appropriate subject of our inquiry to 
the witnesses who will appear here today should be whether or 
not we are being sufficiently ambitious in simply addressing 
the funds prospectively, and making sure that they are 
dedicated toward appropriate purposes.
    I think that we also need to be asking about what we should 
be doing with regard to the $14 billion currently on deposit, 
for which there is no, in my view, sufficient safeguard and 
assurance that those funds will also be directed toward the 
proper purposes of this fund, and that will be an area of focus 
for our questions this morning.
    I very much look forward to hearing from our witnesses. I 
thank each of them for taking the time to share their views 
with us today, and Mr. Chairman, with that, I yield back.
    Mr. Hall. I thank the gentleman. At this time, the Chair 
recognizes Mr. Norwood for 3 minutes. You have used 45 seconds 
and the Chair will yield you 1 of his minutes. You have the 
full 3 minutes, and we recognize the gentleman.
    Mr. Norwood. Well, Mr. Chairman, first let me ask for 
unanimous consent and request that only you and the ranking 
member make opening statements so we can move right to the 
witnesses.
    Mr. Boucher. Mr. Chairman, I am going to object.
    Mr. Markey. Objection.
    Mr. Hall. There is objection. Go ahead, Mr. Norwood.
    Mr. Norwood. Thank you, Mr. Chairman, I appreciate the 
opportunity to be here today and let me start by commending you 
for holding this hearing, and I thank you for your leadership 
on this very important issue.
    And I don't know how others feel about it, but I am very 
comfortable with you being in that chair and being on this side 
of the aisle, and I think probably you are, too. Now, I believe 
that Yucca Mountain and its selection as a permanent waste 
repository for this country's spent nuclear fuel was probably 
one of the real important decisions that we made in the 107th 
Congress.
    I am greatly looking forward to hearing the Department of 
Energy's progress in pursuing the license application for Yucca 
Mountain construction, and authorization license from the 
Nuclear Regulatory Commission today.
    The United States has over 45,000 metric tons of spent 
nuclear fuel scattered across some 70 sites in this country, 
and as a result of past and ongoing commercial nuclear power 
plants alone.
    An additional 2,000 metric tons of spent nuclear fuel is 
generated by the operation of nuclear waste plants each year. 
By 2010 the total amount of commercial spent nuclear fuel is 
expected to reach approximately 60,000 metric tons.
    Now, Mr. Chairman, this issue may not be on the radar 
screen of every American citizen, but let me assure you that it 
is very important to a great many of my constituents, 
particularly those who live in the Augusta area, and work at 
the DOE Savannah River site just across the river in Aiken, 
South Carolina.
    In addition, Yucca Mountain is important to the folks who 
live within my district in Burt County, Georgia, which is the 
home of Plant Vogel operated by Georgia Power, which includes 
two separate reactors of approximately 1,200 megawatts each.
    The Department of Energy has estimated that roughly $7 
million has already been spent on characterization and 
development activities at Yucca Mountain, with much of this 
money coming from fees collected from currently operating 
commercial reactors paid into the Nuclear Waste Fund.
    Georgia rate payers along have contributed over $460 
million to this project. It is critical that DOE submit their 
license application to the NRC by December 2004 for the sake of 
saving Federal dollars.
    Each year the 2010 operations date is pushed back, an 
additional $500 million in Federal costs will be added to the 
project for each year. So let me just echo that I am very much 
looking forward to our witnesses' testimony today, and I am 
anxious to hear of the DOE's progress.
    I would like to make just one final note about the two 
pieces of legislation that we are discussing today, H.R. 3429 
introduced by my friend from Illinois, Mr. Shimkus, and H.R. 
3981, sponsored by the distinguished Chairman, Mr. Barton.
    The intent of both of these bills is to create a direct 
link between funds coming from----
    Mr. Markey. Mr. Chairman.
    Mr. Hall. The gentleman from Boston.
    Mr. Markey. I make unanimous consent that the gentleman 
from North Carolina be given 1 additional minute to finish his 
statement.
    Mr. Norwood. Mr. Chairman, since the gentleman is not here 
from North Carolina, I don't----
    Mr. Markey. I'm sorry, from Georgia.
    Mr. Hall. Hearing no objection so ordered.
    Mr. Norwood. Let me just conclude, and I will submit for 
the record, but simply to say that it was interesting to me in 
the first testimony that you can characterize Federal 
representatives on this issue of Yucca Mountain in many ways, 
but recklessly is not one of the ways you can characterize 
them. We have not rushed into this issue, and it is time to 
complete it. Thank you, Mr. Chairman.
    Mr. Hall. The Chairman recognizes Mr. Markey, and you have 
no time left, Mr. Markey, but since I sat by you for 24 years, 
I will give you 3 minutes of my time.
    Mr. Markey. I thank the gentleman. On June 26, 1995, men in 
moon suits descended upon Golf Manor, a subdivision of Commerce 
Township, Michigan. They dismantled David Hahn's back yard shed 
with electric saws and stuffed all the pieces into large steel 
drums marked radioactive.
    It turned out that David Hahn, who was an avid Boy Scout, 
earned his atomic energy merit badge by building a model 
nuclear reactor, and then decided to earn Eagle Scout status by 
building a real live breeder reactor in his back yard.
    The EPA later estimated that his efforts had placed 40,000 
people at risk of radiation exposure. David was an enterprising 
boy, and this is 1995, and he had lots of help from the Nuclear 
Regulatory Commission.
    He requested and obtained information from the NRC on how 
to isolate radioactive elements, and was told how to go about 
getting isotopes that could sustain a chain reaction when 
bombarded with neutrons.
    He was told by the NRC that the health dangers of having 
some of these isotopes was very slight because if he possessed 
ample quantities of these materials that he would need an NRC 
license.
    So he didn't worry when he began finding large quantities 
of radium contained in clocks at antique stores. He was told by 
the NRC that nothing produces neutrons as well as beryllium, 
and so he had a friend steal some from school.
    The NRC sent him pricing data and commercial sources for 
some of the radioactive materials that he needed for his 
efforts, including a company in Czechoslovakia. It turned out 
that David's backyard experiment became a radioactive Superfund 
site that cost $60,000 to clean up. He did, however, make Eagle 
Scout.
    These days the Department of Energy is their very own 
radioactive Boy Scout, and is trying to earn its own Atomic 
Energy Merit Badge by designing a repository that can keep 
millions of tons of high level radioactive waste safe for 
thousands of years.
    If they can do this safely, then the Department would truly 
earn Eagle Scout status, but as we know many Boy Scouts do not 
always live up to the Scout's motto of Be Prepared. That is why 
they require adult supervision.
    And in this case adult supervision is supposed to be 
provided by our Nation's Nuclear Safety Regulator, the Nuclear 
Regulatory Commission. Today, I will be anxious to hear from 
our witnesses about the latest delays, security risks, 
lawsuits, and whistle-blower cases that have occurred since we 
last heard from them.
    I have numerous questions that need to be answered before 
Eagle Scout status can be achieved. Will Yucca Mountain turn 
into a backyard shed Superfund site like David Hahn's little 
project and require billions of clean up dollars?
    Will the DOE ever provide responses to the hundreds of 
unanswered technical questions required to license this 
facility? If not, will the NRC grant the license anyway? Will 
the NRC increase the security requirements for transporting all 
that waste across the country by rail, especially now that the 
tragedy in Spain has alerted us to how vulnerable the rail 
system really is?
    Will it ensure that we don't have hundreds of mobile-
Chernobyls riding across our country, and will Congress decide 
to take the waste fund off budget, ranking it above Homeland 
Security, defense spending and countless other priorities in 
importance?
    The answers to these questions should help the subcommittee 
get a sense of whether DOE has a chance to make Eagle Scout, or 
be sent back to Tenderfoot. Thank you, Mr. Chairman, very much.
    Mr. Hall. The gentleman yields back his time. I was never 
an Eagle Scout. I was a permanent Tenderfoot. I remember part 
of that obligation was to tell the truth. Is there anyone else 
who wants to be recognized?
    Mr. Shimkus. Mr. Chairman.
    Mr. Hall. Mr. Shimkus is recognized for 3 minutes.
    Mr. Shimkus. Thank you, Mr. Chairman, and I will try to cut 
down my remarks, but I will tell my friend, Mr. Markey, who is 
a good colleague and friend, and I always enjoy a serious 
debate, that Yucca Mountain is not a suburb of Boston.
    And it is a mountain depository under the mountain in the 
desert, which if you are going to have a waste site, that is 
probably the best place in the world that it could ever be. And 
we have gone through this debate, and so this debate is not 
about society. This debate is about the funding.
    And the reality is that it is really a budgetary debate. 
Truth in budgeting. If you are going to consume or ask for $23 
billion from an industry to develop a waste depository site, 
truth in budgeting would say that money goes there.
    Now, if there are delays, and if there are concerns, if 
there are problems, I think that my questions will be to DOE as 
if we had an adequately funded program based upon the fund 
itself, would this be expedited.
    I think the answer is pretty clear. I think that the answer 
would be yes. So I know that I missed my colleague from the 
State, and I know that I was casually referenced for those that 
have been following this issue.
    It was a great debate and hopefully a final resolution, and 
now the issue is to move this project forward because of the 
promise that we have made to the Nation for decades. So I look 
forward to this debate.
    It is very, very important for our oversight and the 
funding. And with that, Mr. Chairman, thank you, and I yield 
back my time.
    Mr. Hall. Are there other opening statements? All right. I 
would like to ask unanimous consent for 1 week following the 
hearing all statements submitted by members be made part of the 
hearing record. Without objection.
    [Additional statements submitted for the record follow:]

 Prepared Statement of Hon. Joe Barton, Chairman, Committee on Energy 
                              and Commerce

    Mr. Chairman, thank you for holding this important hearing. In my 
opinion, the development of a centralized and permanent geologic 
disposal site at Yucca Mountain is one of the most important public 
health and safety issues for the nation.
    In the 107th Congress, I was pleased to help lead the bipartisan 
effort in this Committee, and on the floor of the House, to pass House 
Joint Resolution 87--the Yucca Mountain siting resolution. We won with 
an overwhelming bipartisan vote of 306-117. I attribute the strong 
support for the Yucca Mountain resolution to the common sense, pro-
environmental aspects of the bill.
    The vote in favor of Yucca was lopsided because the nation will not 
tolerate high-level nuclear wastes that are spread out at 77 sites in 
more than 30 states in every region of the country. Every one of these 
waste sites shares one common aspect: They were all designed for 
temporary storage of these dangerous wastes--not long-term disposal.
    So for the sake of long-term public health and safety, and our 
national security interests, it is absolutely critical that we move to 
develop a single nuclear waste repository at Yucca Mountain.
    However, we are not quite there yet. In fact, we are just getting 
started. DOE and its Yucca Mountain site contractor, Bechtel 
Corporation, must complete and submit a license application to the 
Nuclear Regulatory Commission by December 2004. There are only nine 
months left before we reach this deadline. If this deadline is missed 
by one year, the nation could incur additional costs of $500 million to 
build Yucca Mountain.
    Over the years I have developed a degree of apprehension about 
DOE's ability to complete major projects on time. The Oversight and 
Investigations Subcommittee has revealed many of DOE's troubled 
projects. I want Yucca to be a success story, and that is why I think 
this hearing is so important.
    Congress must also do its part, and provide DOE with the requested 
appropriations to get the job done. I was happy to introduce H.R. 3981 
last week, at the request of the Administration, to help solve the 
funding problem. The Nuclear Waste Fund has been cannibalized over the 
years to pay for unrelated Federal programs at the expense of the 
consumers who pay into the fund. The Federal government is required by 
law to develop a central repository, and the nuclear waste fund was 
created for the sole purpose of paying for radioactive waste disposal. 
The fees paid into the nuclear waste fund must be freed up to cover 
these obligations.
    The Nuclear Waste Trust Fund has more than $14 billion in reserves, 
and receives about $750 million in additional fees each year. I am 
willing to do all I can in to make sure these funds go toward their 
intended purpose. Thank you, Mr. Chairman.

                                 ______
                                 
Prepared Statement of Hon. Tom Allen, a Representative in Congress from 
                           the State of Maine

The situation in Maine
    The rocky Maine coast inspired the great artwork of Winslow Homer 
and has filled fish markets and lobster shacks for centuries. But along 
Montsweag Bay, at the end of a rocky peninsula, stands a dry cask spent 
nuclear fuel storage facility left over from the Maine Yankee Nuclear 
Plant, which closed in 1997. While the decommissioning plant will soon 
be nothing but a parking lot, its spent fuel sits there waiting for the 
Department of Energy to pick it up.
    Maine Yankee no longer exists, but the community of Wiscasset 
cannot redevelop its shoreline, cannot entice businesses, and cannot 
open the peninsula for public use. In effect, the community is held 
hostage by this spent fuel. I am happy that we are having a hearing on 
the progress at Yucca Mountain, because it is important to the people 
of Maine that the United States create a safe, permanent facility to 
store spent nuclear fuel.
Mainers have contributed to the funding of a Repository
    The people of New England have contributed over $1.6 billion to the 
Nuclear Waste Fund set up to fund a permanent nuclear waste facility. 
Currently, more than $14 billion sits in this fund, and yet Congress 
still is unwilling to allocate more money to the Yucca project than the 
fund collects in any given year. We need to give the Yucca Mountain 
project the resources to finish by 2010.
    The Department of Energy will testify that they cannot complete the 
Yucca Mountain facility by 2010 unless they receive more funding, so I 
am interested to hear what witnesses have to say about various funding 
mechanisms. In particular, I would like to know whether our panel today 
supports the legislation introduced by Reps. Shimkus-Rush that attempts 
to direct the Nuclear Waste Fund's annual income directly to the Yucca 
Mountain Program's annual appropriation.
    I support appropriating the necessary funding to complete Yucca on 
schedule, and I hope our witnesses will advise this subcommittee on the 
most effective path towards that goal.
We need to begin developing a plan to move the fuel.
    But funding the Yucca Mountain program will not get spent fuel off 
the coast of Maine unless the Department of Energy begins planning to 
move the fuel.
    In 1982 Congress committed to start picking up spent fuel by 1998, 
but none has been picked up to date. In fact, DOE has not even 
developed the necessary plans and facilities to begin picking up fuel 
in 2010 when Yucca Mountain is scheduled to open.
    Moving all of the Nation's spent fuel is a major task, and DOE 
needs to begin preparing for this project now. Last year nine of my New 
England colleagues and I requested that more funds from the Nuclear 
Waste Fund be directed towards building the transportation-related 
systems and infrastructure necessary to remove spent fuel. The 
Department must demonstrate its ability to move spent fuel safely 
before it begins full-scale shipping in 2010. Maine has fuel ready and 
waiting to be shipped, as do other communities with decommissioned 
plants. Why, I wonder, doesn't DOE get this process started so that 
communities like Wiscasset can leave their nuclear experience behind?
Congress has required DOE to develop a spent fuel transport plan
    In the fiscal year 2004 appropriations bill, Congress instructed 
DOE to work ``more actively'' with facilities storing spent nuclear 
fuel in order to develop a ``detailed and comprehensive acceptance and 
transportation plan for the years 2010 to 2020'' by the end of this 
year. Furthermore, Congress instructed DOE to develop a plan that would 
``ensure that spent nuclear fuel and high level waste from those 
reactor sites that are undergoing decommissioning . . . shall be 
accepted and transported as soon as practicable to facilitate the 
closure of those sites.'' I trust that DOE is on schedule to complete 
this plan.

Conclusion
    In 1982 Congress made a deal with the American public. In exchange 
for a surcharge on their electricity, this body promised that the 
United States would build a safe, permanent facility to store nuclear 
waste by the end of the century. We have not made good on our promise. 
Until we make good on our promise, ratepayers, taxpayers, and people in 
small towns like Wiscasset, Maine will suffer, and we will all be more 
at risk.
The Decommissioned Plant Coalition testimony.
    Finally, I would like to submit testimony from the Decommissioning 
Plant Coalition. This testimony was prepared for our September 11, 2003 
hearing on this topic which had to be rescheduled.

                                 ______
                                 
 Prepared Statement of Hon. John Dingell, a Representative in Congress 
                       from the State of Michigan

    For many years I have been concerned about the misuse of monies 
contributed to the Nuclear Waste Fund by utility ratepayers.
    As many Members will recall, our Committee reported a bill in 1999 
that would have taken the Fund ``off budget.'' That bill had two 
purposes--to restore the Fund to its intended purpose, and to ensure 
that the Department of Energy's (DOE) repository program would be 
adequately funded. It is a shame that bill was not enacted while the 
nation enjoyed a budgetary surplus, because it bothers our colleagues 
on the Budget Committee when we try to restore the Fund to its proper 
purpose--and the task only becomes harder when deficits loom large, as 
they do today.
    It is encouraging, however, that the Administration at last has 
begun to grapple with the need to put funding for the repository 
program on sound footing. The Administration has proposed a change in 
law that will automatically direct all future ratepayer contributions 
into the nuclear waste program, with costs in excess of the revenues 
requiring further appropriations. Rep. Shimkus has introduced a similar 
proposal.
    Congress approved the Yucca Mountain site for a repository in 2002; 
DOE hopes to file an application for a license by the end of this year; 
and the Nuclear Regulatory Commission appears ready to commence 
consideration once the application is filed. Meanwhile, waste continues 
to pile up at utility and at DOE sites in dozens of states.
    All of the agencies' preparations to date, which entailed the 
expenditure of $6 billion from the Waste Fund already, will come to 
naught if funding reform legislation is not enacted.
    I would note, however, that one shortcoming of these proposals is 
their failure to deal with the unexpended balance in the Nuclear Waste 
Fund, which is about $14 billion. The bill reported by the Committee on 
Energy and Commerce in 1999 addressed the need to safeguard both the 
balance in the Fund and future contributions. It ensured that neither 
would be siphoned off to other purposes. By contrast, the bills before 
us appear to address only the question of future contributions--and do 
nothing to restore the existing Fund to its proper use.
    My understanding is that over $500 million of the current Fund has 
been contributed by Michigan ratepayers over the years. I have 
reservations about legislation that does not dedicate both existing and 
future ratepayer contributions to their proper use. Failure to restore 
amounts in the existing Waste Fund to their intended purpose would be 
tantamount to approving the subsidization by ratepayers of other wholly 
unrelated programs. That would be a breach of faith, and I am not 
convinced at this point that we should be settling for half a loaf in 
terms of budget reform.

    Mr. Hall. I ask for unanimous consent that written 
statements from the Nuclear Waste Strategy Coalition and the 
Decommissioning Plant Coalition be made part of the hearing 
record. Without objection, it is so ordered.
    [The information referred to follows:]

         Prepared Statement of Nuclear Waste Strategy Coalition

    Mr. Chairman, and distinguished members of the Subcommittee, the 
Nuclear Waste Strategy Coalition (NWSC) appreciates this opportunity to 
present a Statement for the Record regarding a hearing entitled, ``A 
Review of the Department of Energy's Yucca Mountain Project, and 
Proposed Legislation to Alter the Nuclear Waste Trust Fund (H.R. 3429 
and H.R. 3981).''

                             ABOUT THE NWSC

    The NWSC is an ad hoc group of state utility regulators, state 
attorneys general, electric utilities and associate members 
representing 46 member organizations in 25 states. The NWSC was formed 
in 1993 out of frustration at the lack of progress DOE had made in 
developing a permanent repository for spent nuclear fuel (SNF) and 
high-level radioactive waste (HLRW), as well as Congress's failure to 
sufficiently fund the nuclear waste disposal program (Program). The 
mission and purpose of the NWSC is to seek on behalf of the ratepayers 
of the United States:

1) The removal of commercial spent nuclear fuel from 72 temporary 
        storage sites located in 33 states.
2) The authorization of a temporary, centralized commercial spent 
        nuclear fuel storage facility.
3) The allocation of appropriate funds from the Nuclear Waste Fund 
        (NWF) by the U.S. Congress to the DOE so that it will fulfill 
        its statutory and contractual obligations.
4) The augmentation of transportation planning and regulations to 
        facilitate transportation systems.
5) The capping of the NWF payments at the present one-tenth of a cent 
        per kilowatt-hour by the U.S. Congress.
6) The operation of the permanent repository by 2010.

                       NUCLEAR WASTE FUND REFORM

    NWSC members believe it is vitally important that Congress and the 
Administration work together to ensure the Program is funded in a 
manner that will allow the DOE to implement the Federal Program in 
accordance with the 1982 Nuclear Waste Policy Act (NWPA). The Program 
is already in default of its requirement to open a facility by 1998, 
and is in danger of slipping further behind schedule. It is imperative 
that a long-term fix of the current funding process be implemented and 
we urge Congress to support passage to reclassify the fees paid into 
the Nuclear Waste Fund as offsetting collections in the 108th Congress.
    The members of the NWSC are supportive of H.R. 3429, the Nuclear 
Waste Financing Act of 2003 and/or the bill introduced by Chairman 
Barton, H.R. 3981. We note that H.R. 3981 would provide funds through 
the completion of the surface facility construction, whereas the 
funding reforms implemented in H.R. 3429 would end in 2010. Both 
propositions define contributions to the NWF as offsetting collections 
made to cover the necessary expenditures of the Program. Additionally, 
either of these funding reforms would make the total budget authority 
available from the NWF each fiscal year equal to the level of proceeds 
collected from fees (plus interest earned) during that fiscal year. 
Most importantly, Congressional oversight of the Program funding will 
continue, similar to the annual appropriations process of the Nuclear 
Regulatory Commission and the Corps of Engineers.
    As the House Appropriations Energy and Water Development 
Subcommittee Chairman Hobson stated last year, ``This Program has been 
starved for funding'' . . . the 2010 deadline for waste fuel acceptance 
at Yucca Mountain, ``is a pipe dream at existing funding levels.'' The 
only way that the DOE will ever achieve its objectives is for Congress 
to reclassify the Nuclear Waste Fund receipts as offsetting 
collections. Only with sufficient funding will the DOE be able to file 
the licensing application by December 2004, initiate the critical path 
items related to the transportation infrastructure systems plan and 
make financial commitment to its contractors. Moreover, delays beyond 
the 2010 deadline increase Program costs by approximately $1 billion 
per year and also expose the DOE to further litigation.

                           NUCLEAR WASTE FUND

    There are adequate funds available to implement the Federal policy 
for permanent disposal of high-level radioactive waste and spent 
nuclear fuel. That statement is conditioned on the premise that 
Congress will vote to support its own legislation--Congress has failed 
to support the NWPA. Since 1983, the NWF has collected more than $22 
billion with interest, and the nation's ratepayers make more than $700 
million per year in payments into the NWF; with interest credits this 
amount exceeds $1.5 billion per year. According to the DOE, it will 
require average annual funding of $1.3 billion from FY 2005 through FY 
2010. The NWF's average annual receipts and interest are projected at 
more than $2.1 billion over the same time period, and therefore, exceed 
the DOE's funding level requirements. Congress's support to codify the 
NWF annual receipts will ensure that every cent collected from the 
ratepayers will be delivered to the Program, as intended by the NWPA. 
Other Congressional programs should be funded from discretionary funds, 
not from the NWF's mandated funding.

           PROGRAM OVERSIGHT OF THE CIVILIAN DISPOSAL PROGRAM

    The NWSC is not calling for carte blanche funds for the DOE without 
Program oversight. We are encouraged that the FY 2004 House Energy and 
Water Development Appropriations Committee (Committee) Report 108-212 
directed the DOE to keep the Program on track to meet its 2010 
deadline. Consequently, the DOE/Office of Civilian Radioactive Waste 
Management (OCRWM), issued a Strategic Plan for the Safe Transportation 
of Spent Nuclear Fuel and High-Level Radioactive Waste to Yucca 
Mountain: A Guide to Stakeholder Interaction, issued on November 18, 
2003. Further, the DOE/OCRWM identified on December 23, 2003, the 
Caliente rail corridor within Nevada as the preferred corridor to serve 
the Yucca Mountain repository.
    However, we believe that the national transportation infrastructure 
system plans must be initiated as soon as possible to facilitate the 
shipment of SNF and HLRW to Yucca Mountain by 2010. Although the 
Strategic Plan is not specific with respect to scope and schedule 
milestones, the following encourages us:

 That OCRWM is now focused on collaborating with interested parties on 
        designing, siting and constructing the infrastructure required 
        for the transportation system.
 That beginning in 2004, OCRWM will increase interactions with states 
        and tribes to update and prioritize topics for discussion and 
        work together throughout the planning, operational testing and 
        operations phases of the transportation program.
 That starting in 2004, OCRWM will validate information with nuclear 
        utilities on site operational and transportation interfaces 
        that determine cask requirements and site servicing equipment 
        needs. As stated in the Plan, this is an opportunity for OCRWM 
        to improve waste acceptance and transportation planning process 
        to allow for more efficient planning, scheduling and operation 
        of the transportation system; hopefully, the final scheduling 
        of SNF deliveries will be at an earlier time than now required.
 That beginning in 2006, OCRWM will shift interactions with state 
        regional groups and tribes from topic identification and 
        resolution to conducting emergency training and operational 
        readiness.
 That OCRWM recognizes the need to begin interaction with cask vendors 
        as soon as possible and before beginning the formal procurement 
        process, the need to interact with private-sector cask 
        suppliers and utilities to solicit information, as well as 
        private sector views on approaches to establishing the 
        necessary system design and cask fleet on a timely and cost 
        efficient basis.
 That OCRWM is open to discussions with the utilities concerning the 
        acceptance of dual-purpose storage/transportation cask systems 
        that have been certified by the NRC. We urge that those 
        discussions begin immediately and that they focus on the most 
        efficient transportation/acceptance of such systems and not on 
        whether such systems are acceptable.
    While we understand the need for a flexible approach in order to 
accommodate input from stakeholders, the NWSC was expecting a Strategic 
Plan that provides more than a simple process outline, but a Plan that 
contains milestones or specific direction as to how OCRWM will achieve 
its objective to begin the removal of SNF and HLRW by 2010. The NWSC 
believes the Plan should include:

 Interim milestones that would benchmark the OCRWM's progress over the 
        next few years.
 Specific schedules by when OCRWM will initiate interaction with 
        private-sector cask suppliers, utilities, logistics providers 
        and others in the transportation industry to establish the 
        necessary system design and cask fleet needed by 2010.
 Consideration of transporting Greater-Than-Class-C (GTCC) waste that 
        is currently being stored in NRC-licensed transportable 
        canisters at nuclear plant sites undergoing decommissioning. 
        There is no doubt that ultimate disposal of GTCC is the 
        Department's responsibility, accordingly, this is an issue that 
        OCRWM should address within the scope of the national strategic 
        transportation plan.
 Specific schedules or milestones that address the national 
        designation of modes and routes of shipment to Yucca Mountain.
    The members of the NWSC also note that this Plan fails to 
incorporate and update the report released by OCRWM, January 2001, in 
response to the House Committee on Appropriations request, ``Plan for 
Transportation Cask Fabrication and the Deployment of Waste Acceptance 
Capabilities.''
    Over the years, the NWSC has been very supportive of the OCRWM 
program and worked to ensure that Congress appropriate sufficient funds 
for the nuclear waste transportation and disposal program. We continue 
those efforts today as we are working very hard for passage of H.R. 
3429 or H.R. 3981, as we believe it will allow the DOE to receive 
appropriate funding increases to keep the repository program and 
transportation infrastructure planning on schedule. Just as 
importantly, the NWSC believes passage of either of these bills will 
ensure money paid by the nation's ratepayers into the NWF will be used 
for its intended purpose to remove SNF and HLRW from the nation's 
nuclear power plants.

                                LAWSUITS

    It is more than five years since the DOE defaulted on its 
obligations, as stated in the Nuclear Waste Policy Act of 1982, to 
remove SNF from the nation's nuclear power plants. In its 1996 Indiana-
Michigan decision, the U.S. Court of Appeals affirmed that the DOE was 
obligated to start moving waste on January 31, 1998, ``without 
qualifications or condition.'' The DOE ignored the Court, prompting 46 
state agencies and 36 utilities to again seek relief through the 
Courts. The DOE has meanwhile ignored repeated Court orders to begin 
moving waste from commercial nuclear plant sites on the grounds that it 
has yet to build a permanent repository and has no authority to provide 
an interim storage and transport of high-level nuclear waste from plant 
sites. Several lawsuits are currently being heard in the U.S. Court of 
Claims and could find the DOE liable for several billions of dollars in 
damages due to its failure to meet its 1998 obligations. Further, the 
11th Circuit Court of the U.S. Court of Appeals has already ruled that 
these damage payments will not come from the Nuclear Waste Fund. 
Consequently, Congress will have to choose where the funds should come 
from and which programs will be affected. As stated earlier, if the DOE 
fails to meet the 2010 deadline, the financial liability the DOE faces 
through lawsuits will continue to mount. As the DOE continues to delay 
honoring its contracts with the utilities to remove spent nuclear fuel 
from plant sites, both the amount of SNF and HLRW stored and the costs 
associated with storing it increase. A DOE contractor has estimated 
that each year's delay will escalate Program costs by approximately $1 
billion per year for the civilian and defense nuclear waste disposal 
programs. The longer Congress refuses to fully fund the DOE 
requirements, the greater the potential liability will be to the 
nation's taxpayers.

               TRANSPORTATION--RIGOROUS SAFETY STANDARDS

    The DOE has proven that it can safely transport SNF and HLRW from 
plant sites across the nation. Since the 1960s, more than 3,000 
shipments of spent nuclear fuel from nuclear power plants, government 
research facilities, universities and industrial facilities have 
crossed the United States, ``without a single death or injury due to 
the radioactive nature of the cargo.\1\ This equates to more than 
70,000 metric tons of SNF, an amount equal to what the NWPA authorizes 
for Yucca Mountain. Shipments include 719 containers from the Naval 
Nuclear Propulsion program between 1957 and 1999, and 2,426 highway 
shipments and 301 railway shipments from the U.S. nuclear industry from 
1964 to 1997. In addition, since 1996, shipments of spent nuclear fuel 
have been safely transported to the United States from 41 countries to 
the DOE facilities;\2\ again, without a single death or injury.
---------------------------------------------------------------------------
    \1\ National Conference of State Legislatures' Report, January 
2000.
    \2\ U.S. Department of Energy Report to the Committees on 
Appropriations, January 2001.
---------------------------------------------------------------------------
    Furthermore, the DOE has safely and successfully made more than 
2,405 shipments to the Waste Isolation Pilot Plant (WIPP) in New Mexico 
as of March 15, 2004.\3\ The Western Governors' Association (WGA) 
signed an agreement with the DOE in April 1996 that affirmed regional 
planning processes for safe transportation of radioactive waste. All 
regional high-level radioactive waste transportation committees also 
endorsed the WGA approach. The WIPP transportation planning system is 
setting the standard for safety and proving to be a critical step 
toward solving the nations spent nuclear waste disposal transportation 
program.
---------------------------------------------------------------------------
    \3\ Waste Isolation Pilot Plant Information Center, March 15, 2004.
---------------------------------------------------------------------------
    To ensure safety at on-site spent fuel storage facilities and 
during transportation, the material is stored in containers that meet 
the NRC's rigorous engineering and safety standards testing. To satisfy 
the NRC's rigorous standards for subsequent transportation approval, 
these containers have been dropped 30-feet onto an unyielding surface, 
dropped 40 inches onto a 6-inch vertical steel rod, exposed for 30 
minutes to a 1,475(F fire, submerged under 3 feet of water for eight 
hours, immersed in 50 feet of water for at least eight hours (performed 
in a separate cask), and immersed in 656 feet of water for at least one 
hour.\4\
---------------------------------------------------------------------------
    \4\ Nuclear Regulatory Commission, Testing Requirements, 10 CFR 
Sections, 71.61, 71.71, and 71.73.
---------------------------------------------------------------------------
    Nonetheless, unless sufficient funds are allocated, the DOE will 
continue to defer the much need transportation infrastructure systems 
plan in Nevada and site preparation activities that would allow 
acceptance of SNF and HLRW at Yucca Mountain by 2010.

                               CONCLUSION

    For the last 20 years, those who want to derail commercial nuclear 
power in this country have used this program as a political tool. In 
fact, the Federal government's failure to deliver extends back several 
decades. The U.S. Congress and the Federal government must immediately 
address the growing problem of SNF and HLRW that now exists. We can no 
longer pretend that stranded waste at plant sites does not exist and is 
without economic consequence to the nation's energy supply as witnessed 
in August 2003. We can no longer pretend that the problem of stranded 
SNF and HLRW is going away. While Congress acts to solve the Federal 
deficit problem, it is unacceptable that Congress would continue to 
utilize ratepayers' money from the NWF--it should be used for its 
intended purpose. The nation's ratepayers continue to make payments 
into the NWF for the purpose of disposing SNF and HLRW from the 
nation's nuclear power plants. The American people are right to expect 
funds from the NWF to be released for this purpose and not be used to 
provide accounting camouflage for other Federal spending. Use of the 
NWF for other purposes has been, and continues to be, an unjust and 
fraudulent tax on the American electricity consumer. Further delay by 
Congress to resolve the funding of this Program will guarantee that 
U.S. taxpayers will pay all of the costs associated with liabilities of 
the DOE to accept SNF and HLRW by 2010. The Courts have already stated 
that the liability for inaction will not be paid from the NWF.
    The members of the NWSC reiterate the importance for Congress to 
keep the DOE on target and schedule by reclassifying the NWF annual 
receipts as offsetting collections to bring the nuclear waste disposal 
program to fruition as promised and mandated by the Nuclear Waste 
Policy Act of 1982.

                                 ______
                                 
       Prepared Statement of The Decommissioning Plant Coalition

    The Decommissioning Plant Coalition (DPC) is pleased to provide a 
statement for the record on the Department of Energy's spent nuclear 
fuel program. The Energy & Commerce Committee's long-standing interest 
in this program and the years of oversight that you have provided has 
had a major positive impact on this program. Indeed, at times, it has 
seemed that only the continued strong interest of the Congress has kept 
the program from succumbing to the undeniably difficult challenges of 
siting this one of a kind geologic facility.
    As we all know, the Yucca Mountain program received considerable 
attention in the last Congress, leading to the bi-partisan approval of 
President Bush's site recommendation decision. Now, more than two 
decades after the original Nuclear Waste Policy Act was adopted in 
1982, the Department of Energy's spent nuclear fuel program has once 
and for all identified a site and is poised to submit a license 
application for Yucca Mountain.
    And, given the relatively limited resources that the Office of 
Civilian Radioactive Waste Management (OCRWM) has been forced to 
operate under, we believe they were correct in the decision to focus 
almost exclusively in the last year on the steps necessary to meet 
their December 2004 date for submittal of the license application. We 
are extremely grateful for the management initiatives that Director Chu 
has instituted to begin focusing the Department and contractor 
workforce on their difficult licensing tasks.
    However, we also believe that the progress made to date and both 
short and longer-term timelines are at risk and we urge the Committee 
to insist that the Department adopt an integrated approach in the 
implementation of various program elements. Specifically, we believe 
that there is a need to facilitate early decisions on outstanding waste 
acceptance, storage, and transportation issues if the goal is a fully 
functioning program in 2010.

The Decommissioning Plant Coalition
    The Decommissioning Plant Coalition was established in 2001 to 
highlight issues unique to nuclear power plants undergoing 
decommissioning. The DPC is focused on addressing the needs of 
decommissioning reactors at single-unit sites, of which there are six 
currently undergoing active decommissioning. Members of the 
Decommissioning Plant Coalition include Connecticut Yankee Atomic Power 
Company, Dairyland Power Cooperative, Maine Yankee Atomic Power 
Company, Sacramento Municipal Utility District, and the Yankee Atomic 
Electric Company.
    Collectively, these plants have a total of 1349 metric tons of 
heavy metal (MTHM) under management. This represents approximately 2% 
of the total amount of commercial spent fuel destined for final 
disposal. Despite the relatively small volume of spent fuel at these 
facilities, the cost of spent fuel and high-level waste management 
represents a disproportionately large issue for DPC members. For 
example, Maine Yankee estimates that spent fuel management represents 
28% of the total decommissioning cost for its facility. This 
disproportionate economic impact is even more acute for nuclear 
facilities that have already completed other decommissioning tasks and 
for whom the costs of monitoring spent fuel and maintaining necessary 
safeguards and security measures represent virtually 100% of operating 
expenses at that site.
    The members of the Decommissioning Plant Coalition play a unique 
role among our colleagues in the nuclear industry in that we have been 
forced to confront and address many of the more difficult spent fuel 
issues that operating plants might have the opportunity to defer. As 
such, we are at the leading edge of spent fuel management issues and 
are currently facing challenges that will ultimately confront the whole 
industry.

Strategic Considerations: Continuing Improvement to the Program
    While the Department of Energy has made considerable progress with 
the Nuclear Waste program in recent years, we believe that there is 
need to supplement the near-exclusive focus on preparation of the 
license application for Yucca Mountain and accelerate its maturation 
into a fully integrated spent fuel management system. Specifically, we 
are concerned that DOE has not yet demonstrated its ability to develop 
and implement a program to expeditiously identify and address critical 
waste acceptance, storage, and transportation issues, especially those 
that affect the ability of spent fuel contract holders to make 
decisions affecting their own facilities.
    The uncertainty in waste acceptance, storage, and transportation 
plans creates a number of special concerns for members of the 
Decommissioning Plant Coalition. First, unresolved fuel acceptance and 
storage issues create current and ongoing uncertainty for operators of 
decommissioning nuclear power plants. This uncertainty introduces doubt 
into every decision that the owners have made or are about to make 
regarding investment in storage and transport technologies. It calls 
into question every assumption and plan governmental officials make 
about the future productive use of the site. For example, we note that 
the Department has seemingly reversed its position on the acceptance of 
dual-purpose storage and transport systems that it once urged our 
members to procure. It also means that security resources have to 
continue to be devoted to a site, in increasing increments, where the 
threat should have been or would have soon been removed.
    The Department's ongoing delays in reaching decisions has a direct 
and current impact on these sites, and the Department must, in our 
view, begin to make these decisions now. We are concerned that the 
Department is being overly cautious in making at least some of the 
decisions because of internal legal considerations. As such, we applaud 
direction in the Appropriations Committee's report on the FY 2004 
Energy and Water Development Appropriations bill reminding the 
Department ``[D]elaying the resolution of pending litigation and 
avoiding potential future litigation are not the objectives of this 
programe. The best way to minimize the liability of the Federal 
government for spent nuclear fuel is to get on with the repository 
program in an expeditious manner.''
    Another aspect of the program that has been identified as needing 
redress is under funding, a situation that is becoming chronic despite 
the fact that a dedicated nuclear waste fund fee is being collected 
from electric ratepayers specifically dedicated to this program. As a 
result of resource constraints, a number of important program elements 
not related directly to the core scientific investigations of Yucca 
Mountain, but nevertheless essential to operation of a repository, have 
suffered from neglect and a lack of adequate funding.
    For example, FY2003 omnibus appropriations funding mark of $460 
million for the nuclear waste program was a $131 million reduction from 
the President's FY 2003 budget request. In his testimony last year, 
Secretary Abraham suggested that the funding shortfall imperiled the 
program by introducing a ``high risk'' to DOE's ability to meet a 
December 2004 license application date.
    The DPC was extremely pleased to see the funding increase that the 
program received in last year. While generous compared to previous 
allocations, the $576.6 allocation barely met the minimum funding 
needed to prevent further schedule slippage. In addition, the FY 2005 
request for $880 million represents a significant but necessary 
increase in funding. We and other key stakeholders in this program 
would be extremely disappointed to see the program announce further 
delays as a result of funding below requested levels.
    To that end, we applaud to Administration for proposing to credit 
annual fees collected against appropriations from the Nuclear Waste 
Fund. This will help ensure that the fund is used for its intended 
purpose and that the government does not further delay meeting its 
legal obligation to remove used nuclear fuel from commercial sites. 
This badly needed funding reform, proposed in the Administration's 
budget submittal, H.R. 3981, introduced by request by Chairman Barton, 
and H.R. 3429, the Nuclear Waste Financing Act or 2003, introduced by 
Representatives Shimkus and Rush, is critical to the timely success of 
this program

Additional DPC Recommendations
    In addition to the strategic approaches that we have discussed, we 
have number of specific recommendations that we believe will help to 
advance the program.

Recommendation: Comprehensive National Acceptance and Transportation 
        Plan
    First, the Department must work actively with the decommissioning 
plant contract holders and the DOE sites that will be shipping spent 
nuclear fuel and high-level waste to the repository to develop a 
detailed and comprehensive acceptance and transportation plan for the 
years 2010 -- 2020. DOE has encouraged owners to invest in storage and 
transport technologies that it once sought appropriations to build on 
its own and were identified as acceptable but now says it may not 
accept. DOE must also design the Yucca Mountain fuel handing and 
storage facilities so that they can accept fuel stored in the currently 
NRC licensed transportation/storage system as ``Standard Fuel'' under 
the DOE/Utility Standard Contract. While both commercial and non-
commercial sites have spent nuclear fuel and nuclear waste stored in 
dual-purpose containers, it is of particular importance to DPC members 
and other utility contract holders who are moving fuel to dry storage.
    We cannot stress the importance of this recommendation strongly 
enough. DOE should negotiate with contract holders to reach a timely 
decision on the schedule for acceptance of spent nuclear fuel stored in 
existing NRC-licensed storage and transport systems. As such we were 
extremely pleased to see the language in last year's Energy and Water 
Development Appropriations report directing the Department to establish 
a Comprehensive National Acceptance and Transportation Plan. 
Development of such a plan in close contact with contract-holders will 
force a re-assessment of how all program elements fit together, where 
bottlenecks exist and hopefully, where schedule slippage can be 
recovered. If the DOE does not design the Yucca Mt. fuel receipt and 
the transportation systems to be compatible with the currently NRC 
licensed storage/transportation systems, then they could classify the 
fuel in those systems as ``non-standard'' causing that fuel to lose its 
place in the DOE's fuel acceptance queue. This would mean a delay of 
many years at many millions of dollars cost before these shutdown plant 
sites are cleared of fuel.
    Because of the importance of this issue to DPC members and due to 
the fact that much of the transportation system will require direct 
interface with contract holders' physical sites, we strongly support 
the notion that the Department should interact directly with contract 
holders notwithstanding legal strategies and tactics favored by the 
Department of Justice.
    As an example of the need for integration that could be addressed 
by a comprehensive plan, we are concerned that the Department's rail 
transportation decision-making matrix and schedule seems to be 
disconnected from other decisions even within the Waste, Acceptance, 
Storage and Transportation (WAST) functions related to canister 
acquisition and deployment to contract holder sites. Furthermore, the 
current schedule will result in a delay of the implementation of a 
fully functioning rail transportation system until well after opening 
of the repository. Such a delay could result in truck-only shipments 
for the first years of the program, significantly increasing 
transportation costs and negating the benefits of large multi-purpose 
canisters already in use at a number of contract-holder sites.
    Another example of the benefits that would be expected to derive 
from such a plan would be for the Department to confront and resolve 
the issues related to acceptance and management of Greater-Than-Class-C 
(GTCC) waste. The Department should either ensure that the detailed 
acceptance criteria that will be part of the license application 
include appropriate criteria and specifications for GTCC waste, or 
present Congress with a separate plan proposing an alternative disposal 
path for this material.
    Finally, we also applaud the House Appropriations Committee for 
directing the Department to specifically address the special needs of 
decommissioning plants. Report language accompanying this years funding 
bill requires the Department to ensure that spent nuclear fuel and 
high-level waste from those reactor sites that are undergoing 
decommissioning will be accepted and transported as soon as practicable 
to facilitate the closure of these sites. Along those lines, we would 
refer you to one valuable recommendation from the GAO Report that this 
subcommittee requested on security of spent nuclear fuel facilities. 
Specifically, the report suggests the early shipment of fuel currently 
stored at shutdown reactor sites reducing the number of sites storing 
fuel that need protecting.

Recommendation: Demonstration Pilot Project
    As previously mentioned, decommissioning plants represent the 
leading edge of issues that must be confronted eventually by all 
contract holders. We therefore see significant value in requiring the 
Department to establish a pilot program to be initiated in FY 2005 to 
demonstrate and test all elements of the Waste Acceptance, Storage & 
Transportation program. In developing the plan, the Department would 
assume, and take those actions necessary to ensure, that fuel in NRC 
licensed storage and transportation systems are acceptable and standard 
waste forms under the Standard Contract.
    As we envision it, the plan would specify the activities to be 
tested, milestones for decisions, and the funding necessary to carry 
out the pilot, including the movement of fuel by DOE under the pilot.
    Such a pilot project would benefit members of the Decommissioning 
Plant Coalition by providing direct relief for a small portion of the 
overall waste inventory, but more importantly would provide systemic 
benefits for all nuclear plant owners and the Department by 
demonstrating work that will be critical path for operations once a 
repository is ready for fuel acceptance.
    In addition, much of the developmental work done by the Department 
of Energy to prepare for moving spent fuel to Yucca Mountain is being 
done ``in a vacuum'' without the ``real world'' perspectives of 
operating companies. Critical activities, such as preparing Operational 
Readiness Tests and Demonstrations, would benefit greatly by working 
directly with actual spent fuel facilities in a formal pilot project. 
Indeed, virtually all elements of the fuel transportation campaign 
could benefit from the experience in spent fuel management, loading, 
transport and handling equipment that is in limited supply and may be 
unavailable to the DOE.
    Another potential benefit of a demonstration pilot project would 
arise if the Department and Congress were in the future to determine 
that a limited early acceptance program at a licensed facility would 
demonstrate the workability of the program. In that event, the pilot 
project that we envision would provide a ready platform for 
demonstrating the compatibility of current licensed storage/
transportation systems at Yucca Mountain.
    DOE recognized the potential importance and benefits of removing 
spent fuel from shutdown reactors when it established its contracts for 
disposal of spent fuel. Those contracts provide that priority may be 
accorded any spent fuel removed from a civilian nuclear power reactor 
that has reached the end of its useful life or has been shut down for 
whatever reason. As we have already noted, the earlier referenced GAO 
Report acknowledged the economic and security benefits of such action.

Recommendation: Long-Term Budget Reform
    As we have indicated throughout this testimony, one of the problems 
that has confronted the program in recent years has been the lack of 
resources for fully funding the many activities that will be required 
to finally take acceptance of, transport and dispose of spent nuclear 
fuel. Final appropriations for the program have fallen perennially 
short of amounts requested by the Department to meet its statutory and 
contractual obligations. Last year, Secretary Abraham noted that these 
funding shortfalls place many elements of the program at ``high risk'' 
for not being ready for implementation when needed.
    Obviously we are gratified by the decision in the Energy and Water 
Development Appropriations for FY 2004 to provide nearly $580 million. 
These additional funds, coupled with sound programmatic direction, were 
sufficient to prevent additional schedule slipping. Now, going forward, 
the program must have sufficient funds not only to complete the Yucca 
Mountain license application in December of this year, but also to fund 
a robust waste acceptance program that can meet the need to accept and 
transport spent fuel by 2010 in more than nominal amounts.
    As the members of this committee well know, the budgetary and 
programmatic requirements to accomplish these two tasks will accelerate 
significantly beginning in FY 2005. Given the myriad competing demands 
for federal discretionary spending, it seems prudent to reconsider the 
mechanisms for funding this program. As such, we were pleased when 
Reps. Shimkus and Rush introduced H.R. 3489 last year. Likewise, we 
were very pleased to see the similar approach proposed by the 
Administration in the FY 2005 budget request. We urge you to enact such 
legislation this year.

Conclusion
    We applaud Congress and the Administration for efforts that have 
been made to complete the Yucca Mountain site characterization effort, 
culminating in the site recommendation and approval. Now however, the 
Department needs a new program focus that integrates all program 
elements and begins to answer important questions that have not 
received needed attention. Specifically, we believe the Department must 
pay particular attention to a number of waste acceptance and 
transportation issues that have remained unresolved for a number of 
years. These issues have created uncertainties that have unnecessarily 
complicated important decisions for contract holders and are especially 
sensitive for decommissioning single-unit sites.
    We commend the Subcommittee for your attention to these issues and 
look forward to working with you and Department to resolve them as we 
move forward to achieving our mutual goal of safe and economical 
disposal of commercial spent nuclear fuel.

    Mr. Hall. Now, at this time, we are very pleased to have 
the Honorable Robert H. Card, Under Secretary of Energy, 
accompanied by Margaret Chu, Dr. Chu, Director of the Office of 
Civilian Radioactive Waste Management, U.S. Department of 
Energy.
    And at this time, we are certainly happy and pleased to 
recognize our friend, Bob Card.

 STATEMENTS OF HON. ROBERT H. CARD, UNDER SECRETARY OF ENERGY; 
ACCOMPANIED BY MARGARET S.Y. CHU, DIRECTOR, OFFICE OF CIVILIAN 
    RADIOACTIVE WASTE MANAGEMENT, U.S. DEPARTMENT OF ENERGY

    Mr. Card. Mr. Chairman, thank you. I find it difficult to 
improve on your opening statement, or that of the ranking 
member, but I just want to make three quick points. First, in 
many ways the repository is vital to the national interests.
    It benefits all citizens of the country, especially the 160 
million who live within 75 miles of nuclear facilities, which 
are located in 39 States, at 127 sites. The President and 
Congress affirmed this vital interest in their overwhelming 
legislative support for the repository siting.
    Second, I am pleased to say that this project is on track. 
We expect to submit a license application to the NRC in 
December, and we will be able to receive waste in 2010. Last, 
you recognize that keeping the project on track requires 
adequate funding. A special assessment of rate payers was 
established to pay for the portion of the repository costs from 
commercial nuclear power.
    Millions of rate payers, homes and businesses across the 
Nation, have paid over $20 billion in fees to support the 
project. By not making those fees available, it drives up rates 
to our costs, and adding insult to injury, and denies them and 
their neighbors the environmental safety security and clean 
energy benefits of having a repository available in a timely 
manner.
    This project deserves our collective continuing backing to 
carry out its Congressional and Presidential mandates. Again, 
we are grateful for today's support and look forward to your 
questions and comments. Thank you.
    [The prepared statement of Hon. Robert H. Card follows:]

      Prepared Statement of Robert Card, Under Secretary of Energy

                              INTRODUCTION

    I appreciate the opportunity to testify about the Department of 
Energy's program to implement our Nation's radioactive waste management 
policy, as established by the Nuclear Waste Policy Act of 1982, as 
amended. The Act requires safe, permanent geologic disposal of spent 
nuclear fuel and high-level radioactive waste resulting from the 
Nation's commercial nuclear power and atomic energy defense activities. 
The disposal of this material in a geologic repository is needed to 
protect public health and safety and the environment, to maintain our 
energy options and national security, to allow the cleanup of former 
weapons production sites, to continue operation of our nuclear-powered 
naval vessels, and to advance our international nonproliferation goals. 
The Department's consolidation of spent nuclear fuel and high-level 
waste from 127 sites at a single secure, remote location in an arid 
desert, far from cities, schools, and water supplies, is vital to our 
national interest. As I will discuss at greater length in a moment, the 
Federal government is contractually required to implement a permanent 
solution for management of commercial spent nuclear fuel, in return for 
which utilities and ratepayers have paid fees to cover the costs of 
disposal.
    The Administration and the Congress have recognized these important 
national benefits and supported the Department's geologic repository 
program. This support was underlined in 2002 when bipartisan majorities 
in both houses of Congress voted to pass a joint resolution approving 
the Yucca Mountain site for a repository, and the President signed that 
resolution into law (Public Law No. 107-200).
    With the approval of Yucca Mountain as a suitable repository site, 
the program's focus has shifted from scientific study to the design, 
licensing and construction of a repository and the development of a 
transportation system. I am happy to report that the Program is on 
track to complete the scientific, technical and design work required to 
submit a license application to the Nuclear Regulatory Commission (NRC) 
in December 2004 and to begin repository operations at Yucca Mountain 
in 2010.
    To accomplish these objectives will require a substantial increase 
in funding over historical levels. We estimate, for example, that from 
2005 to 2010 it will cost about $8 billion to construct the repository 
and develop the transportation system. That would average more than $1 
billion a year, much higher than our previous annual appropriations. If 
these funding levels are not achieved, we cannot meet the 2010 goal.
    Today I would like to focus attention on the Administration's 
legislative proposal that is designed to make it easier for Congress to 
provide the necessary funding levels. Action on the Administration's 
proposal is needed as soon as possible to enable the program to stay on 
track.

The Nuclear Waste Funding Problem
    Enactment of the Administration's legislative proposal would help 
rectify a long-standing inequity imposed on all of the tens of millions 
of households who use nuclear-generated electricity. Since 1983 these 
households have been paying a fee on every kilowatt-hour of nuclear 
electricity they use, in order to fund the development of a repository 
for disposal of the used fuel from the nuclear reactors producing that 
electricity. They are not being treated fairly. By law that money is 
being collected for one purpose and one purpose only--performance of 
``nuclear waste disposal activities'' through the development of a 
repository. In actuality, much of the total that has been collected 
sits unused, but on a year-to-year basis, the fees not appropriated are 
used to offset other federal programs.
    The problem is compounded by the fact that the fee is part of a 
legally binding contractual agreement mandated by Congress in the 
Nuclear Waste Policy Act that the Department of Energy entered into 
with the nuclear utilities. In that contract, the Department was 
required to begin accepting the used fuel for disposal beginning by 
January 31, 1998, in exchange for utilities' payment of the fee. The 
fact that this fee is a quid pro quo payment in advance for a 
contractually required service to be performed by the federal 
government--a legal obligation affirmed by the federal courts--sets it 
apart from most other federal user charges and taxes and justifies 
special consideration in the budget process.
    The fee was to be placed into a Nuclear Waste Fund and used to pay 
the full cost of developing and operating the facilities needed to meet 
the federal government's commitment to conduct nuclear waste disposal 
activities mandated by the Nuclear Waste Policy Act, and for that 
purpose alone. This funding mechanism was designed to ensure that the 
Department of Energy's high-level waste program would have the funds it 
needed as it needed them in order to get the job done, and that the 
federal taxpayer did not pay for it.
    The utilities and their ratepayers have been keeping their part of 
the bargain since 1983. Unfortunately, the federal appropriations 
process is increasingly constraining the ability of the federal 
government to do its share. Because the fee revenues are classified 
under budget control legislation, as mandatory receipts, they are 
treated just like general tax revenues and deposited into the federal 
treasury with no impact at all on the ability of the appropriators to 
fund the program for which the fees are being paid. As far as the 
millions of ratepayers are concerned, the fee appears to be just one 
more federal tax instead of the payment to ensure the delivery of a 
service that it was intended to be.
    Over the last 10 years, ratepayers of nuclear utilities have 
averaged annual payments into the Fund of about $636 million, while 
appropriations from the Fund averaged $198 million. The total unspent 
balance in the Fund is nearly $15 billion. Until recently, the waste 
program's requirements were substantially below the annual fee 
collections. Beginning with the FY05 budget, however, that situation 
has changed, with program requirements equaling or exceeding projected 
income from the fee. To ensure that the waste fee revenues are fully 
available for their contractually obligated purpose, they need to be 
reclassified from mandatory to discretionary so they can directly 
offset the appropriations from the Fund.
    If the federal government is to honor its solemn legal obligation, 
it must act now to ensure that the moneys obtained from millions of 
ratepayers are applied to their intended purpose. The clear objective 
of the Nuclear Waste Policy Act is not satisfied by letting the money 
accumulate unspent in the Fund, as is happening now. Instead, it 
requires that these funds be used at the time and in the amounts needed 
to deliver on the contractual obligation that justifies their 
collection in the first place.

Need for a Funding Remedy to Avoid Delays and Cost Increases
    The Department of Energy recognized long ago that it would not be 
able to open the repository contemplated by the Nuclear Waste Policy 
Act by 1998. Since 1989, however, it has held to the firm goal of 
beginning repository operations by 2010. Meeting the 2010 objective 
will require much greater resources than the program has thus far 
received. If Congress appropriates less than requested by the 
Administration, the schedule for repository operation would be 
jeopardized.
    This would not be fair to the ratepayers, and it would not be fair 
to the taxpayers, since they will both pay if there are further delays 
in meeting the government's contractual obligations. Those taxpayers 
who are also ratepayers will pay twice.
    Delay could lead to additional costs in three ways:

1. Delay would increase the cost of the waste program. If funding 
        constraints drag out construction, it would add unnecessary 
        years of overhead costs and prevent the facilities from being 
        constructed as efficiently as possible. Under the full cost 
        recovery provisions of the Nuclear Waste Policy Act, any cost 
        increases would have to be passed on to the utilities and their 
        ratepayers through the fee. It is not hard to imagine how they 
        would respond to being required to pay additional costs that 
        resulted from refusal of the government to make full use of the 
        funds they have already been paying so faithfully.
2. Delay would add costs of nearly a billion dollars per year for 
        commercial utilities and federal defense nuclear waste sites to 
        continue to provide temporary storage. Ratepayers will bear the 
        costs of utility storage in addition to continuing to pay for a 
        repository, and all taxpayers will pay for storage of the 
        defense waste.
3. Delay could increase the damages the federal government will have to 
        pay for failure to meet its contractual obligations, damages 
        that will be borne by taxpayers. The government's liability for 
        damages for not beginning to take commercial spent fuel in 1998 
        already has been established by final court decisions. While an 
        accurate calculation of damages must await determinations by 
        the courts, it is not unreasonable to assume that the amount of 
        damages will be substantial and will increase with each year of 
        delay. There is nothing in the law or the contracts that allows 
        lack of appropriations to be used as an excuse for failure to 
        meet the statutorily-required contractual obligations.
    In short, everyone loses if we don't fix this funding problem soon. 
The country will be forced to spend billions of extra dollars, without 
solving the waste problem. Nuclear waste will remain at sites near 
communities and water supplies throughout the country, and we will not 
have finished the job of cleaning up the Cold War legacy at defense 
sites.

The Administration's Proposal
    We believe a solution to this problem is the Administration's 
proposal that has been put forward to the Congress and introduced by 
request as H.R. 3981. The essence of this proposal is to reclassify the 
revenues from the nuclear utility fees so they can be used in the way 
that was intended when the Nuclear Waste Policy Act was passed: to 
develop a repository for disposal of high-level radioactive waste and 
spent nuclear fuel. Specifically, under the Administration's proposal, 
the amount of receipts from annual fees would be credited as offsetting 
collections. The amount credited as offsetting collections would still 
be subject to approval in an appropriations act, but could be 
appropriated without reducing the funding that would be available for 
other federal programs.
    I should add that the Administration also appreciates the efforts 
of Congressman Shimkus, Congressman Rush, and the other bipartisan 
supporters of their bill, H. R. 3429, which seeks the same goal of 
reclassification of the nuclear waste fee revenues so they can be used 
to offset appropriations.
    In light of the issues and concerns just described, we urge you to 
give careful consideration to the Administration's proposal to correct 
the constraining way these moneys are now being treated.
    As you consider the Administration's proposal, let me correct two 
misconceptions about it--
    First, despite misrepresentations by some critics, it does not 
reduce Congressional control of the program's budget in any way. 
Congress will still have to appropriate the funds, as required by the 
Nuclear Waste Policy Act. The effect of the proposal is simply to 
ensure that Congress can focus its appropriations decisions on ensuring 
that the funds are used effectively and efficiently to meet the 
objectives of the Act, without having to worry about the impact on the 
funding of other programs within the Energy and Water Development 
appropriation. Why should other programs continue to have to compete 
with a contractually mandated program that is, or is intended to be, 
fully self-financing? That competition will only get worse as damage 
judgments increase the pressure to keep the repository on track.
    Second, the principle supported by the proposal is specific to the 
highly unusual contractual arrangement required by the Nuclear Waste 
Policy Act, and is unlikely to be relevant to many other federal 
activities. Simply stated, whenever the Federal government, pursuant to 
an explicit statutory requirement, makes a legally binding contractual 
commitment specified by that statutory requirement to perform a well-
defined service in exchange for payments that cover the costs of that 
service, it should treat those payments in a way that ensures that they 
are used for the statutorily-specified contracted purpose. It is hard 
to see how anyone could disagree with that principle. Likewise, it is 
hard to see how such distinctive--if not unique--statutory obligations 
could threaten the ability of Congress to weigh competing demands for 
appropriations in other, unrelated areas.
    Let me repeat one key point: The Federal government is 
contractually obligated to perform the service for which these fees are 
paid. Over 65 lawsuits have been filed in the U.S. Court of Federal 
Claims for damages for failure of the government to meet that 
obligation. The Court of Appeals has already established liability in 
at least some of the cases, and the first case to proceed to trial to 
determine the scope of the damages for which the government will be 
liable recently concluded. Passage of this legislation to help assure 
adequate funding for the waste program would send a strong signal to 
the ratepayers, the utilities, and the court that the Federal 
government is indeed serious about meeting its obligations. Failure to 
ensure full funding of the waste program could have quite the opposite 
effect, at a most inopportune time.

Importance of Timely Action
    Some people argue that because of federal budget constraints, now 
is not the time to increase appropriations for the waste program, much 
less to make changes in the budgetary treatment of the waste fee. If 
past decisions are any guide, federal courts are not likely to accept 
funding limitations as an excuse for failure to meet contractual 
obligations. In a case from the Depression era involving a federal law, 
the Economy Act, that stopped payment on government-issued insurance 
policies, the Supreme Court concluded: ``No doubt there was in March, 
1933, great need of economy. In the administration of all government 
business economy had become urgent because of lessened revenues and the 
heavy obligations to be issued in the hope of relieving widespread 
distress. Congress was free to reduce gratuities deemed excessive. But 
Congress was without power to reduce expenditures by abrogating 
contractual obligations of the United States. To abrogate contracts, in 
the attempt to lessen government expenditure, would not be the practice 
of economy, but an act of repudiation.'' 1
---------------------------------------------------------------------------
    \1\  Lynch v. United States , 292 U.S. 571, 580 (1934)
---------------------------------------------------------------------------
    The Administration and many in Congress understand the magnitude of 
the injustice being inflicted on households using nuclear electricity 
and recognize the need to end it. A number of proposals have been 
advanced before, to no avail. It is time to stop arguing about which 
approach would be best, and adopt one that will start to fix the 
problem. Procrastination will not make it any easier to do the right 
thing later. We need to take action now to ensure that inappropriate 
funding constraints do not prevent us from achieving the goal of 
operation of a repository in 2010.

Status of the program
    Let me talk for a minute about the current activities of the 
program. By decisively approving the President's recommendation of the 
Yucca Mountain site, Congress allowed the process of developing a 
nuclear waste repository to proceed to the next step, recognizing that 
the independent experts at the Nuclear Regulatory Commission deserve 
the right to review the 24 years of scientific study of Yucca Mountain 
and to consider the site for a license. As I stated earlier, the 
program is on track to complete the work required to submit a license 
application to the Nuclear Regulatory Commission in December 2004 and 
to begin repository operations at Yucca Mountain in 2010, providing 
that action is taken to ensure that the necessary funding is provided 
throughout that critical period.
    FY 2005 is a critical year in which important activities must 
converge if we are to meet the 2010 objective. In FY 2005, the program 
will be fully engaged in the licensing process. At the same time, it 
must initiate certain activities in the near term to permit timely 
construction and ensure readiness for operations. These activities, in 
the areas of repository readiness and detailed design, transportation 
system development, and waste acceptance readiness--along with 
licensing activities--lead to the program's total budget request for FY 
2005 of $880 million. While this is a significant increase over 
historical funding levels, it is an increase that has been carefully 
planned and understood for many years. We are confident that the 
program is positioned to commit funds effectively to defend the license 
application; to accelerate repository surface, subsurface, and waste 
package design work needed for construction authorization; and to 
conduct conceptual and preliminary design activities for Nevada 
transportation. Moreover, a major portion of the increase represents 
procurements: transportation cask acquisition and important repository 
site safety infrastructure upgrades.
    In view of the change in focus of the program since the site 
recommendation and approval, several steps have been taken to turn the 
program into a project-oriented organization that can manage capital 
projects efficiently and cost-effectively and secure a repository 
license from the NRC. The program is committed to achieving a project 
management and organization culture founded on the highest standards of 
safety and quality. The program's ``human capital'' has been 
significantly strengthened by installation of a new senior management 
team with strong skills and extensive experience in the successful 
management of large capital projects. The Department is putting in 
place numerous far-reaching management measures, such as a Capital 
Asset Management Plan and earned-value management system for the 
program, and undertaking annually a comprehensive, independent external 
financial, cost, schedule, and technical audit of the program. The 
program has also undertaken major management initiatives to improve 
performance in such areas as Quality Assurance, Safety Conscious Work 
Environment, and Corrective Action, and to better define roles, 
responsibilities, authority and accountability. These initiatives have 
better positioned the program to be a successful NRC licensee and to 
meet mandated requirements for a safe repository, and will help ensure 
that funds are spent in a way that merits the confidence of Congress 
and the public.
    The program plans to submit to the NRC, by December 2004, a high-
quality, defensible license application that meets regulatory 
requirements, merits the NRC's confidence, and supports construction 
authorization in December 2007. By the end of FY 2004, with the funds 
appropriated, we will have:

 Addressed all ``key technical issue'' agreements that the Department 
        and NRC agreed the program needed to address prior to license 
        application submittal.
 Completed required elements of the preliminary design for the waste 
        package, surface facilities, and subsurface facilities in 
        support of the license application.
 Completed the safety analyses for Department-owned spent nuclear fuel 
        and high-level radioactive waste, and Naval spent fuel for the 
        license application.
 Completed the total system performance assessment postclosure report 
        in support of the license application. This report will reflect 
        increased understanding of how emplaced nuclear waste will 
        interact with the natural and engineered barriers after the 
        repository is closed.
 Prepared millions of pages of relevant documentation for inclusion in 
        the electronic Licensing Support Network (LSN) and completed, 
        for initial certification, the electronic LSN consistent with 
        the requirements of 10 CFR Part 2, Subpart J, at least six 
        months prior to submitting the license application.
 Completed a draft of the license application.
    While we are concentrating on the technical issues that the NRC 
expects us to address for the license application, we are also 
considering issues raised by the Nuclear Waste Technical Review Board 
and other independent observers. For example, there has been discussion 
recently of a report by the Technical Review Board concerning the 
possibility of corrosion of the waste packages at the temperatures 
which will be reached in the repository. As we understand it, the 
Board's concern relates to the appropriate thermal operating conditions 
for our proposed repository design rather than to the ability to build 
a safe repository at the Yucca Mountain site at all. We are conducting 
a detailed evaluation of the Board's report, and plan to discuss the 
issue with the Board at their meeting in May.
    We believe that our current design and proposed operating 
conditions would meet the radiation protection standards established by 
the Nuclear Regulatory Commission and the Environmental Protection 
Agency for a Yucca Mountain repository. We also believe that the 
licensing process will ensure that any issue that has significant 
potential for affecting safety will receive rigorous scrutiny. A 
repository will not be constructed, much less operated, unless such 
issues have been addressed to the Commission's satisfaction. Even after 
operation begins, the Commission's regulations require us to conduct a 
long term performance confirmation program to collect and analyze data 
to verify the bases for the repository license. We must also ensure 
that the waste can be retrieved from the repository if necessary for at 
least 50 years after emplacement begins, in the event that the results 
of performance confirmation indicate that changes are necessary. In 
fact, we are providing the capability to keep the repository open for 
at least 100 years, allowing plenty of time to improve our scientific 
understanding and deploy new technology as appropriate.
    Before discussing our efforts to ensure that we will have a 
transportation system in place to move waste to the repository in 2010, 
I would like to address an issue concerning work at Yucca Mountain that 
has received considerable attention recently and about which we are 
taking decisive action. In September 2003, a former Yucca Mountain 
Project employee expressed concern about overexposure to silica and 
other potentially harmful substances during tunnel mining operations in 
the early to mid-1990s. Prior to the beginning of tunnel boring 
operations in 1994, safety programs were in place. Respiratory 
protection was made available to Yucca Mountain workers; however, 
between 1992 and 1996, requirements for its use were not consistently 
applied. In 1996, the Office of Civilian Radioactive Waste Management 
issued a stop work order, established a rigorous protection program, 
and enhanced monitoring of the work environment. Also in 1996, 
ventilation in the tunnel was improved to better control dust levels. 
Our records indicate that the requirements for the proper use of 
respiratory protection have been in effect since 1996 and have been 
rigorously enforced. We feel confident that the program is in full 
compliance and will provide safe conditions for its workers into the 
future.
    To respond to the concern expressed by the former employee in 2003, 
in January 2004 we established the Silicosis Screening Program with the 
University of Cincinnati for current and former workers. This program 
provides medical screening that will detect any pulmonary changes. This 
program is free of charge to the workers. We have sent 2400 letters 
about this program to former and current workers, including a 
substantial number who did not work in the underground facility. We 
estimate that some 1200-1500 people have worked in the underground from 
1992 to the present.
    I should note that in 2000, two cases of silicosis were diagnosed 
through the ongoing medical surveillance program for current workers. 
Both of these individuals worked at Yucca Mountain during the tunneling 
operations and also had previous mining experience. In addition to 
implementing the screening program, we also have taken action to ensure 
that our current worker protection program is technically sound and 
fully implemented.
    Let me turn now to our transportation activities related to Yucca 
Mountain, which were deferred for many years while the program focused 
on site characterization and the technical work supporting the license 
application. The acquisition of rail and truck casks; interactions with 
state, tribal, and local governments; and construction of a rail line 
in Nevada are all critical for achieving waste acceptance goals in 
2010.
    We have taken some significant first steps. In November 2003 we 
published the Strategic Plan for the Safe Transportation of Spent 
Nuclear Fuel and High-Level Radioactive Waste to Yucca Mountain: A 
Guide to Stakeholder Interaction. The plan described how we will 
conduct an open and collaborative planning process involving states, 
tribes, and other interested parties as we develop and refine the 
transportation system. We have already begun working with State 
Regional Groups to identify the topics for future interaction and 
establish processes for working together. We anticipate a productive 
dialogue on issues that include the selection of transportation routes 
and modes, emergency response planning and training, safeguards and 
security, operational practices, communications and information access, 
worker protection, training, training standards, and qualifications.
    Another important action that occurred at the end of last year was 
the identification of a preferred rail corridor for construction of a 
rail line in Nevada to connect an existing main line to the repository, 
should the Department choose mostly rail as the preferred mode of 
transportation. Five rail corridor options were identified in the Final 
Environmental Impact Statement (EIS), but none offered a clear 
environmental advantage. We looked at other factors, including views 
that had been expressed over the years, to identify our preferred 
corridor. The Caliente corridor appears to best assure the safe, 
secure, and timely transport capability, due to its remote location and 
lower likelihood of land use conflicts. In December, we identified the 
Caliente corridor as our preference, with the Carlin corridor as a 
secondary preference. We also initiated the process for withdrawal of 
federal land for the Nevada rail line within the preferred corridor.
    In the Final EIS for the repository, the Department stated that 
mostly rail was the preferred mode of transportation, both nationally 
and in the State of Nevada. The mostly rail option would limit the 
number of shipments into Nevada to the repository site each year. A 
Record of Decision is pending on the mode of transportation and on the 
corridor for Nevada transportation if the mostly rail mode is selected. 
Following these actions, we would schedule public scoping hearings in 
Nevada and award a contract for an EIS for a specific alignment within 
the rail corridor, and a contract for conceptual design for the rail 
line.
    We plan to focus on cask acquisition activities in FY 2005. We must 
begin the process now because cask design, certification, and 
fabrication take years to complete. We are also planning to undertake 
conceptual design for a fleet management facility that will support 
operations and maintenance of the cask fleet.
    We believe that we can implement a transportation system that is 
safe and secure and merits public confidence, and we are committed to 
doing so. We are still at an early point in the process, but the 
collaborative approach we have established provides the framework for 
addressing stakeholder priorities and ensuring coordination with all 
interested parties.

Conclusion
    In conclusion, in FY 2005 and beyond, the program will need 
significantly increased funding to pay for the design, construction, 
and operation of the repository, and the transportation infrastructure. 
The repository and the transportation projects are on the critical path 
to the program's goal of initiating waste receipt in 2010. If funds are 
available as needed, the program is well positioned to achieve the goal 
of beginning, in less than 7 years, to operate the world's first 
geologic repository for high level waste and used nuclear fuel.

    Mr. Hall. All right. We are open for questions now. Mr. 
Card, as you know there are a couple of bills floating around 
out there to change the funding status of the Nuclear Waste 
Fund, and I hate to put you on the spot, because Representative 
Shimkus is here, and Chairman Barton is knowledgeable of this 
and aware of the hearing.
    But which of these bills do you prefer? Are you in a 
position to make that statement; H.R. 3429 by Mr. Shimkus, or 
H.R. 3981 by Chairman Barton, and what do you think is 
necessary to reclassify the budget status of the Nuclear Waste 
Fund?
    Mr. Card. Well, first of all, I am glad that Representative 
Shimkus is here, because it gives me the opportunity to thank 
him for his leadership in moving forward on this issue last 
year.
    And the administration is very appreciative of his efforts. 
In fact, if you look at our proposed bill, it is simply his 
bill with amendments. The bills, as you noted in your opening 
statement, are very similar. We have included what we think is 
a somewhat more robust term of coverage in the administration's 
proposal.
    It also includes what we would view as some desirable 
administrative controls for the management of the funding. Both 
bills, let me just comment, in no way disempower the Congress 
from its oversight appropriations authority.
    So obviously we submitted a bill that we would have a 
preference for, but we find ourselves strongly aligned with 
3429 as well.
    Mr. Hall. All right. Does the ranking member have 
questions? I recognize Mr. Boucher for 3 minutes. I'm sorry, 5 
minutes.
    Mr. Boucher. Well, thank you very much, Mr. Chairman. And 
Secretary Card, I want to commend you on the concise nature of 
your testimony this morning. I wish more of our witnesses would 
follow your outstanding example, or members for that matter.
    You mentioned in your testimony that the program would 
incur additional costs and delays if we do not legislatively 
correct the funding mechanism. Could you indicate what those 
costs and delays would be? Do you have any estimates with 
regard to either?
    Mr. Card. I think we have an estimate by Margaret of half-
a-billion dollars per year of delay.
    Ms. Chu. That is just for the defense side storage costs, 
and then I think from the industry side, it is probably 
comparable. So just the temporary storage costs will probably 
be close to a billion dollars a year not to mention the other 
costs because of the delay.
    Mr. Card. I might add then that if each site needs to go to 
dry storage or make some other structural change, then there 
would be step changes in that costs of delay as well.
    Mr. Boucher. Okay. Can you give me an indication of the 
proportion of waste that would be deposited at Yucca Mountain 
that derives from the civilian program, as compared to the 
portion that is derived from defense origins?
    Ms. Chu. The civilian waste is dictated by law. We are 
supposed to put in 70,000 metric tons of waste in Yucca 
Mountain. About 90 percent of it will be civilian waste, and 10 
percent will be defense waste.
    Mr. Boucher. Okay. Thank you very much. And you were 
indicating, Mr. Card, that the major element of costs that were 
derived from our failure to act legislatively at this point 
would actually be on the defense side, is that correct, or 
would there be additional costs on the civilian side as well?
    Mr. Card. Well, the costs as Margaret mentioned would be 
somewhat equally spent on the average between the two. However, 
with our accelerated clean up program on the defense side now, 
that may be done in 2025.
    So we could be in a situation where the taxpayer, through 
the Department of Energy, will be having to pay to store high 
level waste at sites like Hanford, Washington, and Savannah 
River, until there is capacity there with repository storage, 
because that waste will now be produced much faster.
    Mr. Boucher. Okay. The other question that I want to pursue 
with you is the rather modest nature of the proposal that has 
been made by the administration, and I think the rather modest 
nature of the proposal that Mr. Shimkus, along with Mr. Rush, 
have also made.
    Both the bills relate to assuring prospectively that monies 
that come into the fund, something on the order of $770 million 
per annum, would in fact be dedicated to the purposes of the 
program.
    They do not address the $14 billion that is already on 
deposit in the fund, and would not receive the same level of 
assurance with regard to proper dedication for applications in 
the future. Are you troubled by the fact that the $14 billion 
would not be addressed?
    Do you not think that perhaps we ought to be a little bit 
more ambitious in what we do given the fact that we probably 
won't have that many opportunities to legislate corrective 
measures with regard to the fund?
    I am personally a little bit concerned that we are leaving 
the $14 billion unaddressed, and I would like to have your 
views regarding that.
    Mr. Card. Well, certainly our position on the $14 billion 
is that its purpose is to be applied toward this effort. So we 
would be opposed to any other use of that money. In terms of 
the annual funding needs though, we believe that our proposal 
will provide for that.
    However, what I would like to do is since you have 
expressed that interest privately as well, is to respond for 
the record on the administration's position on the precise 
number that we have put in the bill.
    [The following was received for the record:]

    We have not given up on the $14 billion corpus of the Fund but do 
not need to tap the corpus at this time. Annual revenues together with 
the annual defense waste disposal fee will provide sufficient funding 
to license and construct the repository and put the necessary 
transportation infrastructure in place. The corpus, which cannot be 
spent for other purposes, will continue to generate interest and thus 
guarantee the ability of additional funds for appropriation at a later 
date.

    Mr. Boucher. Well, I would appreciate that, and if in the 
course of that response if you could also very clearly state 
what guarantees we could anticipate if we do not act 
legislatively with regard to spending the $14 billion for its 
intended purpose. I would not appreciate that as well.
    So the picture is not encouraging, and that funding has 
been used for other purposes. DOE has been in a position of 
having to compete, or have all of its funding essentially 
compete one program to the other, including this program.
    And it just occurs to me that while we have a chance for 
legislation, perhaps that could be a little bit more ambitious 
in doing so, and address the $14 billion, as well as the 
prospective funding. Thank you very much, Mr. Chairman. That is 
all that I have.
    Mr. Hall. Anyone else seek recognition at this time?
    The Chairman recognizes Mr. Barton, the Chairman of the 
Commerce Committee.
    Chairman Barton. Mr. Chairman, thank you for recognizing me 
out of order, and I will be very brief. I have an opening 
statement to submit for the record, and I hope it will be 
accepted by unanimous consent.
    Mr. Hall. Is there an objection? The Chair hears none, and 
the Chair recognizes Mr. Barton for 5 minutes.
    Chairman Barton. I just want to make two points, maybe 
three points. Obviously, we have worked to designate Yucca 
Mountain as the senior repository for high level nuclear waste 
for 15 or 20 years, and we finally got that designation on a 
bipartisan basis in both the House and the Senate.
    So we have two items before us. No. 1, to make sure that 
the Department of Energy submits the license application on 
time in December of this year, which is not that far off.
    And, No. 2, that we find a way to use the Nuclear Waste 
Fund, which has $14 billion in it, to actually spend it for 
what it was intended, which is to build and maintain this 
repository. So I hope that this subcommittee asks the 
appropriate questions.
    My question would be, Mr. Card, and it may have already 
been asked, but what is the probability of actually having an 
application to the NRC on time this December?
    Mr. Card. We feel confident that we can provide them the 
application on our promised date of December 2004.
    Chairman Barton. And is that a universally held opinion in 
the department, or is that your opinion because you know that 
is what I want to hear?
    Mr. Card. It would be my strong personal opinion, but I 
believe it is universally held as well.
    Chairman Barton. Okay. Second, on the piece of legislation 
that we introduced last week to fund construction and 
maintenance of the repository, is it your view that the Bush 
Administration is going to strongly support that, moderately 
support that, accept it if it passes, or something even less 
than that?
    Mr. Card. Could you restate----
    Chairman Barton. We introduced a piece of legislation in 
the House taking the Nuclear Waste Fund off-budget so that we 
could use it for what it was intended. We only did that last 
week, and I understand that sometimes news does not travel very 
quickly from getting it that way.
    Mr. Card. You can count on our strong support of that bill.
    Chairman Barton. Thank you, Mr. Chairman.
    Mr. Hall. I thank the Chairman, and the Chairman recognizes 
Mr. Markey for 5 minutes.
    Mr. Markey. Thank you, Mr. Chairman, very much. This 
morning we are having a hearing on the legislative proposals to 
take the Nuclear Waste Fund off-budget, but this afternoon on 
the House floor, we will be voting on the Republican budget, 
which fails to include a proposal to take it off-budget.
    But I will be voting against that budget on the House floor 
this afternoon, and all the Republicans who really want any 
part of that budget this afternoon, just so you can understand 
the position of this hearing with what is actually going to 
happen on the House floor today with the Republican budget on 
that issue.
    It is my understanding--Mr. Card, any relation?
    Mr. Card. To?
    Mr. Markey. Andy.
    Mr. Card. No.
    Mr. Markey. It is my understanding that DOE will issue its 
decision on the preferred mode of transportation for the 
nuclear waste going to Yucca Mountain sometime in the next 
month, and that it most likely will be a rail decision.
    The tragedy in Spain has illustrated how vulnerable our 
rail system is to terrorist attack. What additional security 
measures will be needed to address this threat since you have 
studied the Spain incident?
    Mr. Card. Well, not knowing everything about the Spain 
incident, it is not clear to us that any additional measures 
beyond what was contemplated may be needed to respond to that 
specific incident.
    Obviously the Department of Energy, and I am assuming the 
NRC, are very concerned about the attacks on trains, and we 
believe that we have a waste shipping system, and we have a 
very robust system in place now, and that whatever is required 
to make it----
    Mr. Markey. Well, do you have a study in progress to 
examine the lessons of Madrid?
    Mr. Card. Not that specific, except that the environmental 
impact statement and other works contain numerous studies of 
not only explosives, but projectiles, and----
    Mr. Markey. I urge you, Mr. Card, to take the Spain 
incident, and take the level of threat that was created in that 
country, and to then closely examine it in terms of the lessons 
that you can learn for transporting nuclear waste across our 
country.
    I don't think that you should assume that you have already 
answered all those questions. I think your agency is making a 
mistake in assuming that everything that you have done up until 
now would protect against an al-Qaida like attack like we saw 
in Madrid. You are making a big mistake if you make that 
assumption.
    When does DOE plan to begin financially assisting 
individually impacted States in the transportation emergency 
preparedness as required by Section 180(c) of the Nuclear Waste 
Policy Act?
    Mr. Card. About 6 months ago when we finally received the 
funding this year thanks to the appropriators, we kicked off 
our transportation program and now have fully engaged State and 
regional organizations and are providing them funding.
    They, I believe--and Dr. Chu may want to comment on this--
are in the process now of advising us on the approach that they 
would like to take for support and route selection, and just as 
we did with the waste isolation pilot project on 
transportation, we would expect to be providing them support.
    Mr. Markey. Is there any truth that the Department of 
Energy is going to use barges as a way of transporting nuclear 
waste?
    Mr. Card. We don't know that yet.
    Mr. Markey. Is that under consideration that you would use 
barges?
    Mr. Card. The Secretary has said that we will consider all 
modes of transportation and make the final decision in 
collaboration with State and local government.
    Mr. Markey. So are heavy trucks still under consideration, 
too, as a way of moving nuclear waste?
    Mr. Card. There is no transportation system that I am aware 
of that is safe that we have ruled out at this time, although 
we have expressed a preference at this point.
    Mr. Markey. And you consider barges to be safe?
    Mr. Card. We don't consider them to be unsafe.
    Mr. Markey. The Association of American Railroads has long 
contended that spent fuel should only be shipped in so-called 
special trains, dedicated trains, hauling only spent fuel and 
other radioactive materials, and operating under special safety 
protocols, such as speed restrictions, buffer car 
specifications, and train passenger rules.
    However, the current Department of Transportation 
regulations allow the shipment of spent fuel in general mixed 
freight trains. What is the Department of Energy's position on 
dedicated trains, versus mixed freight trains?
    Mr. Card. We have not yet made a decision on that, but we 
have expressed a preference to keep trains segregated.
    Mr. Markey. That is your preference? And you have stated 
that to them?
    Mr. Card. We have not made a decision on that.
    Mr. Markey. You have not made a decision?
    Mr. Card. That is right.
    Mr. Markey. I would urge you to make a decision. It is very 
important for you to move forward only after you have 
completely investigated those important issues. In October 
2003, researchers with the NRC informed the NRC's advisory 
committee on nuclear waste that tunnels leading inside Yucca 
Mountain to the repository could degrade and fill with rubble 
within several hundred years of the repository's construction.
    While the material stored in the repository will be weakly 
radioactive for hundreds of thousands of years, it is possible 
that access to the tunnel could be nearly non-existent within 
several hundred years.
    The NRC scientists responsible for reaching this finding 
questioned the DOE's methodology for determining the 
availability of the tunnels. How does the DOE respond to those 
findings?
    Mr. Card. Tunnel integrity over the long term is only 
important in that it not damage the engineered container, and 
they have been designed to deal with that.
    Mr. Markey. So you are saying the fact that you won't have 
access to it any longer, and as long as you determine that the 
container will be secure, then that is no longer an issue as 
far as you are concerned?
    Mr. Card. Once the repository is closed, which we said 
could be as long as 300 years from now, the condition of the 
tunnels at that point is only a consideration to ensure that we 
properly analyze if rocks fall on the containers, which we 
have.
    Mr. Markey. Well, I think that you need to do more work on 
that. I don't think that we can pass on like an 
intergenerational punt the responsibility for them to figure 
out how to deal with it, and I think it is our responsibility 
in this generation to figure out how to keep that open.
    Mr. Card. I would just say that there has been no decision 
made that would prohibit the indefinite repository opening and 
not closing it. So that is a decision that future generations 
will be able to make. Nothing in our design compromises that.
    Mr. Markey. Thank you, Mr. Chairman.
    Mr. Hall. The gentleman's time has expired. Who seeks 
recognition? Mr. Norwood is recognized for 5 minutes.
    Mr. Norwood. Thank you very much, Mr. Chairman. My 
questions could be answered by either of you. This 
transportation question keeps cropping up just a little bit, 
and do we move any nuclear waste today by barge?
    Mr. Card. The answer is that I don't know if you could term 
it barge. If you say over the water, the answer is yes. And in 
fact a number of reactor cores, I believe, have been moved to 
South Carolina and fuel, and reactor parts to Washington State.
    Mr. Norwood. And are we moving nuclear material by truck 
today?
    Mr. Card. Large quantities of it.
    Mr. Norwood. And how about trains?
    Mr. Card. Yes.
    Mr. Norwood. Have we had any major accidents in the last 40 
years that we have been moving nuclear material?
    Mr. Card. There have been no accidents that have resulted 
in a significant release of nuclear materials.
    Mr. Norwood. In other words, I guess I hear you saying 
that, yes, you can blow up the train, and you can blow up the 
track, and the train may turn over, but that doesn't 
necessarily mean there is going to be a release of nuclear 
material?
    Mr. Card. The cask testing is rigorous. They are dropped 
from a considerable height. They are ignited in 1,450 degrees 
for 30 minutes, and they still have to be leak proof after 
that.
    So I want to clarify one of the previous witnesses, who 
said that our EIS said there would be 300 accidents. Those are 
not nuclear accidents. Those are normal highway accidents, and 
our experience is that they are mostly caused by other drivers 
running into our equipment.
    Those are of course--it may be less with the rail option 
that we selected as our preferred method.
    Mr. Norwood. And I understood that to be what that study 
meant. I was amazed that the witness did not point out the rest 
of it. Yes, we are going to have some accidents, but that is 
different from releasing nuclear material.
    One last question, Mr. Chairman. MOX fuel, are you 
familiar--I know that you are familiar with that. Where are we 
with that, and as soon as we get ourselves into position to 
produce MOX fuel, such as France and Britain here today, how 
does that change--and I am not sure that I know the right 
words. Should I say tons of volume, but the tons of nuclear 
waste that would be stored at Yucca Mountain?
    Mr. Card. Well, I will first go in reverse order, and Dr. 
Chu, if you have any other comment, hop in, but I don't believe 
it changes it at all because you still have the same reactor 
loading essentially with the MOX fuel as you would without it.
    Ms. Chu. I agree.
    Mr. Card. So it just displaces uranium. In terms of the 
overall--I assume your first question was on the overall 
program.
    Mr. Norwood. Well, let me interrupt, please, because I 
don't understand that. If we reduce nuclear waste in converting 
to MOX fuel, there has got to be a smaller amount of nuclear 
waste when you finish reducing it into additional fuel that we 
burn up.
    Mr. Card. I'm sorry, I was referring--I thought you were 
referring to only the power side of that equation. It will 
substantially reduce the defense waste component to Yucca 
Mountain.
    Mr. Norwood. So as opposed to some of the testimony that we 
heard earlier, yes, this has been in the planning stages and 
operational stages way too long in my opinion, but we have been 
looking at ways to reduce--is it volume or tons should I say?
    Mr. Card. Well, both.
    Mr. Norwood. Well, reduce the volume that we are going to 
send out to Yucca Mountain. So it is not like all of this was 
just thought up 20 years ago, and nothing has been done in the 
interim. There has been many steps taken in the interim I think 
to make this a more palatable decision.
    Now, having said that, I think Mr. Gibbons won't feel 
comfortable with this discussion until we are able to say to 
him at what point in time will we begin to be able to reduce 
the volume by building a MOX fuel plant. Where are we with 
that?
    Mr. Card. In terms of a MOX plant construction, which I 
assume you are asking.
    Mr. Norwood. I am.
    Mr. Card. We are all ready to go on our side of the ocean 
on that, but what we are waiting for right now is for the 
Russian component to catch up with us. So we just announced 
about a 1-year delay in the program, hoping that we are able to 
resolve some liability issues for the contractors that would be 
working from the U.S. in Russia.
    And we are optimistic that may be resolved, but we have had 
a commitment all along that we will go as fast as we can with 
that project, but no faster than the Russian side.
    Mr. Norwood. Can I be comfortable in thinking that we are 
going to get there. It is just taking as usual a little longer 
than we would like?
    Mr. Card. We are committed.
    Mr. Norwood. Mr. Chairman, just an observation. Earlier 
witnesses were talking about lying down in front of train 
tracks so we can't send nuclear waste out to Yucca Mountain. 
And I can't wait to get to the floor to tell my good friend, 
Jim Gibbons, who is my good friend, that the last fellow that 
did that, threatened to lie down in the road in South Carolina 
to move nuclear waste, was soundly defeated for Governor the 
next time he ran.
    And I don't want Jim to get defeated for lying down in the 
road somewhere, and so that is not necessarily a good plan. 
Thank you, Mr. Chairman.
    Mr. Hall. We don't want Jim to expire, but your time has 
expired. The Chair has time to recognize Mr. Shimkus, and then 
we will have a series of several roll call votes, but we will 
excuse this panel if that is agreeable. The Chair recognizes 
Mr. Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman, and some of these 
questions can be answered probably pretty quick. Do you agree 
that confidence in the Department's ability to meet program 
goals could be improved if funding were predictable and 
enhanced?
    Mr. Card. No question.
    Mr. Shimkus. What are you doing to ensure that the 
repository will be able to receive waste by 2010?
    Mr. Card. Well, we are engaged in the first critical step, 
which is getting a license application submitted in December. 
That license application actually contains a substantial start 
on the concept thinking for the design of the repository. We 
have----
    Mr. Shimkus. And funding is important?
    Mr. Card. Funding is critical.
    Mr. Shimkus. If we are going to meet the 2010, we really 
need to get a consistent, reliable, funding stream for this; is 
that appropriate?
    Mr. Card. That's correct.
    Mr. Shimkus. Can you briefly--and we do want to make sure 
that we get our Chairman over in time to cast votes and myself, 
but can you give me an example of something that has been 
delayed because of the funding problem?
    Mr. Card. Well, transportation, which has been talked about 
here as an example, we are almost 2 years late on our start on 
transportation, because we have made it clear that we have to 
fund the license application first.
    So unfortunately some of the things that are most important 
to our stakeholders, which are advanced science and 
transportation have not been funded over the last 2 years 
because of the funding shortfall.
    Mr. Shimkus. Well, my good friend, Mr. Markey, and I hate 
to talk about him when he is not in the room, but if you are so 
concerned about transportation, he would be very supportive of 
my piece of legislation.
    He would want more funding if you wanted transportation. I 
will remind him of that on the floor when I get a chance. I 
will yield back.
    Mr. Hall. All right. We have got about 8 minutes left. Mr. 
Otter, would you like to be recognized? The Chair recognizes 
Mr. Otter.
    Mr. Otter. Thank you, Mr. Chairman. My question is going to 
go primarily to--I heard in your earlier testimony, Mr. Card, 
that you are very supportive of both of the bills that we have 
under consideration.
    And obviously one of the reasons that we have these under 
consideration is so that there is some continuity to the 
financing of our nuclear waste problem. Does that also include 
research and development?
    Mr. Card. Well, research and development is within the 
budget, and to the extent that we have the funding that we 
asked for, we have a commitment for an ongoing science program 
at Yucca Mountain, and also to deal with the technologies for 
transportation of any nuclear waste.
    So we fund our commitments to the NRC and the license 
application first, and then we fund those other things to the 
extent that we get the full President's request.
    Mr. Otter. Well, what I wanted to get to, Mr. Card, was the 
importance of the continuity of funding, and how important that 
is to sustain a program, and to get the kind of people into 
those programs that are going to be able to make the 
contributions, and get the expertise that you need.
    If we have to come back and have these silly little fights 
every year in order to have a program that is as serious as 
what some would suggest here, and I believe that it is, that 
this is serious stuff, that obviously it needs to have some 
sort of funding stream that can be counted on so that once 
again you can get the kind of expertise.
    What I noticed was that there is a proposal in the 
administration budget to request moving the spent fuel from the 
Environmental Management Program to the Radioactive Waste 
Program.
    And the reason that I want you to talk a little about that 
is because it appears to me in the review of that that the 
funding is only for 1 year, and that is 2005. So I agree with 
you; funding is important for the development of the repository 
for this stuff.
    But it is also important, as I think you learned yesterday 
in the Subcommittee on Appropriations on Energy and Water, that 
if we don't have ongoing research and development on 
reprocessing and that sort of thing, that we have got to get to 
work on another Yucca Mountain, because we are going to be 
producing the kind of waste that is going to fill that up 
pretty fast if we don't have ongoing funding.
    So my question is how do you--there is a question in here, 
and be patient with me. And that question is I agree with you 
that continuity in a program is important for the success of 
the program to attract the kind of talent that we need.
    If it is so important in establishing the waste program, 
why isn't it equally as important, and then why is that not 
reflected in the administration's policy on funding the lab, 
and on funding the reprocessing potential for R&D?
    Mr. Card. Yes, I can respond to that. First of all, let me 
just be clear. When we transferred the budget for fiscal year 
2005 into Dr. Chu's operations for the Idaho spent fuel, we 
also were transferring all the out-year targets as well.
    Plus, the restrictions that are in place with the Nuclear 
Waste Policy Act would prohibit us from trying to fund the 
Idaho work through the funds that we are talking about today. I 
think that your question points directly at the 
administration's proposal for the advanced fuel cycle work for 
this year, both for fiscal year 2005.
    Frankly that came down to two issues. One is that one of 
the processes that we are interested in, we concluded was not 
as desirable as we thought, and so there is some retooling 
going on.
    Second, in looking at funding for critical needs for the 
transition at the Idaho lab and other budget issues, we 
concluded that for the overall thrust of what we needed to get 
done in the nuclear area that that was somewhat less important 
than others.
    And you will notice that we did bump up the generation for 
reactor, which we felt was a more right-now substantive project 
that deserved more priority in a constrained environment.
    Mr. Otter. Okay. I would just use the balance of my time to 
reflect that I think--and I am a supporter of ongoing funding 
so that there is some certainly, because I can see what happens 
to industry whether if in the future.
    And I look at the University of Idaho today, which I think 
has some tremendous opportunities, yet not one person goes into 
mining in Idaho because we can't mine our lands in Idaho. Not 
one person goes into forestry anymore in Idaho, where we have 
the preeminent university having to do with silver cultural and 
force management, because there is no future in it.
    If you are not going to cut a log, there is no sense in 
studying it. With that, thank you, Mr. Chairman, I yield back.
    Mr. Hall. Mr. Otter yields back his time, and at this time 
we thank you, Dr. Chu, and thank you, Bob Card, for a job well 
done. You are excused. We will recess for a vote on the floor. 
We will resume this hearing at 11:45.
    [Brief recess.]
    Mr. Hall. We are convened. The Chair is pleased to announce 
the third panel, the Honorable Nils J. Diaz, who is the Acting 
Chairman, U.S. Nuclear Regulatory Commission; and Dr. David 
Duquette, who is a U.S. Nuclear Waste Technical Review Board 
Member.
    We are honored to have both of you, and at this time, we 
recognize you, Mr. Chairman, for 5 minutes, or for as long as 
it takes for you to make your presentation.

    STATEMENTS OF HON. NILS J. DIAZ, CHAIRMAN, U.S. NUCLEAR 
  REGULATORY COMMISSION; AND DAVID J. DUQUETTE, U.S. NUCLEAR 
                  WASTE TECHNICAL REVIEW BOARD

    Mr. Diaz. Thank you, Mr. Chairman, and members of the 
subcommittee. On behalf of the United States Nuclear Regulatory 
Commission, I am very pleased to join you today to discuss the 
NRC's regulatory oversight in the national program for 
management and disposal of high-level radioactive waste and 
spent nuclear fuel.
    I have submitted a full statement for the record, and 
respectfully request that it be included in the record. The 
Commission continues to believe that the long-term success of 
the national program to secure spent nuclear fuel and other 
high level radioactive waste requires a permanent disposal 
solution, and that a geologic repository can provide an 
appropriate need for the United States to secure these wastes 
in a safe manner.
    We also believe that public health and safety, the 
environment, and the common defense and security can be 
protected by deep underground permanent disposal of these 
wastes.
    However, the Commission takes no position at this time on 
whether the construction of a repository at Yucca Mountain, 
Nevada, should be authorized.
    Our views on that question will be shaped by the results of 
the Congressionally mandated licensing process. I can assure 
you that the NRC licensing process is based on sound technical 
evaluations and due legal process.
    I would emphasize that the use of wet and dry storage 
technologies for spent fuel continues to be safe, and its use 
will continue to provide adequate assurance of public health 
and safety until such time that the permanent disposal solution 
is available.
    The Department of Energy has stated that it intends to 
submit a repository license application to the NRC in December 
of this year. Several important steps must occur before the 
Commission can decide whether to authorize the construction of 
a repository at Yucca Mountain.
    First and foremost the DOE application must be complete and 
of high quality. Second, the NRC will determine to what extent 
it can adopt DOE's environmental impact statement.
    Third, if the NRC determines that the application is 
acceptable for further review, the NRC staff will conduct a 
detailed safety review, and issue a publicly available safety 
evaluation report with its review findings.
    And, fourth, the NRC must conduct a full and fair public 
hearing on the application prior to reaching a decision on 
whether to authorize construction of the repository, which 
would be based on the information before us at that time.
    For the present, we are preparing for the potential 
transition from the pre-licensing role to the role of licensing 
authority to ensure that we are prepared to carry out our 
responsibilities should DOE submit their license application.
    In this regard, we issued final radiation standards 
specific to Yucca Mountain that are consistent with those of 
the Environmental Protection Agency. We developed licensing 
guidance for use by the staff in reviewing the application, and 
we continue our pre-license application interactions with the 
DOE on many program areas.
    We are developing the inspection and enforcement programs 
that would be in effect if the license application is accepted 
for review, and finally we have recently reorganized our staff 
to create a new organization dedicated solely to addressing the 
full scope of licensing activities associated with the review 
of a repository application.
    As the subcommittee knows, Federal regulation of spent fuel 
transportation safety is shared by the U.S. Department of 
Transportation and the NRC. DOT regulates the transport of all 
hazardous materials, including spent fuel and has established 
regulations for shippers and carriers.
    For a start, the NRC established design standards for the 
transportation casks, and reviews and certifies cask designs 
prior to their use. Further, cask design, fabrication, use, and 
maintenance activities must be conducted under an NRC approved 
quality assurance program.
    For spent fuel shipments the NRC also conducts an 
inspection and enforcement program and reviews and approves 
physical security plans. Also, the Nuclear Waste Policy Act 
requires DOE to utilize NRC-certified casks for spent fuel 
shipments to a repository.
    It requires them to follow the NRC's advanced notification 
requirements and to provide emergency response training along 
shipment routes. The NRC believes that the current 
transportation regulatory system provides safe protection to 
the public and is well established.
    Mr. Chairman, I believe this statement makes clear that we 
have executed our responsibilities under the Nuclear Waste 
Policy Act, and we take our continuing role very seriously. 
Thank you for the opportunity to testify today, and of course I 
will be pleased to take any questions.
    [The prepared statement of Nils J. Diaz follows:]

 Prepared Statement of Nils J. Diaz, Chairman, U.S. Nuclear Regulatory 
                               Commission

    Mr. Chairman, members of the Committee, I am pleased to join you to 
testify on behalf of the Nuclear Regulatory Commission (NRC) concerning 
the NRC's regulatory oversight role in the U.S. program for management 
and disposal of high-level radioactive waste and spent nuclear fuel.
    The Commission continues to believe that the long-term success of 
the national program to secure spent fuel and other high-level 
radioactive waste requires a permanent disposal solution, and that a 
geologic repository can provide the appropriate means for the United 
States to secure these wastes in a safe manner. We also believe that 
public health and safety, the environment, and the common defense and 
security can be protected by deep underground disposal of these wastes. 
However, the Commission takes no position at this time on whether 
construction of a repository at Yucca Mountain, Nevada, should be 
authorized. In the interim, the NRC considers the available 
technologies for wet and dry storage of spent fuel at reactor sites to 
be safe, and their use will continue to provide adequate assurance of 
public health and safety until such time that a permanent disposal 
solution is available. Both wet and dry storage provide adequate 
storage for decades but they are not suitable for disposal.
    The Nuclear Waste Policy Act of 1982 and the Energy Policy Act of 
1992 provide that the NRC is to serve as an independent regulator to 
ensure that any licensed geologic repository adequately protects the 
public health and safety, the environment and common defense and 
security. I am pleased to state that the NRC has consistently met its 
obligations established by these Acts. We are now in the midst of 
preparations for an important transition--from the pre-licensing role 
to the role of licensing authority.

                     THE PRESIDENT'S RECOMMENDATION

    As you know, in July 2002, Congress approved the President's site 
recommendation and the Department of Energy (DOE) was authorized to 
submit to the NRC a license application for a repository at Yucca 
Mountain, Nevada. When DOE does so, several important steps must be 
taken before the Commission can decide whether to authorize 
construction of a potential repository at Yucca Mountain. First, DOE 
must submit a complete, high-quality license application. Second, the 
NRC staff will determine to what extent, if any, it can adopt DOE's 
Environmental Impact Statement (EIS). To the extent the NRC cannot 
adopt the EIS, it would need to be supplemented. Third, NRC staff must 
conduct an independent safety review to determine whether or not the 
DOE proposal to design and construct a repository meets NRC's 
regulatory requirements. The results of this review will be documented 
in a safety evaluation report that would be made available to the 
public. Fourth, the NRC will conduct a full and fair public hearing 
prior to reaching a decision on whether to authorize construction of 
the repository. The Commission determination on whether the DOE license 
application meets regulatory requirements will be based on the entire 
record, including a review of the record of the issues contested in the 
NRC hearing process, as well as the uncontested issues pertaining to 
findings necessary to issue a construction authorization.
    The Nuclear Waste Policy Act gives NRC the responsibility to 
establish licensing criteria for a potential repository, to provide our 
preliminary views on the sufficiency of certain DOE information 
collected during site characterization, and to comment, along with 
other federal agencies, on the EIS prepared by DOE for Yucca Mountain. 
The Act also requires the Commission to be prepared to make a fair, 
informed, and timely licensing decision. The Commission takes these 
obligations seriously and I will discuss each of them in turn.

                        THE REGULATORY FRAMEWORK

    Under the Energy Policy Act of 1992, the Environmental Protection 
Agency (EPA) was directed to establish radiation dose-based 
environmental standards for Yucca Mountain. The NRC was directed to 
modify its technical requirements and criteria for the repository to be 
consistent with any final EPA standards issued. We have done that.
    EPA issued its final standards in June 2001. In November 2001, 
after carefully considering and analyzing the public comments received 
on our proposed criteria, the NRC promulgated final health and safety 
regulations that will guide our licensing decision on Yucca Mountain. 
As required by law, our regulations are consistent with the health and 
safety standards established by the EPA. We are confident that a 
repository at Yucca Mountain, that can be shown by DOE to comply with 
these demanding standards and regulations, will provide reasonable 
assurance that there is no unacceptable risk to the environment or 
health and safety of the public today and in the future.
    The EPA and NRC regulations are being challenged in the Federal 
courts. We expect a Court ruling later this year.

                     NRC PREPARATIONS FOR LICENSING

    As part of our overall pre-licensing strategy, we continue to hire 
staff with the knowledge, skills, and abilities needed to review a 
license application. We have also recently created a new organization 
dedicated solely to addressing the full scope of licensing activities 
associated with review of a DOE repository application. We have 
developed guidance to help focus the review on the issues most relevant 
to repository performance. Our staff has applied the experience gained 
in the reviews of DOE documents and pre-licensing interactions to the 
preparation of a Yucca Mountain Review Plan, which was published in 
final in July 2003. The Yucca Mountain Review Plan, which is available 
on our website, will guide the NRC's review of any DOE license 
application for the repository. Also, the staff is in the early stages 
of developing the inspection and enforcement programs that would be in 
effect if the license application is accepted for a detailed review.
    In addition, our Atomic Safety and Licensing Board Panel is 
actively engaged in developing the infrastructure, including automation 
tools, for addressing the repository licensing hearing schedule set out 
in the Nuclear Waste Policy Act. We have developed an Internetbased 
Licensing Support Network (LSN) to provide a document discovery 
database to make the hearing process more efficient. Currently, the LSN 
provides electronic access to over 15,000 documents out of the 
anticipated millions of such pages that are likely to comprise the 
document discovery database when such documents are made available to 
the LSN by the parties and potential parties to the licensing 
proceeding through the LSN. Further, working with the General Services 
Administration, NRC awarded a contract for a hearing room facility in 
the Las Vegas area that should be operational by May 2005, in time for 
the start of hearings.

                    DOE'S COLLECTION OF INFORMATION

    Over many years, NRC has performed reviews of DOE program documents 
and preapplication technical material and held extensive pre-licensing 
interactions with DOE staff and various stakeholders, including the 
State of Nevada, affected units of local government, Indian Tribes, 
representatives of the nuclear industry, and interested members of the 
public. The DOE and the NRC staff have reached and documented numerous 
agreements regarding additional information that will be needed for a 
licensing review. Approximately two-thirds of these agreements call for 
DOE to provide information that is sufficient for the staff to 
undertake a detailed technical review of the DOE application. The 
remainder oblige DOE to perform specific tests or analyses, to document 
prior tests or studies, or to provide other information. DOE continues 
to address these agreements and the NRC staff continues to review the 
results promptly and notify DOE of its findings. Addressing these 
agreements increases the likelihood that DOE can assemble the 
information necessary for an application that NRC can accept for 
review. Last May, the staff provided DOE information on how NRC staff 
ranked the agreements in accordance with their importance to repository 
safety. The staff continues to use similar information and insights to 
focus its technical review and licensing and inspection programs on 
those areas most important to repository safety. NRC has made, and will 
continue to make, information on its regulatory program publicly 
available, and expects to have continued dialogue with DOE and other 
stakeholders on these matters.
    It is important to note that the NRC staff is also focusing on the 
quality of DOE documentation that would support a license application 
for Yucca Mountain. Over the course of its pre-licensing interactions, 
the staff has had ongoing discussions with DOE on its implementation of 
a quality assurance program and the quality of the data, models and 
software that DOE will rely on to support a license application. In a 
May 29, 2003, letter to NRC, the DOE committed to ensure that 
improvement initiatives in its quality assurance program will be fully 
and effectively implemented. Quality management remains a challenging 
program area for DOE, one which the NRC staff continues to monitor.

                DOE'S FINAL ENVIRONMENT IMPACT STATEMENT

    As required by the Nuclear Waste Policy Act, Secretary Abraham 
included a final EIS with his recommendation to the President along 
with the comments other agencies including those of NRC provided on the 
final EIS. Our comments were developed on the basis of reviews of DOE's 
draft EIS for Yucca Mountain, the supplement to the draft EIS and the 
final EIS. Our reviews were informed by the NRC staff's extensive 
prelicensing interactions with DOE, the State of Nevada, affected units 
of local government, Indian Tribes, representatives of the nuclear 
industry, and interested members of the public. The analyses provided 
in the EIS appear to bound appropriately the range of environmental 
impacts. We expect that DOE's current efforts to refine the repository 
design and define transportation modes and routes will allow for more 
precise estimates of impacts. In this regard, DOE announced that if it 
selects a rail corridor, it will issue a Notice of Intent to initiate 
preparation of a rail alignment EIS. The outcome of such reviews will 
help inform an NRC determination regarding to what extent the EIS can 
be adopted, in connection with issuance of a construction authorization 
or license, as required by the Nuclear Waste Policy Act. NRC continues 
to interact with DOE and other interested stakeholders to consider and 
address outstanding technical and environmental issues, as needed.

            SAFETY AND SECURITY OF SPENT FUEL TRANSPORTATION

    The Commission believes that the spent fuel and high-level 
radioactive wastestored at multiple sites can be safely and securely 
transported to a single location for geologicdisposal.
    Responsibility for Federal regulation of spent fuel transportation 
safety is shared by the U.S. Department of Transportation (DOT) and the 
NRC. DOT regulates the transport of all hazardous materials, including 
spent fuel, and has established regulations for shippers and carriers 
regarding radiological controls, hazard communication, training, and 
other aspects. For its part, NRC establishes design standards for the 
casks used to transport licensed spent fuel, and reviews and certifies 
cask designs prior to their use. Further, cask design, fabrication, use 
and maintenance activities must be conducted under an NRC-approved 
quality assurance program. In addition, NRC periodically inspects cask 
vendors and has enforcement authority over such licensed activities.
    NRC does not have authority to regulate shipments made by DOE. For 
spent fuel shipments made by commercial shippers, over which NRC has 
regulatory authority, NRC reviews and approves physical security plans. 
These plans provide information on how shippers and carriers comply 
with NRC spent fuel shipment protection requirements, including advance 
notification of each shipment to the appropriate State Governor's 
designee, the establishment of redundant communication capability with 
the shipment vehicle, the arrangement of law enforcement contacts along 
the route, and provision of shipment escorts.
    The Nuclear Waste Policy Act requires DOE to utilize NRC-certified 
casks for spent fuel shipments to a repository, follow NRC's advance 
notification requirements, and provide emergency response training 
along shipment routes. NRC has reviewed and certified a number of 
package designs that could be used for transport of spent fuel to a 
repository, and is ready to review any new design that may be proposed 
by DOE.
    The NRC believes the safety measures provided by the current 
transportation regulatory system are well established. Nonetheless, we 
continue to examine the safety of the transportation program. In FY 
2000, NRC re-evaluated its generic assessment of spent fuel 
transportation risks to account for the fuel, cask, and shipment 
characteristics likely to be encountered in future repository shipping 
campaigns. The NRC also began development of the Package Performance 
Study to conduct confirmatory research to demonstrate the robustness of 
full-scale spent nuclear fuel transportation casks using an enhanced 
public participation process. The confirmatory research will involve 
testing the integrity of a full-scale transportation rail cask and 
validating the scaling methodology used in cask design and 
transportation risk assessment analyses. NRC is also supporting a study 
by the National Academies' Board on Radioactive Waste Management that 
is examining radioactive material transportation, with a primary focus 
on spent fuel transport safety. As a part of its evaluation, the NRC 
staff has analyzed appropriate national transportation accidents, such 
as the 2001 train tunnel fire in Baltimore, Maryland. For example, the 
staff analyzed a currently approved spent fuel transportation cask 
design, under thermal conditions similar to those experienced during 
the Baltimore tunnel fire, and concluded that there would be no release 
of radioactive material from such an event. Our reevaluation of generic 
assessments of spent fuel transportation risks, the significant history 
of safe shipments, the rigor of our pre-certification design reviews, 
and our inspections provide confidence that spent fuel can be shipped 
safely today and in the future. We are committed to continue to work 
with our stakeholders openly to increase public confidence in the NRC 
regulatory process. Finally, NRC is sponsoring a study to update its 
evaluation of cask response to acts of sabotage and will utilize the 
results of these studies as input to its overall assessment of the 
safety of cask design and transportation risks. Results to date show 
that a large commercial aircraft crashing into a transportation cask 
would not result in release of radioactive material.

                               CONCLUSION

    The Commission believes that deep geologic disposal is appropriate 
for high-level radioactive wastes and spent fuel and that such wastes 
can be safely and securely transported to a disposal location. However, 
the Commission takes no position at this time on whether construction 
of a repository at Yucca Mountain, Nevada, should be authorized. NRC's 
role is to ensure that a regulatory program is in place that adequately 
protects public health and safety, the environment and common defense 
and security, and to review and evaluate any license application 
submitted to determine compliance with regulatory requirements. As I 
believe this statement makes clear, we take that obligation very 
seriously and we are ready to fulfill our statutory role.
    I will be pleased to answer any questions you may have.

    Mr. Hall. Mr. Chairman, thank you very much.
    The Chair recognizes you, Dr. Duquette.

                 STATEMENT OF DAVID J. DUQUETTE

    Mr. Duquette. Thank you, Mr. Chairman. As you indicated, my 
name is David Duquette, and I chair the U.S. Nuclear Waste 
Technical Review Board Executive Committee. All members of the 
Board are appointed by the President, and serve on a part-time 
basis.
    In my own case, I am the department head and professor of 
materials science and engineering at Rensselaer Polytechnic 
Institute. I am pleased to be here today to present the Board's 
comments and with your permission, Mr. Chairman, I will make a 
very brief oral statement, and request that my full statement 
be included in the hearing record.
    Mr. Hall. Without objection.
    Mr. Duquette. As you know, Congress created the Board in 
the 1987 amendments to the Nuclear Waste Policy Act. The Board 
reviews the technical and scientific validity of the Department 
of Energy's activities related to the disposal, transportation, 
and packaging of commercial spent nuclear fuel and defense 
high-level nuclear waste.
    Since Congress approved the site recommendation for Yucca 
Mountain in 2002, the Board has continued its review of DOE 
technical and scientific efforts, with emphasis on DOE's plans 
for transporting waste and constructing and operating a 
repository.
    Today, I will not comment on one of the hearing topics, 
alterations in the Nuclear Waste Fund. That issue is outside 
our purview. I will comment on the other topic of the hearing, 
a review of the Yucca Mountain program. I will confine my short 
statement to three examples of scientific issues that the Board 
has addressed since we last testified before this subcommittee.
    Other examples of the Board's work during the last year or 
so are included in my written testimony and I will begin by 
discussing the engineered barriers of the repository. At Yucca 
Mountain, about 15,000 waste packages will be used to dispose 
of spent nuclear fuel and high-level radioactive waste.
    The waste packages are important elements of the engineered 
part of the repository system. Based on the Board's review of 
information presented in the last year by the DOE and the 
Nuclear Regulatory Commission's Center for Nuclear Waste 
Regulatory Analysis, the Board believes that all of the 
conditions necessary for localized corrosion of the waste 
packages will likely be present during the first several 
hundred years after repository closure.
    During that time waste package temperatures will be well 
above boiling in the DOE's current repository design. Once 
initiated, localized corrosion will likely propagate rapidly 
even at lower temperatures, resulting in a possible release of 
radionuclides.
    From a technical perspective in the Board's opinion the 
problems related to localized corrosion could be avoided if the 
DOE's current repository design and operation were modified to 
keep the waste package surface temperatures below boiling.
    Contrary to the Board's views, the DOE apparently believes 
that high-temperature conditions in its repository tunnels will 
not lead to significant corrosion. We will have a major meeting 
on this issue with the Department of Energy and other 
interested parties at an upcoming Board meeting on May 18 and 
19 here in Washington.
    We look forward to an open and thorough exchange of views 
at that meeting. The second issue that I would like to 
introduce involves the natural barriers of Yucca Mountain. 
Hydrogeological features potentially can act as natural 
barriers for the migration of radioactivity from a repository.
    At a Board panel meeting held just 2 weeks ago the 
Department of Energy presented a variety of data indicating 
that natural barriers at Yucca Mountain might isolate waste for 
several thousand years, possibly even longer for some 
radionuclides.
    The Board believes that the natural barriers are very 
important and that addressing uncertainties associated with 
specific aspects of the natural system can enhance confidence 
in predictions of the performance of geological barriers.
    Finally, I would like to comment briefly on transportation 
and other waste management activities. Over the last year the 
Department of Energy has expanded significantly its activities 
related to the transportation of radioactive waste and the 
design and operation of surface and underground facilities at 
the planned repository.
    Consequently, the Board's involvement in these important 
areas also has increased substantially. Several Board 
recommendations to the Department of Energy have evolved in the 
last year from Board meetings on transportation.
    For example, the Board believes that the Department of 
Energy should systematically analyze and schedule all 
transportation activities, should conduct an inventory of 
needed infrastructure, and definitely should consider security 
planning needs.
    Mr. Chairman, these are just a few examples of issues that 
have been the focus of the Board's work over the last 2 years. 
The Board will continue its technical and scientific review, 
and will make recommendations that it believes will improve the 
technical validity of the DOE's transportation and repository-
development activities. Thank you for this opportunity to 
present our views.
    [The prepared statement of David J. Duquette follows:]

 Prepared Statement of David J. Duquette, U.S. Nuclear Waste Technical

    Good morning, Mr. Chairman and members of the Subcommittee. I am 
David Duquette, and I chair the U.S. Nuclear Waste Technical Review 
Board's executive committee. All members of the Board are appointed by 
the President and serve on a part-time basis. I am Department Head and 
Professor of Materials Science and Engineering at Rensselaer 
Polytechnic Institute.
    I am pleased to be here today to present the Board's comments on 
technical and scientific issues that continue to be of interest related 
to the proposed repository for spent nuclear fuel and high-level 
radioactive waste at Yucca Mountain in Nevada. We hope that the 
Subcommittee will find the Board's testimony useful in its oversight of 
activities related to a Yucca Mountain repository. With your 
permission, Mr. Chairman, I will make a brief oral statement, and I 
request that my full statement be included in the hearing record.

Background
    As you may know, Mr. Chairman, Congress created the Board in the 
1987 amendments to the Nuclear Waste Policy Act. Congress charged the 
Board with performing an ongoing independent evaluation of the 
technical and scientific validity of activities undertaken by the 
Secretary of Energy related to implementing the Nuclear Waste Policy 
Act. The Board reviews Department of Energy (DOE) activities related to 
the disposal, transportation, and packaging of spent nuclear fuel and 
high-level radioactive waste. Most of the spent nuclear fuel comes from 
the commercial generation of electricity, but some comes from defense 
activities. Virtually all of the high-level radioactive waste comes 
from defense activities.
    Since the Board was established, its primary focus has been 
evaluating the DOE's efforts to characterize the Yucca Mountain site in 
Nevada to determine its suitability as the location of a potential 
repository for spent nuclear fuel and high-level radioactive waste. 
Since the site recommendation was approved by Congress in 2002, the 
Board has continued its review of the validity of the DOE's technical 
and scientific efforts and has increased its involvement in the 
important area of waste management, including transportation and 
packaging of the waste and plans for constructing and operating a 
repository. To gather information for its evaluation, the Board and its 
panels hold public meetings several times a year with the DOE and other 
interested parties.

Overview of Technical Issues
    One of the two topics for today's hearing is a review of the DOE's 
Yucca Mountain program. And so today, Mr. Chairman, I will present a 
brief overview of some of the important technical and scientific issues 
that the Board has commented on in reports to Congress and the 
Secretary and in letters to the DOE in the nearly two years since we 
last testified before this Subcommittee. I will not comment on the 
second topic of this hearing relating to alterations in the Nuclear 
Waste Fund. That issue is outside the Board's technical purview.
    In conducting its technical and scientific evaluation, the Board 
makes an effort to take an integrated look at how one part of the 
proposed repository system might affect another. The two major 
components of the repository subsurface system are the engineered 
system and the natural system. We have taken a similar approach in 
reviewing waste management activities, considering, for example, how 
the type of transportation packages selected by the DOE might affect 
the design of the repository surface facilities.
    The following are a few examples of some of the important technical 
issues that the Board has commented on in the last year. To make the 
technical issues more relevant and understandable, I have organized 
them so that they roughly align with elements of the systems that I 
just described. I will begin with examples of Board comments on the 
engineered elements of the repository system.

The Engineered System
    An important engineered component of the repository system is the 
waste package that will be used to dispose of spent nuclear fuel and 
high-level radioactive waste in a repository. As part of its technical 
review, at a meeting held last May, the Board invited the DOE to 
discuss how the repository tunnels would work with the waste packages 
to provide waste isolation. Based on information from that meeting, the 
Board sent a letter to the DOE last October, followed by a detailed 
technical report in November on the potential for corrosion of the 
waste packages during the period called the ``thermal pulse.'' These 
two documents composed a Board letter to Congress and the Secretary 
that was issued in December, and they, like all Board letters and 
reports, are available on the Board's Web site: www.nwtrb.gov.
    The thermal pulse is the period of roughly 1,000 years following 
repository closure during which temperatures will be high in repository 
tunnels. The Board has voiced concerns about the effects of high 
temperatures on repository performance almost continuously since the 
Board was established about 15 years ago.
    The main focus of the Board's October letter and November technical 
report was the potential of salts deposited on the waste packages to 
absorb moisture from the air inside repository tunnels, resulting in 
corrosion of the metal packages. I will briefly summarize the major 
points in the Board's letter and technical report.
    Based on the Board's review of data gathered and presented by the 
DOE and the Nuclear Regulatory Commission's Center for Nuclear Waste 
Regulatory Analyses, the Board believes that all the conditions 
necessary to initiate localized corrosion of the waste packages will 
likely be present during the thermal pulse, resulting in corrosion of 
the waste packages. Once started, the corrosion would likely propagate 
rapidly even after conditions necessary for initiation are no longer 
present. The result would be perforation caused by localized corrosion 
and possible release of radionuclides.
    From a technical perspective, in the Board's opinion, the problems 
related to localized corrosion that I have just described could be 
avoided if the repository design and operation were modified. The data 
currently available indicate that perforation of the waste packages 
caused by localized corrosion is unlikely if temperatures are kept 
below boiling.
    The DOE does not believe that conditions in repository tunnels will 
promote significant corrosion. The DOE also maintains that the 
conditions under which localized corrosion might occur are extreme and 
unlikely. The Board has looked at the information provided by the DOE 
supporting these assertions and has not found it compelling. However, 
we are devoting most of the time at our upcoming public meeting, to be 
held May 18-19 in Washington, D.C., to further discussion of these 
issues. We have offered broad latitude to the DOE to present additional 
data, analyses, and arguments related to localized corrosion and 
estimates of conditions in the repository tunnels. The Board is looking 
forward to an open and thorough exchange of information and views on 
these subjects.

The Natural System
    The Board has long had an active interest in the fundamental 
understanding of the geologic systems that act as natural barriers to 
radioactivity migrating from a repository. The Board uses a combination 
of field excursions, laboratory visits, information-gathering, and 
formal meetings to conduct its evaluation of DOE activities in this 
area. Over the years, the Board has made numerous recommendations 
related to increasing fundamental understanding of and enhancing 
confidence in predictions of natural-barrier performance. Technical and 
scientific topics covered by those recommendations include hydraulic 
characteristics of major faults, colloid-facilitated transport of 
radionuclides, matrix diffusion, the nature and spatial extent of 
alluvial sediments, the scientific bases of computer models, and the 
use of natural analogs.
    The Board continues to review DOE activities in this area. For 
example, at a Board panel meeting held two weeks ago, the DOE presented 
a variety of observations and experiments suggesting that natural 
barriers might provide waste isolation for time periods as long as the 
regulatory period and possibly longer for some radionuclides. The Board 
has not yet formally commented to the DOE on the information presented 
at the meeting, but we believe that geologic barriers are very 
important. Addressing uncertainties associated with specific aspects of 
the natural system can enhance confidence in predictions of natural-
barrier performance.
    The movement of water through the Yucca Mountain site is one of the 
most important factors affecting waste isolation. Several years ago, 
studies on chlorine-36 traces found at places in the exploratory 
studies facility seemed to imply the existence of ``fast paths'' where 
water might have moved from the surface to the level of the repository 
in about 50 years(a very short time. However, studies conducted since 
then have both supported and contradicted the first results. Because 
this issue is important to fundamental understanding and to the 
credibility of the DOE's scientific program, the Board has encouraged 
the DOE to reconcile the various study results. The DOE has 
commissioned a third-party review to help address the discrepancies. 
The Board agrees with this decision.
    Another issue related to the natural system that the Board has 
commented on recently is the DOE's earthquake hazard analysis. Based on 
presentations made at a February 2003 Board panel meeting, the Board 
found that the DOE's analysis is generally sound. However, extending 
the analysis to exceedingly unlikely and, quite possibly, physically 
unrealistic seismic events raises serious questions related to 
understanding how the repository system will behave and what factors 
are important to safety. Among other things, it also could cast 
unwarranted doubt on much of the excellent work carried out by 
scientists working for the DOE in this area. In June 2003, the Board 
sent a letter to the DOE with details of its findings and 
recommendations. The DOE is continuing its efforts to address these 
issues. The Board will review and comment on the results of the DOE's 
work.

The Waste Management System
    Over the last year, DOE activities related to transportation of 
spent nuclear fuel, design of surface facilities, and its plans for 
surface and underground repository operations have expanded 
conspicuously. During that time, the Board's involvement in these 
important areas has increased commensurately. The Board's Panel on the 
Waste Management System has held two meetings in the last 12 months, 
and the plan is to hold more in the future.
    Several Board recommendations to the DOE have come out of those 
sessions. For example, the Board recommended that the DOE develop and 
produce a Gantt chart (or its equivalent) showing the schedule for 
transportation planning activities; conduct a complete and accurate 
inventory of needed rail, truck, and barge access and egress 
infrastructure and site interfaces; review its waste inventory and 
acceptance assumptions; and explicitly consider security planning 
needs. We expect that over the next few years, the Board will become 
even more fully engaged in reviewing the activities of the DOE in this 
critically important area.

Safety Case and Performance Confirmation
    Over the years, the Board consistently has pointed out the 
importance of the concept of a ``safety case'' in developing an 
integrated presentation of the various elements of a Yucca Mountain 
repository and how those elements would work together to contribute to 
waste isolation. The safety case would include information and 
arguments independent of performance assessment modeling, such as 
analog studies, which would provide additional lines of evidence for 
repository performance estimates. This concept is endorsed strongly by 
virtually all the major nuclear waste management programs abroad and 
has considerable merit. The Board believes that a narrative description 
specifically written to address this concept would make the DOE's 
approach to ensuring safety more transparent and understandable.
    Another concept with significant potential for enhancing confidence 
in the DOE's repository performance estimates is a credible performance 
confirmation program. The Board has encouraged the DOE to develop a 
clear understanding of what performance confirmation will entail and to 
integrate its performance confirmation activities thoroughly with 
performance assessment and repository design.
    Mr. Chairman, these are just a few examples of technical and 
scientific issues that have been the focus of the Board's work over the 
last year or so. The Board looks forward to continuing its review and 
to making recommendations to the DOE on the technical validity of DOE 
activities.
    An equally important part of the Board's mandate is advising 
Congress on technical and scientific issues related to the DOE's 
implementation of the Nuclear Waste Policy Act. We take that 
responsibility very seriously. The Board stands ready to provide its 
technical perspective whenever appropriate so that policy-makers and 
members of Congress engaged in oversight can factor technical 
information into their decision-making.
    Thank you for the opportunity to present the Board's views. I will 
be happy to respond to questions from the Subcommittee.

    Mr. Hall. Dr. Duquette, thank you. We know that the DOE is 
going to submit its license application to the NRC later this 
year, and that the application and all of its documents are 
going to be voluminous. They are going to contain probably 
millions of pages of material that could maybe even fill half 
of this room here.
    Will the NRC have enough technical staff with the 
knowledge, and with the skills, and the abilities, to review 
this application in a fair, and informed, and in a timely 
manner?
    Mr. Diaz. Yes, sir. We are prepared to have the resources 
needed, and the staff, who will be properly qualified to be 
able to judge the application on its technical merits. We also 
have been preparing for the electronic handling of this 
documentation to our system, which is called the Licensing 
Support Network.
    As well as preparing an electronic docketing system that 
will assist all the parties to have access to all the 
information as the hearing process begins.
    Mr. Hall. And you all have been here, I think, in 
attendance this morning have you not, and have heard a lot of 
the testimony. You heard the testimony about the risk of 
transporting any spent fuel in trucks, or by rail, and then of 
course by barge was pitched in.
    And, for example, if a September 11 airplane crash 
happened, for example, into a transportation cask that it would 
be devastating. Have you reviewed--I understand that it would 
be devastating, but have you reviewed the possibility of a 
plane crashing into a transportation cask, and if so, what have 
you found?
    Mr. Diaz. Yes, sir, we have. We have just completed those 
studies recently and our present findings are that a 
transportation cask has been certified by the NRC and those 
that will be certified would actually resist the impact of a 
large aircraft without releasing radioactivity to the public.
    Now, I cannot go into any further details, but the findings 
are a result of a significant series of work that has been 
conducted for the past several years. We have even carried them 
beyond the aircraft crashes, and we feel confident that the 
present design of this cask is quite resistant to terrorist 
attacks.
    And they will provide substantial protection to the 
American public from the type of attacks that have been 
considered.
    Mr. Hall. So crashes are really an almost remarkable 
stretch of the imagination isn't it, that it could ever happen?
    Mr. Diaz. It is a low probability scenario. However, we 
thought that it was our obligation to conduct those studies. 
Those studies are complete and they are classified studies.
    Of course, the committee will make available these studies 
in the proper venue and at the proper time as the Chairman 
decides.
    Mr. Hall. And they talked about the train tunnel fire in 
Baltimore in 2001 and they talked about--of course, they are 
looking for anything to tie and cast some doubt on the success 
of the operation.
    Such an accident there would be disastrous. Well, any kind 
of accident like that would be disastrous, but what is the true 
effect and has the NRC reviewed the Baltimore train fire 
incident, and would it have resulted in the release of 
radioactivity if it had happened, and it had been hit as was 
the tunnel fire ignited in Baltimore?
    Mr. Diaz. No, sir, our studies indicate that it would not 
have resulted in a significant release of radioactivity. It 
would have been able to withstand the fire and the cask would 
not have been breached. So there would be no impact to public 
health and safety.
    Mr. Hall. So remote that it might happen, but in abundance 
of caution, you have got to defend your position and spend time 
and money, and that is what runs these costs up, are frivolous 
accusations like that, that are costly to the American 
taxpayer.
    But you have gone that extra step and in an abundance of 
caution on both of these, you have explored that?
    Mr. Diaz. We have, sir.
    Mr. Hall. All right. I yield back my time and recognize the 
ranking member, Mr. Boucher.
    Mr. Boucher. Well, thank you, Mr. Chairman. Chairman Diaz, 
when the license application for Yucca Mountain was filed with 
your agency, can you give us a sense of the timeframe that you 
are contemplating will be occupied for its consideration? How 
quickly do you think your agency will be able to act?
    Mr. Diaz. We will be ready when it is delivered. We stand 
ready to fulfill our responsibilities as established by the 
Act. We will be able to, within 90 days, determine whether the 
application meets the requirements, and that it should be of 
high quality to provide the information that needs to be on the 
record to proceed with further consideration of the 
application.
    And if it fulfills those requirements, we should be able to 
proceed with the consideration of the application in the 
timeframe that the Congress has determined that we have to.
    Mr. Boucher. And what timeframe is that?
    Mr. Diaz. It is 3 years for full consideration, and with 
hearings it could be extended an extra 12 months if the time is 
needed.
    Mr. Boucher. And you can meet that timeframe, you are 
confident?
    Mr. Diaz. Sir, we are making sure that we will be prepared 
to meet that framework. I cannot guarantee you that we will, 
because it depends on--and I am sorry to insist on this--a very 
high quality application, and on the number of potential 
changes, and a series of processes.
    But the Nuclear Regulatory Commission is ready to process 
it and to do it in a timely manner as established by Congress.
    Mr. Boucher. In the event that your agency finds that for 
some reason the application is not adequate and that additional 
information would have to be provided, and you have issues with 
the application, do you have any kind of process under which 
you could issue a permit subject to the applicant fulfilling 
certain specified conditions?
    Mr. Diaz. No, sir.
    Mr. Boucher. You do not have any process where that can be 
done?
    Mr. Diaz. No, sir. If the application does not meet the 
requirements, our processes will say you need to give us more 
information. You need to provide additional information, and if 
it does not meet what we consider our standards for submittal 
of an application, they will actually have to put additional 
work into it.
    It might not have a tremendous impact on the time line of 3 
or 3\1/2\ years if the Department of Energy is capable of 
fulfilling our requests in a timely manner. So a period of a 
few months might not be a show-stopper, but certainly we are 
encouraging the Department of Energy to make sure that the 
application is as complete and of high quality as possible.
    Mr. Boucher. Well, thank you very much, Chairman Diaz. Dr. 
Duquette, there will be testimony on the panel that will follow 
you to the effect that some of the funding restrictions that 
were evident in the year 2003 for the Department of Energy may 
already have interfered with the Department's ability to move 
forward effectively with regard to planning for the 
transportation of high level nuclear waste.
    I think Commissioner Ervin will be testifying to that 
effect. Does your board share any of those concerns? Do you 
believe that DOE's work, in terms of planning for 
transportation, has been impaired by virtue of the funding 
restrictions that have been demonstrated to date?
    Mr. Duquette. Sir, the Board does not get involved with the 
funding aspects at all, and we have only begun to explore the 
transportation issues. In fact, our first panel meeting on 
transportation was only this last January.
    So it is a great deal of interest to us, of course, but we 
can't respond I don't think to whether or not the Department of 
Energy has been slowed down because of funding restrictions. 
Again, I will repeat that funding is outside of our purview, 
but transportation is certainly of a great deal of interest to 
us, and we are beginning to study it at the present time.
    Mr. Boucher. All right. Well, even though funding is 
outside your purview, the transportation activities are within 
your purview, and presumably you are surveying what the 
Department of Energy is doing at this point, in terms of its 
planning for transportation.
    So I would simply put the question again. Do you have any 
evidence or belief that the fact that funding has not flowed as 
effectively as it should has in some way hindered the 
Department's ability to move forward as expeditiously as it 
could have and should have with regard to planning for 
transportation?
    Mr. Duquette. No, we have no evidence of that.
    Mr. Boucher. You have no information to that effect?
    Mr. Duquette. No, we do not.
    Mr. Boucher. Thank you very much. Thank you, Mr. Chairman.
    Mr. Otter [presiding]. I am going to recognize myself now. 
I just took over as chairman as you might noticed. Mr. Hall, 
Chairman Hall, had to go out for a short period of time. Mr. 
Duquette, the Nuclear Waste Technological Review Board has 
several concerns with the DOE's repository design, and 
concerning primarily I guess with the amount of heat and high 
temperatures that would be present, and those aspects of the 
repository itself.
    Does your organization believe that the repository design 
will fail to meet the EPA ground water standards for Yucca 
Mountain?
    Mr. Duquette. I have to say that the models that have been 
presented for the transport of radionuclides out of the 
repository are fairly complex. They are based on very complex 
models. I don't think that we have enough information yet to 
know whether it will meet the requirements or not.
    Our concern, our immediate concern about the temperature in 
the repository is that information presented to us by the 
Department of Energy based on their own data indicate that 
there is an almost 100 percent probability of the breaching of 
the containers because of corrosion processes that can occur in 
the repository.
    I don't think the Board wants to go on record to say that 
that will necessarily release radionuclides to the environment. 
It basically simply says that they will be released from the 
container.
    Because of the concept of the repository, we believe that 
based on multiple barriers, and we are concerned about 
breaching one of the barriers, and releasing any radionuclides 
at all, it is our belief that if the temperatures could be 
lowered in the repository that the corrosion problem would 
essentially go away, and that the containers would not be 
breached.
    And so there would not be any release at that level in the 
repository.
    Mr. Otter. Will the NRC adequately evaluate your technical 
concerns in the licensing process?
    Mr. Duquette. We are not directly involved in the licensing 
process. Our mandate from you, the Congress, is that we should 
review the information presented by the Department of Energy 
and simply comment on their scientific and technical viability.
    The decision to go ahead with licensing is going to be made 
by policymakers, hopefully based on some of the information 
that we present to you and other policymakers. But we are not 
going to take a position as far as I can tell on licensing.
    Mr. Otter. Well, we are not going to sit here in a vacuum. 
We are certainly going to take any advice and input that you 
would have relative to the safety, and relative to the success 
of the designed mission.
    So you are still going to have an opportunity, just as you 
do today, to give input to the policymakers, and so I guess I 
would restate the question. If you are going to guess that 
there is something wrong with the technical concerns that you 
may have, would you not then opine to this committee, and opine 
to others here on The Hill that perhaps it is not a good idea 
to license it?
    Mr. Duquette. Absolutely.
    Mr. Otter. And you are prepared to do that?
    Mr. Duquette. We are prepared to do that if asked. And new 
information that we provide, by the way, is provided to you in 
annual reports, as well as letter reports that we send to you.
    It is posted on our web for anyone who needs access to it 
to use. I think we will respond to whatever the Congress asks 
us to do.
    Mr. Otter. Chairman Diaz, you are probably aware of this, 
but there is significant disagreement between yourself and Mr. 
Duquette's organization, and the Department of Energy, 
regarding the technical approach to Yucca Mountain.
    The Board believes that the Department's high temperature 
as we just discussed, the high temperature designed from Yucca 
will result in corrosion of the waste packages and potential 
release of radioactivity.
    Will the NRC fully and openly explore the concerns 
expressed by the NWTRB when it reviews the Department's license 
application for Yucca Mountain?
    Mr. Diaz. Yes, sir. We are addressing those issues. Our 
staff is continues to interact with the Board, as well as the 
different parties, and the Department of Energy, and continues 
to interact in many different ways with the State of Nevada.
    We are looking at how to best address these issues. Of 
course, they we will have to eventually be resolved during the 
licensing process. We do have some disagreements, but not in 
every aspect, but we do have some disagreements in the 
corrosion area.
    Our staff continues to interact and we hope that as time 
gets closer that we will get some convergence on those issues. 
What the rest of the issues will be, I can't tell you at the 
present time, but we certainly will keep the committee 
appraised of our evaluations.
    Mr. Otter. What are your disagreements then with Mr. 
Duquette's organization and opinion of the corrosion effects 
from the high temperatures?
    Mr. Diaz. Right, there are disagreements in the corrosion 
rate. There is no doubt that if you put it at a function of 
time with any type of package, and you could have a very long 
time, a hundred-thousand, or thousands of years, that packages 
will corrode.
    How they will corrode and the time for the corrosion to 
actually impact the release of radioactive materials, and then 
the transportation of those radionuclides through the 
environment to wherever they are placed, and we are taking no 
position on where they are placed, are very complex issues.
    But we do seem to have a technical disagreement. The staff 
is interacting with the Board, and I do think that we have 
resolved those disagreements, but we will continue to work with 
them and trying to resolve them.
    Mr. Otter. The gentleman's time has expired. The chairman 
would recognize the gentleman from Illinois, Mr. Shimkus. The 
chair stands corrected. The chair will recognize Mr. Markey 
from Massachusetts.
    Mr. Markey. I thank the chairman very much. We have seen 
recently tragically in Spain a rail system that is vulnerable 
to terrorist attack, and we have seen even more recently that 
in France a bomb was buried under rail tracks and a terrorist 
group has said that there are nine bombs that have been buried 
somewhere on the rail system, and they would blow them up 
unless they received money.
    When do you plan, Mr. Chairman, on doing a rulemaking on 
the threat of terrorism to and sabotage of high level waste 
transport by rail?
    Mr. Diaz. I don't know when we are going to do a rulemaking 
on that issue, but what we have done is that we have conducted 
a study.
    Mr. Markey. I know, but when are you going to do a public 
rulemaking on terrorist threats to the rail transport of 
nuclear waste?
    Mr. Diaz. I cannot tell you that right now, Congressman. I 
think that the Commission has not decided on what is the best 
way to address this issue. However, as far as the 
transportation of the spent fuel, if the DOE provides an 
application, then at that time that entire process will become 
part of the public record, and at which time will be able to 
become adjudicated.
    So it is the kind of different processes that we are making 
in this arena, and the process that is established right now 
would be conducive to a fair and equitable process in which 
different communications of the issues will be available.
    Mr. Markey. Well, my own position to you is that the best 
process is a public rulemaking that would allow for the 
American people to determine what level of security they want, 
and given what is happening in Europe right now.
    We learned 2 days ago that in Boston that al-Qaida was 
using the LNG facility and Algerian ships as their entry point 
to go to Boston. None of the Federal officials ever told us in 
Boston about that.
    Our city is outraged that they did not learn about al-Qaida 
penetration of our LNG facility. So I strongly recommend to you 
that you have a public rulemaking on that issue. I think it 
would be best for the agency in the long term if you did not 
avoid the central security concern that Americans have.
    On January 15, 2004, Dr. Paul Craig resigned as a member of 
the Congressionally established Nuclear Waste Technical Review 
Board so that he could speak more freely about the waste 
dumping, and who has since said that the fact that the current 
repository design will cause the canisters to corrode and leak, 
and will result in DOE having to admit that its current design 
is a failure, and redesign the repository, with a delay of 
several years. Do you agree with Dr. Craig's statements? Dr. 
Duquette, quickly, please.
    Mr. Duquette. I'm sorry, I thought you were addressing Dr. 
Diaz. First of all, Paul Craig did not resign from the Board in 
order to be free to make public statements. Keep in mind that 
he served on the Board for 7 years, and he knew what was going 
on at Yucca Mountain for all of that time.
    He resigned from the Board for some personal reasons, and I 
think that there is a newspaper article or a newspaper 
editorial out there that misquoted him considerably.
    Mr. Markey. So do you disagree with the position or the 
contention that there will have to be a redesign of the 
repository because of the current design failure?
    Mr. Duquette. No, sir, I don't. I think you were not here 
when I made my opening statement, but basically the Board 
believes strongly based on data provided by the Department of 
Energy that in the current design or under current design 
conditions the data that has been presented to us by the 
Department of Energy, there will be corrosion of the 
containers, and there is the possibility of a breach in the 
containers.
    That is absolutely correct. I indicated earlier that the 
Board isn't necessarily convinced that will release 
radionuclides to the environment outside of the repository, but 
it could lead to the release of radionuclides inside the vault.
    Mr. Markey. And you are willing to live with that result?
    Mr. Duquette. No, sir, I did not say that. In fact, my 
personal opinion, and not the Board's opinion, but my personal 
opinion is that you would be compromising one of the multiple 
barriers, and we believe that there are designs that can be 
used that will not result in corrosion. So it will not 
compromise that particular barrier.
    Mr. Markey. And finally isn't it true that spent fuel 
coming out of a reactor has to stay cool onsite at the reactor 
for at least 5 years before it is cooled enough to be shipped 
anyway?
    So that means that even if Yucca Mountain is built, so long 
as there are still operating reactors in the country that there 
will still be spent fuel stored at other sites across the 
country?
    Mr. Diaz. That is correct. There would be spent fuel stored 
because the spent fuel will be coming systematically out of 
these reactors as they refuel. So there will be spent fuel 
stored in the sites, but the objective of a repository would be 
to remove the majority of the fuel that has been already used, 
and are no longer serving----
    Mr. Markey. But in conclusion, the most radioactive 
materials for at least 5 years will remain at each one of these 
nuclear power plants right next to the reactor; is that 
correct?
    Mr. Diaz. That is correct. The fresh and the spent fuel 
will be close to the reactor, but most of the fuel, or the 
larger amount of spent fuel will be removed from the site.
    Mr. Markey. But the most radioactive spent fuel will be 
right there next to the reactor in storage?
    Mr. Diaz. Per unit waste, that is correct.
    Mr. Markey. That is correct. Thank you.
    Mr. Hall. The chair recognizes the gentleman from Illinois, 
Mr. Shimkus.
    Mr. Shimkus. Thank you, Mr. Chairman, and I would remind my 
friend from Massachusetts that if we would open up our 
available natural gas reserves along the coast lines that we 
would not have the LNG facilities and that we would have to 
import liquid and natural gas, and that is another debate for--
well, not really, because this is an energy debate, and it is 
about national security, and it is about having a reliance on 
our own available fuels.
    Because if we don't move on a Yucca Mountain the reality is 
that the storage of the high level nuclear waste, which is all 
across the country in major metropolitan areas will stay there 
and cool, and nuclear facilities will close.
    That is the big picture, and that is what the debate is. 
And now we are moving forward and really the debate we had 
earlier was now are we trying to sustain death by a thousand 
cuts by limiting the funding, and all these other options.
    And I am going to follow up really on Chairman Barton's 
question to Mr. Card on the licensing date, and so my question 
would be to Mr. Diaz, or Chairman Diaz, excuse me, the NRC 
advanced 293 key technical issues for DOE to work on.
    To date, you have closed 90 as I am being told, which makes 
123 that are still under review by the NRC, and 80 remain to be 
submitted to the NRC. With the deadline of December 2004, and 
meaning 9 months left, do you think that the NRC has the staff 
available to quickly review and approve all the remaining key 
technical issues over the next 9 months?
    Mr. Diaz. Yes, sir. We are ready to do that, and we are 
working closely with the Department of Energy to submit their 
analysis and results of these agreements as quickly as 
possible. The key technical agreements will all have to be 
resolved by the time the license application is submitted.
    However, some of those agreements are what we call having 
long term issues with them, some of them will continue, but 
that is acceptable to us once we have received the resolution 
of these key technical issues by DOE, and to receive them in 
the application.
    And those few that have long term implications will be 
analyzed, and reviewed, during the license review period.
    Mr. Shimkus. Thank you, Mr. Chairman. Mr. Chairman, I don't 
have any further questions. So I yield back my time.
    Mr. Otter. This panel is then excused. We thank you very 
much for your time and your testimony, and being here. Thank 
you.
    We will now invite the fourth panel to come forward. The 
fourth panel will be the Honorable Sam J. Ervin IV, the 
Commissioner from the North Carolina Utilities Commission, on 
behalf of the National Association of Regulatory Utility 
Commissioners in Raleigh, North Carolina.
    Also, Mrs. Angelina Howard, Executive Vice President of the 
Nuclear Energy Institute, Washington, DC; and Mr. John T. 
Mitchell, President and General Manager of Bechtel. I welcome 
the fourth panel, and I welcome you to the committee room 
today, and we await your testimony.
    Mr. Ervin.

    STATEMENTS OF HON. SAM J. ERVIN, IV, COMMISSIONER, NORTH 
   CAROLINA UTILITIES COMMISSION, ON BEHALF OF THE NATIONAL 
 ASSOCIATION OF REGULATORY UTILITY COMMISSIONERS; ANGELINA S. 
HOWARD, EXECUTIVE VICE PRESIDENT, NUCLEAR ENERGY INSTITUTE; AND 
JOHN T. MITCHELL, PRESIDENT AND GENERAL MANAGER, BECHTEL SAIC, 
                              LLC

    Mr. Ervin. I thank you, Mr. Chairman. As you indicated, I 
am Commissioner Sam Ervin IV of the North Carolina Utilities 
Commission, and I served as chairman of the subcommittee on 
nuclear issues of the committee on electricity at the National 
Association of Regulatory Utility Commissioners.
    As chairman of the subcommittee, it focuses on the issues 
that are the subject of today's hearing, and I am testifying as 
you indicated on behalf of NARUC.
    My testimony also reflects the views of the North Carolina 
Utilities Commission, and I very much appreciate the chance to 
appear before you this morning in hopes that my full statement 
will be incorporated in the record.
    NARUC's goals in the nuclear waste area are simple. NARUC 
believes that the Federal Government should meet its 
obligations to accept commercial spent nuclear fuel and to 
safely dispose of that waste in geological repositories in a 
timely manner.
    The Nuclear Waste Policy Act of 1982 as amended created a 
bargain between the Federal Government and the customers of the 
Nation's nuclear generators. Under the terms of that bargain, 
customers agreed to pay a one mill per kilowatt hour fee for 
generation from nuclear facilities.
    In-turn, the Federal Government agreed to begin accepting 
waste to a proposed repository by 1998. The Nation's rate 
payers have provided more than $21 billion to the Nuclear Waste 
Fund in the form of direct contributions from income earned on 
the principal since 1983.
    And unfortunately as we all know, the proposed repository 
has yet to open. At this point, NARUC believes that every 
effort should be made to open the proposed repository by 2010 
in accordance with the Department of Energy's current schedule.
    The process of attempting to open the repository has been a 
difficult and protracted one as we all know. Despite Congress' 
decision to proceed with the development of the Yucca Mountain 
facility in 2002, the timely opening of the proposed repository 
by 2010 is not a fait accompli.
    The Department of Energy has to meet a number of challenges 
in order to accomplish that goal. The United States Court of 
Appeals for the D.C. Circuit is currently considering several 
challenges to the fund, and achieving waste acceptance by 2010 
requires as we just got through discussing timely approval of 
the Department of Energy's license application by the NRC.
    In all honesty, however, the biggest obstacle to the 
beginning of waste acceptance in 2010 may be the risk of 
inadequate funding during the next few years.
    The consequences of failing to begin waste acceptance by 
2010 are serious. The administration has estimated that it 
costs more than $500 million annually to manage governmental 
high level radioactive waste in the event of further delay.
    In addition the Department of Energy's liability for 
failing to meet the original 1998 deadline will increase even 
more if additional delay occurs. Finally, continued use of 
existing storage sites, aside from imposing a burden on nuclear 
generators and their customers raises a serious homeland 
security issue.
    The level of funding for the proposed repository has been 
and remains a source of concern to NARUC. Although income 
continues to flow into the Nuclear Waste Fund, there is a 
persistent gap between the annual appropriations to the 
repository program and the amount of money entering the Nuclear 
Waste Fund each year.
    The administration's budget request for the program has 
been reduced for the past decade, despite the availability of 
adequate monies to support the program from the fund. If NARUC 
understands the situation, and I certainly don't purport to be 
an expert in Federal budgetary rules, the existing rules make 
no distinction between monies appropriated for the Nuclear 
Waste Fund and other funds available to the Department of 
Energy.
    As a result, as we understand, that any increase in the 
amount appropriated for the nuclear waste program must be 
offset under current rules by decreases in other DOE programs.
    The primary difficulty created by the existence of these 
rules need not persist. There is a solution to the funding 
problem, and it involves renewed reliance on various mechanisms 
created in the Nuclear Waste Policy Act.
    Put simply the existing budget rules should be changed so 
that the Nuclear Waste Fund is only employed by its intended 
purpose.
    At this point as I understand it, there are two specific 
proposals before you. The first of these proposals is H.R. 
3429, which was introduced by Representatives Shimkus and Rush.
    The bill includes many provisions, including making annual 
fund revenues a de facto amount appropriated for the program 
through 2010 and ensuring that fund revenues not needed for 
repository purposes in any given year remain available for 
their intended purpose at a later time.
    The other proposal which has been introduced by request is 
by Chairman Barton, is H.R. 3981, and embodies the 
administration's proposal to reclassify Nuclear Waste Fund 
revenues as offsetting collections beginning this year.
    The administration's proposal seems simpler than the 
approach spelled out in H.R. 3429, and would continue to 
provide adequate appropriations for the repository program 
through the construction of the necessary surface facilities.
    There are a number of acceptable solutions to the current 
funding problem, including the proposals embodied in H.R. 3429 
and H.R. 3981, and perhaps others. At this point, NARUC will 
support any approach to resolving the existing problems so long 
as the imbalance between Nuclear Waste Fund revenue and annual 
appropriations end, and the proposed change doesn't threaten 
the beginning of nuclear waste acceptance by 2010.
    The Nuclear Waste Program is of immense national 
importance. Having overcome the political hurdle inherent in 
the vote on the joint resolution in 2002 to forward with the 
Yucca Mountain facility in 2002, Congress should focus on 
ensuring that the means to license, construct, and operate the 
proposed repository are made available to the Department of 
Energy.
    The Nation's rate payers have been paying for a nuclear 
waste repository for over 20 years. It is past time that they 
get what they paid for. NARUC urges Congress to reform the 
nuclear waste funding process issue this year.
    [The prepared statement of Hon. Sam J. Ervin, IV follows.]

 Prepared Statement of Sam J. Ervin, IV, Commissioner, North Carolina 
     Utilities Commission on Behalf of The National Association of 
                    Regulatory Utility Commissioners

    My name is Sam J. Ervin, IV. I am a member of the North Carolina 
Utilities Commission, having served in that capacity for four years. I 
also serve as the Chairman of the Subcommittee on Nuclear Issues and 
Waste Disposal of the Electricity Committee of the National Association 
of Regulatory Utility Commissioners (NARUC). As Chairman of the NARUC 
Subcommittee that focuses directly on the issues that are the subject 
of today's hearing, I am testifying today on behalf of that 
organization. In addition, my testimony reflects the views of the North 
Carolina Utilities Commission. On behalf of NARUC and the North 
Carolina Utilities Commission, I very much appreciate the opportunity 
to appear before you this morning. The issues that you are addressing 
in this oversight hearing are very important to NARUC's membership and 
the North Carolina Utilities Commission, and I am grateful to have this 
opportunity to present our point of view concerning the progress of the 
Yucca Mountain project.
    NARUC is a quasi-governmental, non-profit organization founded in 
1889. Its membership includes the State public utility commissions 
serving all States and territories. NARUC's mission is to serve the 
public interest by improving the quality and effectiveness of public 
utility regulation. NARUC's members regulate the retail rates and 
services of electric, gas, water, and telephone utilities. We are 
obligated under the laws of our respective States to ensure the 
establishment and maintenance of such utility services as may be 
required by the public convenience and necessity and to ensure that 
such services are provided under rates and subject to terms and 
conditions of service that are just, reasonable, and non-
discriminatory.
    NARUC's goals in the nuclear waste area are well known and have 
been stated before this and other Congressional committees on a number 
of prior occasions. NARUC believes that the federal government needs to 
meet its obligation under the Nuclear Waste Policy Act of 1982, as 
amended, to accept spent nuclear fuel from utilities and other nuclear 
generators in a timely manner. NARUC further believes that the nation's 
ratepayers have upheld their end of the bargain struck in the Nuclear 
Waste Policy Act by providing, either directly or through income 
generated on prior payments, over $21 billion for use in constructing a 
nuclear waste repository. Finally, NARUC believes that the Nuclear 
Waste Fund should only be employed for its intended purpose and that 
the monies in the Nuclear Waste Fund should be utilized, along with 
appropriations from the Department of Defense budget, for the sole 
purpose of supporting the opening of the Yucca Mountain facility in a 
timely fashion. The basic principles underlying NARUC's approach to the 
nuclear waste issue provide a solid foundation for future policy 
decisions concerning the nuclear waste program.
    The process of attempting to open a geologic repository for the 
storage of high-level radioactive waste, including spent nuclear fuel, 
has been a protracted one. As you know, the Nuclear Waste Policy Act 
contemplated that the proposed repository would begin to accept waste 
in 1998. Instead, over five years later, the Department of Energy (DOE) 
is still engaged in the process of attempting to license, construct, 
and open the proposed repository. In the meantime, the customers of the 
nation's nuclear facilities continue to pay the required one mill per 
kilowatthour fee that is intended to finance the proposed repository 
while, at the same time, continuing to bear the cost of on-site waste 
storage as well. The nation's debt to these customers is long past due. 
Moreover, the Administration indicated in its FY 2003 budget request 
that it will cost $500 million annually to manage government high-level 
radioactive waste at Department of Energy sites in the event waste 
acceptance at the proposed Yucca Mountain facility is delayed past the 
currently-scheduled 2010 opening date. Finally, the federal courts have 
decided that the Department of Energy has breached its statutory and 
contractual obligation to take spent nuclear fuel by the date specified 
in the Nuclear Waste Policy Act, subjecting the nation's taxpayers to 
significant damage liabilities that have yet to be quantified and that 
will continue to increase with the passage of time. In evaluating the 
potential impact of these liabilities on the federal budget, it is 
important to remember that the United States Court of Appeals for the 
Eleventh Circuit has determined that monies from the Nuclear Waste Fund 
may not be used to pay any damages ultimately awarded to the nuclear 
industry for breach of the Department of Energy's obligation to take 
nuclear waste beginning in 1998. While we do not have an agreed-upon 
estimate of the government's liability for the added storage costs for 
commercial spent fuel that will result from further delay in waste 
acceptance at Yucca Mountain, we can safely assume that the cost of 
delay relating to commercial spent nuclear fuel is several times the 
cost of delay identified for government material since there is nine 
times more commercial waste than governmental waste. These factors make 
taking action to ensure that further delay in opening the Yucca 
Mountain facility does not occur even more imperative.
    The decision by both Houses of Congress to uphold the President's 
proposal to proceed with the development of the Yucca Mountain facility 
in 2002 was gratifying to NARUC and its members. Although the process 
that led to the recommendation of the Yucca Mountain site by Secretary 
Abraham, the President's decision to concur in the Secretary's 
recommendation, and the Congress' decision to override Governor Guinn's 
veto brought much needed attention to the nuclear waste disposal issue, 
the passage of the Congressional resolution reaffirming the federal 
government's commitment to the development of the Yucca Mountain 
facility does not end the need for Congressional supervision of and 
commitment to this program. In other words, the adoption of the 2002 
Congressional resolution should certainly not lead to complacency on 
the part of any branch of the federal government. The timely opening of 
the Yucca Mountain facility is not, as this committee well knows, a 
fait accompli. As you are aware, the United States Court of Appeals for 
the District of Columbia Circuit heard arguments in January concerning 
a number of legal challenges by the State of Nevada and others to 
numerous facets of the repository program and related portions of the 
Code of Federal Regulations, including the federal government's 
decision to proceed with the selection of the Yucca Mountain site. 
Assuming that the outcome of these proceedings is generally favorable 
to the Yucca Mountain program, certain budgetary issues still need to 
be resolved in order to minimize the risk of additional delay. In all 
honesty, the biggest obstacle to the beginning of waste acceptance at 
the proposed repository in accordance with the Department of Energy's 
current schedule is the risk of inadequate funding during the next few 
years.
    As a result, NARUC believes that it is vitally important for 
Congress to take certain specific steps on an expedited basis to ensure 
that the Yucca Mountain facility opens without additional delay. Most 
importantly, Congress should act to ensure that adequate money is made 
available for the licensing, construction, and operation of the 
proposed facility. Unless adequate money is appropriated for the Yucca 
Mountain project, the proposed facility will not open in accordance 
with the current schedule, resulting in increased costs to both the 
federal government, the nuclear industry, and the customers of the 
nation's nuclear generators. Therefore, I repeat, the most important 
issue for Congress to address in connection with the nuclear waste 
program at this time is ensuring that adequate monies are appropriated 
for the Yucca Mountain project.
    The history of funding for the Yucca Mountain program is and has 
been a source of concern to NARUC and its members. Over the past 
decade, fee revenue has continued to flow into the Nuclear Waste Fund 
at an ever-increasing level, a pattern that reflects improving nuclear 
industry productivity. Earnings on the balance in the Nuclear Waste 
Fund have grown to the point where they have exceeded fee revenue in 
some years. In the face of this increase in the amount of available 
resources, annual appropriations have consistently been reduced from 
the amount requested by the present and past Administrations for the 
last decade. Although over $21 billion dollars has been collected for 
the Nuclear Waste Fund from ratepayers to date, only about $6 billion 
has been expended from the fund to support the repository program. This 
reduces the likelihood that important milestones associated with the 
repository program will be met, the most important of which is the date 
upon which nuclear waste begins moving to the repository for storage. 
Furthermore, spent nuclear fuel continues to accumulate in 77 locations 
that were never intended to be indefinite storage facilities. Although 
the Nuclear Regulatory Commission and the nuclear industry express 
confidence that the present practice of storing spent fuel at reactor 
sites is safe, NARUC agrees with Secretary Abraham that permanent 
storage of nuclear waste at the Yucca Mountain repository would be more 
secure than on-site storage and that the prospect of further delays in 
opening the Yucca Mountain facility raises a serious homeland security 
issue.
    The history of the budget process relating to the Civilian 
Radioactive Waste Management program suggests that there is a risk that 
past funding problems will continue in the future. For most of FY 2003, 
funding for the Yucca Mountain program was determined by a series of 
continuing resolutions, a development that left the amount of money 
available for use in connection with the repository program in a state 
of fundamental uncertainty. When the relevant appropriations bill was 
finally passed, the approved amount was 23 percent lower than the 
amount that the Administration had said was absolutely necessary to 
assure the submission of an adequate license application to the Nuclear 
Regulatory Commission by the end of 2004. Although the Secretary of 
Energy and the individuals managing the repository program stated that 
transportation planning would be ``ramped up'' in 2003, that aspect of 
the program became one of the first casualties resulting from the FY 
2003 budget reduction. As a result, reductions in the amount requested 
for the Yucca Mountain program have real world consequences that could 
affect the date upon which waste acceptance begins.
    The leadership shown by the House of Representatives in approving 
an increase over the President's FY 2004 Budget request of $591 million 
to $765 million was an encouraging attempt to both support the 
President's initial budget request and to make up for the $134 million 
cut that occurred in 2003. Although the final amount approved in 
conference was only $580 million, it was the closest Congress has ever 
come to fully funding the repository program consistently with 
Administration requests in recent years and resulted from the 
monumental efforts of many members of this subcommittee and others to 
avoid further delay in the date upon which waste begins to be accepted 
at the proposed repository. Similar efforts may not, however, be 
sufficient in future years because the program is just approaching the 
period when the Department of Energy will need ever-higher 
appropriations in order to meet the heavy cash requirements inherent in 
building the repository and procuring very expensive shipping and 
disposal waste containers.
    These funding difficulties need not persist. There is a solution to 
the funding problem that seems perfectly obvious to us. The money is 
available to sustain the required level of program spending through the 
use of the very funding mechanism contemplated in the Nuclear Waste 
Policy Act. The $14 billion balance in the Nuclear Waste Fund, which 
continues to grow every year, provides more than enough money to permit 
the Department of Energy to maintain the current schedule, assuming 
that these monies are actually made available for use in the program. 
The real problem lies in developing an approach to funding the Yucca 
Mountain program that ensures that the monies paid in to the Nuclear 
Waste Fund by the nation's electric ratepayers are actually devoted to 
the purposes for which that fund was created. The best way to achieve 
that result is for Congress to reform the process by which monies from 
the Nuclear Waste Fund are appropriated for repository program 
activities.
    As we understand it, the existing budget rules applicable to the 
Yucca Mountain program make no distinction between monies appropriated 
from the Nuclear Waste Fund and other general funds available to the 
Department of Energy as a whole. As a result, any increase in the 
amount appropriated for the program from the Nuclear Waste Fund 
currently must be offset by decreases in expenditures for other 
Department of Energy programs despite the fact that the nuclear waste 
program is the only Department of Energy program that can be 
appropriately paid for from the Nuclear Waste Fund. Although the 
existence of such a limitation might constitute sound budgetary policy 
in the event that all Department of Energy programs were supported 
through general appropriations, such a limitation seems overly 
restrictive given the Nuclear Waste Fund's status as a special fund 
containing monies contributed by a specific group of Americans for use 
in a particular way. As a result, NARUC believes that the key to timely 
completion of the Yucca Mountain project is for Congress to reform the 
process by which the monies from the Nuclear Waste Fund are made 
available for use in connection with the repository program.
    There have been a number of efforts to attempt to resolve this 
problem in the recent past. As I have already pointed out, the House 
has taken a leading role in trying to solve the funding problem. In 
addition to last year's increase in the repository program budget, the 
House has evaluated the appropriateness of more fundamental solutions 
to this problem on a number of occasions. The report accompanying the 
FY 2001 appropriations bill issued by the House Appropriations 
Committee requested the Secretary of Energy to review the management 
and financing of the Civilian Radioactive Waste program. Secretary 
Abraham submitted a report in September 2001, in response to this 
request entitled an ``Alternative Means of Financing and Managing the 
Civilian Radioactive Waste Program.'' The Secretary's report indicated, 
consistently with statements made in connection with the 
Administration's FY 2004 budget request, that annual funding for the 
Yucca Mountain program needed to average $1.3 billion to ensure that 
the repository begins to accept waste in 2010. As far as NARUC is 
aware, no action has been taken on the basis of the recommendations of 
that report to date. NARUC was, however, encouraged by the House's 2002 
decision to consider including a provision in H.R. 4 that would have 
taken the Nuclear Waste Fund ``off-budget.'' As NARUC understood it, 
the adoption of such an approach would have meant that annual 
appropriations from the Nuclear Waste Fund for use in the repository 
program would be limited only by the amount of revenue coming into the 
Fund in any particular year. It is our understanding that this 
provision was removed at the direction of the Budget and Rules 
Committees. Taking the Nuclear Waste Fund ``off-budget'' remains, in 
our opinion, a viable option that should be given further consideration 
in addition to other proposals that have recently been placed on the 
table. The Administration's FY 2004 budget alluded to an ``alternative 
funding proposal'' that would permit temporary cap adjustments for FY 
2004 and FY 2005. So far as NARUC is aware, however, no specific 
alternative funding proposal of this nature was submitted to Congress 
in connection with the FY 2004 budget process. Although there are 
certainly legitimate reasons for the Congress to retain budgetary 
control over expenditures for the Yucca Mountain facility, it is 
NARUC's hope that the means chosen to achieve that end will not result 
in a continuation of the program's past budget problems and that 
fundamental changes in the funding process will be adopted that make 
the monies in the Nuclear Waste Fund more readily available for use in 
supporting the repository program.
    The manner in which the mechanics of the appropriations process are 
designed is, of course, a matter committed to the sound judgment of 
Congress and not to an association of State regulators. However, as is 
evidenced by the letter sent by public utility regulators from 23 
States to the Director of the Office of Management and Budget late in 
2002, NARUC believes that State commissions have a valid justification 
for promoting reform of the process by which monies from the Nuclear 
Waste Fund are expended in support of the Yucca Mountain project. There 
are probably a number of acceptable ways for the current problem to be 
resolved, ranging from modification of the existing budget rules to 
taking the Nuclear Waste Fund ``off-budget.'' At this point, we are 
willing to support a range of alternative methods for reforming the 
appropriations process as long as the imbalance between the amount of 
revenue entering the Nuclear Waste Fund and the amount of monies 
actually expended from the fund in support of the repository program 
ends. Any reform, however structured, should ensure that future annual 
appropriations are limited by the needs of the program rather than the 
amount appropriated in the past, particularly given that past 
appropriations were barely adequate for the study period and are 
totally inadequate for the licensing, construction, and waste 
transportation phases that lie ahead. There is no question but that 
measures to assure that monies from the Nuclear Waste Fund are spent 
wisely are appropriate. Those measures should not, however, thwart the 
entire purpose of the Yucca Mountain program. Assuming that Congress 
believes that expenditures from the Nuclear Waste Fund need to be 
capped for budget oversight reasons, such expenditures should only be 
capped at the sum of fee revenues and earnings on the balance of the 
fund received in a particular year. As we understand it, expected 
program needs, even in peak years, should not exceed the total that 
would be available under the application of such a formula. The 
Department of Energy projects that $1.5 billion will be added to the 
Nuclear Waste Fund each year during the remainder of this decade and 
that the Department of Defense budget will contribute an additional 
$600 million per year toward the repository program. For these reasons, 
there is no question that the amount of money flowing into the Nuclear 
Waste Fund coupled with adequate support from the Department of Defense 
budget will suffice to pay for needed work on the Yucca Mountain 
program over the next several years as we near initial repository 
operations. Any reform proposal should also provide that increased 
expenditures from the Nuclear Waste Fund for support of the repository 
program would not necessarily result in the reduction of other 
Department of Energy expenditures, since the funds used to support 
those other programs come from a different source that is not directly 
tied to the programs in question. A failure to reform the process by 
which monies from the Nuclear Waste Fund are appropriated for use in 
the repository program as NARUC suggests will condemn the Yucca 
Mountain program to additional years of fiscal uncertainty and 
undermine the progress made by the 2002 decision to approve the 
Administration's recommendation that the program go forward.
    As NARUC understands it, there are at least two proposals for 
reforming the budgetary process relating to the Yucca Mountain program 
pending before the House that merit serious consideration. The first is 
the proposed Nuclear Waste Financing Act, H.R. 3429, introduced by 
Congressmen Shimkus and Rush. As I understand it, H.R. 3429 would treat 
the receipts, proceeds, and recoveries realized by Department of Energy 
associated with the Nuclear Waste Fund as offsetting collections and 
authorize expenditures from the Nuclear Waste Fund for nuclear waste 
disposal activities in the amount of $725 million for FY 2005 and in 
the amount deposited in the Nuclear Waste Fund for FY 2006 through FY 
2010. H.R. 3429 also includes provisions intended to preserve the 
corpus of the Nuclear Waste Fund and make it available in future fiscal 
years. The enactment of H.R. 3429 would accomplish many of the 
objectives I have previously outlined for fiscal years 2005 through 
2010, assuming that sufficient monies are included in the Department of 
Defense budget to meet expected repository program needs in those 
critical years. NARUC particularly approves of the provision in H.R. 
3429 that ensures that revenue collected in any year in excess of that 
year's program needs may be rolled over for use in connection with the 
repository program in future years rather than allowing such excess 
revenue to be diverted to other uses. The enactment of H.R. 3429 would 
allow Congress to ensure adequate funding for the program from the 
beginning of the construction phase through the existing anticipated 
waste acceptance date. After the construction license is issued, NARUC 
assumes that Congress could consider revising the funding mechanism to 
provide adequate sustenance for the program once waste shipments begin.
    The second proposal well worth considering is the one referenced in 
the President's budget proposal for FY 2005. At the time that the 
President's budget proposal for FY 2005 was submitted, the 
Administration indicated that it would submit a legislative proposal to 
reclassify Nuclear Waste Fund fee revenue from its current status to 
``offsetting collections'' beginning this year and continuing until 
construction of the surface facilities for a fully operating repository 
have been completed. As a matter of fact, the President's budget 
proposal assumes that dedicating the $749 million in fee revenues 
forecast for this year for use in connection with the repository 
project would eliminate the need for any appropriations from the 
Department of Energy's discretionary budget. On February 27, 2004 
Energy Secretary Spencer Abraham submitted proposed legislation 
containing the specifics of the Administrations' proposal to Congress. 
Chairman Barton has introduced the Administration's proposal as H.R. 
3981 by request. Although the Administration's proposal is similar to 
H.R. 3429, it is both simpler and would have a longer-lasting impact 
given that the Administration's proposal does not halt the dedication 
of current revenues from the Nuclear Waste Fund for use in connection 
with the repository project until construction of the surface 
facilities has been completed. The intent of both bills is identical 
and the enactment of either piece of proposed legislation would further 
NARUC's objectives of ensuring that the ratepayers' contributions to 
the Nuclear Waste Fund will be used for their intended purpose and that 
the Department of Energy is provided with the resources that it says 
are necessary to begin waste acceptance in 2010. At its Winter 
Committee Meetings held a couple of weeks ago, NARUC adopted a 
resolution, a copy of which is attached to this testimony, urging 
enactment of any legislation, including H.R. 3429 or the Administration 
proposal, that has the effect of reforming the budgetary process so as 
to ensure the timely availability of sufficient funds to enable initial 
waste acceptance at the repository in 2010.
    The nuclear waste program is of immense national importance. Having 
overcome the political hurdle inherent in the vote on the joint 
resolution in 2002 to move forward with the Yucca Mountain process, the 
Congress should focus on ensuring that the means to complete the 
process of licensing, constructing, and operating the repository are 
made available to the Department of Energy. Nuclear energy is an 
inevitable component of both our energy present and our energy future. 
Congress recognized that fact when it enacted the Nuclear Waste Policy 
Act two decades ago. Congress reaffirmed that determination when it 
voted to proceed with the repository program in 2002. The nation needs 
to move forward to assure the availability of a safe, permanent nuclear 
waste disposal site for future generations without further delay. The 
nation's electric ratepayers have been paying for a nuclear waste 
repository for over twenty years. North Carolina ratepayers alone have 
contributed more than $1.7 billion dollars to the Nuclear Waste Fund 
since its inception. It is past time that the ratepayers get what they 
have paid for. The best way for Congress to assure that this result 
occurs is to reform the process of funding the repository program so 
that monies from the Nuclear Waste Fund are more readily available for 
use connection with the Yucca Mountain facility. We urge this committee 
and other relevant committees to make reforming the use of the Nuclear 
Waste Fund a priority in this Congress, to identify a way to provide 
stable financing for the program using the ample revenue stream that is 
available for the purpose, and to enact any legislation necessary to 
effectuate that decision. Thank you for your attention and I look 
forward to your questions.

                                 ______
                                 
         Resolution Supporting Reform of the Nuclear Waste Fund

    WHEREAS, In 1982, the Nuclear Waste Policy Act established policy 
that the federal government is responsible for safe, permanent disposal 
of all high-level radioactive waste, including spent nuclear fuel from 
commercial power reactors; and
    WHEREAS, In 2002, the President recommended and Congress approved 
Yucca Mountain, Nevada as the location suitable for development as the 
disposal site; and
    WHEREAS, Since 1983 ratepayers in States using nuclear-generated 
electricity have paid over $20 billion in fees and interest, via their 
electric utility bills, to the Nuclear Waste Fund (NWF) in the U.S. 
Treasury; and
    WHEREAS, Congress historically has only appropriated a fraction of 
the amount of revenue going into the NWF to develop the waste 
repository--resulting in a balance in the Fund, now over $14 billion, 
which must be available to meet future disposal program needs; and
    WHEREAS, The Department of Energy estimates annual appropriations 
will need to average $1.3 billion from 2005-2010 to enable 
construction, waste package procurement and transportation to meet the 
goal of initial waste acceptance in 2010; and
    WHEREAS, Previous attempts to address the gap between NWF revenue 
and annual appropriations have either never been adopted or may not 
have seemed necessary before the repository site was approved; and
    WHEREAS, Congress is considering a bill, H.R. 3429, that would 
match annual appropriations for the disposal program with total annual 
NWF fee revenue and allow any funds not needed in any given year to be 
retained in the Fund only for future program needs; and
    WHEREAS, The President has proposed to reclassify fees paid by 
utilities to the Nuclear Waste Fund in FY 2005 as discretionary 
offsetting collections equal to annual appropriations from the Fund as 
another alternative means of financing the nuclear waste program, 
should Congress authorize it in legislation, now therefore be it
    RESOLVED, That the Board of Directors of the National Association 
of Regulatory Utility Commissioners (NARUC), convened at its March 2004 
Winter Meetings in Washington, D.C., urges that the 108th Congress 
recognize that approving Yucca Mountain for development as the disposal 
site is not the end of Congress's ongoing responsibility to enable the 
Federal Government to meet its obligation to safely dispose of high-
level nuclear waste; and be it further
    RESOLVED, That Congress enact substantive reform--this year--of how 
Nuclear Waste Fund funds are appropriated, whether along the lines of 
H.R. 3429 or as proposed in the FY 2005 Department of Energy Budget, so 
long as whatever change is made has the result of ensuring the 
availability of sufficient funds in a timely manner to enable initial 
waste acceptance in 2010.

Sponsored by the Committee on Electricity
Adopted by the NARUC Board of Directors March 10, 2004

    Mr. Otter. Thank you very much, Mr. Ervin.
    Ms. Howard.

                 STATEMENT OF ANGELINA S. HOWARD

    Ms. Howard. Thank you, Acting Chairman Otter, Mr. Boucher, 
and Mr. Shimkus. I am Angie Howard, executive vice president of 
the Nuclear Energy Institute, and I am pleased to be here.
    I have provided a written statement for the record. What I 
would like to do this morning though is to focus on two 
specific issues. The first is that the nuclear energy industry 
believes that legislation is needed to ensure timely funding to 
meet program milestones.
    And, second, the industry is encouraged by the Department 
of Energy's progress with the program to date. Meeting DOE's 
schedule for the initial repository operations in 2010 requires 
certainty in funding for the program, particularly given that 
the projected annual expenditures will exceed over a billion 
dollars beginning in fiscal year 2006.
    Over the past 11 years appropriations have been reduced by 
$723 million below DOE's budget request. Funds should be made 
available when they are justified and not conditioned on annual 
budget constraints.
    Further delay of the repository program would have 
significant financial implications as we have heard Secretary 
Card, as well as Dr. Chu; and actually Secretary Abraham has 
communicated to Chairman Barton that each year of delay could 
add nearly a billion dollars to the cost of the program.
    We have heard a lot of numbers thrown around, but frankly a 
picture is worth a thousand words as someone said, and I do 
have a chart, and it is lit up behind my right. This chart 
shows that consumer fees, including interest submitted to the 
Nuclear Waste Fund, totals roughly $23 billion.
    Yet, only about a third of this funding, about $8 billion, 
has been used for the program. In effect, this constitutes a 
taking of the American consumers money and spending it in an 
area for which it was not intended.
    Consumers pay an estimated $750 million to $800 million 
into the fund each year. Those are largely funds that are 
generated through the generation of nuclear energy to the 
customers.
    The balance in the fund is nearly $15 billion, and must be 
available to the program with the appropriate Congressional 
oversight and we appreciate Mr. Boucher's comments on this.
    Treating the funds paid into the Nuclear Waste Fund as 
offsetting collections as evidenced in the two bills that have 
been proposed, and the President's budget request, is 
consistent with general Federal budget accounting principles.
    This treatment is also consistent with that of the end-user 
fees that are paid for the Nuclear Regulatory Commission's 
oversight. In addition, this approach will not adversely impact 
the deficits.
    By reducing the risk of delays, it has the potential to 
reduce future Federal liabilities once it begins accepting this 
used nuclear fuel proposal. Under this proposals the programs 
will remain subject to Congressional oversight and I am 
confident that this subcommittee will continue its strong 
oversight of the program, and it will have the program continue 
to be subject to the annual appropriations process.
    Mr. Chairman, Congress must approve the revisions to the 
funding process for fiscal year 2005. The budget request of the 
program for 2005 are $880 million, and is an increase of more 
than $300 million above the 2004, and it assumes that such a 
change has been made.
    Absent Congressional action the Appropriations Committee 
will have to address a significant shortfall within 
discretionary spending totals before we fund the program. 
Predictable funding is a prerequisite for program success.
    But it is not by itself sufficient. DOE and its contractors 
must continue to effectively manage the program, and 
demonstrate that the repository meets regulatory requirements 
for the safe and secure long term storage of used nuclear fuel.
    DOE has improved the management of its Yucca Mountain 
program, and the industry is confident that the agency can meet 
its goal in submitting a license application by the end of this 
year, and will meet its 2010 schedule for opening a repository, 
assuming that sufficient funding is available.
    DOE must also fully develop a comprehensive transportation 
plan to moving these fuels to Yucca Mountain. In December 2003, 
DOE did issue a National Transportation Strategic plan that 
addresses the interactions with State, local, and tribal 
governments.
    The industry endorses the DOE's mostly rail strategy and 
the designation of the Caliente corridor for rail 
transportation in the State of Nevada.
    The industry thanks the committee for its long-standing 
support to the safe and secure management of used nuclear fuel. 
This is vital if we are going to ensure the continued use of 
nuclear energy in our country, which does generate electricity 
for 1 out of every 5 homes and businesses in our country.
    Developing a new funding process for the Yucca Mountain 
project is essential to complete one of the world's most 
important projects, and begin fulfilling its obligation to the 
American public. Thank you.
    [The prepared statement of Angelina S. Howard follows.]

  Prepared Statement of Angelina S. Howard, Executive Vice President, 
                        Nuclear Energy Institute

    Chairman Hall, Ranking Member Boucher and distinguished members of 
the committee, I am Angie Howard, executive vice president at the 
Nuclear Energy Institute. I am pleased to have this opportunity to 
testify on legislation to restore the Nuclear Waste Fund to the 
purposes established in the Nuclear Waste Policy Act of 1982 and on the 
progress toward establishing appropriate funding for the used nuclear 
fuel repository at Yucca Mountain, Nev.
    NEI is responsible for developing policy for the U.S. nuclear 
industry. Our organization's 270 member companies represent a broad 
spectrum of interests, including every U.S. energy company that 
operates a nuclear power plant. NEI's membership also includes nuclear 
fuel cycle companies, suppliers, engineering and consulting firms, 
national research laboratories, manufacturers of radiopharma-ceuticals, 
universities, labor unions and law firms.
    America's 103 nuclear power plants are the most efficient and 
reliable in the world. Nuclear energy is the largest source of 
emission-free electricity generation in the United States, providing 
electricity for one of every five U.S. homes and businesses. Given this 
essential contribution to our nation's energy security and economic 
growth, Congress should adopt policies that foster the further 
development of emission-free nuclear energy as a vital part of our 
nation's diverse energy mix--and fulfill existing federal obligations, 
including the disposal of used nuclear fuel.
    My testimony will focus on two issues. The first involves making 
necessary funding available in a timely manner to meet Yucca Mountain 
program milestones and maintain established operational schedules. NEI 
believes that legislation is needed to restore the clear link between 
electricity consumer fees and expenditures for the nation's used 
nuclear fuel disposal program. The second is the industry's assessment 
of the Department of Energy's progress with the nuclear waste 
management program.
    Meeting DOE's schedule for initial repository operations in 2010 
requires certainty in funding for the program, particularly given 
projected expenditures exceeding $1 billion beginning in fiscal 2006. 
The Yucca Mountain program has a history of funding shortfalls. Despite 
consistent support for DOE's budget requests for Yucca Mountain in the 
House, billions of dollars contributed by American consumers solely for 
the federal government's used fuel programs have been diverted for 
other use. The program has experienced a $723-million shortfall below 
DOE's budget requests in the past 11 years. While the reduction in 
fiscal 2004 was a modest $11 million, funding was preserved only 
because House conference managers made it their top priority.
    Program opponents attempt to delay the program through budget cuts 
and litigation. They attempt to use delay to effectively negate 
scientific consensus and the will of Congress to develop a repository 
at Yucca Mountain, subject to Nuclear Regulatory Commission approval. 
These dilatory tactics would set responsible environmental management 
back to square one. The Nuclear Waste Policy Act of 1982 created the 
Nuclear Waste Fund based on the premise that electricity consumers who 
benefit from nuclear energy should pay for the used nuclear fuel 
disposal program. To effectively implement this relationship, funds 
should be available when justified and not conditioned on annual budget 
constraints.
    Funding shortfalls in past years have caused DOE to defer important 
programs, including procuring transportation containers for used 
reactor fuel; acquiring transportation and logistics services; creating 
the final grant process for providing emergency responder assistance; 
developing a transportation infrastructure in Nevada; and working with 
regional, state, tribal and local representatives from across the 
nation on transportation planning.
    Further delay in the repository program will have significant 
financial implications. As Secretary of Energy Spencer Abraham stated 
in his Feb. 27 letter to Rep. David Hobson, chairman of the Energy and 
Water Appropriations Subcommittee: ``Each year of delay could add 
nearly $1 billion per year in costs for commercial utilities and 
federal defense nuclear waste sites to continue to provide temporary 
storage. These costs would be borne by the federal government, based on 
its existing contracts with electric utility companies.''
    Consumer fees, including interest, committed into the Nuclear Waste 
Fund since its formation in 1983 total $23 billion. Consumers are 
projected to pay between $750 million to $800 million to the fund each 
year. Yet only about $8 billion 1 has been used for the 
program. The balance in the fund is nearly $15 billion. In each of the 
past several years, there has been a dramatic gap between the annual 
fee income and disbursements from the fund (see chart).
---------------------------------------------------------------------------
    \1\ $7.6 billion has been used by DOE, $350 million by other 
federal agencies

[GRAPHIC] [TIFF OMITTED] T3300.001

    The Nuclear Waste Fund has three unique characteristics that 
justify modifying the current budget rules governing its use:
 The fund is intended to cover the entire cost of the federal 
        government's commercial used fuel management program over 
        several decades.
 The federal government is obligated by law and contracts signed with 
        electric companies that operate nuclear power plants to 
        implement the used fuel management program.
 The disposal of used nuclear fuel from commercial reactors is 
        financed entirely through a 1 mill per kilowatt-hour fee 
        established by federal law and paid by consumers of electricity 
        generated at nuclear power plants. Not having these funds fully 
        dedicated to the disposal program constitutes a taking from the 
        American people.
    Scoring the net budget impact of the used fuel disposal program is 
consistent with general federal budget accounting principles, because 
it more accurately reflects the complete impact of the program on 
federal budget and discretionary spending totals and is consistent with 
treatment of industry user fees to the Nuclear Regulatory Commission. 
It will not adversely impact deficits. In fact, by reducing the risk of 
program delay, it should improve the long-term federal accounts 
balance.
    Although the program should remain subject to congressional 
oversight, Yucca Mountain program appropriations should not compete 
each year for funding with unrelated programs. The industry commends 
the committee for its long-standing support for reform of Yucca 
Mountain program budgeting, as most recently evidenced in the 
committee's approval of H.R. 45 during the 106th Congress and in H.R. 4 
in 2002. During this committee's 1999 hearings on the issue, Chairman 
Joe Barton noted that one of the objectives of the legislation was to 
``protect consumers by halting the diversion of consumer fees to fund 
other federal programs.''
    Last year, Committee Ranking Democrat John Dingell, in a letter to 
Energy Secretary Abraham, wrote:
          ``It has been clear for some time that absent legislative 
        action, money paid into the [Nuclear Waste] Fund will continue 
        to be diverted to other purposes--an inequitable use of funds 
        collected from utility ratepayers specifically to pay for the 
        repository. If this continues, construction could be delayed 
        even in the event DOE had already received NRC approval to 
        build a repository at Yucca Mountain. In that event, waste 
        would remain in de facto permanent storage at dozens of 
        facilities which were not designed for this purpose--in 
        Michigan and many other states, at even greater cost to 
        ratepayers. Moreover, damages in breach of contract lawsuits 
        against DOE would continue to mount and, as I understand it, 
        could be paid from general taxpayer revenues.''
    This year, the administration submitted to Congress proposed 
legislation to authorize the reclassification of fees paid into the 
Nuclear Waste Fund as offsetting collections, in an amount equal to 
appropriations for nuclear waste disposal. Chairman Barton recently 
introduced the proposal as H.R. 3981. That bill is substantively 
similar to H.R. 3429, introduced by Reps. Shimkus and Rush last 
November and co-sponsored by six other committee members, including 
five members of the subcommittee.
    Reforming the funding process is vital in FY2005, with the budget 
request for the program increasing to $880 million, more than $300 
million above FY2004. These funds are necessary to support NRC review 
of the license application, to acquire long-lead items to support the 
transportation system and to execute detailed facility design.
    The need to reform the funding profile is even more critical in 
view of the administration's assumption in its FY2005 budget that this 
legislation would be enacted. In addition, absent congressional action, 
the Appropriations Committee will have to address a significant 
shortfall within the discretionary spending totals to fully fund the 
$880 million request.
    Under the legislation, Congress could limit obligations in any year 
for the Yucca Mountain project if it determines less funding is needed, 
or could provide additional funds from the Nuclear Waste Fund balance, 
if required. In the latter case, funding above annual receipts into the 
Nuclear Waste Fund would be subject to discretionary spending 
limitations. Funding for the program from DOE's defense program account 
would remain subject to discretionary spending limitations. This 
approach, if enacted in FY2005, would provide sufficient funding for 
the non-defense portion of the program, based on DOE's requirements 
through completion of the surface facilities. The industry strongly 
urges the committee to approve offsetting collections legislation.
    Although adequate and predictable funding is a prerequisite for 
program success, it is not by itself sufficient. DOE and its 
contractor(s) must continue to effectively manage the program. The 
Energy Department also must demonstrate that it will meet NRC 
requirements for the safe and secure permanent disposal of used nuclear 
fuel at Yucca Mountain before it can operate the repository.
    President Bush in 2002 signed legislation designating Yucca 
Mountain as the site for a national used fuel repository. DOE and its 
contractors are preparing an application to build the repository and 
are expected to submit it to the NRC in December. If approved, the 
license will permit DOE to build and operate the repository.
    Congress approved Yucca Mountain as the site of the national 
repository in 2002. The policy question now before Congress is: When 
will Yucca Mountain be ready to accept used nuclear fuel? DOE plans to 
begin accepting used fuel in 2010-12 years behind the statutory 
deadline in the Nuclear Waste Policy Act. That law required DOE to 
begin accepting used fuel by Jan. 31, 1998.
    DOE has improved management at the Office of Civilian Radioactive 
Waste Management (OCRWM), giving the industry more confidence that the 
agency can meet its 2010 deadline for opening the repository, assuming 
sufficient funding for the next six years. In addition, OCRWM has 
effectively implemented a Management Improvement Initiative using the 
same management principles that the nuclear energy industry has applied 
in building an exemplary safety record at the nation's nuclear power 
plants. The creation of DOE's Office of Repository Development in 2002 
established strong project management. DOE also has made substantial 
progress in resolving the NRC's outstanding key technical issues for 
the Yucca Mountain project. The transition from scientific research to 
a licensing project team has been a critical transition at the Yucca 
Mountain site. Recently, DOE announced that it is pursuing several 
other far-reaching management initiatives, including annual 
comprehensive independent external financial, schedule and technical 
audits of the program.
    These programs are further evidence of the Energy Department's 
commitment to a sound scientific basis for the project. The integrity 
of the scientists working on the program, the extensive and ongoing 
independent review process, the conservatism built into performance 
assumptions, and the extensive NRC review of the license application 
all enhance public and policymaker confidence in the Yucca Mountain 
repository. Repository operations will not begin until DOE can meet 
strict standards established for public safety and environmental 
protection.
    Several critical milestones must be met to maintain the 2010 target 
for repository operation. The most significant of these--submitting a 
construction license application to the NRC--must be accomplished by 
the end of this year. The industry expects DOE to meet this milestone. 
After DOE files its license application, the NRC must issue a decision 
on the application and conduct public hearings within four years, using 
the same safety-focused, performance-based principles it applies to 
licensing nuclear power plants.
    DOE also must proceed with land withdrawal and transfers, site 
preparation, and preliminary construction to meet the 2010 date. 
Congress should specifically instruct DOE to begin these activities 
before the NRC's final authorization of repository construction.
    Planning for a comprehensive transportation program to transfer 
used fuel to the repository also must be fully developed. This planning 
will build on the comprehensive transportation program that has been 
used for 40 years to safely transport 3,000 shipments of used fuel 
across 1.7 million miles. In December 2003, DOE issued a National 
Transportation Strategic Plan for developing a nationwide 
transportation program, with input from state, local and tribal 
governments, as well as the industry. DOE must implement this strategy.
    The industry's transportation policy endorses a predominantly rail 
scenario contained in DOE's Yucca Mountain Environmental Impact 
Statement. This scenario recently was identified by the department as 
its preferred transportation strategy. NEI also supports the use of 
dedicated trains for used fuel transportation to the repository. 
Transportation planning must include extensive consultation with state 
and local officials consistent with DOE's December 2003 strategy.
    It is encouraging that the Secretary of Energy has also identified 
a preferred rail corridor within Nevada for transportation of used 
nuclear fuel to the repository. The Secretary's action is consistent 
with direction provided last year by the House, which concluded that 
the Caliente route is the most feasible corridor to Yucca Mountain. It 
is also consistent with what Nevadans prefer. In a June 2003 public 
opinion survey of Nevadans by Voter Consumer Research, 56 percent said 
they would find ``acceptable'' rail transport of used nuclear fuel 
through rural routes, away from major cities like Reno or Las Vegas. In 
contrast, 88 percent find truck transport through major cities like 
Reno or Las Vegas unacceptable.
    The industry encourages DOE to proceed further with the development 
of a comprehensive transportation program.
    This timely action supports the department's objective of beginning 
construction of a rail line immediately after a decision on 
construction authorization, expected by 2008. That would make rail 
transportation available for used fuel shipments early in the program 
and minimize the need for truck shipments within the state.
    The industry also supports funding the state of Nevada and affected 
units of local governments for appropriate oversight of the repository 
project and local transportation preparedness. This would include 
federal assistance to mitigate the social and economic impacts of the 
program, consistent with Section 116 of the Nuclear Waste Policy Act.
    Each of these DOE milestones must have a clearly defined schedule, 
with implementation plans linked to funding requirements, if the 
federal government is to meet its 2010 goal for opening the repository.
                               conclusion
    The industry thanks the committee for its long-standing commitment 
to implementing public policy that ensures the safe and secure 
management of used nuclear fuel from nuclear power plants and high-
level radioactive waste from the nation's defense programs. Developing 
a new funding process for the Yucca Mountain project is essential to 
complete one of the world's most important environmental facilities and 
pave the way for the U.S. government to begin fulfilling its legal 
obligation to move used nuclear fuel from 40 states to a secure and 
safe federal repository.

    Mr. Otter. Thank you, Ms. Howard.
    Mr. Mitchell.

                  STATEMENT OF JOHN T. MITCHELL

    Mr. Mitchell. Mr. Chairman, and members of the 
subcommittee, and members of the staff, we appreciate the 
opportunity to discuss this with you today. I am the President 
and General Manager of Bechtel SAIC, and that is a limited 
liability company formed as a partnership between Bechtel 
International and SAIC expressly for the limited purpose of 
serving as the management and operating contractor to DOE and 
Yucca Mountain.
    And in that vain our responsibilities are several. One, we 
are in fact the people who take the scientific data that is 
provided by the national laboratories and other Federal 
agencies of the last 15 to 20 years, and combine that into a 
document which is in fact the license application, which will 
be submitted in December to the NRC.
    It will be of high quality and we believe a fully 
docketable license application submittal at that time. In 
addition to that, we also performed the engineering 
construction planning leading to the next steps for the 
repository, moving from the design necessary to support the 
license application, to the engineering design and 
construction, and eventual operation of the full repository.
    We also support the Department in putting in place a 
culture appropriate to a regulated entity, which provides a 
basis of competency to the NRC to assume that we can and will 
honor our obligations on behalf of the DOE for the long term.
    As a professional project manager probably my strongest 
comment about funding would be a simple one. I have managed 
major projects for the government in many places for a long 
time. This project has been marked with every year, except for 
fiscal year 2004, by funding which is less than that planned, 
and less than that previously requested on many occasions.
    This results in instability and insufficiency time after 
time as you are well aware. I am very pleased with the funding 
support that we had, particularly from the House in the last 
year.
    We were able to stay in our plan going into fiscal year 
2004, and we are in fact on track, and will submit a license 
application in December 2004, which will serve the NRC's needs.
    We have also continued on the process to do the things 
necessary in the project to ensure with confidence that we can 
in fact open the repository in 2010 and fill its designated 
mission.
    I would ask particularly for the committee's attention to 
the fact that it is more critical than most over the next 
several years to have stability, ability, and predictability in 
funding.
    When you enter into the stage of actually proceeding beyond 
science and actually into the engineering design and 
construction, these are related serial activity and dependent 
upon each other, and vitally dependent for their success and 
efficiency in being able to sustain a plan.
    That is where we are in the program, and that is where we 
have proceeded, and we urge your support. Thank you, sir.
    [The prepared statement of John T. Mitchell follows.]

  Prepared Statement of John Mitchell, President and General Manager, 
                           Bechtel SAIC, LLC

    Mr. Chairman and Members of the Committee: Thank you for the 
invitation to appear before you today and report on the progress made 
on the Yucca Mountain Project since the last oversight hearing in June 
of 2000. As you know, significant strides have been made and I am 
confident that, given adequate funding, the Project is on track to 
submit a high-quality docketable license application to the Nuclear 
Regulatory Commission by the end of 2004 and begin waste acceptance at 
the repository in 2010.
    Before I begin with Project-specific testimony, let me tell you who 
I am and who I represent. My name is John Mitchell and I am the 
Bechtel/SAIC Project Manager for Yucca Mountain Project. Bechtel 
National, together with Science Applications International Corporation, 
formed Bechtel SAIC Company, LLC (BSC) to be the management and 
operating contractor for the Department of Energy's (DOE) Office of 
Civilian Radioactive Waste Management (OCRWM) Program. We were awarded 
the five-year contract in November of 2000 and began work in February 
of 2001.
    In July of 2002, after strong votes of approval in both the Senate 
and House, President Bush signed a Joint Resolution (PL 107-200) 
designating Yucca Mountain as the site for our nation's permanent 
repository for spent nuclear fuel and high-level radioactive waste. 
This site recommendation was the culmination of more than 20 years of 
scientific study and represents a major milestone in the development of 
the repository. The recommendation allows DOE to take the next step in 
establishing a safe repository--submittal of a License Application to 
the Nuclear Regulatory Commission (NRC).
    DOE plans to submit the License Application by December of 2004. 
The application will include an overview of the repository's 
engineering design concept as well as a safety analysis report 
demonstrating how the repository can be constructed, operated, and 
closed in a manner that protects public and worker health and safety 
while preserving the quality of the environment. DOE has the strong 
support of our national laboratories to aid in the scientific and 
investigatory work that is ongoing. DOE, BSC and the national labs are 
all working together effectively in support of our one common goal--
constructing and operating a first-of-its-kind, world-class facility to 
store this nation's spent nuclear fuel and high-level radioactive 
waste.
    We are aggressively proceeding with numerous activities in support 
of the December 2004 goal. Design work is underway on both the surface 
and subsurface facilities and progress continues on both the Preclosure 
Safety Analysis and the Total System Performance Assessment. Other 
activities include completing and certifying the Licensing Support 
Network no later than June 2004.
    In addition, work proceeds on closing the nine Key Technical Issues 
(KTIs) identified by the NRC in pre-licensing interactions. 293 
agreements were made prior to site recommendation, largely for 
documentation and data confirmation. The NRC used these agreements as a 
basis for their sufficiency comments that accompanied the site 
recommendation. As of March 17, 2004, 213 of these agreements have been 
submitted to the NRC with 90 closed and 123 in various stages of NRC 
review. 80 remain to be addressed and submitted to the NRC between now 
and License Application in December 2004.
    Becoming an NRC licensee is more than closing KTIs and filing a 
license application. BSC is working closely with DOE to implement a 
nuclear operational culture to ensure the effectiveness of licensing, 
design, and construction activities under NRC oversight. As we enter 
this environment, together we must do a number of things to gain and 
keep regulator confidence and trust. First and foremost is establishing 
a strong and sustainable safety culture.
    As part of the Management Improvement Initiatives (MII), a program 
established last year to identify and focus attention on changes 
necessary to be a successful license applicant, a rigorous Safety-
Conscious Work Environment, where every employee is free to raise and 
resolve concerns without fear of retribution, is being strengthened on 
the Project. I am pleased to report that consecutive surveys have shown 
improvement in employee attitudes and perceptions. The results are 
encouraging and both BSC and DOE are committed to addressing the 
results of these surveys and continue making improvements.
    As part of the MII, we have completed a major reorganization of BSC 
that reflects a move from a functional structure to a line-
accountability, project-focused structure. I believe this new structure 
will better reflect the work to be done and will allow for closer 
coordination and integration of Project personnel and activities.
    I have also brought to the Project a new Quality Assurance manager 
with directly applicable experience to revamp and revitalize this 
important function. Quality is not just a buzzword--it is our integrity 
and our credibility. It is the only acceptable way to do our work and 
the first step for a successful License Application. From the top down, 
our organization is devoted to achieving quality in everything we do so 
that we might provide an objective and visible basis for confidence 
that we are doing things right the first time. Quality is each 
individual's responsibility and senior management will assure that 
clear direction and accountability are provided for a visible and 
effective process.
    The majority of our work between now and December 2004 will focus 
on the License Application. We are on schedule to submit a complete, 
high-quality LA to the NRC by the end of this year. Once the NRC 
receives the LA, it will conduct extensive technical reviews and 
hearings during which it will consider the scientific and design 
information submitted on the repository. The NRC will grant a 
construction authorization only if it concludes from its investigations 
and public hearings that the repository will protect the safety and 
health of workers and the public.
    If construction authorization is granted, DOE will begin initial 
construction of the repository. This may occur in early 2008. Before 
completing construction, DOE would have to update its LA for a license 
to receive and possess waste. If the amended license is granted, 
initial receipt of waste would begin in 2010.
    You may have noticed a lot of ``ifs'' in my previous testimony. 
That's because this Program, which has one single focus--to build a 
permanent high-level waste repository, will only succeed if--there's 
that word again--if it is fully funded by the Congress. The Department 
cannot begin repository operations by 2010 if adequate funding is not 
available to license and construct a facility. Nor will waste be moved 
if we don't have a transportation system up and running in time. Yes, 
lots of things other than money are required for success but cold hard 
cash is the lynch pin. Without it, all the hard work and good 
intentions of the thousands of people involved will not make the 
project a success.
    As you are all well aware, this Program has a long history of being 
significantly underfunded and thus, behind schedule. FY2004, thanks to 
Chairman David Hobson, was an exception--the Program was funded at only 
$11 million less than the Administration's request. And because we 
received adequate funding, we have maintained our 2004 schedule--even 
with five months of a Continuing Resolution--and are on track to submit 
a high-quality, docketable License Application to the NRC by the end of 
this calendar year.
    As I mentioned earlier in my testimony, receipt of waste in 2010 is 
heavily dependent on adequate funding. Success is achievable, but will 
be jeopardized if the Program suffers from inadequate funding. Full 
funding of this Program has always been crucial, yet from 1986 to 2003, 
appropriations have consistently fallen short of the budget request.
    Steady and adequate funding is crucial as we make the critical 
transition from scientific site investigation to preparation for 
licensing, constructing and operating a repository. Past underfunding 
has forced the DOE to delay and reprioritize the work leading to 
successful milestone achievement. Continued underfunding, and the delay 
that inevitably follows, will only increase costs to the federal 
government--for both storage of defense waste and liability to civilian 
reactors. Some estimate the cost of delay at $1 billion a year.
    This year, funding the Project is not as simple as merely 
requesting and receiving an adequate appropriation. Though the 
Administration's request of $880 million is large and adequate for this 
year's Project activities, the request assumes passage of legislation 
to ``fix'' the Nuclear Waste Fund by reclassifying fees as offsetting 
collections. Without this, or a similar fix, the appropriations 
committees will be left with a $750 million shortfall--a very serious 
problem for both appropriators and the Project.
    I urge the Members of this Committee to give very serious 
consideration to the bills that are the subject of today's hearing--HR 
3429 and HR 3981--and recognize that without the solution they offer, 
this Program cannot succeed. I am a project manager, not a lawyer or 
legislator so I won't tell you how to fix the funding--I can just tell 
you it needs to be fixed. If I, or any other project manager, is given 
funding adequate to the task, then I will succeed at that task. 
Inadequate funding will only lead to more delay and eventual failure of 
the project.
    I cannot emphasize enough the importance of adequate funding. We 
are already operating on the margins as a result of previous cuts and 
cannot withstand much more without schedule slippage. Any less than the 
budget request for FY2005 seriously jeopardizes receipt of waste in 
2010. Any funds in addition to the request would increase confidence 
that we could meet the 2010 date.
    Thank you for your time. I am happy to answer any questions you may 
have.

    Mr. Otter. Thank you, Mr. Mitchell. I would now recognize 
the ranking member to open the questions.
    Mr. Boucher. Thank you very much, Mr. Chairman. I am going 
to ask just one question, and I will begin by asking you, Mr. 
Ervin, the legislation that we have before us, two versions of 
it actually, accomplish the same goal and that is to provide 
some greater level of assurance that on a going forward basis 
the revenues that are paid into the fund are derived from the 
utilities that have nuclear energy, and are actually spent for 
the intended purpose.
    Both of those bills would affect approximately $770 million 
on an annual basis, and I think that there is a general 
agreement here that we need to do that at a minimum. My 
question to you is, is that a sufficiently ambitious agenda at 
this point?
    We still have $14 billion in payments previously made from 
the electric utilities into this fund, and much of that money 
in the past has been diverted to other purposes. We really have 
no guarantee as we look at the matter today that this money 
ultimately is going to be spent as it was designed to be spent.
    And should we not at this point legislatively be taking 
some steps to provide assurance not only with regard to the 
$770 million coming into the fund annually in the future, but 
also with regard to the $14 billion previously collected and 
now placed in the fund?
    So, Mr. Ervin, your comments on that, and then I would 
welcome comments from the other two witnesses.
    Mr. Ervin. The short answer to your question is that NARUC 
would certainly like to do that, but I cannot speak for what is 
politically possible within this body. But in addition to----
    Mr. Boucher. But it is your view as the NARUC 
representative is that we should be a little bit more ambitious 
and undertake that greater challenge?
    Mr. Ervin. NARUC believes that every penny that has been 
paid into the Nuclear Waste Fund should be used and made 
available easily for the purposes for which it was intended. We 
have endorsed the specific pieces of legislation because we 
favor what they do, but I would agree with the implication of 
your question that the other $14 billion ought to be accessible 
as well. And our resolutions and our membership I believe would 
support any legislation that did that.
    Mr. Boucher. Thank you, Mr. Ervin. Ms. Howard.
    Ms. Howard. We would certainly agree.
    Mr. Boucher. Thank you, Ms. Howard. Mr. Mitchell.
    Mr. Mitchell. Anything that can be done to stabilize the 
funding ensures the success of Yucca Mountain.
    Mr. Boucher. Well, the three of you have provided a truly 
excellent series of answers to my questions, and I thank you. 
Thank you, Mr. Chairman.
    Mr. Shimkus. You are welcome. Now you can run and vote, and 
I think after you guys put up with me, you will be done, and we 
may have a few members matriculate back here after a few votes.
    Mr. Ervin, good to see you again. I think that those rate 
issues that you mentioned, if we would just move the standard 
market design, there might be some savings there. I know that 
we have a disagreement on that, but I am sure that is another--
--
    Mr. Ervin. I was going to say that I came back with the 
express purpose of making you happier this time.
    Mr. Shimkus. But I think that we are on the same side, 
which is good. I have got a quick series here. Mr. Mitchell, in 
your written testimony or in the written testimony of Chairman 
Diaz, he points out that quality management remains a 
challenging program area for DOE, one which the NRC staff 
continues to monitor.
    What can you tell me about Bechtel's quality assurance 
program at Yucca, and is it fully effective and implemented to 
your satisfaction?
    Mr. Mitchell. I would say that we are on a path to 
continuous improvement, which will be consistent with the 
license application of being able to meet and sustain quality 
requirements acceptable as a regulated entity.
    Mr. Shimkus. And following up other questions previously, 
do you think that you have enough technical staff with the 
knowledge, and skills, and abilities to review the application, 
and in a fairly informed and timely manner?
    Mr. Mitchell. We certainly have that. Our job of course is 
to produce this, as well as to review, as we go along, and I 
believe that you will find and as we have stated that we do in 
fact have those resources.
    Mr. Shimkus. And what about the NRC staffing management, or 
not just management, but the staffing positions? Do you think 
they have enough to meet the demand? I think you probably heard 
me ask earlier, what we are trying to make sure is that there 
are resources and personnel are in place to meet the December 
time line.
    Mr. Mitchell. Yes, sir, we have a structured set of 
interactions with the NRC that have been doing on for some 
period of time. We have found those steps to be excellent, and 
we have found them to be interactive, and to this date we have 
found that the resources they have are applicable and apply to 
substantially what needs to be done in the process.
    Mr. Shimkus. Great, and again following up on this line of 
questioning, I talked about the 80 remaining key technical 
issues. Will you be submitting these 80 with enough time for 
the NRC to review them to make the December time line?
    Mr. Mitchell. We believe so. Right now it is our intention 
to fully conform to those agreements that we have with the NRC.
    Mr. Shimkus. Great. Thank you. Obviously that continues 
with the ranking member's comments. We appreciate this 
testimony.
    Commissioner Ervin, it is my understanding that for each 
day or each year we delay the 2010 waste acceptance date for 
Yucca Mountain that an additional $500 million in costs will be 
incurred.
    But your testimony points out that this $500 million figure 
is just a tip of the iceberg, because it only accounts for the 
additional government's costs of managing government high level 
waste, and not the costs incurred by commercial nuclear plant 
sites.
    Can you discuss this further and describe how much it will 
cost the private sector if we delay the opening of Yucca 
Mountain? And, of course, I am from Illinois, and we have 
incurred great costs through a trust fund in trying to receive 
some benefits from all those costs.
    Mr. Ervin. Well, I think that Illinois and North Carolina 
are one and two according to our calculations, but I don't know 
the exact non-governmental costs. I do know, however, that 
there are at least two respects in which non-governmental costs 
should include.
    First of all, we have as you know a series of lawsuits 
pending by the nuclear facilities against the DOE for non-
acceptance of fuel by 1998. The longer the non-acceptance 
period lasts the higher the damages are.
    Second, as you know, we have got to store the fuel 
somewhere in the interim, and there are costs associated with 
that, and I can't speak for how it is done in Illinois, but I 
know that in North Carolina, under our normal rate making 
processes, the costs of such storage would be previously 
incurred costs and it would be included in the utility rates.
    And so you have at least those two types of costs. I can't 
quantify them because I just don't know what the answer to that 
is, but it would appear to me that those costs would be 
substantial as best as I can tell.
    Mr. Shimkus. Based on the facilities that you are 
knowledgeable with what is the onsite capacity and are you 
close to relicensing, and do you have close to some that have 
full storage space, of which--I mean, there would really be a 
cost if you had to stop producing.
    Mr. Ervin. I don't think that any of our facilities that 
serve North Carolina are to the point of running out of storage 
space, and therefore having to close. I understand that there 
are some in the rest of the country. As an example, Minnesota 
that comes to mind.
    We have had to move some fuel around within North Carolina 
utilities, and I am not sure if that is because of a lack of 
storage space, or whether that was just an attempt at managing 
the fuel better.
    But our facilities are in the process of obtaining license 
extensions. Some have already obtained several license 
extensions, and I believe all of the companies that serve North 
Carolina either have obtained such extensions, or in the 
process of attempting to do so.
    The end result is that--and as you indicated--we are going 
to continue to use these units, and they make up a substantial 
portion of the electricity that is consumed in North Carolina, 
and in order for us to continue to serve our citizens, we are 
going to have to have a way to store this fuel.
    And it seems to us that solving the kinds of problems which 
your legislation addresses is at least a step in the right 
direction toward doing that.
    Mr. Shimkus. Ms. Howard, you are nodding, and is there 
something that you want to add on this debate?
    Ms. Howard. Well, just to add on that most of the nuclear 
plant sites in the country have had to add additional storage 
capacity either in the form of expanding the pools themselves, 
or how to manage the pools, or putting them in what is known as 
dry cask storage.
    And it is a substantial cost that the companies are 
incurring, and at the same time paying in the one mill per 
kilowatt hour of generation from the nuclear plant.
    Mr. Shimkus. What percentage of these are in major 
metropolitan areas that you would envision? Is it 50 percent, 
or 75 percent of these facilities?
    Ms. Howard. I would say closer to 50 percent or less. 
Again, it is that most of them are east of the Mississippi.
    Mr. Shimkus. Well, it is critical on the debate on the 
whole Yucca Mountain to continue to make the argument there 
still are facilities in major metropolitan areas, urban areas, 
and suburban areas, versus a desert under a mountain.
    Ms. Howard. And the way that the program was envisioned, 
because Mr. Markey asked a question that you would still have 
fuel being stored for the first 5 years, and that was the way 
the plan was originally designed, and it appears adequate to 
store that for the cooling period.
    And then the assumption that you would then be shipping to 
the Federal repository, and what we have had to add is adding 
capacity at the pools, and now the dry cask storage, and that 
was a technology that truly was developed because of the 
government's inaction in moving forward with Yucca Mountain.
    Mr. Ervin. Just to give you an example, and again this is 
antidotal, but of the seven nuclear units that the Depaul 
Company operates that serve North Carolina, four of them are 
very close to Charlotte.
    One of the four units that Progress Energy uses to serve 
its territory is real close to Raleigh, and two of them are 
relatively close to Wilmington. So the implication of your 
question that a lot of these plants are fairly close to at 
least what in North Carolina would be major metropolitan areas 
is certainly true.
    Mr. Shimkus. And I can speak to the Chicago land area and 
the facilities there. Ms. Howard, and this will be my final 
question, you have heard the debate on the time line, in 
December 2010. From the industry's position do you think we are 
on track?
    Ms. Howard. Yes, we do, and again in my testimony, I 
mentioned that caveat, that with sufficient funding, and with 
sufficient management in both of the programs, and appropriate 
oversight.
    We are very positive that the Department of Energy and its 
program management is going to make that application and we are 
providing the industry support that we can to make sure that 
anything that they need from the industry will be available to 
them.
    Mr. Shimkus. Well, I think you see some excitement from 
most members of the committee, and we look forward to working 
with you and following this process to work, because we believe 
that it is very important for all of those citizens of this 
country, and based on generation remaining as part of the 
nuclear power industry. So I thank you, and seeing no other 
members, I call this hearing adjourned.
    [Whereupon, at 1:02 p.m., the subcommittee was adjourned.]

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