[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]
CHARTING THE COURSE FOR AMERICAN
NUCLEAR TECHNOLOGY: EVALUATING
THE DEPARTMENT OF ENERGY'S
NUCLEAR ENERGY RESEARCH
AND DEVELOPMENT ROADMAP
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON SCIENCE AND TECHNOLOGY
HOUSE OF REPRESENTATIVES
ONE HUNDRED ELEVENTH CONGRESS
SECOND SESSION
__________
MAY 19, 2010
__________
Serial No. 111-94
__________
Printed for the use of the Committee on Science and Technology
Available via the World Wide Web: http://www.science.house.gov
----------
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COMMITTEE ON SCIENCE AND TECHNOLOGY
HON. BART GORDON, Tennessee, Chairman
JERRY F. COSTELLO, Illinois RALPH M. HALL, Texas
EDDIE BERNICE JOHNSON, Texas F. JAMES SENSENBRENNER JR.,
LYNN C. WOOLSEY, California Wisconsin
DAVID WU, Oregon LAMAR S. SMITH, Texas
BRIAN BAIRD, Washington DANA ROHRABACHER, California
BRAD MILLER, North Carolina ROSCOE G. BARTLETT, Maryland
DANIEL LIPINSKI, Illinois VERNON J. EHLERS, Michigan
GABRIELLE GIFFORDS, Arizona FRANK D. LUCAS, Oklahoma
DONNA F. EDWARDS, Maryland JUDY BIGGERT, Illinois
MARCIA L. FUDGE, Ohio W. TODD AKIN, Missouri
BEN R. LUJAN, New Mexico RANDY NEUGEBAUER, Texas
PAUL D. TONKO, New York BOB INGLIS, South Carolina
STEVEN R. ROTHMAN, New Jersey MICHAEL T. McCAUL, Texas
JIM MATHESON, Utah MARIO DIAZ-BALART, Florida
LINCOLN DAVIS, Tennessee BRIAN P. BILBRAY, California
BEN CHANDLER, Kentucky ADRIAN SMITH, Nebraska
RUSS CARNAHAN, Missouri PAUL C. BROUN, Georgia
BARON P. HILL, Indiana PETE OLSON, Texas
HARRY E. MITCHELL, Arizona
CHARLES A. WILSON, Ohio
KATHLEEN DAHLKEMPER, Pennsylvania
ALAN GRAYSON, Florida
SUZANNE M. KOSMAS, Florida
GARY C. PETERS, Michigan
JOHN GARAMENDI, California
VACANCY
C O N T E N T S
May 19, 2010
Page
Witness List..................................................... 2
Hearing Charter.................................................. 3
Opening Statements
Statement by Representative Bart Gordon, Chairman, Committee on
Science and Technology, U.S. House of Representatives.......... 6
Written Statement............................................ 7
Statement by Representative Dana Rohrabacher, Acting Minority
Ranking Member, Committee on Science and Technology, U.S. House
of Representatives............................................. 7
Written Statement by Representative Ralph M. Hall, Minority
Ranking Member, Committee on Science and Technology, U.S.
House of Representatives................................... 9
Prepared Statement by Representative Jerry F. Costello, Member,
Committee on Science and Technology, U.S. House of
Representatives................................................ 9
Prepared Statement by Representative Harry E. Mitchell, Member,
Committee on Science and Technology, U.S. House of
Representatives................................................ 10
Panel I:
Dr. Warren P. Miller, Assistant Secretary, Office of Nuclear
Energy, U.S. Department of Energy
Oral Statement............................................... 11
Written Statement............................................ 13
Biography.................................................... 16
Discussion
Cost Sharing................................................... 17
Creating an Export Market...................................... 17
Yucca Mountain Nuclear Waste Repository........................ 18
Uranium and Thorium............................................ 20
Water-Cooled vs. Gas-Cooled Reactors........................... 22
Specific Issues in the DOE Roadmap............................. 23
More on Uranium Supply......................................... 25
Information on Full Recycling.................................. 26
Small Modular Reactors......................................... 27
Modeling and Simulation of Reactors............................ 28
General Comments............................................... 29
Licensing for SMRs............................................. 29
Cost Competitiveness........................................... 30
Panel II:
Mr. Christofer Mowry, President and CEO, Babcock & Wilcox Nuclear
Energy, Inc.
Oral Statement............................................... 32
Written Statement............................................ 34
Biography.................................................... 40
Dr. Charles Ferguson, President, Federation of American
Scientists
Oral Statement............................................... 40
Written Statement............................................ 42
Biography.................................................... 48
Dr. Mark Peters, Deputy Director for Programs, Argonne National
Lab
Oral Statement............................................... 48
Written Statement............................................ 50
Biography.................................................... 60
Mr. Gary M. Krellenstein, Managing Director, Tax Exempt Capital
Markets, JP Morgan Chase & Co.
Oral Statement............................................... 61
Written Statement............................................ 62
Biography.................................................... 64
Dr. Thomas L. Sanders, President, American Nuclear Society
Oral Statement............................................... 64
Written Statement............................................ 66
Biography.................................................... 68
Discussion
U.S. Manufacturing Needs....................................... 69
New Reactor Permitting......................................... 71
How DOE Can Support New Developments........................... 71
Financing and Cost Competitiveness............................. 72
A Skilled Workforce and Domestic Manufacturing................. 73
Submarine Reactors and mPower.................................. 74
Fission vs. Fusion............................................. 75
Expediting Technology Development.............................. 76
Maintaining Competition........................................ 77
Appendix 1: Answers to Post-Hearing Questions
Dr. Warren P. Miller, Assistant Secretary, Office of Nuclear
Energy, U.S. Department of Energy.............................. 82
Mr. Christofer Mowry, President and CEO, Babcock & Wilcox Nuclear
Energy, Inc.................................................... 86
Dr. Charles Ferguson, President, Federation of American
Scientists..................................................... 89
Dr. Mark Peters, Deputy Director for Programs, Argonne National
Lab............................................................ 91
Mr. Gary M. Krellenstein, Managing Director, Tax Exempt Capital
Markets, JP Morgan Chase & Co.................................. 92
Dr. Thomas L. Sanders, President, American Nuclear Society....... 94
Appendix 2: Additional Material for the Record
Summary and Table of Contents, Department of Energy Nuclear
Research and Development Roadmap............................... 98
A Sustainable Energy Future: The Essential Role of Nuclear
Energy, from DOE Directors of National Laboratories............ 106
Additional Testimony from Marvin S. Fertel, President and Chief
Executive Officer, Nuclear Energy Institute.................... 114
Additional Testimony from Paul Lorenzini, Chief Executive
Officer, NuScale Power......................................... 121
Additional Testimony from Dr. Travis W. Knight, Assistant
Professor and Director, Nuclear Engineering Program, University
of South Carolina, submitted by Representative Bob Inglis...... 124
CHARTING THE COURSE FOR AMERICAN NUCLEAR TECHNOLOGY: EVALUATING THE
DEPARTMENT OF ENERGY'S NUCLEAR ENERGY RESEARCH AND DEVELOPMENT ROADMAP
----------
WEDNESDAY, MAY 19, 2010
House of Representatives,
Committee on Science and Technology,
Washington, DC.
The Committee met, pursuant to call, at 10:02 a.m., in Room
2318 of the Rayburn House Office Building, Hon. Bart Gordon
[Chairman of the Committee] presiding.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
hearing charter
COMMITTEE ON SCIENCE AND TECHNOLOGY
U.S. HOUSE OF REPRESENTATIVES
Charting the Course for American Nuclear
Technology: Evaluating the Department of
Energy's Nuclear Energy Research and
Development Roadmap
wednesday, may 19, 2010
10:00 a.m.-12:00 p.m.
2318 rayburn house office building
Purpose
On Wednesday, May 19th, 2010 the House Committee on Science &
Technology will hold a hearing entitled: ``Charting the Course for
American Nuclear Technology: Evaluating the Department of Energy's
Nuclear Energy Research and Development Roadmap.''
The Committee's hearing will explore the Administration's strategy
for research and development to advance clean and affordable nuclear
technology. Amongst the issues to be considered will be how the Federal
Government will enhance the safety and economic viability of nuclear
power and what programs it recommends for managing nuclear waste,
advancing reactor design, sustaining the existing nuclear fleet, and
minimizing risk of proliferation of nuclear materials.
Witnesses
Panel I
Dr. Warren P. Miller is the Assistant Secretary for
the Office of Nuclear Energy at the U.S. Department of Energy.
Dr. Miller will testify on the Department of Energy's recently
released Nuclear Energy Research and Development Roadmap and
provide additional guidance on the Office of Nuclear Energy's
technology and innovation initiatives.
Panel II
Mr. Christofer Mowry is the President and CEO of
Babcock & Wilcox Nuclear Energy, Inc. Mr. Mowry will testify on
Small Modular Reactors and provide an overview of B&W's reactor
operations. He will provide information on the role Small
Modular Reactors can play in reducing capital costs and
improving the safety of nuclear power. Mr. Mowry will also
comment on DOE's Nuclear Energy Research and Development
Roadmap.
Dr. Charles Ferguson is the President of the
Federation of American Scientists. The Federation of American
Scientists (FAS) is a public policy think-tank that was
originally founded by scientists from the Manhattan Project.
Currently FAS is conducting a project titled the Future of
Nuclear Energy in the United States to explore and analyze the
direction of nuclear energy technology innovation. Dr. Ferguson
will provide an overall analysis and critique of the Nuclear
Energy Research and Development Roadmap and Small Modular
Reactor technology.
Dr. Mark Peters is the Deputy Director for Programs
at Argonne National Lab. Dr. Peters will testify on the Nuclear
Energy Research and Development Roadmap with particular
attention to the Administration's strategy for waste management
technology. He will also present a summary of new waste
management technologies currently under development at Argonne
National Lab.
Mr. Gary M. Krellenstein is a Managing Director in
JPMorgan's Energy and Environmental Group and is a former
nuclear engineer at the Department of Energy and Nuclear
Regulatory Commission. Mr. Krellenstein's areas of focus are
municipal utilities, Rural Electric Cooperatives, alternative
energy technologies and project financing, and is also involved
in JPMorgan's ``carbon'' policies. Mr. Krellenstein will
testify on private capital interest in nuclear power including
how Small Modular Reactors and other new technologies may
attract private capital investment.
Dr. Thomas L. Sanders is the President of American
Nuclear Society. The American Nuclear Society is a nuclear
professional society dedicated to promoting the awareness and
understanding of the application of nuclear science and
technology. Dr. Sanders will provide an overall evaluation of
the Nuclear Energy Research and Development Roadmap and provide
recommendations of policy areas to more fully develop or
explore.
Background
According to the Department of Energy's Energy Information Agency
(EIA), the nation's 104 commercial nuclear reactors currently provide
70 percent of the emissions-free energy in the United States and
approximately 20 percent of the country's electricity generation.
However, nuclear power as it exists today relies on a ``once-through''
fuel cycle that produces high level radioactive waste from enriched
uranium. In the United States there exists a stockpile of approximately
63,000 metric tons of nuclear waste from reactors and generates roughly
2,000 more tons per year. Furthermore, the capital costs of nuclear
plants have risen steeply and present a high hurdle to deployment of
new reactors. Some have argued that without a fully developed strategy
to deal with these challenges, nuclear power will be unable to compete
with other fuel sources.
The Obama Administration recently proposed a substantial
modification of Federal nuclear energy policy which may have widespread
implications for the nation's energy portfolio and for the focus of the
Department of Energy's nuclear energy research, development,
demonstration and commercial application initiatives. The Waste Policy
Act of 1982 requires the Federal Government to construct a nuclear
waste repository, and Yucca Mountain was later designated as the site
for a permanent waste repository in 1987. However, in its Fiscal Year
2011 budget request, the Administration proposes to terminate funding
for Yucca Mountain. To address the growing backlog of nuclear waste and
the environmental concerns surrounding this issue, the President
convened the bipartisan Blue Ribbon Commission on America's Nuclear
Future. This Commission shall evaluate the best path forward for
managing nuclear waste. Also reflected in the Fiscal Year 2011 budget
request is a reorganization of the Office of Nuclear Energy to account
for the cancellation of the Yucca project and a priority shift towards
a ``goal-oriented, science-based approach'' that will include a larger
focus on research & development in addressing post-generation nuclear
waste. Furthermore, the Administration proposes to increase loan
guarantees for nuclear power by $36 billion. This is intended to
provide funding guarantees for construction of at least six new nuclear
plants and will likely result in development of the first new U.S.
commercial reactor in decades.
The Administration's Roadmap
On April 15, 2010 the Department of Energy (DOE) published the
Nuclear Energy Research and Development Roadmap (Roadmap) with the goal
of providing a guide to the Office of Nuclear Energy's internal
programmatic and strategic planning going forward. The report lays out
four objectives: 1) establish solutions that can improve reliability
and safety of the current fleet of reactors and extend their life; 2)
advance reactor technology to both improve affordability and
performance; 3) develop sustainable nuclear fuel cycles; and 4)
understand and minimize the risks of proliferation and terrorism.
Objective 1: Safety and Life Extension
While nuclear power today accounts for twenty percent of all
electricity consumed in the United States, the plants supplying that
energy are nearing retirement age. By 2035 most of the 104 operating
reactors will have surpassed their 60 year life expectancy. Should new
nuclear plants not be constructed in the interim, it is possible that
retiring nuclear plants will be replaced by fossil fuel generation in
order to meet rising demand. The Roadmap outlines a list of research
initiatives that will explore how to extend reactor life and how to
increase their safety and efficiency.
Objective 2: Improve Reactor Technology and Reduce Costs
According to Moody's Investors Service, the current cost to
construct a nuclear power plant is around $5000 to $7000 per kWe of
capacity in comparison to the $1625 per kWe for a traditional
pulverized coal plant. The Roadmap highlights a series of programs to
reduce the capital cost of nuclear and create advanced, clean reactors.
Among DOE's priorities is the creation of a dedicated Small Modular
Reactor (SMR) program. SMRs by definition are smaller than conventional
reactors, which can be as large as approximately 1500 mWe. Furthermore,
certain SMR designs allow for in tandem or ``stackable'' use of
multiple units to achieve large generation capacity. As envisioned by
SMR supporters, this technology should reduce capital costs related to
nuclear deployment as well as increase overall safety of nuclear
generation. What is unclear is if the private capital and finance
community will embrace SMRs as a worthwhile and acceptable risk
investment.
Objective 3: Sustainable Nuclear Fuel Cycles
In the Roadmap, DOE provides a broad outline of its strategy for
nuclear waste management which focuses largely on the development of a
suite of options that future decision makers may pursue. This approach
reflects the uncertainty created by the pending Blue Ribbon Commission
decision and its two year investigation. Until its resolution the
Department will endeavor to establish the programs that will serve as
the basis to implement the Commission's recommendations. The Roadmap
provides three potential strategies for waste management: 1) advanced
once-through; 2) modified-open; and 3) full recycle. Advanced once-
through cycle is similar in process to the fuel cycle used by
commercial nuclear power today, but will develop fuels for use in
current reactors that will increase efficiency and reduce waste output.
A modified open cycle would use innovative fuel-forms and advanced
reactors to increase the use of the energy content of fuel and reduce
waste output. This approach would also employ some technologies to
separate waste products from reusable isotopes. A full recycle approach
endeavors to create a cost-effective and low proliferation risk process
of repeatedly cycling fuel waste products to reduce radioactivity and
decay heat and increase total energy consumption. All approaches will
require some degree of waste storage.
Objective 4: Understanding and Addressing Proliferation
To address the concern that civilian nuclear power resources could
be used by foreign entities for weapons applications, DOE recommends a
strategy to better account for and understand proliferation risks. The
Roadmap advises that any technology innovation and development program
must be informed by development of more advanced risk assessment tools
to limit, mitigate and manage the risks of nation-state proliferation
and lead to innovation of next generation physical security
technologies.
Conclusion
The Obama Administration's Roadmap is intended to demonstrate its
commitment to encouraging wider use of current nuclear energy and to
innovation of advanced nuclear technology. Specifically through Federal
research and development, the Administration seeks to address the
widely known risks and concerns that have hampered the industry since
its inception, including waste management, capital cost reduction, and
proliferation security.
Chairman Gordon. Good morning, and welcome to today's
hearing to review the Department of Energy's recently published
Nuclear Energy Research and Development Roadmap. I look forward
to learning from the witnesses how this policy framework will
shape Federal R,D&D policy for nuclear technologies.
I would like to welcome our expert panelists, who will
discuss and evaluate the four main objectives highlighted in
the Roadmap and help us to understand how innovation and
nuclear energy can affect our national energy portfolio, our
economic competitiveness, and our national security.
As I have said before, I am a supporter of nuclear power,
as I believe it is a part of the solution to challenges of our
energy independence and climate change. Our 104 commercial
reactors today produce 20 percent of our electricity and 70
percent of our emissions-free energy.
However, the decision by the Administration to cancel
funding for the Yucca Mountain Repository has served to
highlight a continuing question with nuclear power. How can we
best manage the waste?
Furthermore, as capital costs continue to rise for
construction of new plants, the future of the U.S. domestic
industry, that in the 1970s seemed so promising, now appears
wholly dependent on loan guarantees, subsidies, and is losing
pace to foreign powers pursuing advanced nuclear technology.
The Roadmap at issue or the roadmap at issue in today's
hearing proposes solutions to these and other problems
affecting the nuclear power. It outlines four R&D objections.
First, to establish solutions that can improve reliability
and safety for the current fleet of reactors and extend their
life expectancy, second, advance reactor technology to both
improve affordability and performance, third, develop
sustainable and efficient nuclear fuel cycles, and fourth,
understand and minimize the risk of proliferation and
terrorism.
This hearing is a continuation in a series of discussions
on nuclear power that will culminate in the Committee moving
R&D legislation later this year. I am hopeful that today's
panelists will shed some light on the past--best path forward
for our research and development and strategy, and I want to,
again, thank these very talented, multiple panels for being
here today.
Let me also give a quick apology. I am going to have to
watch part of this on our award-winning website later on this
afternoon. We have a suspension bill that is on the floor now.
I need to go attend to that, and for my Republican Members that
are here, it is the America COMPETES Act that we are bringing
up on suspension. I got the message, and it is being reduced
from a five-year to a three-year authorization. The funding
authorization will also be reduced by 50 percent from what we
voted for.
So we have done that, and you will be pleased to know that
those individuals that are watching pornography on Federal
systems will be punished and that no child molesters will be
eligible for any of these fundings. So hopefully we have
covered the concerns.
And so I am going to yield to my friend from California,
Mr. Rohrabacher. I used to be his Ranking Member when he
chaired and I was the Ranking Member of the Space and
Aeronautics subcommittee, and he was a chairman that dealt with
me very fairly. And I will ask Subcommittee Chairman Baird to
take over. I hope to be back with you later.
Please, witnesses, this is a very important issue. There is
a lot going on this morning, and so the lack of attendance here
and certainly my temporary lapse does not diminish the
importance of this issue. Our staffs are here, this is going to
be part of our record, and your testimony will play an
important role in developing the basis for what I hope will be
a really excellent R&D authorization that we will be able to
get into law this year. Thank you.
[The prepared statement of Chairman Gordon follows:]
Prepared Statement of Chairman Bart Gordon
Good morning and welcome to today's hearing to review the
Department of Energy's recently published ``Nuclear Energy Research and
Development Roadmap.'' I look forward to learning from the witnesses
how this policy framework will shape Federal RD&D programs for nuclear
technologies.
I would like to welcome our expert panelists who will discuss and
evaluate the four main objectives highlighted in the Roadmap and help
us understand how innovation in nuclear energy can affect our national
energy portfolio, our economic competitiveness, and our national
security.
As I have said before, I am supportive of nuclear power as I
believe it is a part of the solution to the challenges of energy
independence and climate change. Our 104 commercial reactors today
produce 20 percent of our electricity and 70 percent of our emissions
free energy and have run with a strong record of safety and operating
efficiency.
However, the decision by the Administration to cancel funding for
the Yucca Mountain repository has served to highlight a continuing
question with nuclear power: how can we best manage the waste?
Furthermore, as capital costs continue to rise for construction of new
plants, the future of a U.S. domestic industry that in the 1970s seemed
so promising, now appears wholly dependent on loan guarantees and
subsidies, and is losing pace to foreign powers pursuing advanced
nuclear technology.
The Roadmap at issue in today hearing proposes solutions to these
and other problems affecting nuclear power. It outlines four R&D
objectives. First, establish solutions that can improve reliability and
safety of the current fleet of reactors and extend their life
expectancy. Second, advance reactor technology to both improve
affordability and performance. Third, develop sustainable and efficient
nuclear fuel cycles. And fourth, understand and minimize the risks of
proliferation and terrorism.
This hearing is a continuation in a series of discussions on
nuclear power that will culminate in the Committee moving R&D
legislation later this year. I am hopeful that today's panelists will
shed some light on the best path forward for our research and
development strategy and will highlight the challenges that must be
addressed as we proceed towards once again becoming a global leader in
nuclear energy.
Again, I would like to thank the witnesses for their participation
today and I look forward to your testimony.
Chairman Gordon. And I recognize Mr. Rohrabacher.
Mr. Rohrabacher. I thank you very much, Mr. Chairman. I
would wish you good luck on the floor, but we will wait and
see.
This following statement is a statement by Ranking Member
Ralph Hall, who is also on the floor right now to be involved
with the debate on the COMPETES Act. I will be adding a few
thoughts of my own, but this is basically Chairman Hall's
opening statement and also would like to welcome Mr. Baird to
the Chairman's seat. On this issue I know that he can do a
great job because he is very well known and respected for his
understanding of this particular issue, as well as others I
might add.
So Mr. Baird, thank you for holding this hearing, and thank
you to our Chairman as well for holding this hearing today on
nuclear energy R&D. After several decades of setbacks and
inaction, a growing consensus is finally emerging in support of
expanding the role of nuclear power in our Nation's energy
portfolio. Electricity demand in the United States is expected
to grow by 30 percent in the 25 years, and nuclear energy
provides a safe, reliable, and cost-competitive source of base
load power to meet this demand.
While much of the nuclear revival revolves and involves
around licensing and building more reactors, using existing
light-water reactor technology, there are a host of longer-term
activities that must also be pursued.
First and foremost among those are dealing with the
management of spent nuclear fuel, and number two, supporting
R&D to facilitate advances and licensing of new reactor designs
and to extend the life of the current reactors that we have in
operation.
With respect to waste management, I have been very clear,
and I am speaking for Congressman Hall now but also for myself,
about my objections to the Administration's attempt to shut
down the Yucca Mountain Project, particularly given the
cancellation was done without serious consideration of
alternative options. You might say this--well, I will have my
own comment later.
The Federal Government is legally obligated to deal with
this waste, and the current absence of a path forward threatens
to jeopardize growing public support for expanding nuclear
power while increasing taxpayer liabilities. This needs to be
addressed as soon as possible.
With respect to research and development, there are
numerous advanced nuclear designs and technologies that hold
promise to address the longer-term cost, safety, and security
challenges facing the nuclear industry, and the
Administration's R&D roadmap provides a useful outline of
Federal efforts in this area.
I support strengthening this R&D effort, and I am
particularly interested in the potential of small modular
reactors that are a focus of this hearing. I look forward--and
this is Ranking Member Hall, I look forward to working with the
Chairman, Mr. Gordon, as we consider crafting nuclear energy
R&D legislation later this year, and I thank him for assembling
this excellent panel of witnesses today. That is the statement
from Mr. Hall.
I would add a few thoughts of my own, and that is I believe
that it has been an historic disservice to the American people
that we have not used nuclear energy to the degree that we
could have in these last few decades to provide the energy for
the American people. By eliminating, by not moving forward on
nuclear energy we have spent perhaps a trillion dollars
overseas for oil and other energy sources that didn't need to
be spent, and when one looks at the serious nature of our
economy today, I think we can trace it back to this type of
non-sensical policymaking in Washington. And let us remember
that this is a result of a scare tactic that happened after
Three Mile Island that frightened the American people away from
this incredibly positive alternative that we had to sending all
of our money overseas, and also it was not only--not only was
it economically important to do that but it was also
environmentally important.
So I would like to make sure I am on the record as saying
that, and also when we talk about Yucca Mountain and this type
of activity, we have to be responsible rather than just do
things by impulse. It appears to me, and it will be interesting
to hear what our witnesses have to say, that Yucca Mountain,
the closure of Yucca Mountain was on par with the closing of
Guantanamo. No alternative, not well thought out, and perhaps
with some consequences that were very negative in the long run.
And finally, Mr. Hall, Ranking Member Hall, talked about
the small modular nuclear plants. I would like to--I am anxious
to hear from the witnesses what they have to say about the
roadmap in the future; whether we are going to be relying on
old technology. I mean, these water-cooled reactors seem to me
to be things that are 50 years old, and I want to know why it
is new technology even when especially we have alternatives
like the gas turbine modular helium reactor, which--and the gas
cool reactors, which do not rely on water, that are available
to us today as an alternative. So I will be looking forward to
hearing the witnesses who are going to give us their expert
opinion, and thank you, Mr. Baird.
[The prepared statement of Mr. Hall follows:]
Prepared Statement of Representative Ralph M. Hall
Mr. Chairman, thank you for holding this hearing today on nuclear
energy R&D.
After several decades of setbacks and inaction, a growing consensus
is finally building in support of expanding the role of nuclear power
in our Nation's energy portfolio. Electricity demand in the U.S. is
expected to grow by 30 percent in the next 25 years, and nuclear energy
provides a safe, reliable, and cost-competitive source of baseload
power to meet this demand.
While much of the ``nuclear revival'' involves licensing and
building more reactors using existing light water reactor technology,
there are a host of longer-term activities that must also be pursued.
First and foremost among these are (1) dealing with the management of
spent nuclear fuel, and (2) supporting R&D to facilitate advances and
licensing of new reactor designs and to extend the life of the existing
reactor fleet.
With respect to waste management, I have been very clear about my
objections to the Administration's attempts to shut down the Yucca
Mountain Project, particularly given that the cancellation was done
without serious consideration of alternative options. The Federal
Government is legally obligated to deal with this waste, and the
current absence of a path forward threatens to jeopardize growing
public support for expanding nuclear power while increasing taxpayer
liabilities. This needs to be addressed as soon as possible.
With respect to research and development, there are numerous
advanced nuclear designs and technologies that hold promise to address
the longer-term cost, safety, and security challenges facing the
nuclear industry, and the Administration's R&D Roadmap provides a
useful outline of Federal efforts in this area. I support strengthening
this R&D effort,
and am particularly interested in advancing the potential of small,
modular reactors that are a focus of this hearing.
I look forward to working with the Chairman as we consider crafting
nuclear energy R&D legislation later this year, and I thank him for
assembling an excellent panel of witnesses today.
I yield back the balance of my time.
[The prepared statement of Mr. Costello follows:]
Prepared Statement of Representative Jerry F. Costello
Thank you, Mr. Chairman, for holding today's hearing to assess the
Department of Energy (DOE) Nuclear Energy Research and Development
(R&D) Roadmap and the future of nuclear energy in the United States.
Since coming to Congress, I have supported a sustainable energy
policy that will provide American homes and businesses the power they
need and reduce our dependence on foreign oil. Nuclear energy, which
currently provides 20% of U.S. power and 49% of Illinois' power, will
play a role in this policy as a domestic, clean energy source. However,
DOE must first overcome a variety of R&D, safety, and investment
barriers before nuclear plays a central role in our energy policy.
President Obama's Fiscal Year 2011 budget requests $503 million for
the Office of Nuclear Energy (NE), an increase of $37 million over FY
10. This increased funding, in addition to $54.5 billion in loan
guarantees for the construction of new reactors, demonstrates the
administration's support for the expansion of nuclear power. However,
the administration decided to eliminate funding for the Yucca Mountain
nuclear waste storage facility while expanding R&D, leaving the U.S.
without a central depository for nuclear waste. I would like to hear
from our witnesses what steps are being taken to store nuclear waste
now and what proposals are being considered for adapting our storage
capability as more reactors come online.
In addition, DOE's Nuclear Energy R&D Roadmap identifies roadblocks
to an expansion of nuclear energy and develop means of overcoming them.
I would like to hear from our witnesses what the timeline is for
achieving these objectives and what role they see Congress playing in
achieving those goals.
If DOE achieves the objectives outlined in their roadmap, they may
still face public opposition to the use of nuclear energy and, as we
saw with Yucca Mountain, the storage of waste. I am interested if DOE
or our witnesses have plans for overcoming this opposition and
increasing the public's awareness and acceptance of nuclear energy.
I welcome our witnesses, and I look forward to their testimony.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Mitchell follows:]
Prepared Statement of Representative Harry E. Mitchell
Thank you, Mr. Chairman.
I strongly believe that we must refocus our energy priorities to
the production of alternative sources of energy, like solar power, that
will not be harmful to our environment.
Nuclear power generation also has the potential of generating
electricity without increasing greenhouse gas emissions.
Nuclear power is a critical electricity source in Arizona where we
have the largest nuclear generation facility in the nation, the Palo
Verde Nuclear Generating Station.
Today we will discuss the Administration's strategy for research
and development to advance clean and affordable nuclear technology.
According to the Nuclear Regulatory Commission, there are
commercial nuclear power reactors licensed to operate in 31 states.
These reactors provide approximately 20 percent of our nation's
electricity supply. Furthermore, according to the Department of
Energy's Energy Information Agency (EIA) commercial nuclear reactors
provide approximately 70 percent of the emissions-free energy in the
U.S.
However, as these nuclear power reactors continue to operate, spent
nuclear fuel continues to accumulate without a clear strategy of how to
store this waste.
I look forward to hearing more from our witnesses on strategies for
managing nuclear waste as well as how to enhance the safety and
economic viability of nuclear power.
At this time, I yield back.
Mr. Baird. [Presiding] Thank you, Mr. Rohrabacher. I don't
know if you have heard the rumor, but my understanding is they
are moving the prisoners from Guantanamo into Yucca Mountain.
So we are going to kill two birds with one stone.
At this point I recognize Mr. Lujan, who will introduce our
first witness.
Panel I:
Mr. Lujan. Thank you very much, Mr. Chairman. It is my
honor today to introduce Dr. Miller, who spent many years
working in the district that I represent. A native of Chicago,
Dr. Miller is a graduate of the U.S. Military Academy. He
served in Vietnam, where he earned a U.S. Army Bronze Star, an
accommodation medal. After his military service he received a
Ph.D. in nuclear engineering from Northwestern University.
After two years as a professor there, he began his career at
Los Alamos National Laboratory in my district within New
Mexico.
Over the course of his 27-year career at Los Alamos, Dr.
Miller held a variety of leadership positions, including
Associate Laboratory Director for Energy Programs, as well as
for Physics and Mathematics, where he supervised the work of
over 2,000 scientists. Following his tenure at Los Alamos, Dr.
Miller was a research professor in the Department of Nuclear
Engineering and Associate Director of the Nuclear Security
Science and Policy Institute at Texas A&M University. He was
elected as a fellow of the American Nuclear Society in 1982,
and to membership in the National Academy of Engineering in
1986.
Dr. Miller was nominated by President Barack Obama as the
Assistant Secretary for Nuclear Energy in June of 2009, and
confirmed by the Senate in August. As Assistant Secretary, Dr.
Miller is responsible for all programs and activities of the
Office of Nuclear Energy.
Today he is here to discuss with us the DOE's Nuclear
Energy R&D Roadmap. Thank you, Dr. Miller, for being here, and
I look forward to your testimony.
Thank you, again, Mr. Chairman.
Mr. Baird. Thank you, Mr. Lujan. You have been a staunch,
strong and effective advocate on behalf of Los Alamos and the
labs there.
Dr. Miller, we appreciate your presence and your service.
It turns out my father actually went to Los Alamos Boys'
School, and before he could graduate the government came in and
said, kids, you are going to have to leave, we have got
something else to do here. And so I know that beautiful
country, and I appreciate your work.
As you know, we have five minutes for your oral testimony.
Your written testimony will be entered into the record as well,
and that will be followed by questions. So thank you for your
distinguished service and your presence today, and please
begin.
STATEMENTS OF WARREN P. MILLER, ASSISTANT SECRETARY, OFFICE OF
NUCLEAR ENERGY, U.S. DEPARTMENT OF ENERGY
Dr. Miller. Thank you very much. Thank you for the
introduction, Congressman Lujan, and I do miss the Land of
Enchantment, so say hello when you are back there.
Chairman Baird, Ranking Member Rohrabacher, Members of the
Committee, it is a pleasure to appear before you today to
discuss the Office of Nuclear Energy's recently-released
Nuclear Energy R&D Roadmap. Input from national laboratories,
universities, and industry were used to develop this document,
which we intend to guide the Department of Energy's nuclear
energy activities in both the near term and the long term.
Identifying the nuclear energy needs of the Nation and the
appropriate roles for the Department of Energy, we developed
four R&D objectives to guide our activities. One, develop
technologies and other solutions that can improve the
reliability, sustain the safety, and extend the life of the
current fleet of reactors.
Two, develop improvements in the affordability of new
reactors to enable nuclear energy to help meet the Nation's
energy security and climate change goals. Three, develop
sustainable nuclear fuel cycles, and four understand and
minimize the risks of nuclear proliferation and terrorism.
In my written testimony I have described each of these R&D
objectives in greater detail. Given my limited time this
morning, I would like to focus on two new programs that we are
proposing and their relation to the Roadmap; the Small Modular
Reactor Program and the Modified Open Cycle Program.
In the past few years there has been great interest in
smaller modular reactors for several reasons. To identify just
one, their lower capital costs makes them potentially
attractive to smaller entities that have difficulty financing
the larger reactors. Capacity could be added at a site unit by
unit, allowing the income from early deployed units to help
finance subsequent additions.
For fiscal year 2011, we have proposed a new multiple year
Small Modular Reactor Program that would include a cost-shared
program element intended to accelerate the availability of
SMRs. We intend to accomplish this by cost sharing design
certifications for up to two LWR-based SMR designs. This
directly supports our R&D objective number two, which is to
improve the affordability of new reactors.
We are holding a workshop on June 29 and 30, 2010, to
inform stakeholders on the status of planning for this SMR
Program and to engage the civil nuclear energy community in
open discussions. What we hear from industry, academia, and the
national labs will help us in developing criteria for program
implementation.
As I mentioned earlier R&D objective number three is to
enable sustainable fuel cycles, which are defined to be those
that improve uranium resource utilization, minimize waste
generation, improve safety, and limit proliferation risks. The
United States currently operates on a once-through strategy
where used nuclear fuel is not recycled after leaving the
reactors. There is still research to be done on the once-
through cycle to improve the efficient use of uranium resources
and reduce the amount of used fuel produced, and we are
pursuing this work.
At the opposite end of the spectrum from once-through is
the so-called ``full recycle'' or ``closed-cycle'' option,
where the long-lived actinide elements in the used fuel would
be repeatedly recycled. The intent is to dramatically increase
uranium utilization to virtually 100 percent and greatly
decrease the remaining long-lived radioactive waste burden.
The federal government has pursued research in this
direction in the past, and we will continue to do so. I think
it is important to emphasize, however, that there is a whole
range of potential options in between once-through and full
recycle, and it is too early to settle on the optimum choice
for the United States to pursue.
Since dry-cask storage of used fuel has been deemed to be
safe and secure for many decades, there is no need to rush the
commercial scale deployment, and we have time to understand the
options. In order to fully explore the options in between once-
through and full recycle, we have proposed a new R&D program
called Modified Open Cycle. The research under this program
will give future decision makers a full suite of options to
select from when deciding the country's fuel cycle.
Our research could yield game-changing approaches that will
let us optimize reprocessing technologies in terms of resource
utilization, proliferation resistance, waste management, and
costs.
For reasons of time I have singled out only two programs
from our roadmap, but there are many other elements that
together form a balanced R&D suite. Each research activity
supports at least one R&D objective from the Roadmap. Both the
strategic thinking in the Roadmap and the R&D programs we have
proposed will guide the Office of Nuclear Energy for many years
to come. They will help ensure that nuclear power remains a
vital component of America's energy future.
Thank you, Mr. Chairman, and I am pleased to take any
questions.
[The prepared statement of Dr. Miller follows:]
Prepared Statement of Warren F. Miller, Jr.
Chairman Gordon, Ranking Member Hall, and Members of the Committee,
thank you for the opportunity to appear before you today to discuss the
Office of Nuclear Energy's R&D Roadmap. We have been working hard for a
long time to produce a document that will guide the Department of
Energy's nuclear energy activities for many years to come, and I think
the resulting plan meets that criterion.
Nuclear energy is a key component of a portfolio of technologies
that can be used to help meet the nation's goals of energy security and
greenhouse gas reductions. This roadmap will guide research,
development, and demonstration activities to help ensure that nuclear
energy remains a viable option for the United States.
Our planning for developing the FY 2012 budget request will be
informed by this report, and our proposed FY 2011 budget for the Office
of Nuclear Energy is also consistent with the R&D objectives outlined
in this roadmap. Earlier in the development process, we had been
calling the objectives ``imperatives'', and in my December 15 testimony
to the Senate Energy and Natural Resources Committee, I described five
of them. We have since merged two of those areas of R&D into one (R&D
Objective 2).
There are several challenges to the increased use of nuclear
energy:
The capital cost of new large plants is high and can
challenge the ability of electric utilities to deploy new
nuclear power plants.
The exemplary safety performance of the U.S. nuclear
industry over the past thirty years must be maintained by an
expanding reactor fleet.
There is currently no integrated and permanent
solution to high-level nuclear waste management.
International expansion of the use of nuclear energy
raises concerns about the proliferation of nuclear weapons
stemming from potential access to special nuclear materials and
technologies.
The four R&D objectives outlined in the roadmap will address these
challenges.
R&D OBJECTIVE 1: Develop technologies and other solutions that can
improve the reliability, sustain the safety, and
extend the life of current reactors
The existing U.S. nuclear fleet has a remarkable safety and
performance record, and today these reactors account for 70 percent of
the low greenhouse gas (GHG)-emitting domestic electricity production.
Extending the operating lifetimes of current plants beyond sixty years
and, where possible, making further improvements in their productivity
will generate near-term benefits. Industry has a significant financial
incentive to extend the life of existing plants, and as such, R&D
activities related to life extension of nuclear facilities will be cost
shared. Federal R&D investments are appropriate to answer fundamental
scientific questions and, where private investment is insufficient, to
help make progress on broadly applicable technology issues that can
generate public benefits. The DOE role in this R&D objective is to work
in conjunction with industry and where appropriate the Nuclear
Regulatory Commission (NRC) to support and conduct the long-term
research needed to inform major component refurbishment and replacement
strategies, performance enhancements, plant license extensions, and
age-related regulatory oversight decisions. DOE will focus on aging
phenomena and issues that require long-term research and are common to
multiple reactor types.
R&D OBJECTIVE 2: Develop improvements in the affordability of new
reactors to enable nuclear energy to help meet the
Administration's energy security and climate change
goals
If nuclear energy is to be a strong component of the nation's
future energy portfolio, barriers to the deployment of new nuclear
plants must be overcome. Impediments to new plant deployment, even for
those designs based on familiar light-water reactor (LWR) technology,
include the substantial capital cost of new plants and the
uncertainties in the time required to license and construct those
plants. Although subject to their own barriers for deployment, more
advanced plant designs, such as small modular reactors (SMRs) and high-
temperature reactors (HTRs), have characteristics that could make them
more desirable than today's technology. SMRs, for example, have the
potential to achieve lower proliferation risks and more simplified
construction than other designs. The development of next-generation
reactors could present lower capital costs and improved efficiencies.
These reactors may be based upon new designs that take advantage of the
advances in high performance computing while leveraging capabilities
afforded by improved structural materials. Industry plays a substantial
role in overcoming the barriers in this area. DOE provides support
through R&D ranging from fundamental nuclear phenomena to the
development of advanced fuels that could improve the economic and
safety performance of these advanced reactors. Nuclear power can help
reduce GHG emissions from electricity production and possibly in co-
generation by displacing fossil fuels in the generation of process heat
for applications including refining and the production of fertilizers
and other chemical products.
R&D OBJECTIVE 3: Develop Sustainable Nuclear Fuel Cycles
Sustainable fuel cycle options are those that improve uranium
resource utilization, maximize energy generation, minimize waste
generation, improve safety, and limit proliferation risk. The key
challenge is to develop a suite of options that will enable future
decision makers to make informed choices about how best to manage the
used fuel from reactors. The Administration has established the Blue
Ribbon Commission on America's Nuclear Future to inform this waste-
management decision-making process. DOE will conduct R&D in this area
to investigate technical challenges involved with three potential
strategies for used fuel management:
Once-Through--Develop fuels for use in reactors that
would increase the efficient use of uranium resources and
reduce the amount of used fuel requiring direct disposal for
each megawatt-hour (MWh) of electricity produced. Additionally,
evaluate the inclusion of non-uranium materials (e.g., thorium)
as reactor fuel options that may reduce the long-lived
radiotoxic elements in the used fuel that would go into a
repository.
Modified Open Cycle--Investigate fuel forms and
reactors that would increase fuel resource utilization and
reduce the quantity of long-lived radiotoxic elements in the
used fuel to be disposed (per MWh), with limited separations
steps using technologies that substantially lower proliferation
risk.
Full Recycling--Develop techniques that will enable
the long-lived actinide elements to be repeatedly recycled
rather than disposed. The ultimate goal is to develop a cost-
effective and low proliferation risk approach that would
dramatically decrease the long-term danger posed by the waste,
reducing uncertainties associated with its disposal.
DOE will work to develop the best approaches within each of these
tracks to inform waste management strategies and decision making.
R&D OBJECTIVE 4: Understand and minimize the risks of nuclear
proliferation and terrorism
It is important to assure that the benefits of nuclear power can be
obtained in a manner that limits nuclear proliferation and security
risks. These risks include the related but distinctly separate
possibilities that nations may attempt to use nuclear technologies in
pursuit of a nuclear weapon and that terrorists might seek to steal
material that could be used in a nuclear explosive device. Addressing
these concerns requires an integrated approach that incorporates the
simultaneous development of nuclear technologies, including safeguards
and security technologies and systems, and the maintenance and
strengthening of non-proliferation frameworks and protocols.
Technological advances can only provide part of an effective response
to proliferation risks, as institutional measures such as export
controls and safeguards are also essential to addressing proliferation
concerns. These activities must be informed by robust assessments
developed for understanding, limiting, and managing the risks of
nation-state proliferation and physical security for nuclear
technologies. NE will focus on assessments required to inform choices
for domestic fuel cycle technology. These analyses would complement
those assessments performed by the National Nuclear Security
Administration (NNSA) to evaluate nation state proliferation and the
international nonproliferation regime. NE will work with other
organizations including the NNSA, the Department of State, the NRC, and
others in further defining, implementing and executing this integrated
approach.
R&D Areas
The Department expects to undertake R&D in a variety of areas to
support its role in the objectives outlined above. Examples include:
Structural materials
Nuclear fuels
Reactor systems
Instrumentation and controls
Power conversion systems
Process heat transport systems
Dry heat rejection
Separations processes
Waste forms
Risk assessment methods
Computational modeling and simulation
R&D Approach
A goal-driven, science-based approach is essential to achieving the
stated objectives while exploring new technologies and seeking
transformational advances. This science-based approach combines theory,
experimentation, and high-performance modeling and simulation to
develop the fundamental understanding that will facilitate advancements
in nuclear technologies. Advanced modeling and simulation tools will be
used in conjunction with smaller-scale, phenomenon-specific experiments
informed by theory to reduce the need for large, expensive integrated
experiments. Insights gained by advanced modeling and simulation can
lead to new theoretical understanding and, in turn, can improve models
and experimental design. This R&D performed by NE must be informed by
the basic research capabilities in the DOE Office of Science (SC).
The Modeling and Simulation Hub led by NE, for which proposals are
currently under review, will integrate existing nuclear energy modeling
and simulation capabilities with relevant capabilities developed by the
Office of Science, the NNSA, and others. Existing advanced modeling and
simulation capabilities (e.g., computational fluid dynamics) will be
applied through a new multi-physics computational capability to provide
predictive capability for life extension and power uprates
calculations. After five years, the Hub is intended to produce a multi-
physics computational environment that can be used by a wide range of
practitioners to conduct predictive calculations of the performance of
reactors in the future for both normal and off-normal conditions. The
results will be used to communicate the potential role of science-based
modeling and simulation to address technology issues concerning nuclear
energy in the near, mid, and long terms.
NE maintains access to a broad range of facilities to support its
research activities. Hot cells and test reactors are at the top of the
hierarchy, followed by smaller-scale radiological facilities, specialty
engineering facilities, and small non-radiological laboratories. NE
employs a multi-pronged approach to having these capabilities available
when needed. The core capabilities rely on DOE-owned irradiation,
examination, chemical processing and waste form development facilities.
These are supplemented by university capabilities ranging from research
reactors to materials science laboratories. In the course of conducting
this science-based R&D, infrastructure needs will be evaluated and
considered through the established planning and budget development
processes.
There is potential to leverage and amplify effective U.S. R&D
through collaboration with other nations via multilateral and bilateral
agreements, including the Generation IV International Forum. DOE is
also a participant in Organization of Economic Cooperation and
Development/Nuclear Energy Agency (OECD/NEA) and International Atomic
Energy Agency (IAEA) initiatives that bear directly on the development
and deployment of new reactor systems. In addition to these R&D
activities, international interaction supported by NE and other
government agencies will be essential in establishment of international
norms and control regimes to address and mitigate proliferation
concerns.
Conclusion
Thank you, Mr. Chairman, that concludes my written testimony. I
would be pleased to take any questions at this time.
Biography for Warren F. Miller, Jr.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Dr. Warren F. Miller was nominated by President Barack Obama as the
Assistant Secretary for Nuclear Energy in June of 2009, and confirmed
by the Senate in August. As Assistant Secretary, Dr. Miller is
responsible for all programs and activities of the Office of Nuclear
Energy.
Before becoming Assistant Secretary, Dr. Miller was a Research
Professor in the Department of Nuclear Engineering and Associate
Director of the Nuclear Security Science and Policy Institute at Texas
A&M University.
A native of Chicago, Dr. Miller is a graduate of the U.S. Military
Academy. He served in Vietnam where he earned a U.S. Army Bronze Star
and a Commendation Medal.
After his military service he received a Ph.D. in nuclear
engineering from Northwestern University. After two years as an
assistant professor there, he began his career at Los Alamos National
Laboratory (LANL) in Los Alamos, New Mexico. His first research
interest was in the area of Reactor and Transport Theory. Over the
course of his 27-year career at LANL, Dr. Miller held a variety of
leadership positions, including Associate Laboratory Director for
Energy Programs, as well as for Physics and Mathematics. As Associate
Lab Director, he supervised the work of 2000 scientists. He also served
as Senior Research Advisor, with the responsibility of deciding which
research projects to pursue, recruiting the talent to pursue them, and
providing the facilities to enable success.
Dr. Miller is the author of many research papers and journal
articles, including, with a colleague, the book Computational Methods
of Neutron Transport, published in 1984, which became a standard
textbook for engineering students around the world.
Dr. Miller was elected as a Fellow of the American Nuclear Society
in 1982, and to membership in the National Academy of Engineering in
1996.
Discussion
Mr. Baird. Dr. Miller, thank you for your expert testimony,
and again, for your service. I will now recognize myself for
five minutes.
Cost Sharing
In your testimony, Dr. Miller, you mentioned the cost
sharing, and I am glad to hear that. I am very interested in
SMRs. One of the questions I have, though, is it is my
understanding, and I may be incorrect, that the cost sharing
would be largely limited to NRC fees and might not be
applicable to other parts of the design certification. Some of
the folks I have contacted seem to believe that that is perhaps
excessively restrictive, and they won't spend all that much
money on the NRC fees, but there may be other things.
Could you talk about that for a moment?
Dr. Miller. Sure. Thank you for the question. So an example
of a program that the Department of Energy did have in the last
decade or so was the NP 2010 Program, which involved cost
sharing much further than design certification. It went through
engineering, it went through COLAs, Construction and Operating
License Applications, and so it went further down the chain
than is proposed in the President's budget for 2011.
So there is a precedent for doing that. Let me say that the
R&D Roadmap is, first, not just in the Nuclear Energy Office
roadmap. It is an Administration roadmap. So it is coordinated
through the interagencies, so it is our Administration's plan.
Similarly as you know, that 2011 is the Administration's plan.
And I am here to support the President's budget.
Mr. Baird. Let me just for the record suggest that if the
goal is to get these things underway a little faster than they
might otherwise, and if we are setting aside I think it is
roughly $38 million----
Dr. Miller. Yes.
Mr. Baird. --but only a small portion of that could be used
for the fees, if we are prepared to spend the money and the
goal is to accelerate development of these, maybe we ought to
expand the possible uses for that money.
Creating an Export Market
A second question. It is my understanding that our
competitors, global competitors, are receiving substantial
government subsidies for their efforts to expand nuclear power:
France, Korea, Japan. That seems to tip the competitive market
internationally against some of our producers, and I think one
of our hopes would be that if we can produce a safe and
effective and cost-effective system, especially in the SMRs,
that might lead to export.
But if we are on an unlevel competitive playing field
financially, that could impede that development. Any thoughts
about how we might address that, either by additional
government support or WTO actions or other things to make sure
that there is a fair playing field?
Dr. Miller. Yes. This has been an issue related to nuclear
energy almost from the beginning, that certain countries--in
fact, I was in both countries that you mentioned, Japan and
France, in the last few months--see a situation in which they
view the world somewhat differently than we do in the sense
that neither country has a large number of natural resources,
energy resources, oil, coal, the rich things that the United
States is blessed with. And so they see nuclear energy as a
national security issue.
And for those reasons the model they use is a model in
which they invest, as you point out, government national
resources in these entities to a much greater degree than we do
in our country. Certainly we invest as well, and if they are
more than willing to go much further down the chain of
deployment, I think that it is certainly a debatable question
of where in our system is the right place for government to end
and industry to begin. I think it is debated a lot within the
Administration. I am sure it will be debated a lot within the
Congress, and other than that I can only say I support the
President's budget.
Mr. Baird. I think one of the issues there particularly as
we look towards possible export, if we are going to compete
globally, which would presumably give us some economies of
scale, the whole premise I understand of SMRs is that you could
not quite assembly line, but you could build them in a factory-
type setting, then transport them. If we are going to compete
in that fashion, we may need more help both domestically and
internationally just to try to level that playing field.
So I would hope we would look at that.
That will conclude my questions for the moment, and I will
recognize Mr. Rohrabacher for five minutes.
Mr. Rohrabacher. I am sorry. Mr. Chairman, with your
permission we would like--Mr. Sensenbrenner actually has
seniority to me.
Mr. Baird. My apologies. Mr. Sensenbrenner.
Mr. Sensenbrenner. Thank you very much, Mr. Chairman.
Welcome, Dr. Miller.
Dr. Miller. Thank you, sir.
Yucca Mountain Nuclear Waste Repository
Mr. Sensenbrenner. I want to talk about Yucca Mountain. We
have invested billions of dollars in Yucca Mountain, and it has
been found to be safe, and now this Administration has taken
that option off the table and wants to start from scratch.
It has taken a long time to reach this point on Yucca
Mountain, and the Department of Energy has given us no
assurances that a new form of storage will be found within the
next 30 years without more money being wasted.
Now, I want to ask a question specifically about Secretary
Chu's motion to withdraw the license application with
prejudice, and does this mean that if this motion is granted,
Yucca Mountain will never even be considered for the storage of
nuclear waste?
Dr. Miller. So----
Mr. Sensenbrenner. All I need is a yes or no answer on
that.
Dr. Miller. Well, unfortunately, I don't know what the
legal implication is with prejudice, but we can get back to
you.
Mr. Sensenbrenner. Legal--you know, I am a lawyer, you
know. I haven't practiced recently, but the legal implication
with prejudice means is that there can never be a license
application submitted again----
Dr. Miller. Uh-huh.
Mr. Sensenbrenner. --for storing nuclear waste in Yucca
Mountain. Now, you know, I want to know what justification
there was made, file the application or dismiss the motion
with--or the motion to dismiss the application with prejudice.
So that means that we can never even consider Yucca Mountain in
the future.
Dr. Miller. Congressman, I understand the concern. Let me
just say under advice from General Counsel, the Secretary made
that decision. I can't--I don't have any other way to give
you----
Mr. Sensenbrenner. Okay.
Dr. Miller. --anymore information on that.
Mr. Sensenbrenner. Well, you know, a lawyer's ethical
obligation is to attempt to minimize the financial exposure of
his client, in this case the United States government to a
decision that is made. Now, we have already spent about $10
billion out of the $30 billion collected through the Nuclear
Waste Fund, studying the site and preparing the application.
And it is estimated that the Federal Government's liability is
now about 12.3 billion and will grow annually by about a half a
billion dollars.
Aren't you a little concerned given that liability that
your General Counsel isn't doing the right thing?
Dr. Miller. Well, first of all, again, Congressman, I am
going to have to give it to you the best I know. I am in NE,
not in RW, so from the best I know, the liability is associated
with taking title to the used fuel, not necessarily tied to the
place that we place the used fuel. So it is not directly tied
to Yucca Mountain. It is tied to taking title.
Mr. Sensenbrenner. But if the Federal Government has no
place to put it, you know, taking title means that we are going
to have all this used fuel that the Federal Government owns and
no place to put it, and that is where I see the liability is.
And, you know, I have reached the conclusion that there is no
economic justification to closing Yucca Mountain.
Now, let me go into one other area. There was a letter that
DOD sent on February 26 that directed that certain office
civilian radioactive waste management activities, including
data collection and performance confirmation activities at the
Yucca Mountain site, will cease as of March 1. And
specifically, the power communications system for all surface
and sub-surface work and data processes will be shut down.
Now, if the DOE rules against--or excuse me, the NRC rules
against DOE's motion to dismiss with prejudice, does this
hiatus in terms of collecting this data mean that even if you
go and lose before the NRC, you can't put nuclear waste in
Yucca Mountain because we don't have the data?
Dr. Miller. I can't answer your question, Congressman. We
will get back----
Mr. Sensenbrenner. Well----
Dr. Miller. --for the record.
[Additional material submitted for the record follows:]
Prepared Response of Assistant Secretary Miller
No, as the Department explained in its April 23, 2010, response to
the State of Washington's request to the United States Court of Appeals
for the District of Columbia for a preliminary injunction, any hiatus
in record collecting should not cause any harm if DOE were forced to
continue the licensing process. First, large databases already exist
for the three suspended data collection and performance confirmation
activities (seismicity, precipitation, and tunnel deformation), and
their suspension will not have a material effect on the understanding
of the Yucca Mountain site. The National Academy of Sciences found that
the period of geologic stability for Yucca Mountain is on the order of
one million years, so one would not expect any sudden changes in
seismicity, precipitation, or tunnel deformation. Second, even in the
absence of active data collection by the Office of Civilian Radioactive
Waste Management for seismicity and precipitation, other entities do
monitor activities in the vicinity of Yucca Mountain and would indicate
any change in seismicity or precipitation. For tunnel deformation,
little to no change is expected; moreover, any deformation would be
found only after the fact. In the past, the Office of Civilian
Radioactive Waste Management has not done continuous data collection on
tunnel deformation and, in fact, had periods of more than a year
between successive measurements. Third, if ordered, restart of
activities would be relatively simple with the resupplying of electric
power.
Mr. Sensenbrenner. --okay. Well, you know, let me say, sir,
with all due respect, you know, this is an extremely arrogant
motion on the part of the Department of Energy because it
ignores the billions of dollars that Congress has appropriated,
it does so unilaterally in a way that even if you lose before
the Nuclear Regulatory Commission, the thing is so screwed up
that you are not going to be able to deposit nuclear waste, and
you have added, you know, a huge amount of liability, not to
talk about the $10 billion that has been wasted simply because
of something that was done by the Department of Energy.
Now, the last question I have is did either the President
or Secretary Chu promise Senator Reid that Yucca Mountain would
be shut down?
Dr. Miller. I do not know.
Mr. Sensenbrenner. Okay. Well, maybe before making huge
decisions like this that would end up costing the American
taxpayer billions and billions of dollars, people who come and
testify before Congress ought to know, and I thank the Chairman
for the time.
Mr. Baird. Mrs. Dahlkemper is recognized for five minutes.
Uranium and Thorium
Mrs. Dahlkemper. Thank you, Mr. Chairman, and thank you,
Dr. Miller. I appreciate you being here today.
I want to ask you about the issue of the supply of uranium.
Dr. Miller. Uh-huh.
Mrs. Dahlkemper. There have been some issues raised in
testimony before the Committee that the supply issue is
something we need to discuss. So what are the most current
estimates on how much uranium is available for nuclear
reactors? And how long is it estimated that supply will
reasonably be there for us to use?
Dr. Miller. Uh-huh. So there are quite a few studies about
the uranium resource, and most estimates would argue with
reasonable projections of the growth nuclear energy throughout
the world, that there is sufficient uranium resource at
reasonable prices, meaning close to today's prices, that would
last throughout the rest of this century.
Now, there are lots of caveats on that. One is as resources
become more difficult to extract, what tends to happen is
technology develops to allow you to extract those, as the price
goes up, and technology gets developed, and then you are able
to extract from different types of mineral deposits, and the
price starts going down, and so it is really hard to estimate
these things.
And one other thing I wanted to mention is the Japanese.
While I was in Japan I got a chance to get a briefing on the
Japanese research on uranium extraction from seawater, and
their estimate is it is about three to five times more
expensive than present extraction methodologies.
If that could be reduced by quite a bit, then it is a whole
new ballgame. Then you are really talking huge amounts of
uranium. So it is a very difficult issue, but I don't think
most of us believe uranium resources will stop the development
of nuclear energy.
Mrs. Dahlkemper. Can you maybe address--so you are saying
there is really no concern with the supply, that the supply is
there?
Dr. Miller. I don't think----
Mrs. Dahlkemper. --as the thirst for energy increases
globally and we look at, obviously, more nuclear energy being
produced not only here but across the globe?
Dr. Miller. In addition, there is also the thorium
possibility. Thorium is actually more prevalent in the crust
than uranium is worldwide. There is also the possibility of
breeder reactors that would use much more of the uranium as I
mentioned before. It is--my personal opinion is that the
uranium resource will not be a show-stopper for nuclear energy.
Mrs. Dahlkemper. Thorium isn't currently used in any
process.
Dr. Miller. Thorium is only used in an experimental and a
research way, but in theory it could be used for reactors, and
I think the country that is leading the research effort is
India actually, which has large amounts of thorium, and so they
are very interested in it.
Mrs. Dahlkemper. Can maybe you address the link with the
supply issue, if there is none, or if there is, with the need
to reprocess, and where you see that as maybe extending even
further the life of using uranium?
Dr. Miller. Yes.
Mrs. Dahlkemper. With the current, available technology
obviously.
Dr. Miller. Yes. Presently the once-through fuel cycle that
is used largely, well, it is not used exclusively worldwide,
the uranium utilization is only .6 percent. So that means of
the uranium that is mined, we actually fission about .6 percent
because in the enrichment process we have all these tails left
in the enrichment process, and then the used fuel has all this
uranium left in the used fuel.
And so maybe the price of uranium or the resource isn't a
driver that much, but what is, is there is a certain
environmental stewardship responsibility that if we have a
natural resource and we are using .6 percent, throwing the rest
of it away, that doesn't fit well in our own view of what is
responsible. So increasing uranium utilization makes a lot of
sense from that point of view.
The second point of view that makes a lot of sense is the
backend of the fuel cycle. The amount of energy we can get out
of a per unit of waste created, you know, has an impact on how
many repositories we need to how much repository capacity we
need as a country over the next 50 to 100 years.
So it makes a lot of sense to increase uranium utilization,
even if the price of uranium is low.
Mrs. Dahlkemper. Thank you. My time is up. I yield back.
Mr. Baird. Mr. Rohrabacher.
Water-Cooled vs. Gas-Cooled Reactors
Mr. Rohrabacher. Thank you very much, Mr. Chairman. Just
one or two thoughts before I ask the witness some questions.
Let us just again note that it was hysteria that was
created over an incident at Three Mile Island decades ago that
caused great harm to our country's economy, and let me not that
from my reading that the only people who lost their lives due
to Three Mile Island were coalminers who now we had to rely on
coal rather than safer nuclear energy and those people who
perhaps have contracted diseases from air pollution using coal
as a means of energy production rather than nuclear energy,
which would have given us clean skies and clean air.
So it is important when we start making policy not to be
basing it on hysteria and to be very steely-eyed about these
decisions that we have to make.
I might ask you this, but we do know that technology has
made great leaps, and the potential technology since Three Mile
Island, Three Mile Island was a water-cooled reactor, and
almost all--I believe all the reactors we have in the United
States currently are water-cooled reactors.
Now, what you have in mind and what we are trying to move
forward, would water-cooled reactors be, still be the focus, or
are we moving onto gas-cooled reactors?
Dr. Miller. Some of the small modular reactor ideas don't
require water cooling, which would be excellent in many ways,
not the least of which that it helps with siting if you don't
have to worry about water cooling.
In addition, the High-Temperature Gas Reactor Program, the
flagship of which would be NGNP, is a helium-gas-cooled
reactor. That allows you to go to much higher temperature and
therefore, a higher efficiency for electricity production as
well as potentially using that heat as a heat source for
industrial processes.
So----
Mr. Rohrabacher. Uh-huh.
Dr. Miller. --and then some of the advanced small modular
reactors look at liquid-metal cooling, sodium cooling. So, yes,
the business is moving in other directions.
Mr. Rohrabacher. I think it is vitally important that
leaders like yourself insist that we move forward with new
technology, newer concepts like the one you are outlining right
now. There is a weakness in our system, and the weakness in our
system is that people who make money make money from what they
have right now.
Dr. Miller. Yeah. Right.
Mr. Rohrabacher. And they will fight change in order to
make money from what they already have in their hands. So it is
up to us to overcome that flaw in the capitalist system.
And I think your point about only utilizing .6 percent of
the actual power that you can get from uranium, our current
systems only get--so it is less than one percent effectiveness,
and I do understand that the new helium reactors that you are
referring to actually have the potential of bringing that way
up, if not making it almost 100 percent effective in terms of
utilizing that potential.
Dr. Miller. Well, that would require changing the fuel
cycle, not just the reactor design. You would have to do
something with the used fuel to get that much uranium
utilization out. You would have to reprocess or recycle----
Mr. Rohrabacher. Uh-huh.
Dr. Miller. --to increase it much beyond .6 even if you
change the reactor design.
Mr. Rohrabacher. Have you seen at all the General Atomics?
They are, by the way, they are not in my district just for the
record. General Atomics has this gas turbine modular helium
reactor, which they believe will be very cost effective and be
accomplishing the things you are talking about.
Dr. Miller. General Atomic has discussed with us their
advanced reactor called EM2, but I have not talked with them
about the reactor design you are referring to.
Mr. Rohrabacher. Uh-huh. I would suggest that that would be
something that would be very beneficial to take a look at their
option.
Dr. Miller. Uh-huh.
Mr. Rohrabacher. I believe--does this mean my time----
Mr. Baird. The clock has blacked out.
Mr. Rohrabacher. The clock has blacked--does that mean I
have unlimited time?
Mr. Baird. Heaven forbid.
Mr. Rohrabacher. Thank you, Mr. Chairman.
Mr. Baird. Thank you, Mr. Rohrabacher.
Mr. Lujan is recognized.
Specific Issues in the DOE Roadmap
Mr. Lujan. Thank you very much, Mr. Chairman, and Dr.
Miller, I am just going to jump right into it as well. I think
that there has been a lot of conversation in some areas of
interest to myself as well, namely around the reprocessing and
recycling aspect of what we are talking about, and the report
outlines it in a few areas. I will just point to the page
numbers quickly.
Page 22 is where it talks about R&D topics for enabling new
builds. My question along that line, Dr. Miller, and I am just
going to put a few out there and that way you can touch on
them, is we talk about new builds. Shouldn't we be talking
about the closed cycle associated with new builds incorporating
the aspects of the recycling so that it is on location in the
same position, eliminating the need for even transportation of
any of the spent fuel so that way it is able to be integrated
into the system there? It is something we should consider,
including on page 30 of the report as we talk about the major
challenges associated with fuel cycle options.
The bottom of page 30, top of page 31 talks about the fuel
cycle and the end of that reads, ``In order for a fuel cycle
strategy to be considered, the waste benefits and improved
resource utilization produced by such a system must outweigh
the complication, expense, and potential proliferation concerns
associated with it.''
And I would pose, isn't that true already today with what
other nations are doing as a result of the accords put forth
under President Carter, with what we have seen with other
nations move forward with recycling and reprocessing?
On page 31 we continue to talk about the R&D for
sustainable fuel cycle options, ending with the transportation
systems, which is reprocessing, recycling, and that ends with
``R&D would focus on broadly-applicable issues, including areas
such as materials and energy conversion. In addition, studies
may be conducted to review the technical and economic aspects
of external neutron, source-driven transportation systems to
inform whether future investigation on this approach is
warranted.''
So, again, do you have the budget you need for R&D to move
forward with recycling programs under the conditions you have?
You know, with the billions spent on Yucca, had that been used
for recycling, would we already have the answer today? I think
that is a fair question that needs to be asked.
Lastly, on page 34, under the R&D objective ``understanding
and minimizing the risks of nuclear proliferation and
terrorism,'' it says, ``The final R&D objective,'' and I hope
that they are not ranked in priority. I would hope that this
would be the primary objective of what we are talking about
here, which talks about, ``achieving economic public health and
safety and environmental goals which are critically
important.''
And lastly, Dr. Miller, I am only going to give you about
two minutes to respond. I apologize, but anything that we might
be able to get submitted into the record for review later would
be important. I would hope as I looked through the report, one
thing that I did not see is the importance of uranium legacy
abandon mine cleanup that we have around the country. I know
there is this whole discussion as to whether it was for weapons
or if it was for energy. Whatever the uranium was mined for
originally, there are still problems across the country, namely
in New Mexico with the Navajo Nation, of some areas that need
to be cleaned up, and I would hope that that could be part of
the order and some serious consideration that we could have
going forward, because there are some serious health issues
that need to be addressed and people have been impacted.
So any of that, Dr. Miller, in a minute and a half,
whatever you can give us I would appreciate it. Then we will
yield back to the Chairman as time expires.
Dr. Miller. Thank you very much, Congressman. Thank you for
your attention to detail as you read our report.
So, first, let me say that security and proliferation risk
is not meant to be the last, you know, the least important
thing. They are just listed in no particular ranked order. So
that is that question.
The budget. In I think fiscal year 1999, the nuclear energy
R&D budget was zero in DOE, and it has gradually over the last
20 years or so, well, ten years, 1999, yeah, ten years or so,
it has come up to a reasonable level and counting the
infrastructure support for Idaho National Laboratory and other
places, it is $900 million.
Now, I feel that we are going to have to make choices. We
are going to have to establish priorities as we move forward,
and so part of our plan is to do down selects, and we are going
to have to explore a wide range and then say, look, these are
the most promising. We can't pursue those. We have to make
choices of what we are going to be able to do within that
framework of that budget.
Mr. Lujan. Thank you, Dr. Miller, and as time has expired,
I look forward to further conversations on this.
Mr. Chairman, I would just close with saying that I think
it is important that as we look at what is being talked about
with energy generation, that there is a waste issue that needs
to be addressed as well, and I certainly hope that we can use
the brightest minds that we have in the world right here in
this great Nation of ours to solve this problem. When the
Manhattan Project was moving forward, they did this in a short
period of time at the direction of Congress, support from the
President, and they made something happen, some things that
still are a concern to many of us, but nonetheless, made
something happen. I think this is an area as well with the
direction and support from Congress that we could see some
action in this area.
Thank you.
Mr. Baird. Living down river from Hanford Nuclear
Reservation I share that concern.
Mr. Smith.
More on Uranium Supply
Mr. Smith of Nebraska. Thank you, Mr. Chairman, and thank
you, Dr. Miller.
I was wondering if you could help paint a picture of our
uranium supply, some numbers, import, export, how we are doing
in that area.
Dr. Miller. Okay. So uranium supply from everything I have
read about estimates of resources are sufficient to supply
nuclear power in the world, especially if one assumes uranium
is a commodity to be bought and sold in the free market. I only
say that, as I mentioned earlier, there are some countries that
view uranium as a national security issue, that if we don't
have uranium in our borders, then we have to do something about
that.
And that is certainly true, well, I won't mention the
particular countries, but that is true of some countries. In
our country we view it as a commodity to be bought and sold on
the free market.
And right now uranium is selling reasonably, for reasonably
low level, about $40 per pound of U308. I think that what
happens is when easily-mined uranium starts getting scarce, the
price goes up, and then we develop new technologies to look at
new ore bodies and then the price starts to come down again.
So I don't believe uranium supply is an issue.
Mr. Smith of Nebraska. What percent do we import?
Dr. Miller. I don't have that number with me. I will have
to get it to you. I don't know.
[Additional material submitted for the record follows:]
Prepared Response of Assistant Secretary Miller
According to the most recent edition of the Energy Information
Administration's ``Uranium Annual Marketing Report,'' which was
published in 2008, the United States imported 92 percent of its
commercial uranium requirements in 2007 and 86 percent in 2008.
Mr. Smith of Nebraska. Do you have any concerns about how
reliant we are perhaps on importing uranium?
Dr. Miller. It is my understanding that the uranium that we
import comes from countries like Canada and Australia, which
are countries that we generally don't have national security or
supply security problems with, and we also have our own uranium
resource here in the United States. And we have a lot of
uranium in reserve. As a matter of fact, in the form of
depleted uranium.
So I guess I don't feel concerned about uranium supply.
Mr. Smith of Nebraska. Okay. Thank you. I do want to just
add that I am encouraged by some of the advancements
politically, unfortunately, of nuclear power and the advocacy.
I am still concerned, though, that there are too many politics
involved with some of these issues. So I hope that you can work
with us to move forward on nuclear power and the opportunity to
build our energy supply so we can create jobs and more
opportunity for Americans.
Thank you, Mr. Chairman.
Dr. Miller. Thank you.
Mr. Baird. Ms. Kosmas.
Information on Full Recycling
Ms. Kosmas. Thank you very much, and thank you for being
here.
Like the others, I have mixed feelings obviously, but
mostly I look forward to what I know we can do well in this
country, which is to take advantage of the scientific knowledge
that we have to produce energy through nuclear opportunities.
What my concern is, with my limited amount of scientific
knowledge, of course, relates back to the sustainable fuel
cycles that you referred to, and specifically you talked about
the options that range between once-through and full recycling
and how many different ways you might be able to accomplish the
goal.
I guess my questions would go to the full recycling
specifically. Is it being done anywhere in the world, and if
so, do we have access to that knowledge, and if not, how far
along would you say we are in the development of an opportunity
to repeatedly recycle, rather than dispose of the product?
Dr. Miller. So the first question is anyone actually
implementing full recycle. I think it is fair to say that there
are two major countries that have decided full recycle is part
of their policy, but they haven't fully implemented it because
they don't have a commercial fast reactor yet, which is key to
having and implementing a full recycle. But those countries,
which are Japan and France, hope to and plan to implement
commercial scale fast reactors. So I would say that no country
has implemented it, but several countries have planned to
implement it and are on the way to implementing it.
So then the second question is would we have access. I
think for sure if--and I should have mentioned earlier that
part of our plan is clearly to take into consideration and look
very carefully at the recommendations of the Blue Ribbon
Commission that is going to help us decide what to do with the
back-into-the-fuel cycle. But if this country decided that its
direct or its path forward is full recycle, I don't think there
is any question we know how to rebuild a reprocessing plant
using the PUREX approach used by France and Japan.
The problem is we have not accepted that approach based
upon the principle of proliferation because it has a step in
which plutonium is bare and could be diverted. So we could do
it in our country if we so decided to do it. I don't see any
question about that.
Ms. Kosmas. So there is a risk involved then in making the
decision to move forward and the Blue Ribbon Commission is
expected to weigh that risk against the gain and make some
recommendations, policy recommendations in that regard?
Dr. Miller. Yes. I can't speak for precisely how the Blue
Ribbon Commission is going to take its charter and what it is
going to say, but I will say from our point of view in DOE a
realistic R&D plan includes trying to reduce proliferation risk
of the full recycle and reduce costs and reduce environmental
burden of that approach, but we have not rejected an option of
doing full recycle.
Ms. Kosmas. Okay. If it were decided to move in that
direction, would you have any projection of either time or
resources necessary to make that happen?
Dr. Miller. So in our plan what we would attempt to do is
to go beyond the PUREX approach, look at other approaches, one
of which has made a lot of progress called pyroprocessing, but
there are other kinds of approaches that we would look at. And
we would attempt again to come up with ways that are improved,
and I would say that we could implement it certainly over the
next, let us say, 20 to 30 years. We could certainly implement
full recycle if we decided to do it now.
Ms. Kosmas. And the costs generally?
Dr. Miller. Most cost estimates would say that full recycle
is considerably more expensive than once-through. Having said
that, it is hard to take into account how many repositories we
would need and what the cost of repositories would be. If you
implemented full recycle, the hope would be you would need many
fewer geologic repositories.
So there needs to be system studies that we are carrying
out that compare these things with what we call modified open
cycle that tries to take into account the cost, the waste
burden, the proliferation risk, all of these things to make
suggestions as to what the Nation ought to do in its future
decisions.
Ms. Kosmas. Okay. Thank you very much.
I yield back.
Mr. Baird. Ms. Biggert.
Small Modular Reactors
Ms. Biggert. Thank you, Mr. Chairman, Dr. Miller.
When I first came to Congress, we were looking at the
electrometal allergical process and it was at Argonne National
Lab, and the first year that I was here the program was cut by
$20 million, so I felt like I had the 800-pound gorilla on my
back and got the funding back. And we have been moving since
then. We have had--in 2005, I think we wanted the systems
analysis, the reprocessing. We have six reprocessing plants in
this country that were shut down before they even opened, and,
you know, they are now used for storage in the most part.
It is very frustrating that we haven't moved with the
recycling as fast as I think we should, and you are talking
about another 20, 30 years. I mean, that really is
discouraging. Maybe with some of the modeling and things we
will be able to move a lot faster and at lesser expense. I am
sorry I can't be here for all of this because I have a markup,
but I did want to ask you about small modulars and as we heard
from you, or as I was told in your exchange with Mr.
Rohrabacher, there are several types of small modular
technologies out there in the market, and all of them different
designs, and each have various production capacities outside
the range defined in the Atomic Energy Act either because some
designs are smaller than the 100 megawatts and--or larger than
300 megawatts.
At this early stage of development do you believe that more
study should be given to the production capacity of smaller
modular reactors and if that capacity limit needs to be
adjusted to reflect the diversity of technology in the market?
Dr. Miller. Certainly I believe we ought to look at what
the market penetration could be for small modular reactors, and
I am sure my colleagues in the private sector who are
advocating certain designs have looked very carefully at the
business case associated with it. Now, they haven't shared--
some of that is probably proprietary information, they haven't
shared it with us, but I think it is certainly appropriate as
we begin our SMR Program. Hopefully if it gets funded in fiscal
year 2011, that we also with our systems people within the
national laboratories will take a look at what the issues are
related to market penetration.
Modeling and Simulation of Reactors
Ms. Biggert. Well, you have noted in your testimony that
the Department is increasingly using modeling and simulation to
predict reactor performance and assess new technologies. How
will this effort leverage or complement actual experimentation,
and how might it reduce or eliminate the need for expensive
demonstration or otherwise assist the NRC's licensing process?
Dr. Miller. Uh-huh. So there are a couple of comments I
could make. We have the most progress I think in fuels designs,
in modeling the performance of fuels, and I think we have the
promise of being able to significantly accelerate the amount of
time it takes to develop a new fuel.
I mean, new fuels are really important. If you get more
burn-up for existing reactors, for fresh fuel, the more burn-up
you get, the better off you are from the point of view of the
uranium utilization efficiency. A whole bunch of reasons this
is a good thing to do.
And I think we have done a really good job of understanding
with high performance computing how these fuels operate, and I
think it is going to really help us in the future. And there
are other examples that relate to the Modeling and Simulation
Hub that was funded in fiscal year '10, that we hope to soon
announce a winner for. There we would do a full reactor design
with advanced modeling tools that would be validated with
experiment.
So I think we are really moving out in the computational
arena, and it is quite heartening to me to see it happen.
Ms. Biggert. All right. Thank you. I yield back.
Mr. Baird. Mr. Davis.
General Comments
Mr. Davis. Mr. Chairman, thank you very much and certainly,
Dr. Miller, thank you for being here today as well and giving
the testimony you have and taking questions from those of us
who serve unique Congressional districts, very similar yet
somewhat very different in the different areas of the country
that we serve. And I live in an area that--Tennessee Valley
Authority, the TVA was established in the '30s, so provides the
generation of electricity so that folks who live in my district
are able to flip a switch and have a certainty that that light
bulb is going to come on, unless the filament is shot and so
they have to replace that from time to time.
The Atomic Energy Commission from the '40s and '50s and
'60s, '70s basically was the agency that oversaw the
development of nuclear energy. Obviously weapons was the main
thrust of the Manhattan Project, and then we started moving
more and more toward energy from nuclear sources.
Through the '70s we actually licensed close to 100 nuclear
reactors that were built from '75, basically to '85, that
provides today roughly 20 percent of the energy that is
produced, electricity produced in this country.
Three Mile Island did change things in the minds, in our
commitment and our focus to becoming more and more energy
independent. I think nuclear energy took the brunt of that, and
it suddenly became Chernobyl in the minds of a lot of folks.
That never happened at Three Mile Island. The reactor acted as
it should, it shut down. The other reactor that was onsite, I
understand, continued to produce electricity for folks to use.
And so we have had 30 years, 25 to 30 years of a flare of
nuclear energy. We suddenly realized that when you drive by
places like Kingston, Tennessee, and you see in Ashville that
there are difficulties with other types of generating
electricity as well. I am excited about this Administration and
the commitment that has been focused on again looking at
nuclear energy as a viable source for us to become more energy
independent, and for me that does two things. It gives us
economic security, and it gives us national security that we
don't have today as a result of our dependence on foreign
sources, and in many cases, foreign sources for carbon-based
fuels.
So I encourage you and this Administration and others and
Members of Congress to take a serious look at nuclear energy as
being that bridge that puts us into the area of economic
security and a stronger national security.
Licensing for SMRs
The question I have to you: I am hearing a lot about the
small nuclear reactors that might be 1,200 megawatts, 125
megawatts. They will be easy to located, they can be basically
the size of a box car. They can be moved from the place where
they are being built, but it also does something else. It
creates jobs in America. I don't think there is any country in
the world that if they are talking about a nuclear reactor, if
they had the choice to buy it from America, they wouldn't buy
it from us.
So we have to move more rapidly in that direction. I hear
folks say it might take 15 or 20 years to get a small nuclear
reactor approved and licensed. We can't wait that long. So how
do we expedite the licensing requirements to be sure that we
have a safe small nuclear reactor that we can use in our Nation
and export to other countries throughout the world? How do we
expedite that?
Dr. Miller. Okay. Thank you, Congressman. So let me begin
by saying I sure hope it doesn't take 15 or 20 years. So we in
our fiscal year 2011 budget have a program, half of which, $20
million, is directed toward LWR SMRs, and there the approach we
have taken is to do a cost share with industry up to two plants
and up to design certification.
Now, as I said in my opening comments, we are going to have
a workshop in June at which we are going to hear from our
industry colleagues, and I am sure if I would guess correctly,
I am sure they will tell me that that is not enough, that we
should do more.
Certainly we will listen to that. We will certainly take it
back, but at this point as I have had to say several times, I
support the President's budget.
Mr. Davis. We have national labs all across this Nation;
one is in Oak Ridge. Wouldn't it be a responsible move for this
Nation on the facilities that we occupy today to actually build
a small nuclear reactor and let that be the source of energy
that we use at our national labs or our reservations?
Dr. Miller. There are several exciting ideas, Congressman,
out there of how one might--or ideas of bringing together the
right companies like, for example, TVA and B&W, to bring a
consortium together to do just as you have described. There are
ideas of doing a similar thing in Washington near the Hanford
Reservation. There are ideas within the Department of Defense
of using small modular reactors for base power.
So I think all of these are interesting ideas. We encourage
this discussion, we encourage--they have actually been in to
see us. We have been encouraging. In fact, Secretary Chu, I
think, was briefed on the ideas in Tennessee when he was there.
So I think we should move forward with these ideas. It is
not clear yet to us what is the government role, what the
Federal Government role is, but certainly we are encouraging.
Mr. Davis. I think it is time to fish. We have been cutting
bait long enough. Let us move forward with it.
Mr. Baird. Thank you. I have just one--we want to make sure
we have time for the next panel. I have just one question, and
that has to do with the economics of nuclear power.
Cost Competitiveness
There has been a lot said about it was Three Mile Island or
Chernobyl that caused the decline in nuclear power. Coming from
a state that had the public power supply system----
Dr. Miller. Uh-huh.
Mr. Baird. --it did not fail because of those accidents. It
failed because of the financing and the largest public bond
default in history of the country at that time, because nuclear
power simply was not cost competitive.
Dr. Miller. Yeah.
Mr. Baird. My understanding is even now, even as we look at
the light water reactors, their cost competitiveness relative
to say coal depends fairly significantly on a price on carbon.
Is that your understanding, Dr. Miller?
Dr. Miller. So first of all, let me say that we are
proposing $54 billion worth of loan guarantees to try to help
the first movers get going and get them out there, but
eventually they have got to stand on their own. The Federal
Government can't loan guarantee forever.
So if, in fact, we are competing in an environment in which
there is not a level playing field. If we are doing standards,
renewable standards, we are doing things that are encouraging
the application and the commercialization of certain resources,
and there is no price on carbon, and we can't get to the point
of coming up with a business model like small modular reactors,
and gas is $4 a million BTU, I think it is going to be a tough
sled for these reactors to make it.
Mr. Baird. I appreciate that. I raise it because it is
fairly common on this committee and maybe in the public
discourse that the greatest proponents of nuclear power are
also opponents of a carbon tax, and my understanding from the
MacKenzie curves and elsewhere is that map doesn't pencil out.
If you have a carbon tax, it makes nuclear power much more
attractive, and I think that is a reasonable approach because
there is a cost of carbon, and nuclear power may actually
reduce that.
Any other colleagues, further questions before we move to
our next panel?
Mr. Rohrabacher. I will refrain from refuting that last
statement.
Mr. Baird. I appreciate that, Mr. Rohrabacher.
With that, Dr. Miller, thank you, again, for your service
and your testimony. We will proceed immediately to seat the
next panel, take just a brief moment for the staff to set up
their name tags, et cetera, and we will move with alacrity
here.
Panel II:
I want to welcome our second panel of witnesses. I will
briefly introduce them, and I understand Mr. Lipinski will
introduce our final witness.
It is my pleasure to introduce Christofer Mowry, President
and CEO of Babcock & Wilcox Nuclear Energy Incorporated, Dr.
Charles Ferguson, President of the Federation of American
Scientists, Dr. Mark Peters, Deputy Director for Programs at
Argonne Lab, Mr. Gary Krellenstein is a Managing Director of
Tax Exempt Capital Markets of JP Morgan and Chase, and I will
yield to my colleague from Illinois, Dr. Lipinski, to introduce
our last witness.
Mr. Lipinski. Thank you, Chairman Baird.
Dr. Thomas Sanders is the current President of American
Nuclear Society, which is headquartered in La Grange, which is
in my district. The ANS is a preeminent nuclear professional
society representing about 11,000 members from the private
sector, national labs, and universities. Dr. Sanders has a
Ph.D. in nuclear engineering, is a licensed reactor operator,
and a qualified electrician. He knows just about every aspect
of the industry from personal experience, having served in the
Navy on two nuclear submarines and as a researcher at the
University of Texas and Sandia National Lab. In his role as ANS
President, as Chairman of the Trade Promotion Coordinating
Committee, of the Civil Nuclear Trade Advisory Committee, Dr.
Thomas has been a leading advocate of rebuilding our domestic
nuclear manufacturing base and has been an outspoken critic of
our current dependence on imports.
I am delighted to welcome him to this hearing and look
forward to his testimony.
Mr. Baird. Thank you, Dr. Lipinski. As we mentioned in the
prior testimony, you will have five minutes for your spoken
testimony, however, we are not operating atomic clocks here and
our digital system seems to be going on the fritz. So if we get
around five minutes, I will let you know, but you should have--
somewhere up there you have got some red light, green light, et
cetera. When the yellow light comes on, you are running out of
time. When the red light comes on, a trap door appears below
you, you disappear, and we move to the next witness.
So at this point, Mr. Mowry, please begin and thanks to all
of you for your expertise and your presence here.
STATEMENTS OF CHRISTOFER MOWRY, PRESIDENT AND CEO, BABCOCK &
WILCOX NUCLEAR ENERGY, INC.
Mr. Mowry. Well, Mr. Chairman and Members of Congress, my
name is Chris Mowry, and I am the President of B&W Nuclear
Energy, Division of the Babcock & Wilcox Company. I ask that my
written statement be entered into the Committee record.
I am honored to be part of this hearing to discuss modular
reactors, and I applaud the DOE for supporting SMR development
in their Nuclear Energy R&D Roadmap.
The Babcock & Wilcox Company has a rich legacy of
innovating energy solutions. We have more than 50 years of
continuous nuclear engineering and manufacturing expertise.
Today B&W provides both industry and government customers with
nuclear manufacturing and services from more than 17 locations
across North America. We employ directly and through our joint
venture companies approximately 12,000 nuclear professionals.
The DOE's Roadmap stresses the need to deploy clean,
affordable, domestic energy quickly to achieve energy security
and reduce emissions and cites capital costs as a significant
challenge to deploying new nuclear plants. These issues are
central to industry's motivation to develop SMRs as a
compliment to large gigawatt-sized reactors. Industry sees
values in a more incremental approach to project financing and
low growth.
Our utilities want a smaller reactor that uses proven
technology, existing nuclear infrastructure, and conventional
nuclear fuel, and they want this option near-term.
The B&W mPower reactor is a scalable modular light water
reactor which can be deployed within today's regulatory
framework, domestic supply chain, and utility infrastructure.
It provides capacity in 125 megawatt increments. It has a four
and a half year operating cycle between refueling. It will be
manufactured in North American at B&W facilities, and it has a
secure underground containment with a spent fuel pool to
securely store spent fuel for the life of the reactor. The
plant is also air cooled to address water resource concerns.
The B&W mPower reactor is intended to be a competitive
source of power generation. Our current analysis of the
levelized cost of electricity indicates that the economics
range from 47 to $95 a megawatt hour. This range is competitive
with new fossil generation and renewable power alternatives,
even without a carbon tax.
We plan to submit our design for certification to the NRC
in 2012 and have joined in an industry consortium, including
among others, the Tennessee Valley Authority, First Energy, and
Oglethorpe Power. The stated goal of this consortium is to
deploy one or more demonstration plants before 2020.
The B&W mPower reactor will be fully supported by a North
American supply chain and has the potential to create thousands
of jobs across North America. When used to repower aging coal
facilities, the B&W mPower reactor creates a net increase in
high-quality jobs at the plant site. Nuclear power plants trade
lower, very stable fuel costs for more high-quality jobs. We
believe this is a great tradeoff for our country's economy and
its employment challenges.
B&W is not alone in the emerging SMR industry. There are
several other companies pursuing small modular reactors based
on a range of technologies. The DOE's Roadmap properly
recognizes that research needs for light water technology are
minimal and focuses instead on identifying priorities that
enable their near-term development and demonstration.
Simultaneously, the DOE plans to support a range of R&D
activities for longer-term technologies.
It is my view that the Roadmap strikes a good balance
between near-term and long-term efforts and creates a broad
foundation for supporting SMR technologies.
B&W believes that SMRs such as the B&W mPower reactor offer
America a practical and affordable near-term, domestically-
produced, clean energy source. Delivering on the promise of
these reactors, that these reactors hold will depend on
leadership and foresight from both the industry and government.
Public-private partnership is, therefore, critical to help
reduce risk and accelerate deployment of a promising new SMR
technology.
A successful cost-sharing program stemming from such a
partnership should encompass all important development
activities, including design and licensing necessary to
programmatically address the first-mover risks inherent in
technology demonstration programs.
In 1957, the first commercial nuclear power plant at
Shippingport, Pennsylvania, achieved full power operation. It
was the result of a partnership between the Atomic Energy
Commission and Duquesne Light Company. This cooperation between
industry and government set in motion the development of the
U.S. commercial nuclear industry, which for 50 years provided
technology leadership to the world and today supplies 20
percent of our electricity. Our government's investment in this
first-of-a-kind technology provided lasting and significant
value to the Nation.
Today we have a new opportunity, an opportunity to
reestablish America's leadership role in the commercial nuclear
industry that we first launched in 1957. A new public-private
partnership will enable the U.S. to demonstrate the promise
which SMR technology holds for our industry by the end of this
decade.
The DOE's Roadmap has created a strong foundation from
which to pursue this goal, and I look forward to working with
the Committee on legislation to implement it. Thank you for the
privilege of testifying before the Committee. I am happy to
answer questions.
[The prepared statement of Mr. Mowry follows:]
Prepared Statement of Christofer M. Mowry
Chairman Gordon, Ranking Member Hall, and Members of the Committee:
My name is Chris Mowry and I am the President of Babcock & Wilcox
Nuclear Energy, a division of The Babcock & Wilcox Company. I would ask
that my entire statement and supplemental information be entered into
the Committee record. My prepared remarks will be a summary of this
statement.
It is my privilege to present this testimony today regarding the
Department of Energy's (DOE's) Nuclear Energy Research and Development
Roadmap (Roadmap). I will focus my testimony on Small Modular Reactors
(SMRs) and the promise they hold to provide carbon-free, base-load
nuclear power in a more flexible, affordable form, while generating a
lasting increase in high quality jobs for America. I applaud the DOE
for recognizing the real potential of SMRs and including significant
support for their development in the Roadmap.
The Babcock & Wilcox Company has a rich legacy of innovating energy
technology solutions for efficient and reliable electricity generation
throughout the United States, North America and across the globe. We
grew our business over the past 140 years by developing and
commercializing practical solutions to the evolving challenges of the
power generation industry. We provide a comprehensive portfolio of
clean energy technologies, including such coal-based systems as oxy-
coal combustion, post-combustion CO2 scrubbing, and
environmental control systems. We supply a wide range of renewable
energy systems including biomass, concentrating solar power, and waste-
to-energy. And, important to today's testimony, we consistently lead
the development and deployment of new nuclear energy technology
solutions for industry and government.
B&W has more than 50 years of continuous nuclear engineering and
manufacturing experience. Seven of the large nuclear power plants
operating in the U.S. today were designed, manufactured and installed
by B&W, including reactors in Arkansas, Florida, Ohio, Pennsylvania and
South Carolina. Many other operating reactors incorporate major B&W
nuclear steam supply components. Today, we provide customers with
nuclear manufacturing and nuclear-related services from more than 17
facilities across North America. These locations are engaged in
everything from manufacturing major components for nuclear power
plants, to operating the Nation's nuclear energy laboratory in Idaho,
to fabricating fuel for the High Flux Isotope Reactor at Oak Ridge
National Laboratory and the University of Missouri's research reactor,
both of which provide critical research and material testing services.
Two of our manufacturing facilities maintain the only privately held
NRC Category 1 nuclear fuel licenses to manage Highly Enriched Uranium
in the United States. We also down-blend Highly Enriched Uranium into
Low Enriched Uranium, which is then delivered into the marketplace for
commercial reactor fuel.
B&W operates significant nuclear manufacturing facilities in
Indiana, Ohio, Virginia and Tennessee, as well as in Ontario, Canada.
We are the only American manufacturer accredited and capable of
producing large N-stamped components for commercial nuclear power
plants. We have fabricated more than 1,100 large Nuclear Steam Supply
System (NSSS) components and pressure vessels, including approximately
300 nuclear steam generators worldwide. And, we employ directly and
through joint venture companies approximately 12,000 U.S. nuclear
professionals.
Nuclear Power and Small Modular Reactors
The DOE Nuclear R&D Roadmap correctly states that ``To achieve
energy security and greenhouse gas (GHG) emission reduction objectives,
the United States must develop and deploy clean, affordable, domestic
energy sources as quickly as possible.'' It is clear that nuclear
energy will play a critical role in achieving these objectives. The
report also concludes that ``The capital cost of new large plants is
high and can challenge the ability of electric utilities to deploy new
nuclear power plants.'' This concern is central to industry's
motivation to develop and deploy SMRs as complements to large,
gigawatt-sized reactors.
More than two years ago, B&W began evaluating the shifting nuclear
industry landscape. Several factors, including the potential for
climate change legislation and carbon emission regulation, the need for
increased energy independence, the constraints on the nuclear component
supply chain, the increasingly restrictive capital markets, and the
growing concerns about water rights and transmission capacity were
pushing the industry to innovate new approaches to nuclear energy. Over
these past several years, it has become increasingly clear that when it
comes to nuclear power generation technology, one size does not fit
all.
As part of our SMR market evaluation, we drew on the experience and
expertise of electric utilities themselves to help us define the type
of SMR technology best suited to meet their near-tern needs. Their
guidance caused us to recognize that many utilities are not comfortable
financing large, gigawatt-sized nuclear power projects. For example,
some smaller electric cooperatives, which have historically been unable
to include nuclear power plants in their own generation portfolios due
to size and cost, now view SMRs as a realistic way to increase their
carbon-free baseload generation capacity. Larger utilities see
significant value in small reactors as well, particularly in providing
a more incremental approach to project financing and to meeting
projections of modest system load growth. In the near term, our utility
customers want a smaller reactor that uses proven light-water nuclear
technology, that can lever their substantial investment in existing
nuclear infrastructure, and that can draw on the well-established
conventional nuclear fuel supply chain. They also want a practical
carbon-free option that can be used to ``repower'' aging coal power
plants. In response to this broad range of emerging energy industry
needs, we have developed the B&W mPowerTM reactor.
B&W mPower Reactor
The B&W mPower reactor (Figure 1) is a scalable, modular, Advanced
Light Water Reactor (ALWR) system, which can be certified, manufactured
and operated within today's existing regulatory framework, domestic
industrial supply chain, and utility operational infrastructure. The
B&W mPower reactor has the capacity to match utility customer
requirements in meaningful 125 MWe increments, while providing a 4.5
year operating cycle between refueling outages (compared to 18 or 24
month refueling cycles for currently operating large reactors). The
scalable size of the B&W mPower reactor will allow industry to utilize
existing electrical transmission line infrastructure and, when used to
repower aging fossil-power plants, reuse existing power plant assets.
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The use of conventional fuel, structures and power conversion
equipment contributes to reliable, efficient plant operations within
the existing Light Water Reactor (LWR) experience base of the industry.
We plan on manufacturing the entire B&W mPower reactor in B&W
facilities across North America, with the completed integral nuclear
module then shipped by rail to plant construction sites. Factory
assembly permits site infrastructure to be constructed simultaneously,
reducing construction time. The reactor is designed to be installed in
a secure underground containment structure (Figure 2), addressing
aircraft impact concerns. The design also includes a spent fuel pool
capable of holding 60 years' worth of spent fuel inside the underground
containment. In other words, the spent fuel is stored securely for the
life of the reactor. Additionally, the B&W mPower reactor plant is
specifically designed to be air-cooled, thereby addressing concerns--
particularly in the Southwest and Southeast--about local and regional
water resources. These capabilities make the B&W mPower reactor a
suitable power generation option for market segments such as
replacement of aging fossil power plants, incremental additions to
existing nuclear sites, power sources for energy intensive industrial
manufacturing sites, potential energy parks, as well as developing
countries and remote areas with limited transmission and access
infrastructure.
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We are currently well into the design phase for the B&W mPower
reactor and plan to submit our Design Certification Application (DCA)
to the U.S. Nuclear Regulatory Commission (NRC) in 2012. Our initial
efforts focus on obtaining NRC Design Certification and lead plant
deployment in America. The NRC is already engaging us in Design
Certification and licensing activities for the B&W mPower reactor. In
support of these goals, we have developed a B&W mPower Consortium made
up of B&W and leading U.S. utilities, including the Tennessee Valley
Authority, First Energy and Oglethorpe Power Corporation. The
Consortium is dedicated to addressing the proper regulatory framework,
design requirements, and licensing infrastructure necessary to support
the commercialization of the B&W mPower reactor. The ultimate goal of
the Consortium is to deploy one or more demonstration plants in the
U.S. by 2020, if not earlier.
This is an aggressive but realistic goal, one which will require
industry leadership from B&W and its utility partners, the right
balance between the promise of innovation and the certainty of proven
ideas, and consistent support from the DOE, NRC, and Congress. A high-
level version of the lead plant schedule, leading to initial deployment
by 2020, is included in Figure 3.
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The B&W mPower reactor is intended to be a competitive source of
power generation. Our current analysis of the levelized cost of
electricity (LCOE), an industry standard metric for total cost of
ownership, indicates that the economics range from 47 $/MWh to 95 $/MWh
(Figure 4) for a nuclear plant composed of 4 B&W mPower modules
generating 500MWe, depending on the deployment configuration. This LCOE
range is competitive with new fossil generation and renewable power
alternatives, even without a carbon ``tax''.
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Manufacturing of the B&W mPower reactor has the potential to create
thousands of jobs in the next 10-15 years across North America,
including Ohio, Indiana, Virginia and Tennessee. The B&W mPower reactor
will be fully supported by a North American supply chain, including all
forgings. Current estimates of manufacturing job growth are variable
based on broad predictions of the market for small reactors. As more of
the development and final design work is completed, and fabrication and
assembly methods are defined, good estimates of manufacturing job
growth will become available.
When used to repower aging coal facilities, the B&W mPower reactor
creates a net increase in high-quality jobs at the power plant. On an
equivalent basis, approximately four times as many jobs are created per
unit of power generated by a B&W mPower plant compared with an aging
coal plant. Nuclear power plants trade lower, very stable fuel costs
for more high-quality jobs. This is a great trade-off for our country's
economy and its employment challenges.
The B&W mPower reactor will also generate significant indirect jobs
in the areas of engineering, project management, field construction and
plant operations. Engineering and design work for the B&W mPower
program has already created more than 100 full-time positions in
Virginia and Ohio and led to the establishment of dedicated facilities
in Virginia.
Generation III Light-Water and Generation IV Technologies
B&W is not alone in the emerging SMR industry. There are many
companies currently pursuing the development of small reactors, based
on a range of technologies from light water design to more long-term
``Generation IV'' concepts. The DOE's R&D Roadmap recognizes the
importance of both near-term light water-based SMRs, as well as the
longer-term, non-light water technologies. In the Roadmap, the DOE
properly recognizes the relative maturity of these various
technologies, acknowledges that basic research needs for light water
technology are minimal, and focuses the Roadmap on identifying
priorities that enable their development, demonstration and commercial
application. Simultaneously, the DOE rightly plans to support a range
of R&D activities for longer term non-light water technologies. The DOE
has struck a good balance between near-term and long-term efforts. It
has prudently created a broad programmatic foundation supporting SMR
technologies that meet market realities and effectively complement
large nuclear power plants and other sources of energy.
Federal Support for SMRs
This Committee recognized the value of public-private partnerships
when it established the Nuclear Power 2010 program in the Energy Policy
Act of 2005. Today, NP 2010, a 50-50 cost-shared program between the
Department of Energy and utility industry partners, effectively
addresses the technical, regulatory, and institutional barriers to
building new, gigawatt-class nuclear power plants in the United States,
providing the framework for industry decisions to construct and operate
those plants. A similar model will also help reduce risk and accelerate
deployment of promising new SMR technologies into the energy industry.
In its Fiscal Year (FY) 2011 budget request, the DOE requested
funding for a new SMR program, to include both a cost-sharing
initiative supporting near-term Design Certification of light water SMR
technologies and R&D activities for longer-term technologies. There are
also several bills under consideration in both the House and Senate
that incorporate cost-sharing programs for SMRs, all articulating
strong support for their development. A meaningful SMR cost-share
program is vital to the energy industry. The timeline, scope and
competitive selection criteria of such a program will have a
significant impact on the ultimate success of SMRs in meeting our
emergent energy industry challenges. To ``develop and deploy clean,
affordable, domestic energy sources as quickly as possible,'' as DOE
states in the Roadmap, an SMR costshare program should support the
near-term deployment of scalable, modular nuclear power in a way that
enables the market adoption of practical, affordable carbon-free
nuclear power. This program must foster development of technology that
domestic utilities are likely to construct, own, and operate in
quantity, while accelerating the creation of stable, high quality
American jobs. We believe the B&W mPower reactor meets these criteria
today.
To deploy SMRs by the end of this decade, it is important that the
cost-share program scope span the spectrum of necessary industry
development activities--including Design Certification, final design
engineering, as well as Early Site Permit and Combined Operating
License activities--rather than being confined simply to offsetting NRC
fees. In any industry, unique risks are inherent in being a technology
``first-mover''. Recent worldwide experience in nuclear construction
projects has shown that successful efforts to deploy new nuclear plant
designs rely on government and industry cooperation encompassing
support, design, licensing, and first-of-class plant construction.
Government cooperation is essential to realistically address the
licensing and schedule risks inherent in such demonstration projects.
Through public-private cooperation, government and industry can share
the risks and benefits of deploying the first SMR plants by the end of
this decade.
As mentioned previously, B&W believes a reasonable programmatic
goal is to deploy light water-based SMR technology in this country by
the year 2020. Working outward from that goal, NRC Design Certification
should be completed for one or two SMR designs by the year 2016. DOE
has requested $39 million in FY 2011 for the SMR program, with funding
split between the near-term, cost-shared Design Certification of two
light-water SMR designs and the longer-term R&D for more conceptual SMR
designs. Both program components are valuable. However, we are
concerned that any reasonable split of this $39 million between the
near-term Design Certification work and the longer-term R&D would
significantly slow building industry momentum supporting a near-team
SMR demonstration program, risking achievement of the goal to deploy a
lead plant by 2020. This is why we have encouraged a number of
Congressional Members to support a programmatic increase of the overall
SMR program account to $55 million for FY 2011, which would leave
adequate funds for long-term R&D while also providing reasonable
funding to initiate meaningful Design Certification and licensing
activity for up to two light water SMR technologies.
As this Committee considers legislation relating to SMRs, I would
offer that a successful cost-sharing program must rely on competitive
selection criteria that support our Nation's energy and security goals.
Emphasis should be placed on:
Modularity that enables factory manufacture of the
integral nuclear steam supply system,
Domestic utility commitment to near-term deployment
of the technology,
Economic competitiveness of the design without long-
term government support,
Domestic supply chain maturity to support near-term
manufacturing, and
Ability for the design to be certified and licensed
within the existing regulatory structure.
These criteria will ensure that the SMR design selection is market-
driven, and that public funding used to support those designs will
ultimately be well spent on a successful program--one that enables a
significant and long-lasting reduction in America's carbon emissions,
that increases America's energy independence, and that creates
substantial high-quality American jobs. In other words, these program
selection criteria will help ensure that America leads innovation in
this new technology and enhances its global competitiveness in the
energy industry.
Closing Comments
B&W believes that SMRs such as the B&W mPower reactor offer America
a practical and affordable source of near-term, domestically produced,
clean energy. Delivering on the promise these reactors hold will depend
on leadership and foresight from both the nuclear industry and
government.
In 1957, the first commercial nuclear power plant at Shippingport,
PA achieved full power operation, the result of a partnership between
the Atomic Energy Commission and Duquesne Light Company. This
cooperation between industry and government set in motion the
development of the U.S. commercial nuclear industry, which for 50 years
provided technology leadership to the world and today supplies 20
percent of all electricity generated in America, and 70 percent of our
carbon-free electricity generation. America's nuclear industry owes its
existence to a successful public-private partnership which first
demonstrated the commercial application of nuclear energy. Our
government's investment in this first-of-a-kind technology more than 50
years ago provided lasting and significant value to the Nation.
Today we have a new opportunity--an opportunity to reestablish
America's leadership role in the commercial nuclear power industry that
we first launched in 1957. A new public-private partnership will enable
the U.S. to demonstrate the promise which SMR technology holds for our
energy industry by the end of this decade. The DOE's Nuclear Energy R&D
Roadmap has created a strong foundation from which to pursue this goal,
and I look forward to working with the Committee on legislation to
implement it.
Thank you for the privilege of testifying before the Committee. I
am happy to answer any questions the Committee may have.
Biography for Christofer M. Mowry
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Mr. Baird. Thank you, Mr. Mowry.
Dr. Ferguson.
STATEMENTS OF CHARLES FERGUSON, PRESIDENT, FEDERATION OF
AMERICAN SCIENTISTS
Dr. Ferguson. Thank you, Mr. Chairman and other Members of
the Committee. Thank you for the opportunity to testify on
behalf of the Department of Energy's--comment on the Department
of Energy's Roadmap. I request that my submitted written
testimony be entered into the record.
In my limited time I want to focus on four issues, four
themes. One, the U.S. ability to compete, the issue of
proliferation, proliferation resistance, waste disposal, and
finally systems analysis compared to other energy sources and
the various fuel cycles being considered.
Other countries such as China, India, and Russia could
already manufacture small to medium-power reactors. The Indian
reactors, in particular, present proliferation concerns. So the
United States confronts an economic competitive disadvantage.
Because the U.S. has yet to license such reactors towards
domestic use, it has placed itself at additional market
disadvantage. By the time the U.S. has licensed such reactors,
China, India, as well as other competitors may have established
a stronghold on this emerging market.
Given the differences in design philosophy among the six or
seven reactors, SMRs, being considered in the U.S. market, none
of these designs have yet penetrated the market, it is too soon
to tell which, if any, will emerge as market champions.
Nonetheless, because of the early stage of development, the
United States has an opportunity to state clearly the criteria
for successful use of SMRs. Because of the head start of these
other countries, the United States should not procrastinate and
should take a leadership role in setting the standard for safe,
secure, and proliferation-resistant SMRs that can compete in
the market.
About 12 years ago a systems analysis was begun at Lawrence
Livermore National Laboratory looking at what should be the
criteria, especially in developing countries. The reactors that
we would market here, the SMRs in the United States, would set
an example for those in the developing world, and there are
three issues that need to be addressed. Can we achieve
reliable, safe operation with a minimum of maintenance and
supporting infrastructure? Can we offer economic competitive
sources of energy that can compete with alternative energy
sources available to those candidate countries and the sites
the reactors would be located? And finally, could we
demonstrate significant improvements in proliferation
resistance relative to existing reactor systems?
And these two researchers, Dr. Brown and Dr. Hasberger of
Lawrence Livermore, pointed out that currently-available
technologies fail in one or more of those standards. So they
put forward what one would consider kind of an ideal type of
situation. One would be that we can eliminate the need for
onsite refueling of the reactor, and that would minimize the
risk of seizure of fissile material, and secondly, they
recommend finding a disposal pathway so you don't have
plutonium and other fissile material lingering onsite in that
country.
Unfortunately, because of the situation with waste disposal
in the United States and other countries, you know, no country
has a repository for spent nuclear fuel or nuclear waste. There
is no clear pathway to take back that material from these
client countries. Nonetheless, we do have a precedent under the
Atoms for Peace Program. We supplied highly-enriched uranium
research reactors and now we have been taking that material
back under the Global Threat Reduction Initiative from various
client states and taking it back and securing it in Oak Ridge,
Tennessee.
So we might be able to play off that precedent. We also
need to establish market incentives for disposal of nuclear
waste from these client countries. Perhaps if the fee is right,
we could achieve public acceptance here in the United States to
take back some of that fuel or find other locations, very
secure locations for those materials.
And concerning systems analysis for the DOE Roadmap, I
think we need to look very seriously at the economic costs of
the various fuel lifecycles; the once-through cycle, the
modified cycle, and the closed cycle. Right now there is an
economic disadvantage for the once-through recycling and for
the full closed recycling methods, and considerable work needs
to be done to figure out what industry is willing to do to help
share the cost, whether industry is really very supportive
economically of that approach.
So in closing, I would say that we really need to determine
how much industry is willing to contribute to cost sharing and
looking at the economic advantages of these new small modular
reactors and the other systems being considered under the DOE's
Roadmap.
Thank you.
[The prepared statement of Dr. Ferguson follows:]
Prepared Statement of Charles D. Ferguson
Introduction
Thank you, Chairman Bart Gordon, Ranking Member Ralph Hall, and
Members of the Committee. I appreciate the opportunity to appear before
you and comment on the Department of Energy's Nuclear Energy Research
and Development Roadmap.
In his invitation letter, Chairman Gordon requested that I begin by
providing a very brief overview of the Federation of American
Scientists (FAS) and its Future of Nuclear Energy in the United States
project. FAS was founded in 1945 by many of the atomic scientists who
had developed the first atomic bombs in the Manhattan Project. They
dedicated themselves to preventing nuclear war and reducing nuclear
dangers by stopping the further spread of nuclear weapons to more
states and terrorist groups. Several of the founders such as physics
Nobel laureate Hans Bethe supported widespread use of peaceful nuclear
energy. They realized, however, that to achieve safe and secure use of
nuclear power, governments needed to make stopping nuclear
proliferation a top priority. Because misuse of commercial nuclear
technology to make weapons may harm business and the prospects for
further expansion of commercial nuclear power, industry also has a
vital stake in ensuring peaceful use.
Building on this legacy of more than six decades, FAS has recently
begun the Future of Nuclear Energy in the United States project in
partnership with Washington and Lee University. With generous grant
support from the Lenfest Foundation, Professor Frank Settle of
Washington and Lee University and I are leading a multiple author-
project. The goal of the project is to assess lessons learned from the
past, examine the present status of U.S. nuclear energy, and explore
where nuclear energy development in the United States is headed. The
main product will be a book-length report with chapters on licensing,
financing, safety, security, the fuel cycle, waste management,
comparison of nuclear energy to other energy sources, and nuclear
energy's role in transportation and the smart grid. The publication
date is early next year. Immediately after publication, Dr. Settle, the
authors, and I will disseminate the results through briefings to
Executive and Legislative officials, the news media, and other
analysts. We will keep the House Committee on Science and Technology
apprized of the progress of the project.
Small Modular Reactors
Because of the renewed attention to small modular reactors (SMRs),
I will start my analysis of the Department of Energy's proposed plans
with this subject.\1\ In many respects, small power reactors are not
new technologies but the potential for modularity, efficient factory
construction, relatively quick deployment once built, and applications
other than electricity generation offer the promise of cost competitive
energy sources for markets that are not appropriate for large power
reactors. As a matter of liability insurance, small power reactors are
defined as generating 300 Megawatts (MWe) or less of electrical power.
Medium power reactors range in power from greater than 300 MWe to 700
MWe. The typical large power reactors now being marketed can generate
from 1,000 MWe to 1,600 MWe.
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\1\ Steven Chu, ``America's New Nuclear Option: Small Modular
Reactors will Expand the Ways We Use Atomic Power,'' Wall Street
Journal, March 23, 2010.
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The United States and several other countries have considerable
experience in building and operating small and medium power reactors.
The U.S. Navy, for example, has used small power reactors since the
1950s to provide propulsion and electrical power for submarines,
aircraft carriers, and some other surface warships. China, France,
Russia, and the United Kingdom have also developed nuclear powered
naval vessels that use small reactors. Notably, Russia has deployed its
KLT-40S and similarly designed small power reactors on icebreakers and
has in recent years proposed building and selling barges that would
carry these types of reactors for use in sea-side communities
throughout the world. China has already exported small and medium power
reactors. In 1991, China began building a reactor in Pakistan and
started constructing a second reactor there in 2005. In the wake of the
U.S.-India nuclear deal, Beijing has recently reached agreement with
Islamabad to build two additional reactors rated at 650 MWe.\2\
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\2\ Agence France Presse, ``China to Build Two Nuclear Reactors in
Pakistan,'' April 29, 2010.
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One of the unintended consequences of more than 30 years of
sanctions on India's nuclear program is that India had concentrated its
domestic nuclear industry on building small and medium power reactors
based on Canadian pressurized heavy water technology, or Candu-type
reactors. Pressurized heavy water reactors (PHWRs) pose proliferation
concerns because they can be readily operated in a mode optimal for
producing weapons-grade plutonium and can be refueled during power
operations. Online refueling makes it exceedingly difficult to
determine when refueling is occurring based solely on outside
observations, for example, through satellite monitoring of the plant's
operations. Thus, the chances for potential diversion of fissile
material increase. This scenario for misuse underscores the need for
more frequent inspections of these facilities. But the limited
resources of the International Atomic Energy Agency have resulted in a
rate of inspections that are too infrequent to detect a diversion of a
weapon's worth of material.\3\
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\3\ Thomas B. Cochran, ``Adequacy of IAEA's Safeguards for
Achieving Timely Detection,'' Chapter 6 in Henry D. Sokolski, editor,
Falling Behind: International Scrutiny of the Peaceful Atom (Strategic
Studies Institute, U.S. Army War College, February 2008).
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The opening of the international nuclear market to India may lead
to further spread of PHWR technologies to more states. For example,
last year, the Nuclear Power Corporation of India, Ltd. (NPCIL)
expressed interest in selling PHWRs to Malaysia.\4\ NPCIL is the only
global manufacturer of 220 MWe PHWRs. New Delhi favors South-to-South
cooperation; consequently developing states in Southeast Asia, sub-
Saharan Africa, and South America could become recipients of these
technologies in the coming years to next few decades.\5\ Many of these
countries would opt for small and medium power reactors because their
electrical grids do not presently have the capacity to support large
power reactors and they would likely not have the financial ability to
purchase large reactors.
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\4\ P Vijian, ``India Keen to Sell Nuclear Reactors to Malaysia,''
BBC Monitoring Asia Pacific--Political, April 27, 2009.
\5\ More in depth analysis on Asia and nuclear energy developments
will appear later this year in a book chapter I am writing for the
National Bureau of Asian Research.
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What are the implications for the United States of Chinese and
Indian efforts to sell small and medium power reactors? Because China
and India already have the manufacturing and marketing capability for
these reactors, the United States faces an economically competitive
disadvantage. Because the United States has yet to license such
reactors for domestic use, it has placed itself at an additional market
disadvantage. By the time the United States has licensed such reactors,
China and India as well as other competitors may have established a
strong hold on this emerging market.
The U.S. Nuclear Regulatory Commission cautioned on December 15,
2008 that the ``licensing of new, small modular reactors is not just
around the corner. The NRC's attention and resources now are focused on
the large-scale reactors being proposed to serve millions of Americans,
rather than smaller devices with both limited power production and
possible industrial process applications.'' The NRC's statement further
underscored that ``examining proposals for radically different
technology will likely require an exhaustive review'' . . . before
``such time as there is a formal proposal, the NRC will, as directed by
Congress, continue to devote the majority of its resources to
addressing the current technology base.'' \6\ Earlier this year, the
NRC devoted consideration to presentations on small modular reactors
from the Nuclear Energy Institute, the Department of Energy, and the
Rural Electric Cooperative Association among other stakeholders.\7\ At
least seven vendors have proposed that their designs receive attention
from the NRC.\8\
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\6\ U.S. Nuclear Regulatory Commission, ``For the Record: `Small'
Reactor Reviews,'' December 15, 2008. [Emphasis added.]
\7\ See, for example, presentations for the panel ``Increasing
Interest in Small Modular Reactors'' at the RIC 2010 conference, March
11, 2010.
\8\ U.S. Nuclear Regulatory Commission, ``Advanced Reactors,''
www.nrc.eov/reactors/advanced.html, November 4, 2009.
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Given the differences in design philosophy among these vendors and
the fact that none of these designs have penetrated the commercial
market, it is too soon to tell which, if any, will emerge as market
champions. Nonetheless, because of the early stage in development, the
United States has an opportunity to state clearly the criteria for
successful use of SMRs. But because of the head start of China and
India, the United States should not procrastinate and should take a
leadership role in setting the standards for safe, secure, and
proliferation-resistant SMRs that can compete in the market.
Several years ago, the United States sponsored assessments to
determine these criteria.\9\ While the Platonic ideal for small modular
reactors will likely not be realized, it is worth specifying what such
an SMR would be. N. W. Brown and J. A. Hasberger of the Lawrence
Livermore National Laboratory assessed that reactors in developing
countries must:
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\9\ See, for example, U.S. Department of Energy, Office of Nuclear
Energy, Science, and Technology, Report to Congress on Small Modular
Nuclear Reactors, May 2001.
``achieve reliably safe operation with a minimum of
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maintenance and supporting infrastructure;
offer economic competitiveness with alternative
energy sources available to the candidate sites;
demonstrate significant improvements in proliferation
resistance relative to existing reactor systems.'' \10\
---------------------------------------------------------------------------
\10\ N. W. Brown and J. A. Hasberger, ``New Concepts for Small
Power Reactors Without On-Site Refueling for Non-Proliferation,'' Paper
for the Advisory Group Meeting on Small Power and Heat Generation
Systems on the Basis of Propulsion and Innovative Reactor Technologies,
Obninsk, Russian Federation, Convened by the International Atomic
Energy Agency, July 20-24, 1998.
Pointing to the available technologies at that time from Argentina,
China, and Russia, they determined that ``these countries tend to focus
on the development of the reactor without integrated considerations of
the overall fuel cycle, proliferation, or waste issues.'' They
emphasized that what is required for successful development of an SMR
is ``a comprehensive systems approach that considers all aspects of
manufacturing, transportation, operation, and ultimate disposal.''
Considering proliferation resistance, their preferred approach is
to eliminate the need for on-site refueling of the reactor and to
provide for waste disposal away from the client country. By eliminating
on-site refueling the recipient country would not need to access the
reactor core, where plutonium--a weapons-usable material--resides. By
removing the reactor core after the end of service life, the recipient
country would not have access to fissile material contained in the used
fuel. Both of these proposed criteria present technical and political
challenges.
Ideally, the reactor would have a core life of 30 or more years.
Such reactors are presently in use in the U.S. Navy. But the problem
from a proliferation standpoint is that these reactors are fuel led
with weapons-grade uranium. Thus, if a client country seized such a
reactor and if it could break into the reactor's core, it could have
bomb-usable fissile material. While the transfer of U.S. naval reactor
technology is not advisable, perhaps there are other methods to achieve
lifetime cores. A Japanese group of researchers, for example, examined
a conceptual design for a small lead-bismuth cooled fast neutron
reactor that computer simulations indicate the fuel could last for 30
years.\11\ Fast reactors, however, have had a history of poor
performance and have generally cost much more than thermal
reactors.\12\ Only Russia presently has a large commercial fast reactor
in operation although China, Japan, and India have active fast reactor
programs. A more promising method for lifetime cores may involve
thorium, a fertile element that can be used to make fissile fuel.
Depending on the reactor design, thorium-based fuels offer favorable
proliferation-resistant properties. Concerning long-lived cores, a
research group has recently shown via computer simulations that
thorium-type small reactors may not need refueling until after ten
years and further design may result in even longer lived cores.\13\
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\11\ Yoshitaka Chikazawa et al., ``A Conceptual Design of a Small
Natural Convection Lead-Bismuth Cooled Reactor Without Refueling for 30
Years,'' Nuclear Technology, Vol. 154, 2006, pp. 142-154.
\12\ Thomas B. Cochran, Harold A. Feiveson, Walt Patterson, Gennadi
Pshakin, M. V. Ramana, Mycle Schneider, Tatsujiro Suzuki, and Frank von
Hippel, Fast Breeder Reactor Programs: History and Status, A Research
Report of the International Panel on Fissile Materials, February 2010.
\13\ Iyos Subki et al., ``The Utilization of Thorium for Long-Life
Small Thermal Reactors Without On-Site Refueling,'' Progress in Nuclear
Energy, March-August 2008, pp. 152-156.
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But these concepts will likely require many years of development
before they are ready for the commercial market. And although thorium
reactors, in principle, look promising, the dominant paradigm has been
to favor uranium-fueled reactors.\14\ Marketplace inertia and comfort
level with the uranium-based technologies have erected barriers to
different concepts. Moreover, the small reactor designs that are
further along in development do not have long-lived cores.
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\14\ Leslie Allen, ``If Nuclear Power Has a Promising Future . . .
Seth Grae Wants to be the One Leading the Charge,'' Washington Post,
August 9, 2009.
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Even if proliferation-resistant lifetime core reactors were
available, the other challenge is to provide a proliferation-resistant
pathway to nuclear waste management. As indicated by Brown and
Hasberger, the ideal would be to remove as soon as possible the used
fuel from the recipient country. But then the question is: What country
will accept the used fuel and the other radioactive materials? No
country has opened up a permanent repository for domestically generated
nuclear waste. However, Russia has accepted used fuel from client
states under the condition that Russia reprocesses the used fuel to
extract plutonium for reuse. Also, Britain and France have reprocessed
used fuel from client states under the condition that high level waste
is returned to the clients.
Another option is to send used fuel from SMRs and perhaps other
reactors fueled under a fuel leasing agreement to territory designated
as an international zone. Such a zone would have to have rigorous
security. In addition to making the difficult decision as to where to
site this zone, supplier states would also have to reach agreement on
whether to just store the used fuel or to reprocess it in order to
recycle the plutonium and other fissionable materials. The political
obstacles to creating this option for used fuel disposal appear
formidable.
Market-based incentives may offer the way forward to convince
clients to buy SMRs. If a client especially one without an existing
nuclear waste storage facility wants to save costs, its government may
be willing to pay a fee for disposal of the waste in a supplier state.
Doing so will obviate the need for the client to pay for the
expenditure of a disposal facility. But achieving agreement will
require a major policy shift on the part of supplier states. Their
governments will have to convince their publics to accept the waste. If
the disposal fee were large enough but also fair to the client, then a
market could be created. If the populace near the disposal site were
assured that the project would create considerable number of jobs and
would uphold the highest safety and security standards, then acceptance
may follow. Because the used fuel from SMRs would be much more compact
than used fuel from large reactors, the barrier to acceptance of the
SMR used fuel may also be lower. As a possible precedent, the United
States has repatriated used U.S.-origin fuel containing highly enriched
uranium. This material has fueled research reactors provided to client
states under the Atoms for Peace Program.
A systems analysis of the economics of SMRs is considerably
different than the economics of more traditional large reactors. On a
per kilowatt cost basis, a large reactor is more cost competitive as
compared to a single SMR. But as two researchers for the International
Atomic Energy Agency have pointed out, it is futile to make such a
comparison because ``SMRs are suitable for those locations that might
not be appropriate for larger plants.'' \15\ Such locations include
countries with weak electrical grids, remote places, and locales
favoring having the reactor near a population center to provide
electrical and non-electrical needs such as district residential
heating, industrial heating, or desalination. The researchers note that
``SMRs have a potential to be competitive by employing alternative
design strategies, taking advantage of smaller reactor size, offering a
less complex design and operation and maintenance, relying on
deployment-in-series approaches, taking an advantage of the accelerated
learning, multiple unit factors and shorter construction duration.''
They caution that ``the economic data does not exist or is not
available at a fine enough level of detail to perform the complex
comparative analyses normally associated with `business models.''' \16\
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\15\ V. Kuznetsov and N. Barkatullah, ``Approaches to Assess
Competitiveness of Small and Medium Sized Reactors,'' Proceedings of
the International Conference on Opportunities and Challenges for Water
Cooled Reactors in the 21st Century, October 27-30, 2009, IAEA, Vienna,
Austria, Paper 1S01.
\16\ Ibid.
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Nonetheless, the IAEA has sponsored research that has assessed the
cost competitiveness of constructing several SMRs at a site versus
building one large reactor.\17\ In particular, the IAEA study has
estimated the overall cost of four SMRs of 300 MWe each to one large
1,200 MWe reactor. Thus, the cumulative power ratings are equivalent.
The SMRs would be built sequentially so that once one has been
completed another will begin construction nine months later. The
estimated construction time for each SMR is less than half the time to
build one 1,200 MWe reactor. While the economy of scale economic factor
alone would indicate that the 1,200 MWe reactor has a 1.74 ratio cost
advantage, other factors even the playing field for the combined SMRs.
By building multiple units, the SMRs are estimated to achieve a 0.78
cost reduction. The speedier construction schedule per SMR gives an
advantage, but balanced over the total construction time of the four
SMRs, the cost reduction is only 0.94. The factory-built modular design
provides a significant cost reduction of 0.85. The timing of the units
to achieve favorable financing may result in another factor reduction
of 0.95. Combining these cost reductions, the IAEA study indicates that
the overall cost of the four SMRs is only 1.04 times greater than one
large reactor, meaning nearly equivalent. It is important to underscore
that these estimates are based on computer studies and have not been
field tested by actual construction. As with practically all first-of-
a-kind endeavors, the first SMRs will most likely exceed cost
estimates. But with learning and deploying enough of these reactors,
costs may very well come down.
---------------------------------------------------------------------------
\17\ IAEA Nuclear Energy Series Report ``Approaches to Assess
Competitiveness of SMRs,'' Status: submitted for pre publication review
and clearances; Targeted publication date: 2010; draft available at:
http://www.iaea.org/NuclearPower/Downloads/SMR/docs/Approaches-to-
assess-competitiveness-of-SMR-Draft.pdf
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It is also worth pointing out that in the United States, Alaska and
Hawaii may derive the most benefit from SMRs. Based on a 2001 DOE
assessment, ``SMRs could be a competitive option'' in those states
because ``the industrial rate for electricity charged by selected
Alaska and Hawaii utilities varied from 5.9 to 36.0 cents per kWh'' and
for a generic 50 MWe SMR, ``the range of electricity cost is estimated
at 5.4 to 10.7 cents per kWh,'' while the ``range of cost for a 10 MWe
SMR is 10.4 to 24.3 cents per kWh.'' \18\ Moreover, SMRs could help
Hawaii reduce its substantial dependence on imported oil to generate
electricity. According to the Energy Information Administration,
petroleum provides about three-fourths of Hawaii's electricity.\19\ In
comparison, petroleum is used in the United States as a whole to
generate about two percent of the nation's electricity.
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\18\ U.S. Department of Energy, Office of Nuclear Energy, Science,
and Technology, Report to Congress on Small Modular Nuclear Reactors,
May 2001, p. iv.
\19\ U.S. Energy Information Administration, ``Hawaii,'' Updated
May 13, 2010, http://www.eia.doe.gov/state/
state-energy-profiles.cfm?sid=HI
Nuclear Energy Research and Development Roadmap
Because the United States relies on nuclear power to provide about
20 percent of its electricity and because this energy source provides
the largest share of near-zero carbon emission electricity, the United
States has a clear interest in protecting its investment in the current
fleet of 104 commercial reactors. Many of these reactors have already
reached their nominal 40-year lifespan. Dozens of these reactors have
been recently receiving 20-year license extensions. Because the United
States has not constructed a new reactor since 1996 with the completion
of TVA's Watts Bar I, which was ordered in the early 1970s, the
existing fleet is relatively old. If no new reactors are built in the
next 20 years and if there are no further life extensions beyond 60
years, within a few years after 2030 about 40 percent of the current
fleet will have to be decommissioned. While 20 years may appear to be a
long time away, understanding the science and engineering demands for
extended reactor life will require at least several years of R&D.
Consequently, I concur with DOE's emphasis in R&D Objective 1 to invest
in improving the reliability, sustaining the safety, and extending the
life of the current fleet. The challenges in this objective are largely
technical and play to DOE's strength.
The challenges in R&D Objective 2 to make nuclear power more
affordable are more complex in that they are a mix of political,
technical, regulatory, and financial factors. Factors outside DOE's
control include streamlining the regulatory process for new reactors
and placing a price on carbon emissions. The latter factor would likely
have the greatest effect in making nuclear power and other low carbon
emission sources more cost competitive with fossil fuels.
Factors primarily within DOE's control include: R&D into new
reactor fuels that can provide more efficient use of fissionable
material and can create isotopic compositions of fissile material that
are less desirable for weapons-use, R&D into very high temperature
reactors that can produce hydrogen for fuel cells and process heat for
industrial applications, advanced computer modeling and simulation,
fundamental research in materials science, and systems analysis. While
the R&D Roadmap emphasizes ``systems design for revolutionary new
reactor concepts,'' there is an urgent need for systems analysis along
at least two fronts.
First, DOE should, if not already doing so, examine the competition
among currently available reactor designs and the newer designs
envisioned in the roadmap. An investment in a new nuclear reactor is at
least a 60-year commitment in operations. Financial incentives for
utilities to buy the currently available technologies may result in
little or no demand for the more innovative technologies outlined in
the roadmap.
Second, DOE should, if not already doing so, continually perform a
systems analysis of the competition among the various electricity
sources. Particular attention should be made in assessing how future
changes in the electrical grid using ``smart'' systems may allow for
greater use of decentralized sources of renewable energies and how
developments in energy storage systems could affect the use of large
and small power generators.
The third R&D objective seeks to develop sustainable nuclear fuel
cycles. I agree with the general principles specified in the roadmap to
``improve uranium resource utilization, maximize energy generation,
minimize waste generation, improve safety, and limit proliferation
risk.'' It makes sense to ``enable future decision makers to make
informed choices about how best to manage the used fuel from
reactors.'' A long term R&D program that seriously examines all three
types of nuclear fuel cycles is needed. While the plan outlined in the
roadmap appears sound in terms of fundamental R&D, I would encourage
DOE to perform a systematic economic analysis of the lifecycles of all
three fuel cycles. Similarly, it is important to determine the extent
to which industry will provide financial support for the two types of
fuel cycles currently not used in the United States: the modified open
cycle and full recycling.
Recommendations
Determine the proportion of cost sharing industry can
commit to in developing the Department of Energy's roadmap.
Provide adequate R&D funding for development of
lifetime core SMRs that do not use or produce fissile material
that would be desirable for nuclear weapons production.
Determine what resources the Nuclear Regulatory
Commission will require to continue with rigorous evaluations
of the many applications for large reactors while expediting
the examination of small modular reactors.
Implement a variable fee structure for NRC license
applications in order to lower the financial barrier for SMR
applicants. In March 2009, the NRC published an advanced notice
of a proposed rulemaking to institute such a structure.\20\
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\20\ Charles F. Rysavy, Stephen K. Rhyne, and Roger P. Shaw, K&L
Gates LLP, ``Small Modular Reactors,'' Special Committee on Nuclear
Power, American Bar Association Section of Environment, Energy, and
Resources, December 2009.
Provide flexibility for the combined construction and
operating license (COL) process to facilitate adding multiple
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SMRs to a site over a several years to few decades period.
Reevaluate the requirement for all Emergency Planning
Zones (EPZs) to be 10 miles in radius from the reactor site.
Even a ``large'' SMR will have a power rating one-fourth or
less than the rating of a typical large reactor. Because an SMR
is less powerful, its radioactivity content is considerably
less than for a large reactor. Emergency Planning Programs may
then require smaller EPZs for SMRs. But as more SMRs are added
to a site, the EPZ may need to change to scale with the growth
in power capacity.
Request the Obama administration to provide a
strategy for international sales of SMRs that only meet high
standards of safety, security, and proliferation-resistance.
Achieving adoption of these criteria will likely face
resistance from states that have available small and medium
power reactors that fall short in one or more of the standards.
Require clear pathways for safe and secure disposal
of used fuel and other radioactive waste before selling SMRs to
countries without disposal facilities or to countries where
regional security concerns may increase the likelihood of
diversion of fissile material into weapons programs.
Biography for Charles D. Ferguson
Dr. Charles D. Ferguson is the President of the Federation of
American Scientists (FAS). He is also an Adjunct Professor in the
Security Studies Program at Georgetown University and an Adjunct
Lecturer in the National Security Studies Program at the Johns Hopkins
University. Prior to FAS, he worked as the Philip D. Reed Senior Fellow
for Science and Technology at the Council on Foreign Relations, where
he was the project director of the Independent Task Force on U.S.
Nuclear Weapons Policy, chaired by William J. Perry and Brent
Scowcroft. Before his work at CFR, he was the Scientist-in-Residence in
the Monterey Institute's Center for Nonproliferation Studies, where he
co-wrote (with William Potter) the book The Four Faces of Nuclear
Terrorism (Routledge, 2005). While working at the Monterey Institute,
he was the lead author of the report Commercial Radioactive Sources:
Surveying the Security Risks, which was the first in-depth, post-9/11
study of the ``dirty bomb'' threat. This report won the 2003 Robert S.
Landauer Lecture Award from the Health Physics Society. Dr. Ferguson
has consulted with Sandia National Laboratories and the National
Nuclear Security Administration on improving the security of
radioactive sources. He also serves on the advisory committee for Oak
Ridge National Laboratory's Energy and Engineering Sciences
Directorate. He has worked as a physical scientist in the Office of the
Senior Coordinator for Nuclear Safety at the U.S. Department of State.
He is writing a book for Oxford University Press titled Nuclear Energy:
What Everyone Needs to Know (forthcoming, January/February 2011). He
graduated with distinction from the United States Naval Academy and
served in the U.S. nuclear Navy, receiving training as a nuclear
engineer at the Naval Nuclear Power School. He earned a Ph.D. in
physics from Boston University.
Mr. Baird. Thank you, Dr. Ferguson.
Dr. Peters.
STATEMENTS OF MARK PETERS, DEPUTY DIRECTOR FOR PROGRAMS,
ARGONNE NATIONAL LAB
Dr. Peters. Mr. Baird, Mr. Rohrabacher, and Members of the
Committee, thank you for the opportunity to testify before you
today on advanced nuclear fuel cycle research development and
demonstration and the Department of Energy's Nuclear Energy
Roadmap. Mr. Chairman, I ask that my full written testimony be
entered into the record, and I will summarize it here.
First, some remarks on sustainable nuclear energy. Nuclear
energy must experience significant growth to support the goals
of reliable and affordable energy in a carbon-constrained
world. Expansion of nuclear energy will increase the need for
effective nuclear waste management. Any advanced nuclear fuel
cycle aimed at meeting the challenges of nuclear waste
management must simultaneously address issues of economics,
uranium resource utilization, nuclear waste minimization, and a
strengthened non-proliferation regime.
As we heard from Dr. Miller, there are two basic fuel cycle
approaches: an open or once-through fuel cycle, which is
current U.S. policy, which involves treating used nuclear fuel
as waste with ultimate disposition of the material in a
geologic repository. In contrast, a closed or recycle fuel
cycle as currently planned by other countries, for example,
France and Japan, involves treating used nuclear fuel as a
resource whereby separations and actinide recycling in reactors
work with geologic disposal.
In our view, to maximize the benefits of nuclear energy it
will ultimately be necessary to close the fuel cycle. Note,
while geologic repositories will be needed for any type of fuel
cycle, the use of a repository could be quite different for a
closed fuel cycle. That said, there is no urgent need to deploy
recycling today. Fortuitously it is conceivable that the
decade's long hiatus in U.S. investment circumvents the need to
rely on dated recycling technologies. Rather, we have the
option to develop and build new technologies and develop
business models using advanced systems.
So now for some comments on the Nuclear Energy Roadmap. The
Nuclear Energy R&D Roadmap provides a comprehensive vision for
advancing nuclear energy as an essential energy source. Argonne
strongly supports the R&D objectives described in the Roadmap.
Argonne also agrees with the R&D approach described in the
Roadmap and particularly the synergistic use of experiment,
theory, and modeling and simulation to achieve the foregoing
objectives.
In collaboration with other DOE laboratories and
universities, Argonne is advancing a new science and
simulation-based approach for optimizing the design of advanced
nuclear energy systems and assuring their safety and security.
A robust and effective R&D demonstration strategy for an
advanced fuel cycle must include several components; a fuel
cycle system development activity to guide and appropriately
focus the research; science and discovery contributions to
technology and design, increased role of modeling and
simulation and nuclear energy research and system design;
advances in separations, fuel, and nuclear reactor
technologies; advancement of safe and secure use of nuclear
energy on an international basis; education and training of
future nuclear energy professionals; support for modernization
of aging research facilities for conducting experimental work;
coordination and integration of R&D and separations of wastes
sponsored by different government agencies and offices; and
finally, close cooperation with industry in R&D, demonstration,
and commercialization efforts as part of robust public-private
partnerships.
Concerning objective three of the Roadmap, namely the
sustainable fuel cycle, Argonne supports a greater emphasis on
coupling the science-based approach that is articulated in the
roadmap, and coupling that with an active design and technology
demonstration effort that would guide and appropriately focus
the R&D and enable assessment of programmatic benefits in a
holistic manner.
This would be accompanied by close cooperation of DOE, its
national laboratories, universities, and industry. These
efforts would allow for fuel cycle demonstration in a timeframe
that could influence the course of fuel cycle technology
commercialization on a global basis.
In particular, Argonne believes that advanced fast neutron
reactors, recycle processes, and waste management technologies
should be developed and demonstrated at engineering scale
during the next 20 years.
I should also say that the Blue Ribbon Commission is
evaluating options for the management of using nuclear fuel,
which we hope will result in recommendations for changes in
U.S. nuclear past policy. In parallel with these efforts,
advances in used fuel processing and waste storage and disposal
technologies will support the development of an integrated
policy for nuclear waste management in the U.S.
So in summary, the United States should conduct a science-
based advanced nuclear fuel cycle R&D and demonstration program
to evaluate recycling and transmutation technologies that
minimize proliferation risks and environmental public health
and safety impacts. This would provide a necessary option to
reprocessing technologies deployed today and supports
evaluation of alternative national strategies for nuclear fuel
disposition, effective utilization and deployment of advanced
reactor concepts, and eventual development of a permanent
geologic repository. This should be done as part of robust
public-private partnerships involving the Department of Energy,
its national laboratories, universities and industry, and
conducted with a sense of urgency and purpose consistent with
the U.S. retaining its intellectual capitol and leadership in
international nuclear energy community.
That concludes my remarks, Mr. Chairman. I thank you and
would be pleased to answer any questions.
[The prepared statement of Dr. Peters follows:]
Prepared Statement of Mark T. Peters
Summary
The United States should conduct a science-based, advanced nuclear
fuel cycle research, development, and demonstration program to evaluate
recycling and transmutation technologies that minimize proliferation
risks and environmental, public health, and safety impacts. This would
provide a necessary option to reprocessing technologies deployed today,
and supports evaluation of alternative national strategies for
commercial used nuclear fuel disposition, effective utilization and
deployment of advanced reactor concepts, and eventual development of a
permanent geologic repository(s). This should be done as part of robust
public-private partnerships involving the Department of Energy (DOE),
its national laboratories, universities, and industry; and conducted
with a sense of urgency and purpose consistent with the U.S. retaining
its intellectual capital and leadership in the international nuclear
energy community.
Introduction and Context
Sustainable Nuclear Energy
World energy demand is increasing at a rapid and largely
unsustainable pace. In order to satisfy the demand, reduce greenhouse
gas emissions, and protect the environment for succeeding generations,
energy production must evolve from the current reliance on fossil fuels
to a more balanced, sustainable approach based on abundant, clean, and
economical energy sources. Therefore, there is a vital and urgent need
to develop safe, clean, and secure global energy supplies. Nuclear
energy is already a proven, reliable, abundant, and ``carbon-free''
source of electricity for the U.S. and the world. In addition to
contributing to future electricity production, nuclear energy could
also be a critical resource for ``fueling'' the transportation sector
(i.e. electricity for plug-in hybrid and electric vehicles and process
heat for hydrogen and synthetic fuels production) and for desalinating
water. However, nuclear energy must experience significant growth to
support the goals of reliable and affordable energy in a carbon-
constrained world.
Key challenges associated with the global expansion of nuclear
energy include: assurance of ample uranium resources for fuel; the need
for increased numbers of trained engineers and technicians to design,
build, and safely operate the plants; the need for increased industrial
capacity for manufacturing and construction; the need to expand the
regulatory infrastructure requisite for safe and secure operations; the
need for integrated waste management; and the need to control
proliferation risks associated with greater access to sensitive nuclear
technologies.
Moreover, domestic expansion of nuclear energy will increase the
need for effective nuclear waste management in the U.S. Any advanced
nuclear fuel cycle aimed at meeting these challenges must
simultaneously address issues of economics, uranium resource
utilization, nuclear waste minimization, and a strengthened
nonproliferation regime, all of which require systems analysis and
investments in technology research and development, demonstration, and
test and evaluation. In the end, a comprehensive and long-term vision
for expanded, sustainable nuclear energy must include:
Safe and secure fuel-cycle technologies,
Cost-effective technologies for an overall fuel-cycle
system, and
Closed fuel cycle for waste and resource management.
Used Nuclear Fuel Management
It is the composition of used nuclear fuel that make its ultimate
disposal challenging. Fresh nuclear fuel is composed of uranium dioxide
(about 96% Uranium-238, and 4% Uranium-235). During irradiation, most
of the Uranium-235 is fissioned, and a small fraction of the Uranium-
238 is transmuted into heavier elements (known as transuranics). The
used nuclear fuel contains about 93% uranium (mostly Uranium-238),
about 1% plutonium, less than 1% minor actinides (neptunium, americium,
and curium), and about 5% fission products. Uranium, if separated from
the other elements, is relatively benign, and could be disposed of as
low-level waste or stored for later re-use, but some of the other
byproducts raise significant concerns:
The fissile isotopes of plutonium, americium, and
neptunium are potentially usable in weapons and, therefore,
raise proliferation concerns. However, used nuclear fuel
remains intensely radioactive for over one hundred years.
Without the availability of remote handling facilities, these
isotopes cannot be readily separated, essentially protecting
them from diversion.
Three isotopes, which are linked through a decay
process (Plutonium-241, Americium-241, and Neptunium-237), are
the major contributors to long-term radiotoxicity (100,000 to 1
million years), and hence, potential significant dose
contributors in a repository, and also to the long-term heat
generation that is a key design limit to the amount of waste
that can be placed in a given repository space.
Certain fission products (notably cesium and
strontium) are major contributors to any storage or
repository's short-term heat load, but their effects can be
mitigated through engineering controls.
Other fission products (Technetium-99 and Iodine-129)
also contribute to long-term potential dose in a repository.
The time scales required to mitigate these concerns are daunting:
several of the isotopes of concern will not decay to safe levels for
hundreds of thousands of years. Thus, the solutions to long-term
disposal of used nuclear fuel are limited to three options (not
necessarily mutually exclusive): the location of a geologic environment
that will remain stable for that period; the identification of waste
forms that can contain these isotopes for that period; or the
destruction of these isotopes. These three options underlie the major
fuel cycle strategies that are currently being developed and deployed
in the U.S. and abroad.
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The nuclear fuel cycle is a cradle-to-grave framework that includes
uranium mining, fuel fabrication, energy production, and nuclear waste
management. There are two basic nuclear fuel-cycle approaches. An open
(or once-through) fuel cycle, as currently planned by the U.S.,
involves treating used nuclear fuel as waste, with ultimate disposition
of the material in a geologic repository (see Figure 1). In contrast, a
closed (or recycle) fuel cycle, as currently planned by other countries
(e.g., France, Russia, and Japan), involves treating used nuclear fuel
as a resource whereby separations and actinide recycling in reactors
work with geologic disposal (see Figure 2).
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In the open nuclear fuel cycle, used nuclear fuel is sent to a
geologic repository that must contain the constituents of the used
nuclear fuel for hundreds of thousands of years. Several countries have
programs to develop these repositories. This approach is considered
safe, provided suitable repository locations and space can be found. It
should be noted that other ultimate disposal options have been
researched (e.g., deep sea disposal, boreholes, and disposal in the
sun) and are not focused on currently. The challenges of long-term
geologic disposal of used nuclear fuel are well recognized, and are
related to the uncertainty about both the long-term behavior of used
nuclear fuel and the geologic media in which it is placed.
For the closed nuclear fuel cycle, limited recycle options are
commercially available in France, Japan, and the United Kingdom. They
use the Plutonium and Uranium Recovery by Extraction (PUREX) process,
which separates uranium and plutonium, and directs the remaining
transuranics to vitrified waste, along with all the fission products.
The uranium is stored for eventual reuse. The plutonium is used to
fabricate mixed-oxide fuel that can be used in conventional reactors.
Used mixed-oxide fuel is currently not reprocessed, though the
feasibility of mixed-oxide fuel reprocessing has been demonstrated. It
is typically stored for eventual disposal in a geologic repository.
Note that a reactor partially loaded with mixed-oxide fuel can destroy
as much plutonium as it creates, but this approach always results in
increased production of americium, a key contributor to the heat
generation in a repository. This limited recycle approach has two
significant advantages:
It can help manage the accumulation of plutonium.
It can help significantly reduce the volume of used
nuclear fuel and high-level waste destined for geologic
disposal (the French experience indicates that volume
reductions by a factor of 5 to 10 can be achieved).
Several disadvantages have been noted:
It results in a small economic penalty by increasing
the net cost of electricity a few percent.
The separation of pure plutonium in the PUREX process
is considered by some to be a proliferation risk.
This process does not significantly improve the use
of the repository space (the improvement is around 10%, as
compared to many factors of 10 for closed fuel cycles).
This process does not significantly improve the use
of natural uranium (the improvement is around 15%, as compared
to several factors of 10 for closed fuel cycles).
Full recycle approaches are being researched in France, Japan, and
the U.S. These typically comprise three successive steps: an advanced
separations technology that mitigates the perceived disadvantages of
PUREX, partial recycle in conventional reactors, and closure of the
fuel cycle in fast reactors. Note: the middle step can be eliminated
and still attain the waste management benefits; inclusion of the middle
step is a fuel cycle system-level consideration.
The first step, using advanced separations technologies, allows for
the separations and subsequent management of highly pure product
streams. These streams are:
Uranium, which can be stored for future use or
disposed of as low-level waste.
A mixture of plutonium and neptunium, which is
intended for partial recycle in conventional reactors, followed
by recycle in fast reactors.
Separated fission products intended for short-term
storage, possibly for transmutation, and for long-term disposal
in specialized waste forms.
The minor actinides (americium and curium) for
transmutation in fast reactors.
The advanced separations approach has several advantages:
It produces minimal liquid waste forms, and
eliminates the issue of the ``waste tank farms.''
Through advanced monitoring, simulation, and
modeling, it provides significant opportunities to detect
misuse and diversion of weapons-usable materials.
It provides the opportunity for significant cost
reduction.
Finally, and most importantly, it provides the
critical first step in managing all hazardous elements present
in the used nuclear fuel.
The second step--partial recycle in conventional reactors--can
expand the opportunities offered by the conventional mixed-oxide
approach. In particular, it is expected that with significant R&D
effort, new fuel forms can be developed that burn up to 50% of the
plutonium and neptunium present in used nuclear fuel. (Note that some
studies also suggest that it might be possible to recycle fuel in these
reactors many times--i.e., reprocess and recycle the irradiated
advanced fuel--and further destroy plutonium and neptunium; other
studies also suggest possibilities for transmuting americium in these
reactors. Nevertheless, the practicality of these schemes is not yet
established and requires additional scientific and engineering
research.) The advantage of the second step is that it reduces the
overall cost of the closed fuel cycle by consuming plutonium in
conventional reactors, thereby reducing the number of fast reactors
needed to complete the transmutation mission of minimizing hazardous
waste. As mentioned above, this step can be entirely bypassed, and all
transmutation performed in advanced fast reactors, if recycle in
conventional reactors is judged to be undesirable.
The third step, closure of the fuel cycle using fast reactors to
transmute the fuel constituents into much less hazardous elements, and
advanced reprocessing technologies to recycle the fast reactor fuel,
constitutes the ultimate step in realizing sustainable nuclear energy.
This process will effectively destroy the transuranic elements,
resulting in waste forms that contain only a very small fraction of the
transuranics (less than 1%) and all fission products. These
technologies are being developed in the U.S. at Argonne National
Laboratory and Idaho National Laboratory, with parallel development
internationally (e.g., Japan, France, and Russia).
Several disadvantages have been noted for a closed fuel cycle,
including:
The economics of closing the fuel cycle. (Note, in
practice, closed fuel cycle processes would actually have
limited economic impact; the increase in the cost of
electricity would be less than 10%.)
Management of potentially weapons-usable materials
may be viewed as a proliferation risk.
These disadvantages can be addressed through a robust research,
development, and demonstration program focused on advanced reactors and
recycling options. In the end, the full recycle approach has
significant benefits:
It can effectively increase use of repository space.
It can effectively increase the use of natural
uranium.
It eliminates the uncontrolled buildup of isotopes
that are a proliferation risk.
The advanced reactors and the processing plant can be
deployed in small co-located facilities that minimize the risk
of material diversion during transportation.
A fast reactor does not require the use of very pure,
weapons-usable materials, thus decreasing proliferation risk.
Finally, it can usher the way towards full
sustainability to prepare for a time when uranium supplies will
become increasingly difficult to ensure.
In summary, the overarching challenge associated with the choice of
any fuel cycle option is used nuclear fuel management. For example,
current U.S. policy calls for the development of a geologic repository
for the direct disposal of used nuclear fuel. The decision to take this
path was made decades ago, when the initial growth in nuclear energy
had stopped, and the expectation was that the existing nuclear power
plants would operate until reaching the end of their design lifetime,
at which point all of the plants would be decommissioned and no new
reactors would be built. While it may be argued that direct disposal is
adequate for such a scenario, the recent domestic and international
proposals for significant nuclear energy expansion call for a
reevaluation of this option for future used fuel management (see Figure
3). While geologic repositories will be needed for any type of nuclear
fuel cycle, the use of a repository would be quite different for closed
fuel-cycle scenarios.
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For reprocessing to be beneficial (as opposed to
counterproductive), it must be followed by recycling, transmutation,
and fission destruction of the long-lived radiotoxic constituents
(i.e., plutonium, neptunium, americium). Reprocessing (with PUREX)
followed by thermal-recycling (mixed-oxide [MOX] fuel in light water
reactors [LWRs]) is well established, but is only a partial solution.
It is not at all clear that the U.S. should embark on this path.
especially since we have not made a massive investment in a PUREX/MOX
infrastructure. (Although, the U.S. is proceeding with a plan to reduce
excess-weapons plutonium inventory using MOX in LWRs.) In contrast,
advancement of fast reactor technology for transuranic recycling and
consumption would maximize the benefits of waste management and also
allow essential progress toward the longer term goal of sustainable use
of uranium (and subsequently thorium) with fast reactors.
There is no urgent need to deploy recycling today, but as nuclear
energy expands, a once-through fuel cycle will not be sustainable. To
maximize the benefits of nuclear energy in an expanding nuclear energy
future, it will ultimately be necessary to close the fuel cycle.
Fortuitously, it is conceivable that the decades-long hiatus in U.S.
investment circumvents the need to rely on dated recycling
technologies. Rather, we have the option to develop and build new
technologies and develop business models using advanced systems.
Detailed Discussion
Argonne National Laboratory
Located 25 miles southwest of Chicago, Argonne National Laboratory
was the country's first national laboratory--a direct descendant of the
University of Chicago's Metallurgical Laboratory where Enrico Fermi and
his colleagues created the world's first controlled nuclear chain
reaction. Appropriately, Argonne's first mission 64 years ago was to
develop nuclear reactors for peaceful purposes. Managed by the UChicago
Argonne, LLC for the U.S. Department of Energy, Argonne has grown into
a multidisciplinary laboratory with a unique mix of world-class
scientists and engineers and leading-edge user facilities, working to
create new technologies that address the most important scientific and
societal needs of our nation.
Argonne's experience over many years of research in the advancement
of nuclear energy positions it as a leader in the development of future
generation reactors and fuel cycle technologies. A primary goal of the
Laboratory's nuclear energy research program is to advance the
sustainable use of nuclear energy through research and development of
technologies that enable waste minimization, enhanced resource
utilization, competitive economics, and increased assurance of
reliability, safety, and security. Expertise in reactor physics,
nuclear and chemical engineering, computational science and
engineering, and fuel cycle analysis is applied in the assessment and
conceptual development of advanced nuclear energy systems that meet
these important goals.
In collaboration with other DOE laboratories and universities.
Argonne is advancing a new science- and simulation-based approach for
optimizing the design of advanced nuclear energy systems and assuring
their safety and security. This approach seeks increased understanding
of physical phenomena governing system behavior and incorporates this
understanding in improved models for predicting system performance in
operating and off-normal situations. Once validated, these models allow
the simulation and optimization of system design and operation, to
enhance safety assurance and cost competitiveness with alternative
energy supply options. They also promise to accelerate the
demonstration of commercially attractive systems in partnership with
industry.
Argonne's waste management and reprocessing research and
development activities are supported primarily by the DOE's Office of
Nuclear Energy (DOE-NE) through its Fuel Cycle Research and Development
program. The objective of Argonne's research in this area is to develop
and evaluate separations and treatment processes for used nuclear fuel
that will enable the transition from the current open fuel cycle
practiced in the U.S. to a sustainable, environmentally acceptable, and
economic closed fuel cycle. Our research focuses on the science and
technology of chemical separations for the treatment of used fuel from
both commercial and advanced nuclear reactors, used fuel
characterization techniques, and waste form engineering and
qualification. Ongoing projects related to reprocessing and waste
management include:
Using advanced modeling and simulation coupled with
experiments to optimize the design and operation of separations
equipment.
Exploring an innovative one-step extraction process
for americium and curium, radionuclides that are major
contributors to nuclear waste toxicity, to reduce the cost of
used-fuel treatment.
Further developing pyrochemical processes for used
fuel treatment. These processes enable the use of compact
equipment and facilities, treatment of used fuel shortly after
discharge from a reactor, and reduction of secondary waste
generation.
Developing highly durable and leach-resistant waste
forms of metal, glass, and ceramic composition for safe, long-
term disposal.
In addition, Argonne's nuclear science and engineering expertise
utilizes theory, experiment, and modeling and simulation in the
assessment and conceptual development of innovative, advanced reactors
operating with a variety of coolants, fuel types, and fuel cycle
schemes. Argonne also leads U.S. development of innovative technologies
that promise to reduce the cost of fast-neutron reactors and increase
their reliability. These technologies include high-performance fuels
and materials; compact, low-cost components for the heat transport
systems; advanced power conversion and refueling systems; and improved
capabilities for in-service inspection and repair.
Argonne's research into the behavior of irradiated fuels and
materials supports the U.S. Nuclear Regulatory Commission (NRC) in the
regulation of industry initiatives to extend the operational lifetime
and optimize the operation of existing and evolutionary nuclear
reactors. Leading-edge systems analysis and modeling capabilities are
used to assess the relative merits of different advanced nuclear energy
systems and fuel cycles for various domestic and global scenarios of
energy demand and supply consistent with environmental constraints and
sustainability considerations. Argonne also has expertise in the
components of nuclear technology that are critical for national
security and nonproliferation, including the conversion of research
reactors to low-enrichment fuels, technology export control, risk and
vulnerability assessments, and national-security information systems.
Current Nuclear Waste Reprocessing Technologies
As discussed above, current commercial used nuclear fuel
reprocessing technologies are based on the PUREX process, which is a
solvent extraction process that separates uranium and plutonium and
directs the remaining minor actinides (neptunium, americium, and
curium) along with all of the fission products to vitrified waste. The
PUREX process has over fifty years of operational experience. For
example, the La Hague reprocessing facility in France treats used fuel
from their domestic and foreign power reactors. Plutonium recovered is
recycled as a mixed-oxide fuel to generate additional electricity.
Other countries using this technology for commercial applications
include the United Kingdom and Japan.
PUREX does not recover the minor actinides (neptunium, americium,
curium, and heavier actinide elements), which compose a significant
fraction of the long-term radiotoxicity of used fuel. Advanced reactors
can transmute and consume minor actinides if separated from the fission
product elements, but incorporation of minor actinide separations into
existing PUREX facilities adds complexity and is outside commercial
operating experience. Moreover, existing international facilities do
not capture fission gases and tritium, but rather these are discharged
to the environment within regulatory limits. Although plutonium is
recycled as mixed oxide fuel, this practice actually increases the net
discharge of minor actinides. Finally, the production of pure plutonium
through PUREX raises concerns about materials security and
proliferation of nuclear weapons-usable materials.
Pyroprocessing is presently being used at the Idaho National
Laboratory to treat/stabilize used fuel from the decommissioned EBR-II
reactor. The key separation step, electrorefining, recovers uranium
(the bulk of the used fuel) in a single compact process operation.
Ceramic and metallic waste forms, for active metal and noble metal
fission products, respectively, are being produced and have been
qualified for disposal in a geologic repository. However, the
demonstration equipment used for this treatment campaign has limited
scalability. Argonne has developed conceptual designs of scalable,
high-throughput equipment as well as an integrated facility, but to
date only a prototype advanced scalable electrorefiner has been
fabricated and successfully tested.
Advanced Reprocessing Technologies
Research on advanced reprocessing technologies focuses on processes
that meet U.S. non-proliferation objectives and enable the economic
recycle of long-lived actinides in used fuel, while reducing the amount
and radiotoxicity of high-level wastes that must be disposed. Main
areas of research include:
Aqueous-based Process Design--Current studies target
the simplification of aqueous processes that can recover the
long-lived actinides as a group in one or two steps.
Pyrochemical-based Process Design--Present work is
focused on development of scalable, high-throughput equipment
and refining our understanding of the fundamental
electrochemical process. We are targeting greater control of
the composition of the recovered uranium/transuranic alloy,
which will facilitate safeguards consistent with U.S. non-
proliferation goals.
Off-gas Treatment--Environmental regulations limiting
the release of gaseous fission products require the development
of materials that will efficiently capture and retain volatile
fission products. Because these volatile fission products are
generally difficult to retain, development of novel materials
with strong affinities for particular fission products is
essential.
Product/Waste Fabrication--This development effort
includes concentrating the product streams and recovery/recycle
of process fluids, solidification of products for both waste
form and fuel fabrication/recycle. The products must meet
stringent requirements as nuclear fuel feedstocks or must be
suitable for waste form fabrication.
Process Monitoring and Control--Advanced
computational techniques are being developed to assess and
reduce uncertainties in processing operations within a plant.
Such uncertainties in design, in processing, and in
measurements significantly increase costs through increased
needs for large design margins, material control and
accounting, and product rework.
Sampling Technologies--The tracking of materials is
critical to the safeguarding and operational control of recycle
processes. Improving the accuracy of real-time measurements is
a major goal for material accountancy and control. Reducing the
turnaround time for analysis by applying state-of-the-art
sampling and analytical techniques will enable ``on-line''
material accountancy in real time. Advanced spectroscopic
techniques are under study to reduce gaps in our ability to
identify key species at key locations within a plant.
Impact on Future Nuclear Waste Management Policy
The Blue Ribbon Commission is evaluating options for the management
of used nuclear fuel, which will result in recommendations for changes
in U.S. nuclear waste policy. In parallel with these efforts, advances
in used fuel processing and waste storage and disposal technologies
will support the development of an integrated policy for nuclear waste
management in the U.S., consistent with our energy security,
nonproliferation, and environmental protection goals. In particular,
advances in nuclear fuel processing and storage and disposal
technologies would enable actinide recycle as fuel for advanced
reactors, allowing for additional electricity generation while
drastically reducing the amount of nuclear waste and the burden on
future generations of ensuring its safe isolation.
Development and implementation of advanced reprocessing, recycle,
and waste storage and disposal technologies should be done as part of
an integrated waste management policy. Reprocessing and disposal
options and long-term waste management policies should go hand in hand.
Alternative technologies will have different economies of scale based
on the type and number of wastes. In addition, waste packages may be
retrievable or not and the waste form should be tailored to the site
geology. This does not preclude the possibility of multiple disposal
sites for selected wastes.
High-level waste disposal facilities are required for all fuel
cycles, but the volumes and characteristics of the wastes will be
different. Consequently, a waste classification system is needed to
define the facilities needed to support waste disposal. The U.S. does
not have a cohesive waste classification system, but rather an ad hoc
system that addresses management of specific wastes. The current point
of origin system requires a complex dual waste categorization system,
one for defense wastes and another for civilian wastes. This approach
has resulted in high disposition costs, wastes with no disposition
pathways, limited disposition sites, and a system that will be
difficult to align with any alternative fuel cycle that is adopted.
The International Atomic Energy Agency (IAEA) recommends a risk-
based classification system that accounts for the intensity of the
radiation and the time needed for decay to an acceptable level. The
intensity of radiation is given by a range of radioactivity per unit of
weight. Decay time is split into short lived (<30 years) and long lived
(>30 years). There is no distinction in either categorization or
disposition options based on the sources of nuclear waste. The result
is a simple, consistent, standard system. Lacking a consistent waste
classification system, it is not possible to compare waste management
costs and risks for different fuel cycles without making arbitrary
assumptions regarding theoretical disposition pathways.
DOE's Nuclear Energy Research and Development Roadmap
Observations
The DOE-NE ``Nuclear Energy Research and Development Roadmap''
(April 2010) provides a comprehensive vision for advancing nuclear
energy as an essential energy source. Argonne strongly supports the R&D
objectives described in the Roadmap, namely:
1. Sustaining and extending the operation of the current
reactor fleet;
2. Improving the affordability of new reactors, for example,
through development of small modular reactors;
3. Enhancing the sustainability of the nuclear fuel cycle
through increased efficiency of uranium utilization and reduced
discharge of actinides as waste; and
4. Quantifying, with the objective of minimizing nuclear
proliferation and security risks.
Argonne also agrees with the R&D approach described in the Roadmap,
in particular the synergistic use of experiment, theory, and modeling
and simulation to achieve the foregoing objectives.
While all four objectives are clearly important, Argonne believes
that the public sector has a proportionately larger role to play in the
efforts supporting objectives 2, 3, and 4. Objective I will be met
largely through industry-financed initiatives and will build on decades
of developments achieved by industry. Objective 4 requires an
integrated systems approach to safeguards and security in developing an
advanced nuclear fuel cycle(s), and complementary assessment work by
the National Nuclear Security Administration (NNSA); its achievement
will depend substantially on implementation and enforcement of
international nonproliferation agreements and security arrangements.
Concerning Objective 2, Argonne believes that deployment of small
modular reactors (SMRs) is a potential game-changer to enable nuclear
energy to be a significant contributor in addressing the world's
climate and energy security challenges. SMRs may be financially
competitive for countries and regions that cannot support commercial-
sized units in the 800-1400 MWe range. Additionally, they offer
flexibility, more broadly, by enabling smaller increments of capacity
addition and may provide a route to competitive economics by shifting
much of the plant assembly and construction work into factories from
the plant site. For SMRs based on existing (light water) reactor
technology, the domestic and international industry is best positioned
to complete the development that is needed, so the Government's
principal role may be to eliminate technical barriers to NRC licensing.
Argonne, in collaboration with economists at the University of Chicago,
is analyzing the economic competitiveness of SMRs. Two of the SMR
attributes that the study is focusing on are: the increased flexibility
for utilities to add appropriately-sized units as demand changes; and
deployment of SMRs as on-site replacements of aging fossil-fueled power
plants.
Concerning Objective 3, Argonne supports a greater emphasis on
coupling the science-based approach for system development with an
active design and technology demonstration effort that would guide and
appropriately focus R&D, and enable assessment of programmatic benefits
in a holistic manner. This would be accomplished by close cooperation
of DOE, national laboratories, universities, and industry. The overall
approach would seek to:
Increase understanding of the diverse physical
phenomena underlying reactor and fuel cycle system behavior;
Improve ability to predict system behavior through
validated modeling and simulation for design, licensing; and
operation; and
Develop advanced materials, processes, and designs
for reactor and fuel cycle systems through application of
scientific discoveries and advanced modeling and simulation
capabilities, as well as the insights and lessons learned from
past nuclear energy development programs.
These efforts would allow for fuel cycle demonstration in a
timeframe that could influence the course of fuel cycle technology
commercialization on a global basis. Moreover, the individual elements
of the planned R&D (e.g., separations, waste forms, transmutation
fuels) are each potentially vast in scope and can absorb substantial
resources, without commensurate benefit, if the different areas are not
sufficiently integrated for the results to fit together in a viable
system.
An Effective Nuclear Energy R&D Strategy Going Forward
The objectives of the DOE-NE ``Nuclear Energy Research and
Development Roadmap'' can be met in a reasonable time frame if the
appropriate priorities are identified and sufficient funding is
provided to allow acceleration of high priority areas. In particular,
Argonne believes that advanced fast-neutron reactors (of small or large
capacity), recycle processes, and waste management technologies should
be developed and demonstrated at engineering scale during the next 20
years. Concurrently, support should be provided for facilitating the
NRC review and certification of advanced reactors designed by
commercial organizations, including small modular reactors.
To enable an effective nuclear energy research and development
strategy, the development of advanced fuel treatment technologies and
waste forms must be closely coordinated with R&D on:
Advanced fuels and interim storage strategies for
current light water reactors (LWRs), as these affect the
requirements on reprocessing and waste technologies. Research
on advanced fuels for light water reactors is one of the
proposed thrusts of the DOE-NE Light Water Reactor
Sustainability program (Objective 1 in the Roadmap).
Advanced reactors such as liquid metal and gas cooled
``Generation IV'' reactors, which employ different fuel types
and thus discharge used fuel that is very different from that
of LWRs. In the administration's budget request for 2011, this
research would be funded as part of the ``Advanced Reactor
Concepts'' program. Advanced, fast spectrum reactors can
efficiently consume the residual actinides in used nuclear
fuel, effectively converting these actinides to electricity
instead of discharging them as waste.
Overall, an effective research and development strategy for
advanced fuel cycles must include:
A fuel cycle system development activity to guide and
appropriately focus the research.
Improved systems analysis of nuclear energy
deployment strategies.
Science and discovery contributions to technology and
design.
Increased role of modeling and simulation in nuclear
energy research, development, and system design.
Advances in separations and fuel technologies to
close the fuel cycle:
Develop and demonstrate aqueous-based technologies;
Develop and demonstrate pyroprocessing technologies;
and
Develop and demonstrate transmutation fuels.
Advances in nuclear reactor technology and design to
generate electricity and close the fuel cycle:
Develop advanced reactor concepts; and
Develop advanced reactor component testing
facilities.
Advancement of safe and secure use of nuclear energy
on an international basis:
Enhance safety assurance capabilities in countries
newly adopting nuclear energy; and
Improve and deploy safeguard and security
technologies and practices.
Education and training of future nuclear energy
professionals.
University programs and partnering with institutions
that have nuclear energy programs.
Support for modernization of aging research
facilities for conducting experimental work; such facilities
should be regionally located in close proximity to universities
in order to develop the human capital needed to sustain
research advances in the future.
Coordination and integration of R&D in separations
and waste sponsored by different government agencies and
offices (DOE-NE, DOE-EM, DOE-OCRWM, and DOE-SC).
Close cooperation with industry in research and
development, demonstration, and commercialization efforts as
part of robust public-private partnerships.
Summary and Recommendations
The United States should conduct a science-based, advanced nuclear
fuel cycle research, development, and demonstration program to evaluate
recycling and transmutation technologies that minimize proliferation
risks and environmental, public health, and safety impacts. This would
provide a necessary option to reprocessing technologies deployed today,
and supports evaluation of alternative national strategies for
commercial used nuclear fuel disposition, effective utilization and
deployment of advanced reactor concepts, and eventual development of a
permanent geologic repository(s). This should be done as part of robust
public-private partnerships involving the Department of Energy, its
national laboratories, universities, and industry; and conducted with a
sense of urgency and purpose consistent with the U.S. retaining its
intellectual capital and leadership in the international nuclear energy
community.
Over the next several years, the research, development, and
demonstration program should:
Complete the development and testing of a completely
integrated process flow sheet for all steps involved in an
advanced nuclear fuel recycling process.
Characterize the byproducts and waste streams
resulting from all steps in the advanced nuclear fuel recycling
process.
Conduct research and development on advanced reactor
concepts and transmutation technologies that consume recycled
byproducts resulting in improved resource utilization and
reduced radiotoxicity of waste streams.
Develop waste treatment processes, advanced waste
forms, and designs for disposal facilities for the resultant
byproducts and waste streams characterized.
Develop and design integrated safeguards and security
measures for advanced nuclear fuel recycling processes that
enable the quantification and minimization of proliferation
risks associated with deploying such processes and facilities.
Evaluate and define the required test and
experimental facilities needed to execute the program.
On completion of sufficient technical progress in the
program:
Develop a generic environmental impact statement for
technologies to be further developed and demonstrated;
and
Conduct design and engineering work sufficient to
develop firm cost estimates with respect to development
and deployment of advanced nuclear fuel recycling
processes.
Cooperate with the NRC in making DOE facilities
available for carrying out independent, confirmatory research
as part of the licensing process.
Biography for Mark T. Peters
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Dr. Mark Peters is the Deputy Laboratory Director for Programs at
Argonne National Laboratory (ANL). Responsibilities of his position
include management and integration of the Laboratory's science and
technology portfolio, strategic planning, Laboratory Directed Research
and Development (LDRD) program, and technology transfer. Duties also
include technical support to the DOE Fuel Cycle R&D (FCR&D) Program and
he also serves as FCR&D National Technical Director for Used Fuel
Disposition.
Prior to his current position, Dr. Peters served as the Deputy
Associate Laboratory Director for the Energy Sciences and Engineering
Directorate. Responsibilities of this position included the management
and integration of the Laboratory's energy R&D portfolio coupled with
development of new program opportunities at the Laboratory, and
management of the energy-related LDRD program. Duties also included
technical support to the DOE Advanced Fuel Cycle Initiative (AFCI) and
also served as the AFCI National Campaign Director for Waste Forms.
Selected to serve on a two-year detail to DOE Headquarters in
Washington D.C., Dr. Peters worked as a senior technical advisor to the
Director of the Office of Civilian Radioactive Waste Management. In a
prior position, Dr. Peters was with Los Alamos National Laboratory,
where he served as the Yucca Mountain Project (YMP) Science and
Engineering Testing Project Manager. In that role, he was responsible
for the technical management and integration of science and engineering
testing in the laboratory and field on the YMP.
Before joining Los Alamos National Laboratory and the YMP in 1995,
Dr. Peters had a research fellowship in geochemistry at the California
Institute of Technology where his research focused on trace-element
geochemistry. He has authored over 60 scientific publications, and has
presented his findings at national and international meetings. Dr.
Peters is a member of several professional organizations including the
Geological Society of America, where he served as a member of the
Committee on Geology and Public Policy. In addition, he is a member of
the American Geophysical Union, the Geochemical Society, the
Mineralogical Society of America, and the American Nuclear Society
(ANS). He was elected recently to serve on the Executive Committee of
the ANS Fuel Cycle and Waste Management Division. Dr. Peters'
professional achievements have resulted in his election to Sigma Xi,
the Scientific Research Society, as well as Sigma Gamma Epsilon, the
Earth Sciences Honorary Society.
Dr. Peters received his Ph.D. in Geophysical Sciences from the
University of Chicago and his B.S. in Geology from Auburn University.
Mr. Baird. To the minute or second, Dr. Peters.
Mr. Krellenstein.
STATEMENTS OF GARY M. KRELLENSTEIN, MANAGING DIRECTOR, TAX
EXEMPT CAPITAL MARKETS, JP MORGAN CHASE & CO.
Mr. Krellenstein. Good morning, Mr. Baird, Members of the
Committee. My name is Gary Krellenstein. I am a Managing
Director in the Energy and Environmental Group at JP Morgan
Chase. I appreciate the opportunity to testify today both on
the Department of Energy's Nuclear Energy Research Roadmap.
At JP Morgan my areas of focus are utilities, energy
technologies, and project financing. I have previous experience
as a utility and energy analyst at Lehman Brothers and Merrill
Lynch, and I have also worked as a nuclear engineer and systems
analyst in private and governmental entities.
JP Morgan is the industry leader in underwriting,
financing, and advising electric utilities and energy companies
around the world.
This morning I am going to focus my testimony on the
financial-related issues associated with small modular reactors
and potential for the DOE roadmap to improve the investment
fundamentals of nuclear power in the United States.
The smaller size and cost of SMRs gives them several
distinct advantages over what I will call conventional nuclear
reactors, but let me first provide a bit of context. For many
people when they think of financing large industrial or entity
facilities, they assume it will be done on a project finance
basis, where the loan is ultimately repaid by the revenue
generated from the asset being financed.
In practice, however, larger power projects, particularly
conventional nuclear plants where the cost can be in the range
of $15 billion for a twin nuclear project, usually have the
financing backed by the full faith and credit of all the
company's assets and net revenues, and they are not secured
solely the project being financed.
So what does this mean for the investment fundamentals of
SMRs? Well, three things. First, the construction of SMRs
require less capital due to their size and other attributes
compared to conventional nuclear plants.
Second, the smaller capital requirements would allow a
single company to build an SMR as opposed to the large and
diverse consortiums that greatly complicate investors' required
diligence as well as their analysis of management structure in
what is already a complex undertaking.
Third, the financing of large conventional nuclear plants
requires utilities to bear a significant default risk such that
construction of each plant is essentially a ``bet the company''
event. Many utilities are not willing to finance such a
project.
Let me take a few moments to expand on these issues. As a
practical matter, it is far easier to find buyers for $2
billion worth of securities than it is find buyers for $15
billion worth. While that's obvious, SMRs' substantially lower
cost will make raising capital easier and one would expect to
provide greater comfort that sufficient investors can be found
at a reasonable price.
In addition, the low cost of SMRs has the potential to
simplify investor analysis. The current enormous cost and very
large capacity of conventional nuclear plants requires multiple
partners to come together to finance a single project. Often
these partners have different credit worthiness. Any financial
consortium is only as strong as its weakest members, which can
raise costs for the more credit-worthy participants, thus
pushing up the costs of the entire project.
Furthermore, the interrelationship and ability of the group
to work together without discord is a major credit factor for
investors and was the cause of many of the difficulties
encountered in the last round of nuclear plant construction in
the '70, and '80.
Related to this consortium complexity I just discussed is
the default risk posed to a particular company or entity and
how that impacts the other participants and the project. The
size of conventional reactors implies that if a project fails,
so may the company. This bet-the-company reality persuades many
private and public power generators to prefer other
technologies that don't pose extinction risks to the company.
In theory, SMRs should substantially simplify potential
investor analysis as well as reducing default risk to the power
companies building them. There are also capacity attributes of
SMRs that make them more attractive to utility and energy
companies as cost-effective means of addressing small increases
in energy demand and dealing with the uncertainties associated
with forecasting local energy needs. SMRs scalable size and
easier site-ability, particularly if located adjacent to or
near an existing nuclear facility, make them a plausible
alternative to building the gigawatt-sized nuclear power
stations, which are currently the only option. If SMRs are
validated, it should increase the ability of both utilities and
investors to participate in nuclear projects.
I applaud the Department of Energy for acknowledging the
potential of SMRs in the Nuclear Energy Research and
Development Roadmap. Reduced capital requirements, expected
improvements in quality control due to modular design, and
potentially simpler issuer structure and therefore, one instead
of multiple consortium members, will be major factors in the
reduction of the financial risk profile, but will probably be
insufficient to overcome investor concerns associated with a
new commercial reactor design.
Consequently, a demonstration project will probably be
needed to further mitigate investor concerns over the
technological risks associated with SMRs, and I urge Congress
to move forward on legislation that proposes such development.
That concludes my remarks, and I would be pleased to answer
questions of the Committee. Thank you.
[The prepared statement of Mr. Krellenstein follows:]
Prepared Statement of Gary Krellenstein
Good morning Chairman Gordon, Ranking Member Hall, and Members of
the Committee. My name is Gary Krellenstein, and I am a Managing
Director in the Energy and Environmental Group at JPMorgan Chase. I
appreciate the opportunity to testify today on the Department of Energy
(DOE)'s Nuclear Energy Research and Development Roadmap (``the
Roadmap'').
My areas of focus are utilities, energy technologies and project
financing. I have previous experience as a utility and energy analyst
at Lehman Brothers and Merrill Lynch, and as nuclear engineer and
systems analyst at EnviroSphere Company (a subsidiary of EBASCO), the
U.S. Department of Energy and the U.S. Nuclear Regulatory Commission. I
hold degrees in Nuclear Engineering, Computer Science and Business
Administration. I have also been ranked multiple times as one of the
top financial analysts in the Nation by Institutional Investor Magazine
(1st team for 12 consecutive years), the Bond Buyer, Global Guaranty,
and Smith's Research and Rating Review.
My firm, J.P. Morgan, is an industry leader in underwritings,
financing and advisory work to electric utilities and energy companies
in the United States. In 2009, J.P. Morgan underwrote more than $11
billion of debt just for electric utilities, and has been involved in
hundreds of power-related projects over the past few years.
I will focus my testimony this morning on the cost and financing
related issues of Small Modular Reactors (SMRs), and the potential for
the DOE's Roadmap to improve the investment fundamentals of nuclear
power in the United States.
The smaller size and cost of SMRs give them several distinct
advantages over what I'll call conventional nuclear reactors. But first
let me provide a bit of context. For many people, when they think of
financing large industrial or energy facilities, they assume that it
will be done on a ``project'' finance basis (i.e. where a loan is
repaid from the revenue generated by the asset being financed). And for
a limited number of power projects where the technology, capital costs
and construction risks are relatively low--for example a simple cycle
gas unit--this type of financing is often utilized.
But in practice, large power assets-particularly conventional
nuclear plants where the costs can be in the range of $15 billion for a
new twin unit project--usually have the financing backed by the full
faith and credit of all the company assets' and net revenues (referred
to as ``system'' financing)--and are not secured solely by the specific
project being financed.
So what does this mean for the investment fundamentals of SMRs,--
well, three things:
First, the construction of SMRs requires less capital, due to their
size and other attributes, than conventional nuclear power plants.
Second, the smaller capital requirements would allow a single company
to build an SMR as opposed to the large and diverse consortium that can
greatly complicate investors' required due diligence as well as their
analysis of the management structure of what is already a complex
undertaking. Third, the financing for large conventional nuclear plants
require utilities to bear significant default risk such that the
construction of each plant is essentially a 'bet the company' event.
Many utilities are not willing to finance such a large project. Let me
take a few moments expand on these issues.
As a practical matter, it is easier to find buyers for $2 billion
worth of securities than it is to find buyers for $15 billion. While
that's obvious, SMRs substantially lower cost will make raising capital
easier and, one would expect it to provide greater issuer (utility)
comfort that sufficient investors can be found at a reasonable price.
In addition, the lower cost of SMRs has the potential to simplify
investor analysis. The current enormous cost and very large capacity
(MWe) of new conventional nuclear plants has required multiple partners
to come together to finance a single project. And often these partners
have significantly different degrees of creditworthiness. Given the
variability of credit ratings and differences in capital structures,
performing due diligence on such a consortium is vastly more complex
and, as a result, more expensive to finance because of the
corresponding increase in uncertainty.
Moreover, any financial consortium is only as strong as its weakest
member, which can raise costs for more creditworthy participants, thus
pushing up costs of the entire project. Furthermore, the
interrelationship and ability of the group to work together without
discord is also a major credit factor for investors, and was the cause
of many of the difficulties encountered in the last round of nuclear
plant construction in the 70s and 80s.
And closely related to the consortium complexity I just discussed,
is the default risk posed to a particular company or entity. The size
of conventional nuclear reactors necessarily implies that if the
project fails, so may the company. This ``bet the company'' reality
persuades many private and public power generators to prefer other
power technologies that don't pose an extinction risk to the company.
In theory, SMRs should substantially simplify potential investors'
analysis as well as reducing the default risk to the power companies
building them.
Furthermore, there are capacity attributes of SMRs that make them
more attractive to utility companies as a cost effective means of
addressing smaller increases in energy demand and the uncertainties
associated with forecasting of local energy needs. SMRs scalable size
and easier sitability, particularly if located adjacent to or at an
existing nuclear facility, makes them a plausible alternative to
building gigawatt sized nuclear power stations, which is currently the
only option. If SMRs are technically validated, and the procedural
risks mitigated by Congress and the Administration, it should increase
the ability of both utilities and investors to participate in nuclear
projects.
I applaud the Department of Energy for their acknowledgment of the
potential of SMRs in the Nuclear Energy Research and Development
Roadmap. Reduced capital requirements, expected improvements in quality
control due to modular design, and a potentially simpler issuer
structure (one or two parties instead of a large consortium) will be
major factors in the reduction of the financial risk profile, but will
probably be insufficient to overcome investor concerns associated with
a new commercial reactor design. A demonstration project will likely be
needed to further mitigate investors concerns over the technological
risks associated with SMRs and could help to catalyze a nuclear
renaissance. In addition, clearly defined Federal financial support for
SMRs is essential to mobilize private sector capital. New technology of
any kind can sometimes struggle to raise capital and this challenge is
accentuated in the nuclear context. I urge Congress to move forward on
legislation that proposes cost-sharing programs for SMRs.
However, beyond these obstacles, there remain political and
regulatory uncertainties that need to be addressed. The NRC's
permitting processes is currently too long and unpredictable for many
investors. It is unclear if the regulatory process can be streamlined
for SMRs, but there should be some licensing synergy if they are
located adjacent to existing nuclear power plants and/or constructed as
identical modular units.
In conclusion, there are three major financial advantages for SMRs:
lower capital requirements, the likelihood of sole-party financing, and
a reduction of the significant default risk for utilities normally
associated with traditional large nuclear facilities.
The Roadmap is laudable for its recognition of the potential for
SMRs to overcome many of the obstacles that have previously hindered
private financing for domestic nuclear facilities. However, while the
Roadmap helps move the needle on addressing technology risk, both
political and regulatory variables continue to give pause to investors
in this space. Unless addressed, these risks will continue to undermine
efforts to promote a domestic nuclear renaissance here in the United
States. I appreciate the opportunity to testify before the Committee
this morning.
Thank you.
Biography for Gary Krellenstein
Gary Krellenstein is an Investment Banker and Managing Director in
JPMorgan's Energy and Environmental Group. His areas of focus are
municipal utilities, Rural Electric Cooperatives, alternative energy
technologies and project financing. He is also involved in JPMorgan's
``carbon'' policies. Prior to rejoining Morgan in 2000, Gary was the
Director of Municipal Research at First Albany Corporation. He has also
worked as a utility analyst (corporate and municipal) at Lehman
Brothers, Merrill Lynch and Morgan Guaranty, and as a nuclear engineer
and systems analyst for Envirosphere Inc., the U.S. Department of
Energy and the U.S. Nuclear Regulatory Commission.
Mr. Krellenstein is nationally recognized in his field and prior to
becoming an investment banker in 2003, for 12 consecutive years took
top honors in the annual polls of financial analysts by Institutional
Investor Magazine (1st team 1991-2002 in the municipal utility
category). He has also been elected to All-American Research Teams
(first place in the Utilities, Industrial Development and Pollution
Control categories) by the Bond Buyer, Global Guaranty, and Smith's
Research and Rating Review. In addition, the National Federation of
Municipal Analysts (NFMA) presented Mr. Krellenstein the ``Award for
Excellence.'' He is a frequent speaker on energy issues and has given
presentations at Harvard University, Cornell University, Carnegie
Mellon, the Electric Power Research Institute (EPRI), the National
Governor's Association (NGA), and the American Public Power Association
(APPA).
Mr. Krellenstein holds degrees in Nuclear Engineering and Computer
Science, as well as an MBA from Cornell University. He is the former
chairman of The Bond Marketing Association's (TBMA) Municipal Credit
Committee and the NFMA's ``Best Practices'' committee for municipal
utilities and also sat on the Advisory Committee for Public Utilities
Fortnightly magazine. Gary is a member of the Institute of Electrical
and Electronics Engineers, the American Nuclear Society, the Natural
Resource Defense Council (NRDC), the National Federation of Municipal
Analysts (NFMA), the IEEE Power Engineering Society, the NYC
Partnership Energy Task Force, and the American Association for the
Advancement of Science.
Mr. Baird. Thank you. Dr. Sanders.
STATEMENTS OF THOMAS L. SANDERS, PRESIDENT, AMERICAN NUCLEAR
SOCIETY
Dr. Sanders. Thank you, Mr. Lipinski, for that kind
introduction. Chairman Baird, Mr. Rohrabacher, and other
Members of the Committee, I thank you for the opportunity to
testify, and my written testimony is submitted for the record.
A lot of what I was going to say has been said by previous
panelists and Members of the Committee so----
Mr. Baird. Okay. We will proceed to questioning then.
Dr. Sanders. Let us say that American Nuclear Society
applauds Assistant Secretary Miller and his team for developing
a comprehensive R&D roadmap. I, too, will focus on small
modular reactors, but I would like to take a little different
approach to that.
Clearly small reactors have a potential to address nuclear
energy's upfront costs as illustrated by several of the
panelists. However, I would like to talk about the global
environment and the opportunities associated with small modular
reactors in that environment.
The world is embarking on a nuclear expansion with all the
opportunities and risks associated with it. Unlike Iran and
North Korea, most nations interested in nuclear energy are
motivated by a sincere desire to improve the standard of living
of their people. Indeed, the U.S. currently has very little say
over whether this renaissance happens. If we are unable or
unwilling to provide nuclear technology, these nations have
plenty of other supplier options outside of the United States.
The choice we have today is clear. We can either commit
ourselves to facilitating this renaissance as a major supplier
of safe, proliferation-resistant nuclear technology, or we can
stand on the sidelines and cross our fingers and hope that
France and others will take care of us.
If we choose the path of engagement, the next step requires
developed systems that are suited for the globally marketplace.
More than 60 countries are actively seeking new nuclear
generation capacity. At the same time nearly three-fourths of
the world's power grids are not large enough to absorb large, 1
gigawatt-sized reactors.
This is where the small reactors come into the picture on
the global marketplace. They comprise a diverse set of
technologies. You have heard about mPower, a light water
reactor design, metal-cooled reactors with extended refueling
intervals could minimize waste. High temperature gas reactors
were mentioned, to process heat and water desalination, and
revolutionary concepts are on the table like traveling wave and
nuclear batteries.
The common thread is their size, small enough to be shipped
and exported to other nations. There are some that are not
comfortable with the notion that the U.S. should actively
promote and supply nuclear technology around the world. They
believe that the risks of proliferation are too great.
However, there is an emerging consensus in my world and the
U.S. nuclear community that, in fact, the opposite is true,
that a revitalized domestic nuclear manufacturing sector is a
critical and necessary component to sustaining our national
interests around the world.
Our national security infrastructure provides us with a
head start. We already make small reactors for submarines and
aircraft carriers. We have modular manufacturing techniques,
and we have the ability to make most of the fuels envisioned
for these designs. What we need is the collective will to make
a long-term investment so that U.S. industry can, again, become
a major supplier to the global marketplace.
NE's R&D Roadmap is a good start. Its areas of focus are
appropriate to the task, but as always the key item of the
debate is proper balance between fundamental R&D and
initiatives specifically geared to accelerate deployment of
real operating reactors. I can tell you that as ANS President I
have traveled the country and met with thousands of ANS
members. If there is one common theme in these conversations it
is that the U.S. cannot afford to be overly cautious in
developing advanced reactor systems.
We are in a race after all, and if we do not move forward
with speed and purpose, we will forever be in the catch-up
mode. Personally, I believe the DOE must make a revitalization
of the U.S. nuclear supply industry one of its primary
objectives. We need an industry capable of supplying cradle-to-
grave technology and solutions that eliminate the incentives
for nations outside of the United States and outside the
current nuclear powers to develop sensitive enrichment and
reprocessing capabilities.
If we could provide technology on the basis of cradle to
grave, we could eliminate the reason for other countries to
develop these technologies. I also believe we must ensure the
U.S. industry is the primary beneficiary of taxpayer
investments in nuclear technology so that we can maximize the
economic job creation benefits of our investments.
So while I support the broad contours of the R&D Roadmap, I
hope Congress will consider giving DOE additional tools to
accelerate the deployment of the next generation reactor so
that we may be better positioned to meet our environmental,
national, and economic security objectives within the next 10
to 15 years.
This concludes my testimony, and I will be happy to answer
any questions the Committee may have.
[The prepared statement of Dr. Sanders follows:]
Prepared Statement of Thomas L. Sanders
Chairman Gordon, Ranking Member Hall, members of the Committee,
thank you for the opportunity to testify. I am here in my capacity as
President of the American Nuclear Society (ANS). ANS is dedicated to
the peaceful use of nuclear science and technology and comprised of
11,000 men and women who work in the nuclear industry, our national
labs, universities and government agencies.
In general, the ANS membership believes that nuclear energy can and
should play a major role in supplying energy in a carbon-constrained
environment. We applaud Assistant Secretary Miller and his team for
developing a comprehensive R&D roadmap to guide the Office of Nuclear
Energy's investments going forward. My testimony today focuses on the
need for DOE to facilitate the development and deployment of a new
generation of small modular reactors.
The nuclear debate in Washington these days focuses on the cost of
nuclear versus other forms of energy--and specifically the large up-
front costs of installing new nuclear generation capacity. Clearly,
SMRs have great potential to address nuclear energy's upfront cost
challenges by allowing the cash flow from initial reactor modules to
help finance subsequent additions. However, to view the nuclear issue
only through the lens of the U.S. market is to miss half the picture.
The world is embarking on a nuclear expansion with all the
opportunities and risks associated with it. While we tend to hear about
countries like Iran and North Korea, most nations interested in nuclear
energy are motivated by a sincere desire to improve standards of living
for their people. And in general, a world with plentiful clean energy
will be more peaceful, more prosperous, and more environmentally
sustainable over time.
Indeed, the U.S. actually has very little say over whether this
renaissance happens. The Nuclear Nonproliferation Treaty guarantees
that all signatories have the right to enjoy the peaceful benefits of
nuclear energy technology. In addition, the nuclear energy supply
infrastructure has become thoroughly globalized in the last three
decades. Frankly, if the U.S. is unable or unwilling to provide nuclear
technology, interested nations have plenty of other supplier options.
The choice we in the U.S. face today is clear. We can either commit
ourselves to facilitating this renaissance as a major supplier of safe,
proliferation-resistant nuclear technology, or we can stand on the
sidelines and cross our fingers that other supplier nations will do it
for us.
If we choose the path of engagement, the next step required is to
develop nuclear power systems that are suited for the global
marketplace. More than 60 countries are actively seeking or have
expressed interest in developing new nuclear energy generation
capacity. At the same time, over 80% of the world's power grids are not
large enough to absorb a 1 GW class nuclear plant.
That is where SMRs come into the picture.
SMRs comprise a diverse set of technologies. The common thread is
their size, generally from 10 to 300 MW electricity, small enough to be
shipped on a flatbed or rail car and exported to other nations as a
complete unit.
For purposes of this discussion, SMRs can be grouped into four
different types.
1. Small light water reactors: these are based on well
understood technology and the U.S. has an existing
manufacturing capacity for supplying the Navy with propulsion
reactors. These reactors would make an attractive option for
existing nuclear plant operators to add capacity in a scalable
fashion in the near term.
2. Sodium or lead cooled fast reactors: these are small pool
type reactors that operate at low pressures. Their fast neutron
spectrum could allow for extended refueling intervals of up to
20-30 years. They have desirable safety characteristics, and
when combined with advancements in turbine technology, can be
operated in an extremely safe manner for long periods of time.
3. High-temperature gas reactors: these proposed designs are
generally optimized for process heat applications such as
hydrogen production, water desalination, shale oil recovery.
They could be located in industrial parks to offset the use of
fossil fuels for process heat generation.
4. The fourth category is what I call exotic designs. While
these innovative concepts will require longer-term research and
development efforts, their simplicity of operation could
provide ``walk away safe'' power to remote communities here in
the U.S. and around the world.
There are some who are not comfortable with the notion that the
U.S. should actively promote and supply nuclear technology around the
world. They believe that the risks of proliferation are too great.
However, there is an emerging consensus in the ANS membership and the
U.S. nuclear community that in fact the opposite is true--that a
revitalized domestic nuclear manufacturing sector is a critical and
necessary component to sustaining U.S. nuclear influence around the
world.
So, what would a revitalized, SMR-focused U.S. nuclear
manufacturing industry look like?
Our national security infrastructure provides us with a head start.
We already have a manufacturing infrastructure for small naval
reactors. We have an operating geological repository in our defense
infrastructure that could potentially accommodate transuranic waste
from recycled SMR fuel. We have many years of operational data for
water and sodium cooled systems. We already have modular manufacturing
techniques. We have the ability to make the fuel envisioned in these
designs. What we need is the collective will make long-term investments
so that the U.S. can again be a major supplier to the global nuclear
marketplace.
NE's R&D roadmap is a good start in that direction. It takes a
crosscutting approach to identifying areas of R&D focus applicable to
sustaining the current U.S. fleet of nuclear plants, developing new
reactor designs and fuel cycles, ensuring a high level of operational
safety, and minimizing the risks of proliferation. I believe these
areas of focus are appropriate to the task and DOE should be applauded
for sharpening its pencil.
As always, the key item of debate is the proper balance between
fundamental R&D activities like modeling and simulation and initiatives
specifically targeted at accelerated deployment of real, operating
reactors. I can tell you that, as ANS president, I've traveled the
country and met with hundreds of ANS members with nuclear engineering
backgrounds. If there is one common theme in these conversations, it is
that the U.S. cannot afford to be overly cautious in developing
advanced reactor systems. We are in a race after all, and if we do not
move forward with speed and purpose, we will forever be in catch-up
mode.
Personally, I believe that DOE must make revitalization the U.S.
nuclear industry one of its stated objectives. We need a U.S. industry
capable of supplying ``cradle-to-grave'' technology solutions that
eliminate the incentives for nations to develop sensitive enrichment
and reprocessing capabilities. I also believe we must ensure that U.S.
industry is the primary beneficiary of taxpayer investments in nuclear
technology, so that we maximize the economic and job creation benefits
of our investments.
So while I support the broad contours of the R&D roadmap, I hope
Congress will consider giving DOE additional tools to accelerate
deployment of next-generation reactors so that we may be better
positioned to meet our environmental, national and economic security
objectives in the next 10 to 20 years.
This concludes my testimony and I would be happy to answer any
questions the committee may have.
Biography for Thomas L. Sanders
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Dr. Sanders is currently serving as President of the American
Nuclear Society. Recently appointed to be a member of the Civil Nuclear
Trade Advisory Committee (CINTAC), which serves to advise Gary Locke,
Chairman of the Trade Promotion Coordinating Committee on trade issues
facing the U.S. civil nuclear industry. Recently elected to the
International Nuclear Energy Academy (INEA). Co-founder and former Vice
President of the American Council on Global Nuclear Competitiveness.
Manager/integrator of Sandia National Laboratories Global Nuclear
Materials Management and Global Nuclear Futures Initiatives since 1997.
Organized numerous focus meetings with senior government policy
officials on the need for a second nuclear era, from a national
security perspective. As the leader of the Global Nuclear Futures
vision, led the development of topical meetings, policy papers, news
articles, partnership events with other countries and non-government
organizations, and caucus events on Capitol Hill to articulate that a
healthy and thriving U.S. nuclear energy infrastructure (from education
to labs, suppliers, operators, and NGOs) is key to global proliferation
risk management in the future. Developed a complementary partnership
initiative between 7 U.S. and 9 Russian Lab Directors. This message has
been delivered at Presidential summits, White House and Congressional
briefings, and to numerous champions throughout government, industry,
labor, and academia. Contributed to and managed several technical
groups and programs at Sandia since joining in 1984. Authored over one-
hundred journal articles, conference papers, magazine articles, and
white papers covering all aspects of the nuclear fuel cycle, from
fusion and fast fission breeder reactor systems to criticality safety
of spent fuel transport, storage, and disposal systems. Completed
Bachelor of Science, Master of Science, and Doctor of Philosophy
Degrees in Mechanical/Nuclear Engineering at the University of Texas in
Austin, Texas. While at UT, licensed as a Senior Reactor Operator at
the University of Texas by the NRC. Also served as a nuclear operator
and supervisor on U.S. Navy Nuclear Submarines for several years,
completing several patrols on the USS Kamehameha and the USS Shark.
Also qualified as a journeyman shipyard electrician. Member of ANS,
ASME, ACGNC, and INMM.
Discussion
Mr. Baird. Thank you, Dr. Sanders. I am glad I didn't cut
you off. Excellent points added to the already other quality
points made.
Mr. Lipinski, I recognize you for five minutes.
Mr. Lipinski. Thank you, Mr. Chairman.
Mr. Baird. Returning the favor when you are Chair.
U.S. Manufacturing Needs
Mr. Lipinski. Thank you, Chairman Baird. I thank all the
witnesses for their testimony. I am especially interested in
Dr. Sanders' testimony, because I know that for a lot of years
the U.S. was the worldwide leader in nuclear technology, but we
moved from an exporter of nuclear goods and services to an
importer. Westinghouse is an American company and made many
parts used in our current generation of reactors. They sold to
the British company and then to Toshiba. They now do most of
their manufacturing in Japan but plan to move to China in the
near future.
So what is the best way for us to go about making sure that
we have the ability, and not just for Dr. Sanders, but for the
entire panel, have, first of all, the manufacturing capability
to do the nuclear reactors? Especially if--I know Dr. Sanders
talked about we do have the capability and we do build the
nuclear reactors for the military, submarines, and ships. But
besides the manufacturing, also to have the workforce that we
need in order to be a leader in nuclear energy.
So I will start with Dr. Sanders. I am just looking for
suggestions of what policies should we be pursuing in order to
be able to maintain that or get back that leadership in nuclear
energy across the board.
Dr. Sanders. I would like to take us back a little bit in
history and describe how it was done the first time around.
President Eisenhower started Atoms for Peace for national
security reasons. He recognized that the world was going to go
nuclear, that nuclear energy was going to spread, and he
established a vehicle called Atoms for Peace that enabled the
U.S. industry to be a dominate player on the global marketplace
for the next 40 years.
But the real enabler of that was that it had collateral
defense applications. The Nuclear Navy was just starting out.
We started out with a pressurized water reactor. The
pressurized water reactor became the design component that
ultimately led to civilian nuclear reactors, and basically
Westinghouse and GE and B&W and others became the major
suppliers around the globe.
We need to reinvent that series of actions basically. We
need a market initiator. DOD could be a market initiator, and
promotion and initiation within our own TVA and other utilities
might be the way to do that.
We also need a technology leap. I don't believe personally
that large scale light water reactor technology and
manufacturers are going to come back to the U.S. because I
don't believe that market is really that large in the United
States. The market is outside the United States for the growth
of nuclear energy, and most of that market is much more
consistent with technology leaps and small modular reactors.
By the technology ``leaps,'' I mean, in all assets:
manufacturing, proliferation resistance, the technologies of
use, different coolants, gas, sodium, water, and technologies
that minimized the waste burden, especially if these kinds of
exports can promote our national interest relative to other
countries developing fuel cycle technologies.
If we can offer solutions such that those countries don't
feel the need for enrichment and reprocessing technologies,
then we have solved, or we have implemented a major opportunity
to solve, most of the world's proliferation issues.
Mr. Lipinski. Dr. Peters.
Dr. Peters. Yes. I would comment on the science and
engineering side of it at the labs and universities. I think
this is where there is an inherent role for government-
sponsored programs, and they exist, but I think we need to
continue to bolster those. Over the last ten years as the DOE
NE R&D Program has been revitalized, you start to see the
workforce develop. You start to see young people coming into
these problems, joining the national labs, and that is very,
very exciting.
I am fortunate to be able to go to other countries on a
scientist-to-scientist basis and talk to people, and they still
look to the United States for leadership in areas around
advanced fuel cycles for example, but they are investing
heavily in their R&D in those countries. So we need to continue
to do that here, both at the universities in terms of
university programs, and also at the national laboratories. And
that involves everything from people all the way to
experimental facilities.
Mr. Baird. Mr. Mowry.
Mr. Mowry. Yeah. I would just like to add a few comments to
those already made by Dr. Sanders. First, the comment about the
application of large reactors and the ability to bring that
manufacturing back into the U.S., I think we would generally
agree with that. One of the promises of SMRs is the ability to
export a completed reactor to the developing country market
that is actually in the long term the largest market access.
So SMRs, in addition to creating the potential for domestic
jobs, also offers the promise of a new significant, high-
technology export product that the U.S. could get into, and
this in and of itself would create significant new
opportunities for domestic jobs to support that export market.
I think it is our view that the workforce will follow a
leadership role that government plays and industry plays in
getting this SMR market off the ground. So if there is a
demonstration project, if we enter into a cost-sharing
partnership, young people will move into those fields that they
see are being supported and endorsed by the Nation.
Mr. Lipinski. Anyone else?
Mr. Baird. Mr. Lipinski, I am going to go ahead and move--
--
Mr. Lipinski. Okay. Go ahead.
Mr. Baird. --because we may have a vote coming up at noon,
and I want to make sure we get to----
Mr. Lipinski. Okay.
Mr. Baird. --have another chance.
Mr. Lipinski. Thank you.
Mr. Baird. Thank you. Mr. Rohrabacher or Mr. Smith.
Mr. Rohrabacher. Mr. Chairman, I think Mr. Smith has an
item on the floor he would like to go to, so why don't I----
Mr. Baird. Mr. Smith next.
New Reactor Permitting
Mr. Smith of Texas. Thank you, Mr. Chairman, and I want to
thank the Ranking Member, Mr. Rohrabacher, for letting me ask
my questions. I do have a suspension bill coming up next, so I
need to get to the floor.
Mr. Krellenstein, let me address my first question to you.
You pointed out accurately that the permitting process slows
down our efforts and makes the goals a little bit harder to
achieve. In particular with regard to the small modular
reactors, what do you specifically suggest that we do to
expedite that permitting process?
Mr. Krellenstein. I am not sure that we can dramatically
change the basic fundamental permitting required for a large or
small nuclear plant, but I think something that we could do to
expedite it would be to locate the SMRs at existing or adjacent
to nuclear facilities, so we would be doing what is called
brownfield citing versus greenfield citing. The burden would be
to add a third or fourth unit, and because they are incremental
in size, it would be far easier for many utilities that are
uncertain about their future load gross or the financial
commitment involved in building a large gigawatt-sized unit.
Mr. Smith of Texas. Okay. Thank you, and Dr. Sanders, you
suggested that Congress give the Department of Energy some
additional tools to accelerate the deployment of next
generation reactors. Would you, too, be a little bit more
specific as to what you would recommend?
Dr. Sanders. I would recommend linking the R&D roadmap to
what is going on in this chamber today, I believe, which is the
competitiveness initiative.
Mr. Smith of Texas. COMPETES Act.
Dr. Sanders. COMPETES Act. I think that is an opportunity
to accelerate some of the deployment of some of these
activities because, as said by other members of the panel,
numerous jobs are going to be created to support an export
market that is very significant in size.
How DOE Can Support New Developments
Mr. Smith of Texas. Okay. Thank you, Dr. Sanders, and Mr.
Krellenstein, back to you for my last question. I would like to
know what you might recommend beside the loan guarantees that
have been proposed by the Administration. Do you think that the
right posse approach, or do you think we ought to be looking at
more direct subsidies? What is the best way, again, to get to
the goal?
Mr. Krellenstein. I think depending on the individual
issuer and the needs of the utility or power company. A
portfolio approach would probably be better. Loan guarantees
would be one way. There is a program available right now in the
municipal market called BABS, or Build America Bonds. That
might be another option to be considered. Favorable tax
treatment would be another way, accelerated price depression.
Because there are so many different situations at various
companies interested in building, I think there is no one
single best option to do but a group of options would be
available.
Mr. Smith of Texas. Do you think the Administration has
done enough? Their loan guarantee program is relatively small.
I don't know what we are going to do on tax credits that you
just suggested.
Do you think we ought to be doing more than we are or more
than the Administration has proposed?
Mr. Krellenstein. If we are serious about pursuing a
nuclear renaissance, yes. I am afraid that what we have is a
good start. It is probably not sufficient to provide the level
that we need.
Mr. Smith of Texas. Okay. Thank you. Thank you, Mr.
Chairman. I yield back.
Mr. Baird. Thank you, Mr. Smith.
Financing and Cost Competitiveness
I want to follow up with a financing question. Mr. Mowry, I
noted with interest you specifically suggested even without
carbon price that you felt that SMRs might be competitive. Walk
us through that. And are there any government subsidies and is
it the full cycle of fuel costs from mining to disposal or
storage? How does that work out? Because that is somewhat
different than what I have been reading.
Mr. Mowry. Well, two things. First, yes, it would include
the entire cost of ownership, the life cycle cost of
electricity, ownership when we are looking at this. We believe
that that has to be the goal of the SMR initiative. If you want
to create a viable, market-based solution long term, it cannot
require government subsidy in the long term.
So the technology approach that you select fundamentally
needs to be competitive, and our goal at B&W is to make this
solution competitive with $5 gas. That is the goal. In a
brownfield application, that was discussed. When you apply this
incrementally in a brownfield application, you want to have
this competitive with $5 gas. There are----
Mr. Baird. Natural gas.
Mr. Mowry. Yes.
Mr. Baird. Not with coal though?
Mr. Mowry. Well, if it competes with $5 gas, it also
competes in total, with our expected prices and goes forward in
that area.
The other aspect of this thing is what innovations you are
going to apply to this and what incremental infrastructure the
SMR is going to require, and that is why we believe that in the
near term SMRs need to be light water reactor based
technologies that use what has been proven in industry over the
past 30 years. The issue with the nuclear industry today is not
fundamentally a technology issue. It is an affordability issue,
and it has to do with how you finance the reactors and get the
projects built with cost certainty and schedule certainty.
In the long term there is promise with fourth generation
technologies, and therefore, R&D should be expended to develop
these technologies, but in the near term that is not what the
challenge is out there. We need to innovate on how light water
reactors are made smaller and more cost effective so that they
can compete with this.
Mr. Baird. I understand that the goal--and I want to refer
to Mr. Krellenstein here, I understand the goal would be that.
That would be an obvious goal with price competitiveness. I
don't think we are even close to anything demonstrated in
actual practice that has met that metric of actual producing at
$5 gas level. And I am interested in how that relates--
basically financing is making a bet here. They are betting how
cost competitive will the electricity produced by this approach
will be.
What are your analyses of this, Mr. Krellenstein?
Mr. Krellenstein. It is true that for a large number of
investors, the expectation that there will be some type of
restriction on emissions of carbon-based fuels is a factor, and
they are viewing this as a viable economical alternative. There
is the potential for modular units being manufactured partially
in a factory and at a high rate to bring the cost down to a
point where they may be able to compete directly.
The biggest challenge we see right now is actually that
natural gas, which has far lower carbon emissions, is very
plentiful, and seems to be becoming more plentiful with each
passing day, and is a very strong competitor for any power
generation technology where environmental considerations are
paramount.
So nuclear really has to compete with gas rather than coal.
A Skilled Workforce and Domestic Manufacturing
Mr. Baird. Okay. Dr. Sanders, I was intrigued by your
observation about the human resource and the technological
resource. My understanding is that, first of all, I appreciate
the shout out to America COMPETES. We hope to pass it this time
through, and I think your point is well taken that we are going
to have to have more engineers and scientists to--if we are
going to bring this nuclear renaissance to reality, we have got
to have the expertise.
What about domestic manufacturing? I understand that, for
example, if you to build a large-scale nuclear plant, just
getting the steel for the containment vessel is a challenge.
How do we promote Buy America-type approaches for--and I think
to some extent the modularity might help us there because we
just assembly. How do we do that?
Dr. Sanders. Well, like I stated, we do have a national
security infrastructure that does that today, and I think what
has to be recognized is that our international security
interests require that we maintain certain infrastructures for
competitive advantage on the global marketplace, particularly
if that competitive advantage promotes our national security
interests like liberation and risk management through a major
position on the global marketplace as the supplier.
That never gets factored in the decisions relative to
nuclear energy versus national security--at least they haven't
been since the Atoms for Peace Initiative, for example. What
has been factored into competitiveness of our nuclear industry
is issues related to proliferation. We stopped reprocessing
because of the belief that if we did, everybody else would, and
that didn't happen. We have made other decisions relative to
trade barriers and expert controls that have limited our
ability. In fact, these decisions resulted in reasons for
Westinghouse and others to move offshore.
Anybody on the panel can correct me if I am a little bit
off base on some of this, but the reality is we have got to
look at our nuclear industry like we look at our submarine
manufacturing industry. We have got to look at it from the
perspective of, it has got to promote our national interests
relative to the national security parts that it plays. And in
the past we have burdened commercial industry with basically
promoting our national security interests, and we have either
put barriers in place or removed the enablers that allowed them
to do it in the beginning of the nuclear age, the first nuclear
age.
And that is a difficult thing to get your arms around, but
I think it is necessary in the future. I think the America
COMPETES Act is probably a step forward in that area that at
least recognizes there is certain areas of our domestic
enterprise where we have to be able to compete. If we have to
develop our aluminum, steel, and concrete resources. We have to
recognize that in 2004, China imported half the world's cement
in the world. We have got to be able to compete on that level
also. We have got to be able to compete and start redeveloping
some of our own resources.
Mr. Baird. Thank you, Dr. Sanders.
Mr. Rohrabacher.
Submarine Reactors and mPower
Mr. Rohrabacher. Thank you very much, Mr. Chairman. Let me
just note that after Three Mile Island the hysteria created by
that incident caused huge regulatory costs and extra road
blocks that were put in the way of this industry because our
regulators were responding to the hysteria along with the
population. So there was a huge cost, and it wasn't just
penciled out in terms of what they--what it would do for
economics because quite often these decisions are affected by
things that are not just economics, not just what the bottom
line is.
Let me ask about some of these various things. Now, why--we
have submarines, we have ships, but submarines with nuclear
reactors on it. How are those reactors different than the new
reactor that you are suggesting, because that--are they light
water reactors as well on the submarines?
Mr. Mowry. Well, the mPower reactor that B&W is developing,
its heritage comes from commercial nuclear ships because you
are trying to solve a different problem here. You are trying to
create an economically-viable product that can plug into the
industry base, you know, that it--so it is a totally
different----
Mr. Rohrabacher. But we already are producing small nuclear
reactors. Has to be if we have nuclear submarines. I mean,
these are not----
Mr. Mowry. Well, B&W has a distinct advantage that we have
existing infrastructure in terms of facilities, manufacturing,
infrastructure, engineers, manufacturing engineers that can be
redeployed from the work we do with the government to this
application.
Mr. Rohrabacher. Yeah.
Mr. Mowry. But, again, this gets back to the cost
effectiveness. We need to focus on a cost-effective solution,
and that is a different problem that you are trying to solve
than the problem you are trying to solve when you do work for
the government in these other areas that you mentioned.
Mr. Rohrabacher. Do you have--with your small reactor, now,
I have studied this--the one that General Atomics has put
before me, and is the one that you are advocating--is your
configuration, does it have leftover plutonium and reprocessing
requirements? Or is that----
Mr. Mowry. It uses the conventional fuel infrastructure and
fuel supply chain that is out there today because that is a
requirement of industry for any near-term deployment of SMRs.
Fission vs. Fusion
Mr. Rohrabacher. Got it. Now, yours is much further down
the line obviously, and the General Atomics small reactor is
supposedly not going to have the proliferation problems, left
over plutonium, or require word processing, but they are not--
you seem to be ready. They are a few years down the line.
It would be--if we permit the Chinese to become the
nuclear, the builders of nuclear power reactors, we are going
to have both safety problems but also major proliferation
problems. So had better address these issues that are being
raised right now, and let me ask, do any of you know--now, we
are all talking about fission. All of these small reactors that
we are talking about, whether it is a gas-cooled reactor or the
reactor that you are talking about, are fission reactors. Is
that right?
Well, how much--have we been putting the necessary research
dollars or Department of Energy into fission as compared to
fusion? What--do any of you know that answer?
Yes.
Dr. Sanders. I am the non-technical one here, but I will
try to answer. The best we can see is that fusion reactors from
an economical point of view because of the inherently difficult
technology are at least a generation away or further, and I am
not sure that putting in dramatically more research dollars
into right now would accelerate that dramatically.
Mr. Rohrabacher. Oh, I agree with you, but as we are
spending the money now, we are spending a lot of money on
fusion research. Are we spending money on fission research as
well?
Dr. Peters. Maybe I can take a shot at that----
Mr. Rohrabacher. Yes.
Dr. Peters. --Congressman. So the fission-related research
is what we have been talking about, what Dr. Miller talked
about.
Mr. Rohrabacher. Right.
Dr. Peters. So in Department of Energy it is funded
primarily by the Office of Nuclear Energy. There is fusion
research going on in the Department of Energy that is primarily
funded by the Office of Science.
Mr. Rohrabacher. Okay.
Dr. Peters. And so that includes participation in ITER.
Mr. Rohrabacher. I am just thinking in terms of overall
spending.
Dr. Peters. Right.
Mr. Rohrabacher. It seems to me that what we are talking
about is something that has a potential, as we have a company
here who has got a potential right now, and other companies
that are stepping forward and saying we have got potential in a
couple of years down the line as compared to fusion which I
have never met a scientist who has told me that we are going to
be able--we can guarantee you that we are going to be able to
build one of these plants ten years from now, and we will have
fusion.
So thus it would seem to me that it would be--we should
be--research dollars should be focused on what we can actually
accomplish rather than what potentially we can't accomplish.
Dr. Peters. Certainly in the applied programs but I would
argue there is fundamental science that one needs to do that
the Department of Energy's Office of Science focuses----
Mr. Rohrabacher. Uh-huh.
Dr. Peters. --around fusion that is important. People still
talk about the promise of fusion. There is a lot of barriers
that involve materials and other barriers that we have to
tackle and that requires science. So I would argue there is
still need for investment, but the timelines for fusion versus
fission are much different.
Mr. Rohrabacher. Yes. That is correct. Well, I am going to
look into that myself. In fact, I will be asking for the record
to find out exactly how much money we are spending on fission
research that would help the small modular reactors as compared
to money that we are spending on fusion research that may never
be put into practice.
Expediting Technology Development
We--one of the factors that seems to be coming up here and
when we are talking about the activities, research activities,
are we talking about research activities that is developing new
technology or research activities that will permit us to set
standards and have--and help along the permitting process? What
are we talking about here?
Dr. Peters. In fact, I would say the answer is probably
yes. It is both. If you look at the roadmap, some components of
it would include providing technical basis to the regulatory
framework, for example, and the NRC themselves actually invest
research dollars in this to do this as well.
But then a lot of what I was talking about with the fuel
cycles really ultimately focused on technology development and
commercialization.
Mr. Rohrabacher. Well, isn't it time that we should be
making up our mind and moving forward and I like this idea
where we had some ideas about putting this on existing sites so
we could move forward quicker without having to go through ten
years of the regulatory process, perhaps on military bases as
well could offer that, Mr. Sanders?
Dr. Sanders. Well, in fact, I think you are exactly right.
The issue here is the Valley of Death between good research and
commercial applications in a lot of these activities. I would
like to remind everybody we operated liquid metal cool fast
reactors for 40 years in this country and never have taken the
opportunity to transfer that technology to the commercial
sector.
So there is this Valley of Death issue between good
research and commercial applications, and our recommendation to
DOE is to figure out how to do that. Basically it is a public-
private partnership with the public side assuming more of the
risk in the beginning of the phase, and the private side taking
over the situation when the risk has been reduced through good
technology development.
Mr. Rohrabacher. Thank you very much. Thank you, Mr.
Chairman.
Mr. Baird. Chairman Gordon has joined us. Mr. Chairman, did
you have any questions you want to ask at this point?
Chairman Gordon. No. I think you should go ahead.
Mr. Baird. Okay. I will briefly make--we have had a chance
to go through all the Members, but I will--I have one or two
quick questions.
On the economic side, you know, in the realm of other
alternative energies, one of the things we hear about is things
like feed-in tariffs or guaranteed marketplace, et cetera. None
of you have talked about that kind of approach as a methodology
for stimulating the development of plants. We talk about loan
guarantees, et cetera, but what about marketing, you know, some
form of assurance that X--that maybe the government will buy X
amount of energy produced by one of these plants.
Any thoughts on that?
Dr. Sanders. Yes, if I could. I think the issue is nuclear
is once the unit is up and running and the power produces on a
variable basis, it is very competitive with energy sources and
really doesn't require feed-in tariffs. That is not the case
for some of the sustainable resources that we are looking at
right now that require feed-in tariffs. Our principle objective
is to get the capital together to build the nuclear plant. Once
it is up and running, its variable cost is relatively low and
very competitive. The initial capital cost is very high and has
been a major detriment in its development.
Mr. Baird. And that is why the loan guarantees and things
of that sort come in.
Dr. Sanders. Correct.
Maintaining Competition
Mr. Baird. One of the other questions is, you know, we have
got a number of potential manufacturers. B&W is one, there are
others, one actually, coincidentally, in Oregon, and several
others. You know we are loathe to try to pick winners and
losers, but at the same time stimulating competition can make
sense.
How do we do that? How do we make sure that different
models, both perhaps the technological model of how the plant
functions, but also the competitive business model, how do we
find a way to make sure that the taxpayer dollars that go out
to try to promote the industry in general create a healthy
competition so there are multiple approaches, each of which may
win in some fashion?
Mr. Mowry, I would appreciate your thoughts on that.
Mr. Mowry. Well, I think first of all, and I think you are
right on in terms of what the ultimate goal is. You want to
have an investment that ultimately yields success, and I think
you need to let the marketplace vote. So we would advocate that
this public, private partnership, a program that Dr. Miller
talked about earlier today, the partnership on the industry
side needs to be not just with a supplier like ourselves, but
it needs to be with a group of utilities that will ultimately
deploy that technology after the demonstration plant has been
built, because unless you have that type of assurance that
there is committed interest by ultimate users, you will never
have assurance that the demonstration plant and the
demonstration of that technology just won't end after the
demonstration.
So a partnership has to include the ultimate users in the
marketplace.
Mr. Baird. Does that then put the manufacturers of the SMRs
in some relationship of--you are then trying to sell your
partnership with the utility as would some of your competitors?
In other words----
Mr. Mowry. It would be incumbent upon each technology
developer such as ourselves to convince the user marketplace
that our technology, if demonstrated in a partnership, is
something that they would want to deploy in a market-based
environment. Otherwise you are spending money on something that
may not ultimately help the Nation in terms of electric
generation.
Mr. Baird. Other comments on that?
Dr. Sanders. Yes. I would have to disagree with Mr. Mowry
on this in that one of the major problems for investors in the
'80s and '70s was the multiplicity of designs and their
inability to determine what was better overall. We actually
need some sort of a bake off done by the government and the
standardization so that investors are not constantly trying to
rediscover technologies that they are not comfortable with and
invest in multiple different uses of small nuclear
technologies, each one requiring a new learning curve, making
it more difficult for them to invest their money into.
Mr. Rohrabacher. Mark Twain--thank you, Mr. Chairman. Mark
Twain once said, ``Put all of your eggs in one basket and then
watch that basket,'' and so there are several different
approaches to that, and I am not sure Mark Twain really knew
what he was talking about, but I do remember the quote.
Mr. Baird. Dr. Sanders.
Dr. Sanders. Well, I would like to point out, though, that
there are different goals and different markets. If you are
promoting a particular technology in the national interest that
wants to eliminate the need to refuel, you may go with a
different technology, and that is driven by a different market.
It is driven by a market that is looking out for national
security interest for export, for example.
That is just one example. If it is for DOD applications for
bases or, you know, to assure energy independence on a DOD
base, either forward or local or in Guam, for example, there is
different requirements that might drive you to a different type
of technology.
So I don't like to close the package, the basket. I like
more eggs in that basket because there is no single egg that
can accomplish all of those objectives when you look at them
across the board.
Mr. Baird. Would it make sense, though, I think these are
excellent points. Would it make sense then, though, as we are
looking at this--as we look at any form of government subsidy
to in some way--and then perhaps I missed it. I don't know that
this does address that that well.
But does it make sense to perhaps categorize some of the
potential types of applications and then make the competition
within those categories. Take the DOT. If you look at what it
costs us to ship fuel into Afghanistan, it is a horrifying
number. It is breaking our bank and dangerous as all heck.
A modular nuclear system that could somehow power the city
and power our forced there might be one application. Export
applications that don't have--does it make sense then as we
look at subsidies to--maybe there is one group that is for
domestics, augmentation of existing power supplies. Would that
makes sense to categorize that in some fashion?
Dr. Sanders. Absolutely. Absolutely, and you are
categorizing according to different markets----
Mr. Baird. Right.
Dr. Sanders. --basically.
Mr. Baird. And different applications.
Dr. Sanders. Different applications. Applications--we spend
a lot of money on summary and reactors. No doubt, but they have
a different performance requirement. No doubt. They are a
combat situation, and you would never put one of those in a
domestic application then force civilian nuclear industry to
pick that egg out of the basket. You could never compete, and
we need to recognize that.
For exports to developing nations, we maybe want to
something different, something we don't have to refuel but
every 10 or 20 years. They can sit there for awhile. If we want
to solve the solution and make energy out of Army garbage in
Kabul or Baghdad, you are going to go to a high temperature
system, very high temperature system able to convert that
garbage at some price. It will never compete with gasoline at
$4 but $150 a gallon, which is what I think a gallon of gas
costs in Baghdad, you have got a different market situation.
Mr. Baird. I want to make sure we recognize the Chairman.
The buzzers you heard, we are both being called. Before I
recognize the Chairman, though, I just have to engage in a
brief conversation with my friend, Mr. Rohrabacher, who is a
dear friend, quite sincerely.
Mr. Rohrabacher. I am about to be refuted again.
Mr. Baird. No, no. What I will just observe that several
months ago on the Energy and Environment Subcommittee, we had a
lengthy hearing about the role of social and behavioral
sciences in our energy system, and just for the record I would
observe that multiple occasions today Mr. Rohrabacher has
talked about hysteria causing increased costs in our energy
approach to nuclear power. Hysteria is a psychological
diagnosis. So maybe Mr. Rohrabacher has become a convert to the
importance of social and behavioral sciences in our energy
picture.
I recognize the Chairman, Mr. Gordon.
Chairman Gordon. Thank you, Chairman Baird, for a good
hearing today. I am looking forward to reviewing it on our
website. I know that Mr. Rohrabacher wants to run over to the
capitol and vote for the America COMPETES bill, so I don't want
to take up much time.
I would like to ask the witnesses this in all seriousness.
We are going to get out a reauthorization. We want to get out a
good reauthorization. This record will remain open for a few
days. I would hope that you would get back to us any
recommendations concerning that reauthorization, areas that you
think that should be covered and research concerning design,
reprocessing, storage, or other areas. I hope you would do
that.
The other area that I would be interested in knowing, this
is expensive, and I know that we have got some international
efforts going on with the G4 nuclear reactor. I would like to
get your thoughts on how you think that is going, and anything
that we might need to do to encourage it to go a different way.
So, again, thank you for your time. Thanks for the good
hearing, and I yield back the balance of my time.
Mr. Baird. Thank the Chairman and as soon as I find the
appropriate closing remarks--essentially what I would like to
say is thank you to the gentlemen for their testimony, and the
record customarily will be open for I believe it is two weeks
for additional comments, and with that the hearing stands
adjourned and with gratitude to our witnesses.
[Whereupon, at 12:17 p.m., the Committee was adjourned.]
Appendix 1:
----------
Answers to Post-Hearing Questions
Answers to Post-Hearing Questions
Responses by Dr. Warren P. Miller, Assistant Secretary, Office of
Nuclear Energy, U.S. Department of Energy
Questions submitted by Chairman Bart Gordon
Q1. One of the more exciting policy provisions in the Roadmap is the
heavy emphasis on Small Modular Reactors (SMR) technology. Your
testimony indicates that SMRs could achieve both lower capital costs
and simplify the construction process.
a. Should the Federal government conduct a Federal
demonstration program for SMR technology?
b. What is the appropriate scale for a demonstration program
to prove small modular reactor technology, reduce the
technology risk, and encourage mobilization of private capital?
A1a. The Office of Nuclear Energy (NE) is formulating an SMR program in
FY 2011 that will be informed by a workshop that was held in June 2010.
Light water reactor-based SMR technology is familiar and well
characterized, and the safety systems and regulatory framework are well
understood by the Nuclear Regulatory Commission (NRC); we see no need
for a near-term federally-funded demonstration project.
As we evaluate opportunities and determine the most appropriate
activities for the program in the context of the most effective and
appropriate federal role, we will be considering the research and
development needs, particularly of advanced SMR designs like metal and
gas-cooled fast reactor technologies. Because these designs are less
well characterized and have little or no domestic commercial history,
there are a range of research and development activities that would
likely be appropriate for NE to support. We will not be undertaking a
demonstration project in the near-term for these advanced designs and
future activities, if any, related to advanced SMRs will be evaluated
and reviewed along with all other priorities in future budget
development processes.
A1b. As noted above, proven and commercialized LWR technology does not
require a demonstration program. Advanced, non-LWR technologies are
still in the R&D phase and no demonstrations are planned.
Q2. Should the United States be reprocessing nuclear waste using
current methods or should we focus on developing more advanced methods
first? Is the Administration's Roadmap consistent with your
recommendation?
A2. The Fuel Cycle Research and Development program is focusing on
developing more advanced methods of reprocessing used nuclear fuel.
Current methods, which are employed overseas, are expensive and have
proliferation concerns, and it is likely that new technologies can
reduce costs. It is also possible eventually to employ new technologies
that would improve the environmental, safety, and nonproliferation
impacts of current reprocessing methods. Since used nuclear fuel in the
U.S. is currently being stored safely and can be for decades to come,
we have ample time to conduct research and development on improved
reprocessing technologies. We have no need to reprocess now using
current methods.
The Administration's Nuclear Energy Research & Development Roadmap
is consistent with this approach. Objective 3, ``Develop Sustainable
Nuclear Fuel Cycles,'' seeks to ``develop a suite of options that will
enable future decision makers to make informed choices about how best
to manage the used fuel from reactors'' (page 27). This approach will
work to understand what can be accomplished and then to develop the
most promising technologies (page 29).
Q3. There is indication that the non-Federal cost share has presented
a high hurdle for private involvement in the Next Generation Nuclear
Plant Project. Could you please give a brief overview of the issues
currently complicating smooth development of this program and plant?
A3. The Department of Energy has actively engaged with industry from
the inception of the Next Generation Nuclear Plant (NGNP) Project to
ensure that this technology will be aligned with commercial needs. Our
research and development activities as well as development of licensing
requirements are progressing. Results are expected to be reviewed by
the Nuclear Energy Advisory Committee, and the Committee will advise
the Secretary on whether to proceed with Phase 2. Phase 2 challenges,
as identified by various vendors and potential end-users, pertain to
the high level of cost and economic risk associated with the deployment
of gas reactor technology. Specific areas of concern that have been
raised by industry include the value of constructing the reactor at the
Idaho National Laboratory versus at an actual industrial location and
the importance of having the design and licensing process result in a
certified design for use at multiple locations. Industry also has
stated that the government should fund the upfront demonstration costs.
Their proposal is in conflict with cost-share requirements and does not
reflect the proper federal role in this project.
Q4. How seamless is the integration between the Office of Nuclear
Energy and the Office of Science on related issues? For example, what
steps will be taken to coordinate efforts between programs on such
issues as advanced nuclear materials and reactor design and simulation
and what role will the Nuclear Energy Enabling Technologies program
play in this coordination?
A4. There is a seamless integration of information between the Office
of Nuclear Energy (NE) and the Office of Science (SC) in a variety of
areas. Coordination efforts between the two programs in the areas of
advanced nuclear materials, reactor design, and modeling and simulation
include:
Advanced Nuclear Materials: SC's three Energy
Frontier Research Centers addressing materials performance
under irradiation are directly connected to NE-funded materials
research.
Reactor Design: NE-funded researchers use the Argonne
National Laboratory computer to simulate the neutronics of a
full fast reactor core, making extensive use of SC and National
Nuclear Security Administration (NNSA)-developed software.
Modeling and Simulation: Strategically, NE's Modeling
and Simulation Hub for Nuclear Reactors demonstrates the high
level of cooperation between the two programs. The Department's
Hubs are large, multidisciplinary, highly-collaborative teams
of scientists and engineers working over a long time frame to
achieve a specific high-priority goal, such as developing fuels
from sunlight in an economical way and making buildings more
energy efficient. SC provides capabilities that NE leverages
within the NE Hub for R&D funded by other parts of the
Department.
The role of the Nuclear Energy Enabling Technologies
(NEET) program, which is proposed for fiscal year 2011, would
be to serve as a focal point for coordinating stakeholder input
of commonly-themed R&D across the DOE complex. A core aspect of
the NEET program would be successful collaboration with NNSA
and SC through peer-to-peer discussions, joint meetings, review
of research proposals, and sharing of scientific and
engineering resources at the national laboratories. As the NEET
program progressed, NE would expect to increase the
opportunities for collaboration with the Office of Science and
other DOE offices.
Q5. The Roadmap mentions thorium as a possible fuel source. Given our
national stockpiles of depleted uranium and our limited thorium
resources, why should we be examining thorium?
A5. Objective 3 of the Nuclear Energy Research and Development Roadmap,
``Develop Sustainable Nuclear Fuel Cycles,'' seeks to ``develop a suite
of options that will enable future decision makers to make informed
choices about how best to manage the used fuel from reactors'' (page
27). The Fuel Cycle Research and Development program is examining
thorium because it may prove to be part of a sustainable fuel cycle
option in the long term. While we agree that there is a significant
uranium resource available and there is no foreseeable need for
thorium, we believe a limited review of thorium options would help
provide a more complete examination of fuel cycle technologies and
options. Thorium research will be a small portion of the overall
portfolio.
Although depleted uranium stockpiles are abundant and more readily
available, the United States also has large natural reserves of
thorium. In addition to fuel resource availability considerations,
advanced thorium fuels could provide improved fuel performance and
increased resource utilization using thermal spectrum reactor systems.
The benefits, along with the challenges, associated with the use of
thorium will be taken into account as we evaluate particular
technologies and integrated fuel cycle system options within our Fuel
Cycle Research and Development program.
Questions submitted by Representative Ralph M. Hall
Q1. The Committee received written testimony from NuScale Power
stating that a Federally-funded small, modular reactor (SMR)
demonstration project was not necessary to advance SMR licensing and
commercialization and Federal funds should instead be focused on
assisting in support for first-of-a-kind applications for design
certification, construction, and operating licenses.
a. Please provide DOE's position regarding the necessity of a
Federally-supported SMR demonstration project. Is DOE planning
to support such a demonstration project?
b. If so, what would it cost, and what does DOE propose should
be the appropriate Federal/industry cost share?
A1a. For the SMR reactor technologies that are closest to
commercialization, specifically the light water-based reactor
technologies, the Department agrees with NuScale that a Federally
funded demonstration project is not necessary for proving the
technology. These designs are relatively mature and are well-
characterized with respect to the existing NRC regulatory framework as
the light water-based designs are very similar to the existing fleet of
commercial reactors. The Department is not planning to support a
demonstration project for these technologies. The more advanced reactor
designs such as liquid metal, liquid salt, and gas-cooled fast reactor
technologies are less well characterized and have little or no domestic
commercial history and therefore more research and development is
needed.
A1b. No demonstration projects are envisioned. All demonstrations would
subject to the cost-share requirements in section 988 of the 2005
Energy Policy Act. Projects would be funded by DOE at no more than 50
percent of the total cost.
Q2. What is your reaction to concerns that an SMR demonstration could
result in the Federal government ``picking winners and losers'' among
competing technologies, resulting in reduced incentives for private
sector investments in ``losing'' technologies and designs?
A2. In general, the future electricity needs will be met with a mix of
technologies and this mix will be determined by industry based on a
variety of factors. Any demonstration project inherently gives the
chosen technology some type of advantage over its competitors. However,
DOE's SMR efforts will be designed and executed in a manner that works
within existing market mechanisms and there are no plans for SMR
demonstration projects.
Q3. It was noted during the hearing that the cost-competitiveness of
nuclear energy would suffer in the absence of regulations to increase
the cost of carbon-based electricity and given expected sustained low
prices for natural gas.
How might industry and Federal priorities--
particularly with respect to research and development--change
if both of these barriers remain in place over an extended
period of time?
A3. The absence of a carbon policy and the expectation of low natural
gas prices could impact long-term R&D priorities for nuclear energy.
However, the portfolio of nuclear R&D planned in the FY 2011 Budget
strikes an appropriate balance to help provide the flexibility and
information needed to inform future decisions and resource
prioritization. Such future decisions will be made considering an array
of factors, including economic and technical concerns as well as public
benefit, federal role, and cost considerations.
Questions submitted by Representative Judy Biggert
Q1. How do SMRs compare to other types of advanced reactor designs
being contemplated and pursued in the private sector, both in terms of
economic potential as well as technical advantages and disadvantages?
A1. The near-term, light water reactor-based technologies being
initially pursued by the industry and the Department are fundamentally
the same as their larger counterparts in the current fleet of
commercial reactors, and even closer in functional characteristics to
the newly-designed Generation III+ reactors (e.g., AP1000, ABWR and
ESBWR). The primary difference is the scale, which may lead to several
operational and economic advantages. Realization of these advantages is
not a given and will be dependent on a variety of factors.
Compared with the Gen III reactors currently operating in the U.S.,
the SMR technologies being developed by industry today:
Are smaller and, based on initial assumptions and
modeling done by industry, may be safer with much lower
predicted core damage frequency;
May require no active response systems in post-
accident conditions;
May be less expensive to construct, operate and
maintain;
May be able to be transported to the deployment site
by truck, rail or barge;
Have the potential to supply remote areas with
appropriate electrical capacity; depending on market needs and
industry decisions; or
Could be used to add new electrical capacity in
smaller increments to match demand growth depending on ultimate
cost, siting, market and other factors.
Projected benefits for SMRs have not been proven, such as whether
smaller plants can overcome the benefits of economies of scale. They of
course still generate used nuclear fuel the same as existing plants.
Certain elements of the electric output and the economics of SMRs could
be considered to be disadvantages, depending on a specific utility's
needs. For example, SMRs may not be cost-competitive as a replacement
for large baseload capacity. They provide the same greenhouse gas
avoidance as existing nuclear technologies, so there is not a net
advantage in that respect.
Some utilities and merchants have shown interest in SMRs, both
domestically and internationally, as a potential solution for their
energy requirements. Issues such as water limits and using nuclear as a
low-carbon option for replacing aging fossil plants help make SMRs an
increasingly attractive option.
The advanced metal, gas, and molten-salt cooled SMR designs are
also similar to the advanced sodium and gas-cooled designs being
pursued under Nuclear Energy programs such as the GEN IV and Next
Generation Nuclear Plant (NGNP), and may offer some of the same
technical and economic advantages discussed above.
These advanced SMR designs are, however, much farther from
deployment readiness.
Q2. Given that the market and regulatory system can support only a
limited number of reactor design types, is there any concern that going
forward with SMR demonstration and licensing impact the viability of
other advanced reactor types?
A2. Future electricity demand will be met by a mix of technologies.
That mix will be determined by industry based on a variety of factors
and nuclear, regardless of the design, will have to compete in that
mix. Any demonstration project inherently gives the chosen technology
some type of advantage over its competitors. There are no demonstration
projects planned for LWR or advanced SMR designs.
In order to be successful SMRs would need to have their own
commercial niche that would be borne out as customers emerge to partner
with SMR vendors to meet specific technical, economic, and electrical
load growth needs. For example, SMRs may allow the nuclear power option
to be viable for customers or applications with power requirements or
financial constraints that preclude the use of the larger plants.
Larger nuclear plants are expected to maintain their market niche,
particularly where there is a need for baseload power and where the
grid and water resources can accommodate a large plant. We also
recognize that, in the future, it could be possible to deploy several
SMRs at a single site to create the equivalent output of a larger
plant.
Answers to Post-Hearing Questions
Responses by Mr. Christofer Mowry, President and CEO, Babcock & Wilcox
Nuclear Energy, Inc.
Questions submitted by Chairman Bart Gordon
Q1. You indicated that your SMR design would be manufactured in the
United States and supported by a ``North American supply chain
including all forgings.''
How will SMR technology be able to keep the supply chain entirely
domestic if we have been unable to do so with large reactors?
Could SMRs become a new American export?
A1. The B&W mPowerTM reactor design is specifically designed
to use a North American supply chain, and to be manufactured at
existing B&W nuclear manufacturing facilities in Ohio, Indiana,
Virginia, Tennessee, and Ontario, Canada. Large, gigawatt-sized
reactors are unable to be 100% domestically sourced because they
require ultra-heavy (>350 tons) forgings which are currently not
available in the United States. Due to the size and modularity of the
B&W mPower reactor, it does not require ultra-heavy forgings and can
therefore be sourced from existing forging suppliers in the United
States and manufactured at B&W facilities.
SMRs represent significant potential for American exports, once a
first-of-a-kind plant is certified, licensed and deployed in the United
States. The B&W mPower module is designed to be factory assembled and
shipped to a plant site via rail as a finished unit. Due to this
modularity and shippability, as well as the reactor's North American
supply chain and air-cooled plant design, there is ongoing interest in
international markets. This is particularly relevant in countries where
cost, accessibility, water availability and grid capacity make larger
reactors impractical.
Q2. NuScale Power in its testimony suggested that a federally funded
``demonstration facility'' is not necessary. Should the Federal
Government conduct a Federal demonstration program for SMR technology?
What is the appropriate scale for a demonstration program to prove
small reactor technology, reduce the technology risk, and encourage
mobilization of private capital? Could you please provide comment on
private interest you are aware of in a demonstration plant?
A2. B&W supports a demonstration program to support near-term
development and deployment of SMR technology through public-private
partnership to share the costs of design, design certification, site
licensing and final engineering. However, Federal Government funding of
construction of a facility is not expected or necessary. While light
water SMRs take advantage of proven technology and decades of
operational experience, unique risks are inherent in being a technology
``first-mover''. Government cooperation through cost-sharing is
essential to realistically address the licensing and schedule risks
inherent in such first-of-a-kind projects. A public-private partnership
between government and industry would share the risks and benefits of
deploying a ``first-of-class'' practical SMR before the end of this
decade. It would provide a realistic mechanism to accomplish the
following broader set of National objectives for the U.S. energy
infrastructure:
Regain U.S. leadership position in the global
commercial nuclear power industry,
Create significant high-quality U.S. manufacturing,
construction and engineering jobs,
Provide carbon-free power generation, and
Provide a practical baseload clean-power option for
DOD applications, aging fossil plant sites, and remote or
isolated locations.
In 1957, the first commercial nuclear power plant at Shippingport,
PA achieved full power operation, the result of a partnership between
the Atomic Energy Commission and Duquesne Light Company. This
cooperation between industry and government set in motion the
development of the U.S. commercial nuclear industry. Our government's
investment in this first-of-a-kind technology more than 50 years ago
provided lasting and significant value to the Nation. A new public-
private partnership to share the costs of design, design certification,
site licensing and final engineering will enable the U.S. to
demonstrate the promise which SMR technology holds for our energy
industry by the end of this decade.
To this end, the estimated total funding requirements for a single
SMR reactor are:
To complete design work and obtain design
certification--$320M
To obtain a combined operating license--$80M
To complete detailed final design to prepare an
Engineering, Procurement, and Construction contract for the
initial SMR deployment--$325M
We believe the appropriate Federal/industry cost-share for these
activities would be 50%/50%.
It is essential that the utility industry be fully engaged in such
a program to ensure that the result is an SMR plant that utilities are
likely to construct and operate in quantity, and that can achieve
commercial financial viability without long-term Federal support. This
first-of-a-kind plant should therefore be developed in partnership with
the Federal Government and constructed, owned and operated by a U.S.
utility, with construction costs borne by the utility customer, rather
than by the U.S. government. In this way, government and industry can
share the risks and benefits of developing the first SMR plants for
deployment by the end of this decade.
We have developed a B&W mPower Consortium made up of B&W and
leading U.S. utilities, including the Tennessee Valley Authority, First
Energy and Oglethorpe Power Corporation. The Consortium is dedicated to
addressing the proper regulatory framework, design requirements, and
licensing infrastructure necessary to support the commercialization of
the B&W mPower reactor. The ultimate goal of the Consortium is to
deploy one or more demonstration plants in the U.S. by 2020, if not
earlier.
Questions submitted by Representative Ralph M. Hall
Q1. You recommend in your testimony that DOE increase its support for
design certification and long-term R&D from $39 million to $55 million
in fiscal year 2011. What specific activities do you believe the
additional $16 million should support?
A1. The DOE's Fiscal Year (FY) 2011 budget request includes $39 million
for the SMR program, of which approximately half is expected to be
dedicated to a cost-sharing program for design certification of up to
two light water SMR designs, with the remaining half used for R&D
activities for longer-term, non-light water technologies. While this
budget request is on the right track, it is not aggressive enough to
support the deployment of SMRs by the end of the decade. To meet this
goal, we recommend that the funding for the SMR program be increased to
$55 million in FY 2011, with $35 million dedicated to the cost-sharing
program for up to 2 light water SMR designs. This funding would be used
for cost-sharing of development and design activities leading to design
certification no later that 2016, to help support deployment by 2020.
Q2. The Committee received written testimony from NuScale Power
stating that a federally funded small, modular reactor (SMR)
demonstration project was not necessary to advance SMR licensing and
commercialization and Federal funds should instead be focused on
assisting in support for first of a kind applications for design
certification, construction and operating licenses.
Please provide B& W's reaction to this position regarding the
necessity of a federally-supported SMR demonstration project.
If such a demonstration project were to go forward, what would it
cost, and what would be the appropriate Federal/industry cost-share?
A2. B&W supports a demonstration program to support near-term
development and deployment of SMR technology through public-private
partnership to share the costs of design, design certification, site
licensing and final engineering. However, Federal Government funding of
construction of a facility is not expected or necessary. While light
water SMRs take advantage of proven technology and decades of
operational experience, unique risks are inherent in being a technology
``first-mover''. Government cooperation through cost-sharing is
essential to realistically address the licensing and schedule risks
inherent in such first-of-a-kind projects. A public-private partnership
between government and industry would share the risks and benefits of
deploying a ``first-of-class'' practical SMR before the end of this
decade. It would provide a realistic mechanism to accomplish the
following broader set of National objectives for the U.S. energy
infrastructure:
Regain U.S. leadership position in the global
commercial nuclear power industry,
Create significant high-quality U.S. manufacturing,
construction and engineering jobs,
Provide carbon-free power generation, and
Provide a practical baseload clean-power option for
DOD applications, aging fossil plant sites, and remote or
isolated locations.
In 1957, the first commercial nuclear power plant at Shippingport,
PA achieved full power operation, the result of a partnership between
the Atomic Energy Commission and Duquesne Light Company. This
cooperation between industry and government set in motion the
development of the U.S. commercial nuclear industry. Our government's
investment in this first-of-a-kind technology more than 50 years ago
provided lasting and significant value to the Nation. A new public-
private partnership to share the costs of design, design certification,
site licensing and final engineering will enable the U.S. to
demonstrate the promise which SMR technology holds for our energy
industry by the end of this decade.
To this end, the estimated total funding requirements for a single
SMR reactor are:
To complete design work and obtain design
certification--$320M
To obtain a combined operating license--$80M
To complete detailed final design to prepare an
Engineering, Procurement, and Construction contract for the
initial SMR deployment--$325M
We believe the appropriate Federal/industry cost-share for these
activities would be 50%/50%.
It is essential that the utility industry be fully engaged in such
a program to ensure that the result is an SMR plant that utilities are
likely to construct and operate in quantity, and that can achieve
commercial financial viability without long-term Federal support. This
first-of-a-kind plant should therefore be developed in partnership with
the Federal Government and constructed, owned and operated by a U.S.
utility, with construction costs borne by the utility customer, rather
than by the U.S. government. In this way, government and industry can
share the risks and benefits of developing the first SMR plants for
deployment by the end of this decade.
Answers to Post-Hearing Questions
Responses by Dr. Charles Ferguson, President, Federation of American
Scientists
Questions submitted by Chairman Bart Gordon
Q1. Dr. Ferguson, your testimony notes the advantage that India and
China currently have in the Small Modular Reactor market and that they
are preparing to sell reactors to foreign nations and into developing
markets. You also mention the technology that those nations seek to
export may be more prone to proliferation and use for a weapons
program.
a. Would you suggest this is a reason to develop SMR
technology in the U.S.?
A1a. I think the United States should encourage further international
competition in SMR technology, including development within the United
States. While China is moving ahead with selling two more medium power
reactors to Pakistan, it is important to recognize that this action
likely stems from China trying to support its traditional ally Pakistan
and bring back into balance the relationship Pakistan has with India in
response to the U.S.-India civilian nuclear deal. The proliferation
concern is that China is rewarding Pakistan, a country that has a
history of not being able to control of nuclear technologies, in
particular, A. Q. Khan's nuclear black market. The Chinese reactors
themselves are not necessarily proliferation-prone as long as adequate
safeguards are in place. Aside from China's deal with Pakistan, it
remains uncertain that China will sell more small or medium sized
reactors. Similarly, while India's nuclear industry has expressed some
interest in selling small pressurized heavy water reactors, which are
proliferation prone, India may not be ready to make such sells in the
near term because it is focused on its domestic nuclear power
development. Thus, the United States and other potential suppliers of
more proliferation-resistant SMRs may have the opportunity to compete
successfully with China and India.
b. Would U.S. development of SMR technology set a safety
standard by which all others competitors are measured or would
cheaper options likely be developed and deployed
internationally?
A1b. Setting a safety and security (including proliferation-resistance)
standard for SMR technology would appear to require: (1) demonstration
of one or more SMR designs with enhanced safety and security features,
(2) U.S. leadership within the International Atomic Energy Agency for
an assessment of all small and medium power reactor designs on the
basis of safety and security, and (3) U.S. leadership within the
Nuclear Suppliers Group to encourage suppliers to only supply reactors
with enhanced safety and security features. Under the theme of
leadership by example, the United States can and should take the lead
in demonstrating SMR technology. Concerning the cost of safe and secure
SMRs versus competitors' designs, many factors determine cost. While a
less safe and secure reactor may appear cheaper in terms of initial
capital costs, a safer and more secure reactor may in the long term
offer advantages in that (1) the much lower probability of an accident
would lower costs related to the consequences of an accident, (2) more
proliferation-resistant fuels would likely be more fuel efficient and
thus save money, and (3) more proliferation-resistant SMRS would likely
require fewer refueling or provide a lifetime core and thus likely
result in lower costs in terms of transportation of fuel and reactor
downtime.
Q2. Should the Federal Government conduct a Federal demonstration
program for SMR technology? What is the appropriate scale for a
demonstration program to prove small modular reactor technology, reduce
the technology risk, and encourage mobilization of private capital?
A2. Yes, I think the time is ripe for the Federal Government to conduct
a demonstration program. Utilities may be reluctant to purchase an SMR
without seeing one demonstrated because the dominant paradigm is for
large reactors. One demo option is for the Defense Department to
purchase an SMR. While that would show the reactor in operation, such a
plan may not satisfy the need to encourage mobilization of private
capital. Another option is to demonstrate one or more SMRs in a
location where the Federal Government has authority but also where the
states and the commercial sectors have jurisdiction. One location that
comes to mind is the Tennessee Valley Authority, which has a defense
mission in its charter. The Oak Ridge National Laboratory with
expertise in nuclear energy technologies may be the natural partner
with TVA to demonstrate SMRs. The SMRs could provide electrical power
to ORNL as well as the local communities. ORNL and the communities
could share costs in paying for the electricity generated.
Q3. You mention that small markets like Alaska and Hawaii may benefit
most from SMRs and that this technology would be attractive to small
markets with weak grids. But other panelists here suggest that SMRs and
their ability to be ``stacked'' or used in tandem would make them a
logical choice for scaled deployment of nuclear generation across the
board. What is your response?
A3. I think this is not an either/or choice. As indicated in my written
testimony, there may be considerable merit in stacking or building
sequentially several SMRs at one location as long as there are economic
advantages. The International Atomic Energy Agency study that I cited
in the testimony suggests that four SMRs at one location could be
stacked in such a way to be very cost competitive with one large power
reactor with the equivalent amount of power of the four SMRs.
Concerning communities in Alaska and Hawaii, the electricity
markets at those locations are relatively small and thus may not be
able to handle a large power reactor or several SMRs in a stacked
configuration. Nonetheless, as long as one SMR is cost competitive with
alternative energy choices, then those communities may find value in
purchasing an SMR. Both Alaska and Hawaii rely significantly on fossil
fuels for electricity generation. So, nuclear power could serve to
reduce reliance on these greenhouse gas generating sources. Concerning
reliance on oil for electricity generation, Hawaii has the highest
dependency in the United States. Consequently, alternative electricity
generation sources would help alleviate this dependency. In addition to
considering nuclear power in the form of SMRs, Hawaii should examine
increased use of geothermal and solar sources, which are ideal in
Hawaii's location. A systems analysis would be useful for Hawaii in
determining what combination of geothermal, nuclear, and solar sources
are environmentally sound and cost competitive with fossil fuels.
Answers to Post-Hearing Questions
Responses by Dr. Mark Peters, Deputy Director for Programs, Argonne
National Lab
Questions submitted by Chairman Bart Gordon
Q1. Dr. Peters, you have indicated that there are problems with the
PUREX process of recycling currently available today, such as
proliferation risks and an inability to perform multiple cycles and
fully use nuclear fuel.
Does the Roadmap as presented provide the resources necessary to
research and develop the advanced reprocessing methods you list and
potentially mitigate many of the problems with nuclear waste?
A1. The DOE Nuclear Energy R&D Roadmap provides a comprehensive vision
for the research and development needed for advanced reprocessing and
recycling technology development that will ultimately mitigate many of
the challenges of nuclear waste management. The research and
development approach described in the Roadmap, in particular the
synergistic use of experiment, theory, and modeling and simulation, is
a sound approach to enabling the required technologies.
This said, the Roadmap needs a greater emphasis on coupling the
science-based approach for system development with an active design and
technology demonstration effort that would guide and appropriately
focus research and development in this next decade to allow for
advanced reprocessing and recycling technology demonstrations at
engineering scale beginning circa 2020. These efforts would allow for
fuel cycle demonstration in a timeframe that could influence the course
of fuel cycle technology commercialization on a global basis.
With an additional emphasis on timely demonstration of advanced
technologies, the objectives of the Roadmap can be met in a reasonable
time frame if the appropriate priorities are identified and sufficient
funding is provided to allow acceleration of high priority areas.
Current resources are not adequate to implement the required program
through robust public-private partnerships involving the Department of
Energy, its national laboratories, universities, and industry. The R&D
and demonstration program needs sufficient resources and should be
conducted with a sense of urgency and purpose consistent with the U.S.
retaining its intellectual capital and leadership in the international
nuclear energy community.
Answers to Post-Hearing Questions
Responses by Mr. Gary M. Krellenstein, Managing Director, Tax Exempt
Capital Markets, JP Morgan Chase & Co.
Questions submitted by Chairman Bart Gordon
Q1. One of the concerns raised about SMR technology is that building
out the necessary infrastructure will be too costly to justify
deployment of an SMR. For instance, if a customer were to want to use a
single 100 MW reactor and then slowly scale up to ten 100 MW reactors,
they would still be required to build all of the surrounding
infrastructure for the full complement of SMRs from the outset.
Could you comment on this argument?
When we build combustion turbine unit plants, which typically come
in 50-150 MWe sizes, we usually start with one or two units and then
add additional units as needed. If planned and sited correctly for
potential additional generating expansion, only incremental
improvements are likely to be needed for the remaining units since most
of the infrastructure is needed for the first unit constructed. The
capital costs for the first unit or two are often higher since items
such as the road, switchyard, transmission and piping are often
allocated to those units. The incremental units added to the site do
not require these facilities or ``right-of-ways,'' and usually just
require upgrades of relatively low cost.
Q2. Are there any other technology or research pathways that you think
should be explored by this Committee that could reduce the capital
costs for nuclear power?
A2. Yes. Most likely we would use a water moderated nuclear reactor for
the SMR. However, several other technologies are suitable for that size
and should be reviewed before a decision is made to proceed with a
scale model. That would include gas-cooled, pebble bed, liquid sodium
moderated, and several other designs. Investors would probably be most
comfortable with water-moderated reactors because they are an extension
of the existing nuclear technology in use today. However, if
significant cost and/or safety advantages could be demonstrated using
alternative reactor designs, it would definitely garner investor
interest.
Q3. Should the Federal Government conduct a Federal demonstration
program for SMR technology? What is the appropriate scale for a
demonstration program to prove small modular reactor technology, reduce
the technology risk, and encourage mobilization of private capital?
A3. If sufficient types of Federal or other types of guarantees could
be provided, it might not be necessary, but investors have become
skeptical and confused by many the ``subsidies'' and guarantees that
have been provided to other energy technologies. In my opinion, the
construction of a full (150 MWe) scale SMR would probably be the most
effective way to mitigate investor (and safety) concerns over a new
reactor technology.
Questions submitted by Representative Ralph M. Hall
Q1. The Committee received written testimony from Nuscale Power
stating that a federally-funded small, modular reactor (SMR)
demonstration project was not necessary to advance SMR licensing and
commercialization and Federal funds should instead be focused on
assisting in support for first of a kind applications for design
certification, construction, and operating licenses.
Do you agree or disagree, and why? If such a project were to go
forward, what would be the approximate overall cost and appropriate
Federal/industry cost-share?
A1. See response to question 3 above.
Q2. What is your reaction to concerns that an SMR demonstration
project could result in the Federal Government ``picking winners and
losers'' among competing technologies, resulting in reduced incentives
for private sector investment in ``losing'' nuclear technologies and
designs?
A2. This is a legitimate concern with no easy answer. To minimize the
risk of picking the ``wrong'' technology, extensive analysis by an
independent group of the various designs should be conducted to
determine which reactor configuration looks most promising from both a
technological and economical (including financing) perspective before
selecting a potential ``winning'' design. The relatively small number
of SMRs that would most likely be built in the first few years is
unlikely to justify multiple prototypes being constructed. Clearly, the
multiplicity of different reactor designs that were used in the 1960s-
1980s was a detriment to the industry and a standard design, while not
a perfect solution, would represent a significant improvement of the
experience of the 1960s-1980s.
Q3. It was noted during the hearing that the cost competitiveness of
nuclear energy would suffer in the absence of regulations to increase
the cost of carbon-based electricity and given expected sustained low
prices for natural gas.
How might industry and Federal priorities--particularly with
respect to research and development--change if both of these barriers
remain in place over an extended period of time?
A3. If no carbon tax is imposed and/or natural gas prices remain low,
the Federal Government will have to increase subsidies and incentives
to the nuclear industry for it to remain competitive. Clearly, there
are significant externalities associated with carbon based fuels that
are not reflected in their current ``market'' prices and the need for
energy diversification using a domestic, non-carbon emitting source is
compelling.
Answers to Post-Hearing Questions
Responses by Dr. Thomas L. Sanders, President, American Nuclear Society
Questions submitted by Chairman Bart Gordon
Q1. Is our workforce prepared to operate, manufacture and evaluate SMR
technology?
A1. The short answer is yes and no. The U.S. retains significant core
experience in the manufacture, operation, and evaluation of SMR
technology through its involvement with the U.S. Naval nuclear
propulsion program, including fuel fabrication, reactor design, reactor
operation, modular fabrication techniques and transportation of used
nuclear fuel. Furthermore, graduate and undergraduate enrollments in
nuclear engineering and related disciplines have increased sharply in
the last few years. (Total enrollments are now approaching 3000
students from a low of roughly 200 students in the 1990s.) Many of
these students have chosen to focus on SMR related technology as part
of their educational programs. However, I remain concerned that the
U.S. will experience significant knowledge gaps in certain technical
areas, especially as they relate to fast and liquid metal reactors,
which many in the field expect to play a significant role in SMR
development in the medium term. While we have nearly 40 years of
operating experience with sodium cooled fast reactors, many of the
scientists and engineers that were involved in its development and
implementation are reaching retirement age. It is critically important
that we capture and preserve their collective knowledge of sodium
cooled/fast reactor technology so that we may employ it in the design
and implementation of SMR's in the future.
Q2. Should the Federal Government conduct a Federal demonstration
program for SMR technology? What is the appropriate scale for a
demonstration program to prove small modular reactor technology, reduce
the technology risk, and encourage mobilization of private capital?
A2. Given the significant political and financial uncertainties
surrounding the development and deployment of SMR technology by U.S.
vendors, it is critical that the Federal Government take an active role
in SMR technology incubation, demonstration, and implementation both in
the U.S. and worldwide. As I suspect you are aware, you can divide SMR
technology into three broad buckets:
advanced light water, high temperature gas cooled, and liquid metal
cooled fast designs. Each of these technologies differs in their needs
for Federal support and partnership. We have a fairly advanced
understanding of the major technical issues related to light water
SMRs, given our experience in Naval nuclear propulsion program and
their big cousins in the U.S. commercial nuclear fleet. As such,
Federal support should focus on the acceleration of design
certification and licensing for first of a kind systems combined with
financial support perhaps to be provided through a DOE loan guarantee.
Congress should also consider the notion of having the Federal
Government become a ``lead customer'' perhaps on a military base or
some other Federal facility.
For high temperature gas reactors, I'm reasonably confident that
the current legislative mandate and regulatory plans for the Next
Generation Nuclear Plant (NGNP) provide a reasonable implementation
pathway, assuming it is aggressively funded by the Federal Government.
Liquid metal cooled SMR designs require additional research and
development activities, including perhaps one or more small engineering
demonstrations to address key technical issues, for which the Federal
Government should take an active role in partnership with U.S.
industry. While these reactors will certainly take longer to implement
them their light water counterparts, they have certain safety, waste
minimization and nonproliferation characteristics that would make them
uniquely attractive.
Questions submitted by Representative Ralph M. Hall
Q1. The Committee received written testimony from Nuscale Power
stating that a federally funded small modular reactor demonstration
project was not necessary to advance SMR licensing and
commercialization and Federal funds should instead be focused on
assisting in support for first of a kind applications for design
certification, construction, and operating licenses. Do you agree or
disagree, and why? If such a project were to go forward, what would be
the appropriate Federal/industry cost share?
A1. It is difficult to say for certain whether a particular SMR
demonstration project would be appropriate for Federal investment,
without understanding the detailed mechanics of the proposal.
Furthermore, it is important to recognize that at least two companies
are developing light water SMRs technologies which are, in my
understanding, generally similar in design although they vary in power
output. The Federal Government should be extremely careful that in
developing and implementing its mechanisms for SMR support, so that it
does not inadvertently favor one vendor over the other.
That said however, my personal opinion is that the Federal
Government should consider all avenues it has at its disposal,
including the possibility of a technology demonstration program, to
ensure the deployment of this technology, so critical to both our
energy security and national security objectives, is implemented in an
expeditious manner. As for the specific percentages of a Federal/
industry cost share, I would hope that the government share would be
less than 50% of the total project cost.
Q2. It was noted during the hearing that the cost competitiveness of
nuclear energy would suffer in the absence of regulations to increase
the cost of carbon-based electricity and given expected sustained low
prices for natural gas. How might industry and Federal policies--
particularly with respect to research and development--change if both
of these barriers remain in place over an extended period of time?
A2. There is no doubt that the combination of low natural gas prices
and the absence of binding carbon constraints will reduce the financial
incentives for private industry to invest in the development and
appointment of SMR technology. However, Federal investment in SMR
technology should not be judged solely on the basis of its role in U.S.
energy supplies. Around the world, over 60 countries are constructing
or actively exploring adding nuclear generation capacity to their
energy portfolios. Many of these countries, approaching 80%, do not
have an electrical grid large enough to absorb the power generated by a
1 GW nuclear plant, and therefore SMR technology is there only
reasonable option. Other nations such as Russia and China are moving
forward aggressively to develop export--oriented SMR technology to
serve these markets. Clearly, the profit and job creation possibilities
are compelling to these nations. If the U.S. is not actively involved
in developing and exporting SMR technologies, other countries will reap
the benefits of the global nuclear renaissance, while the U.S. watches
from the sidelines with little role in influencing global safety and
nonproliferation norms.
In short, this is a U.S. national security issue, therefore, the
Federal role in developing and deploying SMR technologies should be
strong and consistent regardless of the U.S. domestic market.
Appendix 2:
----------
Additional Material for the Record
Summary and Table of Contents, Department of Energy Nuclear Research
and Development Roadmap, April 2010
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
A Sustainable Energy Future: The Essential Role of Nuclear Energy, from
DOE Directors of National Laboratories
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Additional Testimony from Marvin S. Fertel, President and Chief
Executive Officer, Nuclear Energy Institute
June 3, 2010
The Nuclear Energy Institute is the industry's policy organization,
whose broad mission is to foster the beneficial use of commercial
nuclear technology. NEI has more than 350 corporate members
representing 17 countries include every U.S. electric utility that
operates a nuclear power plant; international electric utilities;
nuclear plant designers; architect and engineering firms; uranium
mining and milling companies; nuclear service providers; universities;
manufacturers of radiopharmaceuticals; labor unions; and law firms. NEI
is responsible for establishing unified nuclear industry policy on
technical, regulatory and legislative policy issues affecting the
industry.
My testimony will address four areas:
1. nuclear energy industry interest in the Department of
Energy's research and development roadmap
2. the DOE R&D roadmap as a guidance document for reactor
research
3. how the DOE R&D roadmap will impact used nuclear fuel
management and nonproliferation
4. additional elements needed for an effective R&D strategy
for commercial nuclear technologies
The U.S. nuclear energy industry's top priority is, and always will
be, the safe and reliable operation of our facilities. America's
nuclear power plants have sustained exemplary levels of safety and
operational performance, and this safe, reliable operation drives
public and policymaker confidence in the industry. Nuclear energy has
had an electric sector-leading average capacity factor of 90 percent or
higher over the last decade. In 2009, the nation's 104 reactors
produced nearly 800 billion kilowatt-hours of electricity--enough for
about 80 million homes--at production costs lower than coal and natural
gas-fired power plants. Nuclear power plants in 31 states generate 72
percent of electricity that comes from carbon-free sources.
Why Is NEI Interested in the Nuclear Energy R&D Roadmap?
NEI appreciates this committee's recognition of the strategic
importance of increased Federal funding for nuclear energy research and
development. Increases in nuclear energy R&D investment will be
necessary in the years ahead to help create a sustainable, reliable and
low-carbon electric supply infrastructure. Unfortunately, recent trends
are in the opposite direction. In a 2007 analysis, the Government
Accountability Office found that DOE's budget authority for renewable,
fossil and nuclear energy R&D declined by more than 85 percent (in
inflation-adjusted terms) between 1978 and 2005. Over that period, the
need for new technologies to address critical energy needs has not
diminished; rather, it has increased with the advent of climate change
concerns.
A robust research and development program is necessary if nuclear
energy is to realize its full potential in the nation's low-carbon
energy portfolio. In 2008, directors of the 10 DOE national
laboratories, including now-Secretary of Energy Steven Chu, published a
report recognizing that ``nuclear energy must play a significant and
growing role in our nation's . . . energy portfolio . . . in the
context of broader global energy, environmental, and security issues.
The national laboratories, working in collaboration with industry,
academia and the international community, are committed to leading and
providing the research and technologies required to support the global
expansion of nuclear energy.''
The national laboratory directors pointed out that the U.S.
leadership position in the global nuclear enterprise is at stake.
Participation in the development of advanced nuclear energy
technologies will allow the United States to influence energy
technology choices around the world. This participation also could help
assure that objective and viable nonproliferation controls are in place
as other countries develop commercial nuclear capabilities. Therefore,
technical leadership and increased R&D funding should be a strategic
and economic imperative of the administration, Congress and the
industry.
The 2008 report identified areas of research that have been
incorporated into a comprehensive strategy for nuclear energy R&D
developed by the Electric Power Research Institute and the Idaho
National Laboratory. NEI supports the R&D priorities listed in that
strategy:
Maintaining the high performance of existing light
water reactors and extending potential operation of these
facilities from 60 years to 80 years. Research and development
programs are needed to develop improved advanced diagnostic and
maintenance techniques, extend component life, introduce new
technologies, and enhance uranium fuel reliability and
performance.
Significantly expand the number of light water
reactors, including small reactor designs. Building new U.S.-
designed reactors internationally will provide global
leadership in safe nuclear plant operation while meeting
stringent nonproliferation objectives.
Developing fast reactor designs and more
proliferation-resistant reprocessing technologies will enable a
higher percentage of the uranium fuel to be used before
reprocessing or disposal. Reprocessing also could reduce the
volume and toxicity of the uranium fuel byproduct that requires
safe permanent disposal in a geologic repository.
Developing high-temperature reactors for electricity
generation and use in other applications, such as a heat source
for industrial processes. High-temperature reactors can reduce
greenhouse gas emissions from large-scale process heat
operations in the petroleum and chemical industries. This
technology could economically produce hydrogen for fuel-cells
and other industrial applications.
In February, NEI convened the 7th Nuclear Energy R&D Summit,
bringing together industry, academia and DOE national laboratory
officials to discuss the industry's R&D portfolio. Nearly 400
participants developed a statement of principles (attached), which
recommends seven focus areas for nuclear energy R&D:
1. Maintain a consistent long-term plan for nuclear energy
programs, including an integrated R&D strategy that supports
basic research that is goal-oriented.
2. Select a limited number of cost-shared projects for
development of reactor and fuel management technologies.
3. Support development of reactor technologies that qualify
for DOE's Loan Guarantee Program.
4. Encourage the restoration and expansion of the domestic
manufacturing supply chain to build new nuclear facilities.
5. Research, demonstrate and deploy technology innovations for
continued safe operation of current reactors.
6. Support work force education and training through
congressional appropriations for university programs,
investment in the industry-endorsed uniform curriculum at
community colleges and tax credits for worker training.
7. Fund the development of reactors to ensure a domestic
supply of medical and industrial isotopes.
NEI believes the DOE R&D roadmap can bring these recommendations to
fruition as it engages industry in implementation of the objectives
outlined in the document.
NEI's Impression of the Nuclear Energy R&D Roadmap
Overall, the roadmap makes a strong case for a continued robust DOE
nuclear energy program to help meet the nation's energy and
environmental goals. Existing and new nuclear plants will help the
United States meet its future electricity demand and climate change
objectives. Various independent assessments of how to reduce electric
sector CO2 emissions--including those by the International
Energy Agency, McKinsey and Company, National Academy of Sciences,
Cambridge Energy Research Associates, Pacific Northwest National
Laboratory, the Energy Information Administration and the Environmental
Protection Agency--show that there is no single technology that can
slow and reverse increases in CO2 emissions. A portfolio of
technologies and approaches will be required, and that portfolio must
include more nuclear energy as well as an aggressive pursuit of energy
efficiency and expansion of renewable energy, advanced coal-based
technologies, plug-in hybrid electric vehicles and distributed energy
resources. Removing any technology from the portfolio places untenable
pressure on those options that remain.
NEI estimates that approximately 28,000 megawatts of new nuclear
energy capacity (22 new reactors) must be built by 2030 to maintain
nuclear energy's 20 percent share of the U.S. electricity supply. To
increase nuclear energy's contribution to achieve greenhouse gas
reduction goals, the amount of new nuclear energy capacity must be
substantially higher. EPRI's PRISM analysis, a study of potential low-
carbon emission energy deployment over the next 20 years, shows that to
provide a high degree of confidence that America's long-term climate
change goals can be achieved, 45 new reactors must be operational by
2030, with others under construction or in the licensing process.
The DOE roadmap achieves this goal by creating a sustained program
for license extension for current reactors to 80 years and enabling new
standardized reactor designs to be licensed and built more efficiently.
Any program that is developed under the auspices of the roadmap must
adhere to the DOE's principle described on page 16 of the roadmap: ``In
laying out the activities in each of the R&D objectives described
below, we must remain goal-oriented to avoid falling into the trap of
doing a great deal of work that, while interesting, fails to address
the challenges to the deployment of nuclear energy.''
NEI supports the proposed Light Water Reactor Sustainability
program and the Nuclear Energy Modeling and Simulation Hub. Both
programs will contribute significantly to maintaining safe operation of
existing reactors and improving the efficiency of new reactor
development. The modeling and simulation hub also will help to reduce
the time to market for innovative reactor designs. The industry
supports an expedited program plan over what DOE includes in the key
activities table on page 21 of the roadmap. The industry also
encourages DOE to continue its efforts to bring advanced light water
reactors and small modular reactors to the market place in an expedited
manner.
NEI strongly encourages DOE to continue the funding of advanced
fuel cycle programs that will improve uranium fuel resource use,
maximize generation, reduce the volume of used fuel that has to be
disposed of in a deep geologic repository and limit proliferation risk.
Domestic facilities are expanding the capacity for uranium fuel
supply. This week, LES opened the first U.S. centrifuge uranium
enrichment plant in Lea County, New Mexico. The plant is currently
awaiting final NRC approval to commence commercial operations, which is
expected shortly. At full capacity, the facility can produce enriched
uranium for nuclear fuel to provide as much as ten percent of America's
electricity needs. Last month, the Energy Department offered a $2
billion conditional loan guarantee commitment to AREVA for its planned
uranium enrichment facility in Idaho. The project will use advanced
centrifuge technology and could create as many as 4,800 direct and
indirect jobs. USEC and the Department of Energy announced an agreement
in March to provide $45 million in funding to USEC to fund ongoing
American Centrifuge enrichment technology demonstration and
manufacturing activities. USEC will match the DOE funding on a 50-50
cost-share basis. Other companies also are investigating advanced
facilities for uranium enrichment, including GE Hitachi Nuclear Energy,
which is developing the Global Laser Enrichment. This is a new method
for enriching uranium that could benefit from DOE support.
How the R&D Roadmap Will Impact Waste Management and Nonproliferation
Programs
Used nuclear fuel is managed safely and securely at nuclear plant
sites and can be done so for an extended period of time. Used nuclear
fuel does not represent an impediment to new reactor development in the
near term. It is, however, an issue that must be addressed for the long
term.
The nuclear industry's position on used fuel management is clear:
The Nuclear Waste Policy Act establishes an
unequivocal Federal legal obligation to manage used nuclear
fuel. Until that law is changed, the nuclear industry believes
the NRC's review of the Yucca Mountain repository license
application should continue.
A credible and effective program to manage used
nuclear fuel must include three integrated components: storage
of used nuclear fuel at nuclear plant sites and at centralized
locations; technology development necessary to demonstrate the
technical and business case for advanced fuel treatment,
including recycling; and, ultimately, operation of a permanent
disposal facility.
DOE's activities in Objective 3 of the roadmap are limited to fuel
cycle research until the Blue Ribbon Commission on America's Nuclear
Future reports its findings to the secretary of energy. NEI supports
the inclusion of a modified open fuel cycle to determine if there is an
opportunity for new waste forms that could reduce the costs of a
national repository program. Here too, the DOE principle stated on page
16 of the roadmap is relevant: ``In laying out the activities in each
of the R&D objectives described below, we must remain goal-oriented to
avoid falling into the trap of doing a great deal of work that, while
interesting, fails to address the challenges to the deployment of
nuclear energy.'' Any program that expends taxpayer funds to pursue
research must be directly linked to an R&D goal.
Nonproliferation issues impact the commercial nuclear industry
worldwide. The U.S. industry works closely with Federal, state and
local governments to ensure safe operation and security at commercial
reactors and fuel facilities. In addition, the nuclear industry
complies with current export control laws and protocols. NEI recently
hosted a Nuclear Security Conference that brought together more than
200 industry leaders from 29 countries to discuss the appropriate role
for industry in securing nuclear materials. Subsequently, the industry
formed a task force of industry executives to develop recommendations
for taking additional steps in securing nuclear materials used in
commercial nuclear applications. As the DOE Office of Nuclear Energy
works to minimize the risk of nuclear proliferation, the industry looks
forward to continued constructive engagement in this area.
NEI supports the inclusion of $3 million for international nuclear
energy cooperation in the FY 2011 budget that will allow DOE's Office
of Nuclear Energy to participate more fully in discussions and
negotiations on a range of international nuclear energy concerns. The
Institute encourages DOE to engage with the nuclear energy industry as
it pursues international nuclear energy cooperation to leverage these
interactions and support the export of U.S. products and services.
What Are the Missing Elements of an Effective R&D Strategy for Nuclear
Technologies?
Supply Chain
The domestic commercial nuclear manufacturing industry has immense
prospects for growth and job creation, yet R&D on manufacturing is
essential to achieve the objective of supplying components for new and
existing U.S. nuclear plants. Failure to conduct targeted R&D in this
area may inhibit American workers from fully realizing the benefits of
global growth in commercial nuclear energy, estimated to be in excess
of $1.6 trillion over the next 20 years.
Research and development for nuclear manufacturing falls into three
categories: fabrication technology; education and training; and codes
and standards. An integrated approach that focuses on each of these
areas will enable the industry to better leverage development in these
areas and more effectively meet the industry's objective--supplying new
nuclear projects from domestic manufacturers.
The industry, with the help of organizations such as the Nuclear
Fabrication Consortium, has started to focus on education and training
as well as the development of new or updated codes and standards for
manufacturing and materials. A specific R&D focus on fabrication
technologies would dramatically expand the North American manufacturing
base for nuclear energy components. A targeted emphasis on high-cost,
high-benefit manufacturing should be in the area of technology
investment. Areas of immediate need and opportunity include:
Real-time Quality Monitoring and Control. This would
enable manufacturers to find fabrication-related defects in the
manufacturing process sooner or eliminate them altogether. The
technology would offer the unique benefit of being deployable
across virtually all fabricated component systems and being
incorporated directly into the fabrication equipment (machining
centers, inspection systems and welding equipment). When
standardized, these improved processes, practices and
technologies would enable a more rapid use throughout the
American fabrication industry.
Thick Section Welding Technology. Many nuclear
facility components are large and have heavy section
thicknesses. Even when forgings are used, numerous thick
section welds are required. By further developing and
validating technologies that other industries are using (such
as laser welding, Laser-Gas Metal Arc Hybrid Welding, Tandem
Gas Metal Arc Welding, and inertia-based welding processes),
production costs could be reduced while improving quality and
lowering the residual welding stress.
Machining Technology. Apart from advances in
computer-aided machinery, machining techniques and equipment
have remained relatively unchanged for the last half century.
The development of new technologies, such as enhanced
ultrasonic machining, will enable substantial increases in
productivity while maintaining product and machine tool
quality.
Forming. Improved forming technologies, beyond those
associated with ultra-large forgings, could have a dramatic
impact on the nuclear manufacturing industry. Improved
techniques and technologies could reduce or eliminate welds;
produce formed components that have an initial geometry that
could be machined to a final design instead of welding multiple
pieces together; and enable multi-material components and
systems to be formed together as a unit rather than formed
individually, then combined.
Materials Development. The nuclear industry uses a
cadre of specialized materials ranging from polymers to high-
alloy metallics. Much of what is known about these materials is
the result of research to maintain safety at existing reactors.
The development of new materials or assessment of materials
being used in other industries, along with the associated
manufacturing techniques, could reduce manufacturing and
component costs while improving reliability and component life-
cycle estimates.
Isotope Production
Nuclear medicine offers procedures that are essential in many
medical specialties, from pediatrics to cardiology to psychiatry. New
and innovative nuclear medicine treatments that target and pinpoint
molecular levels within the body are revolutionizing our understanding
of, and approach to, a range of diseases and conditions. However, the
domestic supply of medical isotopes has virtually disappeared. Leading
companies that provide products for medical diagnostic and therapeutic
applications obtain supplies from Canada and other nations. This year,
supplies of essential medical isotopes and equipment from Canada and
Europe were interrupted, leading to disruption of critical health
services for patients. Despite warnings from industry and the medical
community, DOE has not supported U.S. reactor development in time to
forestall this shortage. Similarly, the DOE laboratory facilities
providing isotopes for industrial purposes cut production, without
warning, for Californium-252, which is a key element in starting new
reactors. Prompt government action is required to develop U.S. reactors
for the production of medical isotopes.
The fact that there is no mention of isotope production in the
roadmap indicates that the government continues to ignore this vital
part of the nation's health care infrastructure. NEI supports continued
funding of isotope production reactors by NNSA but believes that the
Office of Nuclear Energy is responsible for establishing a roadmap
objective ensuring the availability of isotopes for nuclear medicine.
Equally, the Office of Nuclear Energy roadmap is incomplete without
objectives for uranium supply and enrichment.
Work Force
A highly educated and well-qualified work force is a critical
element in the development of nuclear technologies. The nuclear
industry commends DOE's Office of Nuclear Energy for its longstanding
commitment to nuclear work force development for both the government
and commercial sectors. This commitment, in conjunction with the
support of other Federal agencies, has resulted in growing enrollments
in nuclear engineering programs and the development of nuclear
technician programs.
Based upon this success, NEI encourages the continued support of
universities to carry out R&D. These programs support the R&D
objectives of the Energy Department and provide support for the
development of future nuclear scientists and engineers as they pursue
advanced degrees. Further, NEI encourages the continued support of the
integrated university program and additional funding of community
college and other programs that will support the development and
training of technicians and skilled craft, the most critical area in
regard to work force development for the commercial nuclear industry.
Finally, NEI encourages greater coordination of existing DOE energy
education and workforce development programs through initiatives such
as Re-Energyse.
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Additional Testimony from Paul Lorenzini, Chief Executive Officer,
NuScale Power
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Additional Testimony from Dr. Travis W. Knight, Assistant Professor and
Director, Nuclear Engineering Program, University of South Carolina,
submitted by Representative Bob Inglis
Statement by Representative Bob Inglis on Dr. Travis W. Knight and
Testimony
I am pleased to be able to offer the Committee additional testimony
by Dr. Travis W. Knight of the University of South Carolina. Dr. Knight
received his training in nuclear engineering at the University of
Florida, and joined USC on the faculty of the Nuclear Engineering
Program in the Mechanical Engineering Department in the fall of 2004.
He is currently serving as the Acting Director of the program, and
recently added a new research laboratory for the study of advanced
nuclear fuels. He has more than ten years of experience in the research
field, and focuses on advanced fuels, fuel cycle analysis, and nuclear
safeguards.
Dr. Knight is a young and promising professor, offering promise of
a successful nuclear renaissance in the United States lead by homegrown
talent and intellect. He is a great asset to USC and to the State, and
Dr. Knight is one of the reasons I believe that the road to energy
independence runs through South Carolina.
I would like to offer his written testimony for the record and
encourage the Committee to rely on Dr. Knight's expertise into the
future.
Comments on DOE Nuclear Energy Research and Development Roadmap
Travis W. Knight
26 May 2010
I should begin by saying that I applaud the DOE in its effort to
layout a roadmap for the development of advances in nuclear energy. I
believe it very carefully outlines the range of technological concerns
and areas for development. It should prove important in giving
direction to academia and industry for making investments in personnel
and infrastructure to be able to be responsive and partner with DOE.
This partnership should advance the technology to make our nation more
secure both economically and strategically and at the same time protect
our environment and promote the health and welfare of our people by
reducing pollution and GHG.
However, no plan is perfect. So I should focus my comments on areas
where I observe a need/gap exists to advance the aforementioned goals
and enable nuclear power to play a larger role.
My chief concern is over what may be a sense of timidity for
pursuing larger demonstration facilities to advance the technology as
evidenced in the language that is repeated several times in the
roadmap:
``Although some smaller component or process
``demonstration'' activities are mentioned, these are largely
field tests and other actions to provide proof or validation of
system elements. They are not costly, large-scale
demonstrations like NGNP [Next Generation Nuclear Plant]. Any
consideration to embark on such large-scale demonstrations will
be the result of decision-making and budget development
processes.''
My concern is that this could represent a belief that government
has limited or no role in advanced demonstration facilities. I submit
that public investment and government leadership is needed to recapture
the U.S. position in this critical technology area that impacts both
our energy and national security. The truth is that there is a dearth
of infrastructure and advanced demonstration facilities to support the
advances needed. In particular, the U.S. has
no fast reactor to study the destruction of high-
level waste,
no high temperature reactor to study the production
of other energy products such as synthetic fuels or hydrogen to
reduce our dependence on foreign energy sources and cut GHG
emissions,
and no recycling plant to address the long-term
sustainability of nuclear power and waste minimization.
This is true while such facilities exist at either the
demonstration or commercial scale in places like China, India, Russia,
France, Japan, etc.
We should not down play the significance of larger demonstration
facilities to provide the critical understanding of the problems that
can exist in larger facilities and issues that arise in bringing to
commercialization technologies developed earlier at the laboratory
scale. Additionally, some demonstration facilities provide useful
research tools in and of themselves such as a fast reactor which is
necessary to study the transmutation (destruction) of high-level waste.
In other instances, government leadership and investment may be needed
to allay concerns over stability of regulation and national policy.
This is perhaps best evidenced in the history of reprocessing/recycling
where changes in U.S. policy in the 1970s led to the abandonment of
commercial facilities constructed for this purpose and worth several
hundred million dollars. These changes in policy did not achieve their
purpose of encouraging other nations to not pursue recycling but did
result in the loss of U.S. leadership in this technology. By originally
abandoning this technology earlier, we are now licensing a more
advanced form developed in subsequent years by the French for our
recycling of excess nuclear warheads, which I may add is a very
worthwhile and important effort.
Without a doubt, there is great need to conduct research at a
laboratory scale to develop the most advanced and robust technologies.
However, resisting the need to develop demonstration facilities
threatens significant delay in implementing these advanced technologies
due to the practical knowledge gained in operating a production
facility and understanding the issues involved in scale up. Timeliness
is further complicated by the long lead times involved in designing and
constructing such facilities where none exist today. If the urgency is
real to address GHG emissions for climate change and reduce dependence
on fossil fuels, then time is of a greater issue. Only by building the
necessary pilot or demonstration facilities in the next decade can we
reliably progress down a path of larger implementation to meet our
needs on a commercial scale. Only follow on commercial-scale
implementation can truly provide the impact to the larger economy and
provide the necessary energy security and independence.
Still, these first steps are not only necessary to provide
incentive and assurance to the commercial sector to pursue investments
but these larger efforts are also needed to provide assurance to
educational institutions to invest in new hires, new programs, and new
curricula and to provide assurances to students that jobs will exist in
these areas upon graduation. Here I can relate my own experience as a
student. In 1994, I was in route to a summer internship at what is now
part of the Idaho National Laboratory when the order came down to
cancel the EBR-II reactor. When I arrived after driving for four days
and having leased an apartment, I was told that I could turn around and
go home or I could stay and work on the paperwork to close out the Fuel
Cycle Facility. I decided to stay and now I can say that I am glad that
I did. Our nation faces a shortage of scientists and engineers and the
situation will only get worse as the current generation that developed
this technology moves to retirement. We cannot expect to inspire and
educate a new generation of engineers and scientists without an
accelerated investment in infrastructure and partnering with industry
to ramp up the development of advanced technologies to meet targets in
waste reduction, GHG reductions, and sustainability.
In my humble opinion, the U.S. should aggressively pursue the NGNP
project to demonstrate the planned improvements in the high temperature
reactor technology. The DOE should implement the major components of
the DOE Global Nuclear Energy Partnership including the Consolidated
Fuel Treatment Center (CFTC) based on the most advanced, proven
technology for the recycling of used nuclear fuel. The Advanced
Recycling Reactor (ARR) should be constructed to demonstrate the closed
fuel cycle through the recycle of used fuel and to ensure the long-term
sustainability of nuclear power and our nation's energy security. Here
research should be focused on ways to make these fast reactors cost
competitive with current technology to enable their larger
implementation in coming decades.
The construction of these larger, demonstration facilities carries
the added stimulus of many good jobs at all levels from skilled craft
to the most advanced research positions. By proving the advances in
technology through these demonstration facilities, a lasting stimulus
is provided leading to the commercialization and deployment on a large
enough scale for sustainable, secure energy production.
All of these investments should not come at the expense of current
and planned efforts to provide loan guarantees to commercial entities
for the construction of new light-water reactor (LWR) plants and fuel
cycle facilities. These guarantees are needed to jump start the U.S.
industry to prevent even longer delays in starting construction.
Indeed, the currently proposed new reactors are only sufficient for the
U.S. to maintain the current nuclear power contribution of about 20% to
our electricity generation. If we are to make serious cuts in GHG
emissions and contribute to energy independence through the use of
nuclear electricity in the transportation sector (i.e. plug-in
hybrids), we must do all we can to encourage even larger numbers of new
plants.
So in summary, the benefits one should derive from investments in
larger scale research and demonstration facilities should be:
The recapture U.S. leadership in this critical area,
Training and education of a new generation of
engineers and scientists,
Lay the foundation in R&D for commercialization of
technologies that will provide energy security/independence,
environmental stewardship, and sustainability,
Provide a lasting stimulus in well paying jobs at all
levels from skilled craft to advanced research positions.