[Senate Hearing 111-375]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 111-375
 
                       ENERGY POLICY ACT OF 2005

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

                                HEARING

                               before the

                              COMMITTEE ON
                      ENERGY AND NATURAL RESOURCES
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                                   TO

RECEIVE TESTIMONY ON S. 2052, A BILL TO AMEND THE ENERGY POLICY ACT OF 
  2005 TO REQUIRE THE SECRETARY OF ENERGY TO CARRY OUT A RESEARCH AND 
   DEVELOPMENT AND DEMONSTRATION PROGRAM TO REDUCE MANUFACTURING AND 
CONSTRUCTION COSTS RELATING TO NUCLEAR REACTORS, AND FOR OTHER PURPOSES 
                AND S. 2812, THE NUCLEAR POWER 2021 ACT

                               __________

                           DECEMBER 15, 2009


                       Printed for the use of the
               Committee on Energy and Natural Resources



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               COMMITTEE ON ENERGY AND NATURAL RESOURCES

                  JEFF BINGAMAN, New Mexico, Chairman

BYRON L. DORGAN, North Dakota        LISA MURKOWSKI, Alaska
RON WYDEN, Oregon                    RICHARD BURR, North Carolina
TIM JOHNSON, South Dakota            JOHN BARRASSO, Wyoming
MARY L. LANDRIEU, Louisiana          SAM BROWNBACK, Kansas
MARIA CANTWELL, Washington           JAMES E. RISCH, Idaho
ROBERT MENENDEZ, New Jersey          JOHN McCAIN, Arizona
BLANCHE L. LINCOLN, Arkansas         ROBERT F. BENNETT, Utah
BERNARD SANDERS, Vermont             JIM BUNNING, Kentucky
EVAN BAYH, Indiana                   JEFF SESSIONS, Alabama
DEBBIE STABENOW, Michigan            BOB CORKER, Tennessee
MARK UDALL, Colorado
JEANNE SHAHEEN, New Hampshire

                    Robert M. Simon, Staff Director
                      Sam E. Fowler, Chief Counsel
               McKie Campbell, Republican Staff Director
               Karen K. Billups, Republican Chief Counsel


                            C O N T E N T S

                              ----------                              

                               STATEMENTS

                                                                   Page

Bingaman, Hon. Jeff, U.S. Senator From New Mexico................     1
Johnson, Michael R., Director, Office of New Reactors, Nuclear 
  Regulatory Commission..........................................    19
Miller, Warren F., Jr., Assistant Secretary, Nuclear Energy, 
  Department of Energy...........................................     5
Murkowski, Hon. Lisa, U.S. Senator From Alaska...................     3
Pietrangelo, Anthony R., Senior Vice President and Chief Nuclear 
  Officer, Nuclear Energy Institute..............................    13
Sanders, Thomas L. President, American Nuclear Society...........     9

                               APPENDIXES
                               Appendix I

Responses to additional questions................................    45

                              Appendix II

Additional material submitted for the record.....................    53


                       ENERGY POLICY ACT OF 2005

                              ----------                              


                       TUESDAY, DECEMBER 15, 2009

                                       U.S. Senate,
                 Committee on Energy and Natural Resources,
                                                    Washington, DC.

    The committee met, pursuant to notice, at 10:04 a.m. in 
room SD-366, Dirksen Senate Office Building, Hon. Jeff 
Bingaman, Chairman, presiding.

OPENING STATEMENT OF HON. JEFF BINGAMAN, U.S. SENATOR FROM NEW 
                             MEXICO

    The Chairman. Ok. Thank you all for being here. Today's 
hearing is to receive testimony on 2 bills, S. 2052, the new 
Nuclear Energy Research Initiative Improvement Act which 
Senator Udall is the prime sponsor. Senator Murkowski and 
Senator Crapo and I are co-sponsoring that bill.
    Also, S. 2812, the Nuclear Power 2021 Act, that's a bill 
that I introduced with Senator Murkowski and Senator Udall and 
Senator Pryor as co-sponsors.
    I'd like to thank the witnesses for testifying. We have 2 
who hail from New Mexico or at least we claim they do.
    Pete Miller, we're glad to have you here to testify. He 
spent many years at Los Alamos National Laboratory.
    Dr. Tom Sanders, also, who is the President of the American 
Nuclear Society, a long standing member of Sandia National 
Laboratories. We welcome them here.
    I'll introduce and welcome all the witnesses after Senator 
Murkowski makes her comments.
    Small nuclear reactors, those that are less than 300 
megawatts, hold a promise of reducing the cost of nuclear plant 
construction. Proponents claim these reactors can utilize 
modular construction techniques such that plant subassemblies 
can be built and assembled onsite, thus reducing the 
construction cost.
    Large nuclear plant cost is a major issue when we're 
talking about 2,000 megawatt plants. It can exceed $12 or $14 
billion. In addition, advocates believe that the small size 
makes it applicable to the chemical industry for process heat, 
thus minimizing carbon dioxide emissions.
    The bills before us today establish research programs to 
reduce the cost of construction of small reactors as well as 
authorizing 2 cost shared demonstrations to obtain licenses 
before the NRC. There are many opinions on the merits of these 
reactors and this way of facilitating the development of these 
reactors. We look forward to the witnesses comments on this 
legislation.
    Let me defer to Senator Murkowski for any comments she'd 
like to make.

        STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR 
                          FROM ALASKA

    Senator Murkowski. Thank you, Mr. Chairman. I appreciate 
the hearing this morning on small modular nuclear reactors. We 
have a good crowd in the audience. I just wish we had more 
members here at the dais. But we'll work on that. It is good to 
see the interest here.
    As we seek to invigorate a nuclear resurgence here in the 
United States, it can be instructive to look back at nuclear's 
ritz. It was through small nuclear reactors that the 
technologies and experience for today's larger reactors were 
actually born. The first nuclear power reactor built was a 60 
megawatt shipping port reactor in 1957 based on technology 
developed for naval nuclear propulsion systems.
    While today the preference has been to develop nuclear 
power reactors in the thousand megawatt range, support for 
small, modular reactors is growing as a complementary 
technology that may be a better fit in certain situations.
    From lower up front capital costs.
    Increased safety and proliferation resistance.
    Longer fuel cycles.
    Greater flexibility in where they can be located.
    The ability for all components to be manufactured here in 
the United States.
    As well as the ability to incrementally add new capacity as 
demand and grid capacity warrants it.
    Small modular reactors deserve consideration as we look to 
how nuclear power can help the United States reduce our 
greenhouse gas emissions.
    I would like to highlight a couple of these potential 
benefits.
    First, smaller reactors can be utilized in off grid 
locations whether it's for localized power generation or for 
non-electrical purposes like process heat or desalination. In 
Alaska we have got a company that has proposed to build a ten 
megawatt nuclear reactor in the community of Galena. It's a 
pretty small, remote community, with about 600 people.
    You need an airplane or perhaps a dog sled to get to it, 
but in an area where electricity can cost over 60 cents or more 
per kilowatt hour, diesel generators are the norm. We are 
really looking at all options for power generation. This has 
been something that has been discussed for a number of years.
    I am pleased that toward that end we have S. 2812. The 
Nuclear Power 2021 Act that ensures at least one of the designs 
to be put forward by Department of Energy will have a capacity 
of not more than 50 electrical megawatts. There is great 
potential for small and perhaps in this case, very small 
reactors in off grid applications.
    Secondly, small modular reactors offer the ability to 
incrementally ramp up the amount of electricity generated to 
meet the amount needed while staying within a grid's capacity. 
A utility or a grid may not be able to handle an additional 
thousand megawatts plus of power all at once nor may it need 
it. Incremental build ups would allow a utility to more easily 
match output with demand and capacity while making up front 
capital costs more manageable. I think all of this sounds 
promising, but we know that there are hurdles to overcome.
    Small reactor designs need to make it through the NRC 
licensing process at a time when the focus is on large 
reactors. We are trying to get new reactors licensed for the 
first time in 30 years. The interconnectivity of modular 
reactors also presents, a new challenge for the NRC staff.
    I look forward to hearing from the witnesses this morning 
on how they perceive the potential for these small reactors. 
Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Senator Udall has had a real role in this. I'll just ask if 
he had any comment that he wanted to make before we hear from 
the witnesses.
    Senator Udall. Briefly, Mr. Chairman, I just want to thank 
you and Senator Murkowski for holding this important hearing. 
I'll have questions and some comments after the witnesses share 
their thoughts with us.
    Thank you.
    The Chairman. Very good.
    Senator Shaheen, did you have any comment?
    Senator Landrieu.
    Alright, well thank you all for being here again. Let me 
introduce our witnesses again.
    Dr. Pete Miller, who is the Assistant Secretary in the 
Office of Nuclear Energy in the Department of Energy, thank you 
for being here.
    Dr. Tom Sanders, President of the American Nuclear Society, 
thank you for being here.
    Mr. Tony Pietrangelo, who is the Senior Vice President and 
Chief Nuclear Officer in the Nuclear Energy Institute, thank 
you for being here.
    Mr. Michael Johnson, Director of the Office of New Reactors 
with the NRC, thank you all for being here.
    So why don't you take 6 minutes or whatever time you need 
to make the main points that you think we need to understand 
about these 2 pieces of legislation, and whether we're on the 
right track or not with what has been proposed here.
    Dr. Miller, go right ahead.

   STATEMENT OF WARREN F. MILLER, JR., ASSISTANT SECRETARY, 
              NUCLEAR ENERGY, DEPARTMENT OF ENERGY

    Mr. Miller. Thank you, Chairman Bingaman, Ranking Member 
Murkowski and members of the Committee. I appreciate the 
opportunity to appear before you and comment on legislation 
under consideration by the Committee, as well as to provide 
information on where small modular reactors fit into Department 
of Energy's portfolio.
    In my written testimony I described the Office of Nuclear 
Energy's 5 imperatives that we have developed to guide our 
activities. For my oral testimony I will restrict my remarks to 
small reactors and the 2 pieces of legislation under 
consideration by the Committee. To begin with there's no exact 
definition for what constitutes a small reactor. The 
International Atomic Energy Agency defines them to be less than 
300 megawatt electric as does S. 2812.
    This boundary is based on 2 factors.
    First is liability insurance.
    The second is factory fabrication and portability to a site 
by rail or by truck.
    For liability reasons reactors above 300 megawatt electric 
must carry separate indemnification insurance for each unit. 
Reactor modules that are sized 300 megawatt electric and below 
can be linked together to form one reactor unit for liability 
insurance. Reactor modules of this size are conducive to 
offsite fabrication prior to transportation by rail or truck 
rather than by barge to an approved site for assembly.
    There are several reasons why small modular reactors could 
have potential advantages over larger plants. Modular reactors 
can be linked together to create a larger plant, as I said, 
which allows the owner of a given facility to incrementally 
increase its size. This arrangement requires less initial 
capital outlay and results in a smaller investment risk for any 
given point in time during the construction. The existing 
operating modules can also be used to finance future additions.
    The term modular also refers to potentially faster and more 
efficient construction techniques using factory fabrication. 
The U.S. defense nuclear shipbuilding Industry is an excellent 
example where modular construction techniques have been proven 
to be highly successful. This fabrication technique could 
reduce construction delays and schedule uncertainty.
    There are areas in this country and elsewhere in the world 
where large plants are not needed or the existing 
infrastructure cannot support the larger capacity. Small 
modular reactors could be used to provide power to these 
smaller electrical markets, isolated areas or smaller grids. 
There is both a domestic and international market for small 
modular reactors. U.S. industry is well positioned to lead and 
compete for these markets.
    There are also some potential non-proliferation benefits of 
the use of small reactors that could be designed to operate for 
decades without refueling. These reactors could be fabricated 
and fueled in a factory, sealed and shipped back to the site 
for power generation and then shipped back to the factory to be 
defueled. This arrangement would minimize the spread of nuclear 
material.
    Small reactors could potentially enter into traditionally 
non nuclear energy markets for applications beyond electricity 
production.
    Possibilities include low carbon process heat for fossil 
fuel recovery and refinement, Synthetic and biofuel production, 
Water desalination, Hydrogen production, and a range of other 
petrochemical applications.
    It should be clear from the preceding comments that the 
Department believes that small modular reactors are an 
important area of research and development.
    The Nuclear Energy Research Initiative Improvement Act of 
2009, S. 2052, gives broad authority to conduct research into 
small modular reactors as well as other related issues. The 
Department is still evaluating the details of this bill.
    S. 2812, the Nuclear Power 2021 Act would require the 
Department of Energy to carry out a program to develop and 
demonstrate 2 small modular reactor designs. The Department is 
also still evaluating the details of this bill. In considering 
a small modular reactor program a variety of factors need to be 
assessed including issues such as reactor size, industry 
readiness and responsibilities and research and development 
needs.
    This concludes my formal remarks. Thank you for the 
opportunity to testify. look forward to answering your 
questions and working with this Committee to achieve the 
Administration's goals of energy security and reducing the 
nation's carbon emissions.
    Thank you.
    [The prepared statement of Mr. Miller follows:]

Statement of Warren F. Miller, Jr., Assistant Secretary Nuclear Energy, 
                          Department of Energy

                              INTRODUCTION

    Thank you, Chairman Bingaman, Ranking Member Murkowski, and Members 
of the Committee. I appreciate the opportunity to appear before you and 
comment on legislation under consideration by the committee, as well as 
to provide information on where small modular reactors fit in the 
Department of Energy's portfolio.
    Let me start by saying clearly that the administration views 
nuclear power as an important element in its strategy to increase 
energy security and combat climate change. As the President said in 
Prague,''[w]e must harness the power of nuclear energy on behalf of our 
efforts to combat climate change, and to advance peace and opportunity 
for all people.''
    Secretary Chu and I are working hard to advance nuclear power in 
the United States, and we expect the Department of Energy to award the 
first conditional loan guarantee for new nuclear plant construction 
soon.
    In the Office of Nuclear Energy, we have developed five imperatives 
to guide our activities.
    First, we are working with industry and the Nuclear Regulatory 
Commission to extend the lifetime of the existing reactor fleet. The 
104 NRC-licensed commercial nuclear reactors produce roughly 20 percent 
of our nation's electricity but 70 percent of our carbon-free 
electricity. Whether those plants retire at 60 or, for example, 80 
years of age could greatly affect our carbon emissions profile in the 
future. Research is needed to answer outstanding questions about how 
long these reactors can safely be operated.
    Second, we are engaged with industry to enable new plant builds and 
improve the affordability of nuclear energy. I mentioned our efforts 
with respect to loan guarantees, but also some of our research, such as 
the soon-to-be-implemented Modeling and Simulation Hub, we expect will 
also help reduce costs.
    Third, we are working to reduce the carbon footprint of the 
transportation and industrial sectors. Nuclear power can supply more 
low-carbon electricity for increased electrification of the 
transportation sector, and provide low-carbon process heat for a range 
of industrial applications.
    Fourth, we are researching ways to create a sustainable nuclear 
fuel cycle. In particular, we are looking at ways of extending nuclear 
fuel supplies and reducing the amount and toxicity of waste requiring a 
permanent repository.
    And fifth, we are working to understand and minimize proliferation 
risks. All nuclear fuel cycles entail some amount of risk, but that 
risk can be reduced with appropriate technology applications and 
international guidelines and agreements.

                         SMALL MODULAR REACTORS

    With that, let me turn to the focus of today's hearing: small 
modular reactors (SMRs) and their potential benefits.
    Let me first define what we mean by ``small'' and ``modular''.
    To begin with, there is no exact definition for what constitutes a 
``small'' reactor. The International Atomic Energy Agency defines them 
to be less than 300 MWe as does S.2812. This boundary is based mainly 
on two factors: (1) liability insurance, and (2) factory fabrication 
and portability to a site by rail or truck. For liability reasons, 
reactors above 300 MWe must carry separate indemnification insurance 
for each unit. Reactors modules that are sized 300 MWe and below can be 
linked together to form one reactor unit for liability insurance. 
Reactor modules of this size are conducive to off-site fabrication 
prior to transportation by rail or truck, rather than by barge, to an 
approved site for assembly.
    The term ``modular'' implies several things that could create a 
potential advantage over larger plants. First, modular reactors can be 
linked together to create a larger power plant. This is potentially 
advantageous because it allows an owner the flexibility to 
incrementally increase the size of a plant. As demand increases, the 
owner can add more modules. Secondly, a smaller plant requires less 
initial capital outlay or investment. The existing operating modules 
can then be used to finance future additions. Multiple units are also 
important during refueling or maintenance because taking a single 
module offline does not require the shutdown of the entire plant.
    The term ``modular'' can also refer to potentially faster and more 
efficient construction techniques using factory fabrication. The U.S. 
defense nuclear shipbuilding industry is an excellent example where 
modular construction techniques have been proven to be highly 
successful. These same techniques can be applied to the commercial 
nuclear industry. This fabrication technique has the potential to make 
nuclear energy more economical and appealing to investors because it 
reduces the perceived ``risks'' associated with new nuclear builds such 
as construction delays and schedule uncertainty.
    There are several reasons why small modular reactors may prove 
advantageous compared to the Generation III+ nuclear plants in terms of 
economics, performance, and security.
    First, the high capital cost for new nuclear reactors has been a 
challenge for private entities to finance. Smaller projects would carry 
lower investment risk and could be more affordable to smaller 
utilities. This reduction in investment risk also provides an advantage 
in rate recovery, regardless of whether the licensee is regulated 
through state public utility commissions or whether it must sell the 
electricity in unregulated commercial markets.
    Second, there are areas in this country--and elsewhere in the 
world--where large plants are not needed or the existing infrastructure 
cannot support the larger capacity. Small modular reactors could be 
used to provide power to these smaller electrical markets, isolated 
areas or smaller grids. There is both a domestic and international 
market for small modular reactors and U.S. industry is well-positioned 
to lead and compete for these markets.
    Third, some of the SMR designs may offer significant environmental 
or safety advantages for siting in industrial settings or where, for 
example, water for cooling is a problem. Some reactor designs would 
produce a higher temperature outlet heat that can be used for either 
electricity or process heat for nearby industries while others use 
little or no water for cooling.
    Fourth, there are also some potential nonproliferation benefits to 
use of small reactors that could be designed to operate for decades 
without refueling. These reactors could be fabricated and fueled in a 
factory, sealed and shipped to the site for power generation, and then 
shipped back to the factory to be defueled. This approach could 
minimize the spread of nuclear material.
    Fifth, small reactors could also enter into traditionally non-
nuclear energy markets for applications beyond electricity production. 
The possibilities include low carbon process heat for: fossil fuel 
recovery and refinement, synthetic or biofuel production, water 
desalination, hydrogen production, and a range of other petrochemical 
applications.
    Finally, while traditional economy-of-scale concepts favor larger 
nuclear plants, there are a number of reasons why SMRs may have some 
economic advantages.
    As mentioned previously, a sizeable portion of the cost and 
schedule uncertainty for building large nuclear plants is the amount of 
work that must be performed on site. Factory production and 
fabrication, and transport to and assembly onsite can significantly 
reduce that uncertainty.
    Research into small modular reactors could address several of the 
Office of Nuclear Energy's imperatives: improving the affordability of 
nuclear power; supplying low-carbon electricity and process heat to the 
transportation and industrial sectors; and minimizing proliferation 
risks. More importantly, the advancement of SMRs will respond to U.S. 
economic and environmental market conditions for low-carbon energy 
sources.

                     COMMENTS ON S.2052 AND S.2812

    It should be clear from the preceding comments that the Department 
believes that small modular reactors are an important area of research 
and development.
    The Nuclear Energy Research Initiative Improvement Act of 2009, 
S.2052, gives broad authority to conduct research into small modular 
reactors, as well as other related issues. The Department is still 
evaluating the details of the bill.
    S. 2812, the Nuclear Power 2021 Act, would require the Department 
of Energy to carry out a program to develop and demonstrate two small 
modular reactor designs. The Department is still evaluating the details 
of the bill.

                               CONCLUSION

    In considering a small modular reactor program, a variety of 
factors need to be assessed, including issues such as reactor size, 
industry readiness and responsibilities, and research and development 
needs.
    That concludes my formal remarks. Thank you for the opportunity to 
testify and I look forward to answering your questions and working with 
the Committee to achieve the administration's goals of energy security 
and reducing the nation's carbon emissions.

    The Chairman. Thank you very much.
    Dr. Sanders, go right ahead.

  STATEMENT OF THOMAS L. SANDERS, PRESIDENT, AMERICAN NUCLEAR 
                            SOCIETY

    Mr. Sanders. Thank you, Chairman Bingaman, Ranking Member 
Murkowski and 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 is dedicated to the peaceful uses of nuclear technology 
and is comprised of 11,000 members across every part of the 
nuclear enterprise from industry, laboratories, universities 
and government. In general our membership believes that nuclear 
energy can and really should play a major role in supplying 
energy in a carbon constrained environment. Let me say from the 
outset that there are significant roles for both large and 
small reactors in the future mix.
    The discussion of small modular reactors should not be 
viewed as an either/or proposition. That said, SMRs offer many 
unique benefits over their larger cousins. You'll hear these 
benefits over and over, I suspect, as we go through the panel 
here.
    The debate in Washington these days focuses on the cost of 
nuclear verses other forms of energy and specifically the large 
upfront costs of installing new generation capacity. However 
the view of the nuclear issue only from or through the lens of 
the U.S. market is to miss half the picture. As you'll see from 
this chart over here, more than 60 countries are actively 
seeking or have expressed interest in developing new nuclear 
energy generation capacity. While some of these countries 
already have nuclear plants, others would be new entrants 
including many of the developing world.
    At the same time as you'll see, from the pie chart at the 
bottom left hand corner of this chart. Over 80 percent of the 
world's grids cannot absorb a large typical type of reactor, in 
particular one gigawatt plant. So the market is really there 
for small modular reactors.
    So what are the take aways?
    First, the world is embarking on a nuclear expansion with 
all the opportunities and risks associated with that. While we 
tend to hear about countries like Iran and North Korea, most 
nations interested in nuclear energy are motivated by sincere 
desire to improve standards of living for their people. In 
general a world with plentiful clean energy will be a more 
peaceful, more prosperous and environmentally sustainable 
world.
    Second, the United States actually has very little say over 
how this renaissance will happen because nuclear energy supply 
infrastructure has become thoroughly internationalized in the 
last 3 decades. If the United States is unable or unwilling to 
provide nuclear technology interested nations have plenty of 
other options. Frankly from a global standpoint the choice we 
face is clear. We can either commit ourselves to facilitating 
the renaissance as a major supplier of safe, proliferation, 
resistant nuclear technology or we can stick our heads in the 
sand and hope that other supplier nations will promote our 
values associated with safety, security and proliferation 
resistance.
    If we choose a path of engagement the next step required is 
a build a better mousetrap, one that can compete on the global 
marketplace. This is where small, modular reactors come in. As 
you'll see from the next chart, SMRs comprises a diverse set of 
technologies. Secretary Miller covered those very thoroughly. 
The common thread is 10 to 300 megawatts transportable by train 
or rail and basically 4 different types.
    Small light water reactors are based on well understood 
technology. As Senator Murkowski stated we know that history 
from the days of Atoms for Peace program in the beginning days 
of the nuclear navy.
    Sodium or lead cooled fast reactors could have the 
advantage of promoting a creative grave approach to the nuclear 
fuel cycle such that you could provide reactors to developing 
nations and not have to worry about refueling them for ten to 
twenty years.
    High temperature gas reactors are proposed designs that are 
well fit to process heat applications such as hydrogen 
production, water desalination, shale oil recovery and other 
beneficial activities. 60 and 100 watt reactors in our shale 
oil foundation out in the West would basically produce enough 
oil from that formation to accommodate or reduce the needs for 
imports from the Middle East, Nigeria and Venezuela.
    The fourth category is what I call radical designs. While 
these innovative concepts require longer term research and 
development efforts their simplicity of operation and walk away 
safe power are desirable attributes that we should pursue.
    There are some who are not comfortable with the notion that 
the United States. should actively promote and supply nuclear 
technology around the world. They believe the risk to 
proliferation are too great. However there is an emerging 
consensus in our ANS membership that the U.S. nuclear community 
that in fact the opposite is true, that a revitalized domestic 
nuclear manufacturing sector is critical and necessary 
component to sustaining U.S. nuclear influence around the 
world.
    So what would a revitalized small modular focused U.S. 
manufacturing industry look like? As you can see from the next 
slide, our national security infrastructure provides us with a 
head start. We have 60,000 people working in our naval 
community, in our shipyards as nuclear workers, as designers in 
2 laboratories at Knolls and Bettis and throughout the service 
industry that provides that. These are American jobs. These are 
not jobs that we import from abroad because their international 
security sector.
    We have an operating geological repository in our defense 
infrastructure that could accommodate transuranic waste from 
recycled small modular reactor fuel. We have many years of 
operational data for water and sodium cooled systems. We 
already have modular manufacturing techniques in our shipyards. 
We have the ability to make the fuel and vision for most of 
these designs.
    What we need is the collective wheel to make long term 
investments. So that the U.S. can again, become a major 
supplier. I can say confidently that the Bingaman/Murkowski/
Udall legislation represents a strong foundational effort to 
augment the Federal Government's role in U.S. modular reactor 
development in a way that furthers our environmental, foreign 
policy and economic objectives.
    ANS also encourages Congress to consider other aspects. 
These include accelerated development of codes and standards, 
updates to U.S. laws and regulations like the American Competes 
Act that encourages rapid maturation and transfer of modular 
reactor technology from our laboratories, universities to our 
industries. Streamlining export control laws to minimize the 
incentives to offshore small modular reactor component 
manufacturing and integration of nuclear engineering science 
and skilled trade education efforts to ensure that we have a 
technically competent work force.
    In closing, there are clear security, economic and 
environmental imperatives for the U.S. to make a long term 
commitment to small modular reactor development both here at 
home and abroad. This concludes my testimony. I would be happy 
to answer any questions the Committee may have. Thank you.
    [The prepared statement of Mr. Sanders follows:]

     Prepared Statement of Thomas L. Sanders, President, American 
                            Nuclear Society

    Thank you, Chairman Bingaman and members of the Committee for the 
opportunity to testify before the Committee today. I am here in my 
capacity as President of the American Nuclear Society (ANS). Our 
society is dedicated to the peaceful use of nuclear science and 
technology. We have about 11,000 ``national'' members and another 
10,000 or so who are strictly members of 51 ``local sections'' spread 
across 38 states. We also have 38 student sections at major US 
universities and 11 sections in other countries.
    Our constituents come from all sectors of the nuclear enterprise: 
utilities, research laboratories, government and state agencies, 
industrial vendors and suppliers, universities, and other areas of 
nuclear science and medicine. We have 19 technical divisions that cover 
almost every aspect of nuclear science and technology--from the mining 
of ore to the burial of fuel cycle byproducts.
    In general, the ANS membership believes that nuclear energy can and 
should play a major role in the provision of affordable and reliable 
energy in a carbon-constrained environment. Let me say from the outset 
that there are significant roles for both large and small reactors in 
the future US energy mix. The discussion of small modular reactors 
(SMRs) should not be viewed as an ``either-or'' proposition. That said, 
SMRs offer many unique benefits, from affordability to transportability 
and ease of manufacturing and construction. SMR designs and market 
opportunities have been discussed thoroughly over the past five years 
at ANS conferences and we have started several special committees to 
look at economic, licensing, policy, and US infrastructure issues 
related to small reactor development. Some of these preliminary results 
will be discussed here and are presented in detail in the background 
report submitted for the record. We are also supporting SMR-related 
activities initiated by other government and private organizations. For 
example, we have supported the Department of Commerce's Civil Nuclear 
Trade Initiative and are working closely with the AFL-CIO in 
revitalizing the US nuclear manufacturing sector.
    The debate on nuclear in Washington these days tends to focus on 
the cost of nuclear energy versus other forms of energy generation. 
Thus, the current domestic interest in SMRs has originated primarily 
from the challenges in financing the large up-front costs of installing 
new domestic nuclear generation capacity and for distributed energy 
applications throughout the US. However, to view the nuclear issue 
solely through the lens of US low carbon energy needs and domestic 
economic opportunities is to miss half the picture.
    As you'll see from the chart before you, more than 60 countries are 
actively seeking or have expressed interest in developing new nuclear 
energy generation capacity. While some of these countries already have 
existing nuclear plants, others would be new entrants, many of whom are 
from the developing world. At the same time, you will see from the pie 
chart over 80% of the world electrical grids cannot absorb 1 GW nuclear 
plant in their current configuration.
    So what are the take away lessons? First, it's clear that the world 
is about to embark on a global nuclear renaissance with all the 
associated opportunities and risks. Despite the headlines we see these 
days, the overwhelming majority of nations interested in nuclear energy 
are motivated by a 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.
    Second, the US actually has very little say over whether this 
renaissance happens, as the nuclear energy supply infrastructure has 
become thoroughly internationalized in the last three decades. If the 
US is unable or unwilling to provide nuclear technology, there are 
plenty of other supplier options for interested nations.
    Frankly, from a global standpoint, the choice we face today is 
clear. We can either commit ourselves to actively facilitating this 
renaissance as a major supplier of safe, proliferation-resistant 
nuclear energy technology, or we can stick our heads in the sand and 
hope that other supplier nations will do it right.
    If we choose the path of global engagement, the next step required 
is to build a better mousetrap that can compete on the global 
marketplace. This is where SMRs come into the picture.
    As you'll see from the next chart, the category of small modular 
reactors comprises a diverse set of technologies and applications. 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 kinds.

          1. Small light water reactors These are based on well 
        understood technology, and the US possesses an existing 
        domestic manufacturing capacity for the purposes of 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.
          2. Sodium or lead cooled fast reactors. These are small pool 
        type reactors that operate at low pressures. Their fast neutron 
        spectrum essentially generates fuel at nearly the rate it is 
        consumed, thereby allowing 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. 
        There are also other liquid metal coolants on the horizon that 
        could further enhance those capabilities.
          3. High-temperature gas reactors. These proposed designs can 
        be optimized for process heat applications such as hydrogen 
        production, water desalination, and 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 radical 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 US and around the world.

    There are some who are not comfortable with the notion that the US 
should actively promote and supply nuclear technology around the world. 
They say that we can exercise sufficient influence simply by exporting 
our regulatory best practices to other nations. They believe that the 
risks of proliferation are too great. However, there is an emerging 
consensus in the US nuclear community that in fact the opposite is 
true--that a revitalized domestic nuclear manufacturing sector is a 
critical and necessary component to sustaining US nuclear influence 
around the world. Consider the so-called ``123'' agreement, which is 
our primary foreign-policy tool for promoting US nonproliferation 
objectives with other nations. 123 agreements with the US only make 
sense for other nations when they are actively interested in procuring 
US-owned technology, and, to put it bluntly, there isn't much US owned 
nuclear energy technology left today.
    So, what would a revitalized, SMR-focused US nuclear manufacturing 
industry look like?
    As you can see from the next chart, our national security 
infrastructure provides us with a head start. We already have a 
manufacturing infrastructure in place to produce the components of 
small naval reactors, and the modular approaches used by our shipyards 
to construct naval vessels are applicable to the mass production of 
SMRs. We have an operating geological repository in our defense 
infrastructure that could potentially accommodate transuranic waste 
from recycling SMR fuel. We have many years of operational data for 
water and sodium cooled systems. We already have advanced manufacturing 
techniques. We have the ability now to manufacture the fuel forms 
envisioned in these different designs. What we need is the collective 
will to make long-term investments in these game-changing technologies 
so that the US is positioned to positively influence the global nuclear 
renaissance.
    As a 501(c)(3) not-for-profit organization, the American Nuclear 
Society does not normally endorse congressional legislation. However, I 
can say confidently that S. 2812, The Nuclear Power 2021 Act, 
represents a strong foundational effort to augment the federal 
government's role in US SMR development. It would provide the DOE with 
the authority to enter into public-private partnerships to develop and 
license small modular reactors. We believe this would significantly 
accelerate US SMR reactor development in a manner that furthers US 
environmental, foreign-policy, and economic objectives. In addition, S. 
2052, The Nuclear Energy Research Initiative Improvement Act of 2009, 
would provide needed investments for revitalizing US competitiveness in 
the global marketplace. Its focus on SMR concepts, advances in energy 
conversion technologies, advanced manufacturing and construction, 
resolution of licensing issues, and enhanced proliferation controls 
will help develop the enabling technologies we need for large-scale SMR 
deployment in the US and around the world.
    ANS also encourages Congress to consider other aspects of SMR 
development. These include accelerating the development of SMR-related 
codes and standards; updates to US laws and regulations that would 
facilitate accelerated maturation and transfer of SMR-relevant 
technology from the national laboratories to US industry; streamlining 
export control laws to minimize the incentives to ``off-shore'' SMR 
component manufacturing; and integration of university-based US nuclear 
science and engineering education programs with SMR development efforts 
to ensure we have technically skilled workforce to design, deploy, and 
operate these reactors in the future.
    In closing, there are clear security, economic, and environmental 
imperatives for the US to be an active participant in the global 
nuclear renaissance. Many of our industrial members have recognized the 
huge potential for SMRs around the world. Organized labor sees the 
promise of hundreds of thousands of high-paying jobs. Our national 
laboratories and universities have developed ground breaking research 
and development and state-of-the-art technology that can be put to the 
task. We are ready to take the next step.
    This concludes my testimony, and I would be happy to answer any 
questions the Committee may have.
    Thank you.

    The Chairman. Thank you very much.
    Mr. Pietrangelo, go right ahead.

STATEMENT OF ANTHONY R. PIETRANGELO, SENIOR VICE PRESIDENT AND 
        CHIEF NUCLEAR OFFICER, NUCLEAR ENERGY INSTITUTE

    Mr. Pietrangelo. Chairman Bingaman, Ranking Member 
Murkowski and other members of the Committee, thank you for 
inviting the industry to participate in this hearing on small 
scale reactor projects. My name is Tony Pietrangelo. I'm Senior 
Vice President and the Chief Nuclear Officer at the Nuclear 
Energy Institute. NEI is responsible for establishing unified 
policy on regulatory, financial, technical and legislative 
issues affecting the nuclear industry.
    Today the industry's focus, as it has been in the past and 
will continue to be in the future, is on the continued safe and 
reliable operation of 104 nuclear power plants in 31 states. 
The safe, reliable operation of these clean energy facilities 
is a prerequisite to building new nuclear energy projects in 
the United States. In the area of new construction our focus is 
on advanced large scale reactors because these are currently in 
the licensing process. Site preparation and preconstruction are 
already starting.
    Along with construction of large plants our focus also is 
on rebuilding the nuclear supply chain and training the work 
force to build and operate these new facilities.
    The industry also attaches high priority to achieving 
economic and regulatory stability for the entire nuclear fuel 
cycle including fuel supply, materials, licensing, used fuel 
management and development of small reactor technologies for 
electricity generation and use in industrial applications such 
as process heat. There is a growing interest in the development 
of small modular reactors, yet until these designs and the 
regulatory and institutional infrastructure are better defined 
the industry will be reluctant to move forward with 
construction of these projects. As a result we will continue to 
give priority to large nuclear plants.
    The industry envisions small scale modular reactors falling 
into one of 3 groups.
    Integrated light water reactors.
    High temperature gas cooled reactors.
    Advanced liquid metal cooled reactors.
    Small modular reactors could reliably perform a variety of 
essential functions including providing clean and reliable 
electricity in locations where a large reactor cannot be used.
    Reducing the capital outlay for a company wishing to use 
nuclear energy.
    Reducing the impact on the environment by using air cooled 
as opposed to water cooled heat sources.
    Enhancing construction capability and schedule by 
manufacturing and fabricating components and systems in a 
factory before being shipped to the site.
    Providing energy free industrial process heat as well as 
electricity generation.
    Improving nuclear fuel utilization and reducing the amount 
of high level radioactive byproducts that will require 
disposal.
    The development and regulatory approval of new nuclear 
designs could cost more than one billion dollars and take 20 
years before first reactor is operational. The nation's 
electricity infrastructure including power plants and 
transmission are aging. Electricity demand will continue to 
increase even with the wide ranging energy conservation and 
efficiency measures.
    Building small reactor technology in a timeframe that 
supports the nation's demand for low cost, reliable electricity 
and the Administration's climate change goals will require 
industry/government partnerships. These partnerships would 
complete research and develop projects and ensure a more rapid 
use of these technologies. A proven model for government/
industry partnership is nuclear power 2010 which is supporting 
the development and approval of new and improved large nuclear 
plant designs and the testing of the new 3 part licensing 
process for these reactors, 10 CFR Part 52.
    There have been substantial benefits from the NP 2010 
program beyond the technical achievements.
    For example, government and industry investments in the NP 
2010 program are expected to stimulate more than 100 billion 
dollars in new nuclear plant construction over the next 10 
years creating tens of thousands of high paying jobs and 
reinvigorating America's manufacturing sector.
    For example, each new reactor will create up to 2,400 
onsite construction jobs for each reactor project between 400 
and 700 jobs for operations and management of these facilities 
once built and thousands of jobs in design, manufacture and 
transportation of components of materials to support new 
reactor construction.
    The industry supports the provisions of the 2 legislative 
proposals, S. 2052 and S. 2812, as well as the provisions of S. 
2776, the Clean Energy Act of 2009 as they relate to small 
modular reactors. We urge the sponsors of these bills to work 
together and combine the small reactor provisions into a single 
bill. Legislation to develop small scale reactor technology and 
allow for accelerated construction of the first reactor designs 
should do the following.
    Define the scope, priorities and funding for R and D.
    Define the scope of government/private cost share 
provisions for design development and prototype simulation and 
testing.
    Provide funding to assist the Nuclear Regulatory Commission 
and the industry in resolving generic regulatory issues 
specific to small modular reactors.
    Define private/government cost share projects for the 
development and RC review and implementation of first of class 
combined license applications up to the NRC authorization for 
fuel load and support the expansion of industrial 
infrastructure, factories, fabrication and training of the work 
force to manufacture, build and operate these facilities.
    There are generic regulatory issues relating to design 
approval, construction and operation of small reactors that 
must be resolved before designs can be completed to a level 
that supports a design certification, procurement and 
finalization of major contracts. The industry's committed to 
work with the staff at the NRC and other public stakeholders to 
put in place a practical and transparent, regulatory process 
for these new technologies and designs. The industry and the 
NRC are familiar with light water reactor technology. As a 
result this technology can be built earlier than the other 2 
technologies if we move forward now and authorize to fund 
government/industry partnerships the first small modular 
reactors could be built by 2020.
    In conclusion there are substantial benefits that can be 
derived from small modular nuclear energy plants. These designs 
merit Congressional support. These designs expand the strategic 
role of nuclear energy in meeting national, environmental 
energy security and economic development goals. The nuclear 
energy industry believes that appropriate public/private 
partnerships such as those described in S. 2052 and S. 2812 are 
important to ensure that our nation continues to grow 
economically without adversely affecting the environment.
    Thank you for the opportunity to address the Committee.
    [The prepared statement of Mr. Pietrangelo follows:]

Prepared Statement of Anthony R. Pietrangelo, Senior Vice President and 
            Chief Nuclear Officer, Nuclear Energy Institute

    Chairman Bingaman, Ranking Member Murkowski, and members of the 
Committee, thank you for your interest in nuclear energy and in 
addressing the policies that can facilitate the research, development 
and deployment of small, modular nuclear power plants to meet national 
energy needs and reduce carbon emissions.
    My name is Tony Pietrangelo. I am a senior vice president and the 
chief nuclear officer at the Nuclear Energy Institute (NEI). NEI is 
responsible for establishing unified nuclear industry policy on 
regulatory, financial, technical and legislative issues affecting the 
industry. NEI members include all companies licensed to operate 
commercial nuclear power plants in the United States; nuclear plant 
designers, major architect/engineering firms, fuel fabrication 
facilities, materials licensees, and other organizations and 
individuals involved in the nuclear energy industry.
    My testimony will cover three major areas:

          1. Modular, small reactor designs can help achieve our clean 
        energy goals and create jobs.
          2. Public/private partnerships can accelerate development and 
        deployment.
          3. Legislation before your Committee contains practical, 
        proven provisions.

1. Modular, small reactor designs can help achieve our clean energy 
        goals and create jobs.
    Near-term construction of large, new nuclear plants will address 
two of our nation's top priorities: Additional supplies of clean energy 
and job creation. Small, modular reactors can complement these large-
scale projects by expanding the level of deployment and application 
options for carbon-free nuclear energy. Small-scale reactors provide 
energy companies and other users with a broader array of energy 
options. Each satisfies different needs in the U.S. energy portfolio 
and is part of a more holistic approach to the effective implementation 
of nuclear energy.
    Today, nuclear energy is one of the few bright spots in the U.S. 
economy--expanding rather than contracting over the past few years--
creating more than 15,000 jobs in design and engineering, in the 
nuclear supply chain, and in site preparation for new construction. In 
the same period of time, the nuclear industry has invested more than $4 
billion in new nuclear plant development, and plans to invest 
approximately $8 billion more to be in a position to start major 
construction in 2011-2012.
    These investments in new nuclear plants will help the United States 
meet its climate change objectives. Both the Energy Information 
Administration's assessment of the Waxman-Markey legislation and a 
recent National Academies' study on America's energy future found that 
the United States must nearly double the existing 100 gigawatts of 
carbon-free nuclear energy by 2030 to meet our climate goals. These 
studies are consistent with the International Energy Agency's findings 
in the World Energy Outlook 2009.\1\ The agency found that by 2030, an 
additional 330 gigawatts of new global nuclear energy must be added, 
nearly doubling the existing global nuclear generating capacity, to 
achieve climate policy goals.
---------------------------------------------------------------------------
    \1\ International Energy Agency's World Energy Outlook 2009, 450 
Policy Scenario
---------------------------------------------------------------------------
    The United States and other nations are planning the construction 
of more than 130 new large and small, modular nuclear generating 
plants, which has increased interest in expanding the U.S. nuclear 
engineering and manufacturing capabilities and facilities.
    Achieving deployment at this speed and scale represents a 
significant challenge. It must be undertaken in conjunction with an 
aggressive development and deployment of energy efficiency and 
conservation measures, renewable energy sources and other low-emitting 
energy technologies. This level of low/non-carbon emitting technology 
deployment will be a catalyst for a major expansion of the American 
engineering, manufacturing and construction sectors. It provides new 
industrial opportunities for state-of-the-art factories, foundries and 
fabrication facilities for domestic and export markets. Private 
investment and government incentives and support for what needs to be a 
mini-Marshall Plan for America will generate tens of thousands of high-
paying jobs and clean energy.
    While it is true that the United States yielded its leadership 
position to international competitors on nuclear plant manufacturing in 
past decades, we have not yielded our innovation or entrepreneurial 
spirit. Small-scale reactor designs already in development provide the 
opportunity to re-establish American global nuclear leadership.

     SMALL REACTOR DESIGNS TARGET A VARIETY OF MARKET APPLICATIONS

    There are many small, modular reactor designs under development to 
meet specific U.S. and international market needs. Small-scale designs 
may be more compatible with the needs of smaller U.S. utilities from a 
generation, transmission and financial perspective compared with large 
1,400 megawatt plants. As a result, these smaller reactors will 
complement the construction of large nuclear energy facilities, which 
are the subject of intense regulatory review by the Nuclear Regulatory 
Commission.
    Small light water reactors being developed are designed to exploit 
the benefits of modular construction, ease of transportation, and 
reduced financing, all of which could create a compelling business 
case. Since these designs are typically smaller than 300 megawatts 
electric (MWe), they could be used to replace inefficient fossil-fired 
power stations of similar size that may no longer be economical to 
operate in a carbon-constrained world. The infrastructure, cooling 
water, rail and transmission facilities already exist at such 
facilities.
    Small-scale reactors can be built in a factory environment and 
shipped directly to the plant site. This will require the expansion and 
updating of existing facilities and the construction of new state-of-
the-art factories. The small size and modular construction will allow 
these plants to be built in a controlled factory setting and installed 
module by module, reducing the financing challenge and matching 
capacity additions to demand growth.
    A second set of small reactor designs are high-temperature gas-
cooled reactors. These reactors could be used for electricity 
generation and industrial process heat applications, such as those used 
in the petrochemical industry. These reactors also could be used for 
the development of tar sands, oil shale and coal-to-liquids 
applications, resulting in a minimal life-cycle carbon footprint.
    A third set of small, modular plants includes liquid-metal cooled 
and fast reactor technologies that hold the promise of distributed 
nuclear applications for electricity, fresh water and district heating 
in remote communities. This group of reactor designs could provide 
nuclear fuel cycle services, such as breeding new fuel and consuming 
recycled nuclear waste as fuel. These reactors could also support 
government-sponsored non-proliferation efforts by consuming material 
from former nuclear weapons, thus eliminating them as a threat.
    Small reactor technology has the potential to help America remove 
carbon from the electric, transport and industrial sectors. However, 
each small reactor technology has unique development needs and 
different timelines to reach the market.
2. Public/private partnerships can accelerate development and 
        deployment.
    The economic, energy security and environmental benefits of small 
reactor technologies make a strong case for accelerated development and 
deployment. However, a variety of factors must be addressed to achieve 
this outcome. The development and deployment of a new nuclear reactor 
technology can take two decades, with design costs exceeding $1 
billion. The cost and time required to design, develop, and license a 
small reactor is not necessarily reduced linearly with size. In 
addition, it takes time and resources for the Nuclear Regulatory 
Commission to develop the institutional capacity to license new reactor 
designs.
    All of these issues increase the risk and uncertainty for vendors 
that face expensive design and licensing challenges. Traditional 
partnerships between technology vendors, component manufacturers and 
end users are necessary but insufficient in themselves. Absent 
additional business risk mitigation through government incentives, the 
potential benefits of these small, modular reactor concepts may go 
unrealized.

DEPARTMENT OF ENERGY'S NUCLEAR POWER 2010 PROGRAM PROVIDES A SUCCESSFUL 
                                 MODEL

    There is a successful public/private partnership model for 
development of small-scale reactors in the Nuclear Power 2010 (NP 2010) 
program. This program has been successful in reducing business risk, 
enabling earlier deployment of advanced large reactor technologies. A 
government-industry, cost-shared program, NP 2010 has given project 
developers and technology vendors the necessary incentives to test a 
new NRC licensing and siting process. The lessons learned by these 
first projects will be shared with industry and NRC staff so that 
future applicants and NRC staff will have a better understanding of the 
expectations and standards for new reactors. When taken with the 
industry's commitment to standardization, NP 2010 will enable a more 
efficient and predictable review process. Furthermore, the funding for 
first-of-a-kind engineering is allowing completion of reactor designs 
to a level of detail that is enabling better cost estimates to be 
developed and long-lead components to be procured.
    The NP 2010 program has achieved significant results to date 
including:

          1. The approval of three early site permits. This activity 
        has provided a roadmap for future early site permit applicants 
        allowing sites to be pre-approved for a 20-year period.
          2. The development and submittal of reference combined 
        construction permit and operating license (COL) applications 
        for NRC review and approval along with an additional 15 COL 
        applications.
          3. The development and NRC review of a design certification 
        application for the General Electric ESBWR design and an 
        amendment to the design certification for the Westinghouse 
        AP1000 design.
          4. The completion of engineering work to support development 
        of construction cost estimates and procurement of equipment.
          5. The development of guidance documents for applicants and 
        NRC staff for implementing 10 CFR Part 52 that when coupled 
        with the industry's commitment to standardization and the 
        approval of the reference COL applications, should ensure that 
        subsequent application development and review will be more 
        efficient, significantly reducing the review schedules.

    There have been substantial, additional benefits of the NP 2010 
program beyond the technical achievements. For example, government and 
industry investments in the NP2010 program are expected to stimulate 
more than $100 billion in new nuclear construction over the next 10 
years--creating tens of thousands of high-paying jobs.
3.Legislation before this committee contains practical, proven 
        provisions
    The industry supports the provisions in the two legislative 
proposals, S. 2052, Nuclear Energy Research Initiative Improvement Act 
of 2009, and S. 2812, Nuclear Power 2021 Act. In addition, we support 
the provisions in the proposed S. 2776, Clean Energy Act of 2009, as 
they relate to small, modular reactors.
    S. 2052 authorizes the Secretary of Energy to carry out research, 
development and demonstration programs to reduce manufacturing and 
construction costs relating to nuclear reactors, including small-scale, 
modular designs. By focusing federal research support on programs to 
reduce the cost of licensing, construction and the manufacturing plant 
components, S. 2052 can accelerate the construction of small, modular 
reactors. The cost sharing provisions are designed to provide the 
greatest federal support to the research and development activities, 
with the cost share provisions for demonstration programs being shared 
equally by government and industry.
    Chairman Bingaman's Nuclear Power 2021 Act directs the Secretary of 
Energy to carry out programs to develop and demonstrate two small, 
modular reactor designs. This legislation is targeted to reactors that 
are less than 300 MWe and requires that one design be not more than 50 
MWe. It would seek to obtain design certifications and combined 
licenses for the two designs by 2021. Proposals for this initiative 
will be made on the basis of scientific and technical merit, using 
competitive procedures, and taking into account efficiency, cost, 
safety, and proliferation resistance.
    We urge the sponsors of these proposed bills to work together and 
combine the small reactor provisions into a single bill. We support the 
proposed cost-share arrangements described in the proposed legislation. 
Legislation to develop small-scale reactor technology and allow for 
accelerated construction of the first reactor designs should include 
the following provisions:

   define the scope, priorities and funding for research and 
        development;
   define the scope of government-private cost share provisions 
        for design development and prototype simulation or testing;
   provide funding to assist the Nuclear Regulatory Commission 
        and the industry in resolving generic regulatory issues 
        specific to small, modular reactors;
   define private-government cost-share projects for the 
        development, NRC review; and implementation of first-of-class 
        combined license applications, up to the NRC authorization for 
        fuel load.

    There are several generic regulatory issues relating to 
construction and operation that must be resolved before designs can be 
completed to a level that supports a design certification, procurement 
and finalization of major contracts. These regulatory issues include: 
control room layout and staffing levels, unique design features, 
construction during operations, security, and the endorsement of 
advanced seismic technologies and designs that would enable these 
designs to be built in more areas of the country.
    The industry's prime focus is the continued safe and reliable 
operation of the existing 104 nuclear power plants. Other main areas of 
industry focus include the construction of advanced, large-scale 
reactors on schedule and within the budget estimates, and the 
establishment of the necessary infrastructure, workforce and 
manufacturing capability, to support the new nuclear deployment 
projects The industry also attaches high priority to achieving 
economic, political, and regulatory stability for the entire fuel 
cycle, including fuel supply, materials licensing and used fuel 
management and the deployment of small reactor technologies for 
electricity generation and use in industrial process heat applications.

                               CONCLUSION

    The potential benefits of small, modular nuclear energy plants are 
substantial and should be pursued and supported. These designs expand 
the strategic role of nuclear energy in meeting national environmental, 
energy security and economic development goals. The nuclear energy 
industry believes that appropriate public/private partnerships, such as 
those described in S. 2052 and S. 2812, are important to ensure our 
nation continues to grow economically without adversely impacting the 
environment.
    Thank you for the opportunity to present this information to the 
committee.

    The Chairman. Thank you very much.
    Mr. Johnson, go right ahead.

   STATEMENT OF MICHAEL R. JOHNSON, DIRECTOR, OFFICE OF NEW 
            REACTORS, NUCLEAR REGULATORY COMMISSION

    Mr. Johnson. Chairman Bingaman, Ranking Member Murkowski, 
members of the committee, thank you for inviting me to 
participate in this hearing today. As the Director of the U.S. 
Nuclear Regulatory Commission's Office of New Reactors, I'm 
pleased to have this opportunity to discuss our preparations 
for performing licensing reviews of small modular reactors. The 
NRC regulates the civilian use of nuclear materials in the 
United States and we take our mission to protect health and 
safety and the environment very seriously.
    Several vendors have approached the agency to discuss their 
interest in gaining approval to build and operate modular 
reactors in the United States. We will take steps to ensure 
that any new modular reactors approved by the NRC are operated 
safely. The current proposed designed generally provide for 
less than 300 megawatts per module. We expect that those--that 
multiple modules would be installed on a site.
    They can be categorized as integral pressurized water 
reactors, high temperature gas cooled reactors and liquid metal 
reactors.
    The integral pressurized water reactors are smaller, less 
powerful versions of the existing reactors.
    High temperature gas cooled reactors use helium gas as a 
coolant and operate at much higher temperatures than today's 
reactors.
    Liquid metal reactors are significantly different from the 
others and use liquid metals such as sodium as a coolant.
    The NRC has primarily licensed light water reactors but 
we've had some experience in licensing high temperature gas 
cooled reactors and reviewing liquid metal reactor designs over 
the last 40 years. These reviews were performed on a case by 
case basis. We plan on developing generic, regulatory guidance 
to streamline our reviews and stabilize the regulatory 
environment.
    Potential licensing applicants for small modular reactors 
have sent the NRC letters that outline proposed application 
dates. The earliest possibly arriving in fiscal year 2011. In 
fiscal year 2012, we expect to receive multiple applications. 
In fiscal year 2013, we expect to receive from the Department 
of Energy an application for a design certification for the 
Next Generation nuclear plant or NGNP. The NRC has been working 
closely with DOE to ensure that we will be ready to review that 
application.
    We have prepared for these activities by establishing an 
Advanced Reactor Program within the Office of New Reactors. 
Both the Advanced Reactor Program and the Office of New 
Reactors are focused on licensed activities for new designs. 
Oversight of the existing reactors is a focus of a separate 
office. Our existing regulations and guidance focus on light 
water reactors and do not necessarily translate to other 
technologies. Therefore the NRC is identifying and conducting 
needed research, developing analytical tools and resolving 
policy issues that could affect any or all small modular 
reactor technologies.
    We are preparing review guidance for both the NRC staff and 
the industry. We are also training our reviewers on specific 
technologies and preserving existing knowledge to support 
future licensing. This is consistent with the approach being 
used for NGNP.
    It is critical that we undertake these preparations in 
parallel with and not subsequent to the development of small 
modular reactor technologies. To that end we have been 
interacting with the national and international community to 
stay abreast of developments and refinements in the 
technologies. In addition the NRC has both multilateral and 
bilateral agreements with many countries. As appropriate we are 
including discussions on small modular reactor development and 
licensing with these countries.
    In reviewing our regulations we have identified some issues 
common to all small modular reactor technologies as well as 
issues relevant to specific technologies. We therefore intend 
to address common licensing issues generically whenever 
possible recognizing that there may be some implementation 
issues unique to each design. In general our readiness to 
review the various reactor technologies will also depend on how 
informed we are on the degree of innovation in the proposed 
design. As increasingly innovative technologies are proposed it 
is imperative that our development of the requirements and the 
regulatory review guidance proceed along with technology 
development. Furthermore, as companies submit applications to 
the NRC our ability to conduct efficient and timely reviews 
will largely depend on the applicant's ability to submit 
complete, technically sufficient, high quality applications.
    In summary the NRC is working proactively to fulfill our 
mission and be prepared to review design certification and 
combined license applications for the different small modular 
reactor technologies. We're actively engaged with the industry 
and the international community regarding these technologies. 
The NRC and the industry have much work to do before commencing 
licensing reviews for small modular reactors. But we continue 
to make progress. We look forward to updating the Congress as 
we proceed.
    Mr. Chairman, members of the Committee, this concludes my 
remarks on the NRC's preparation activities for performing 
licensing reviews of small modular reactors. I would be pleased 
to respond to any questions you may have.
    [The prepared statement of Mr. Johnson follows:]

   Prepared Statement of Michael R. Johnson, Director, Office of New 
                Reactors, Nuclear Regulatory Commission

    Mr. Chairman and Members of the Committee, thank you for inviting 
me to participate in this hearing today. As Director of the U.S. 
Nuclear Regulatory Commission's (NRC's) Office of New Reactors, I am 
pleased to have this opportunity to discuss the status of the NRC's 
preparation activities for performing licensing reviews of small 
modular reactors (SMRs).
    The NRC's job is to license and regulate the Nation's civilian use 
of byproduct, source, and special nuclear materials in order to protect 
the public health and safety, promote the common defense and security, 
and protect the environment. In this capacity, the NRC has been 
approached by a number of vendors interested in design certifications 
for a new class of reactors, described as SMRs.
    While there is no universally accepted definition of these designs, 
the power levels for a single module are generally below 300 megawatts 
electric, and multiple modules can be 1 installed at a single site. For 
the purposes of this testimony, we are categorizing the designs--based 
on the underlying technology--as integral pressurized-water reactors 
(iPWRs), high-temperature gas-cooled reactors (HTGRs), and liquid metal 
reactors (LMRs). The iPWRs are similar to existing power reactors but 
are physically smaller, produce less power, and have the steam 
generators and circulation pumps, if any, installed inside the reactor 
pressure vessel rather than as separate components. In contrast to 
iPWRs that use water as the coolant, HTGRs use helium gas as the 
coolant and operate at much higher temperatures. Experience with HTGRs 
is limited in the United States, as the Peach Bottom Unit 1 reactor 
received its operating license in 1966 and was shut down in 1979, and 
the Fort St. Vrain reactor received its operating license in 1973 and 
was shut down in 1989.
    Liquid metal reactors are significantly different from iPWRs and I-
ITGRs and use liquid metals, such as sodium, as the coolant. The NRC 
has limited experience in licensing LMR designs, as the agency was 
conducting a regulatory review of the Clinch River reactor in the early 
1980s until the project was terminated in 1983. Review of these SMRs 
was done on a case-by-case basis without the benefit of well-developed 
regulatory guidance governing the submission and review of these 
applications. Development of regulatory guidance would increase the 
effectiveness and efficiency of the review process and enhance 
regulatory stability.
    The NRC has to a limited extent, been engaged in the review of 
modular reactors since the mid-1980s. This consisted of preliminary 
reviews of three conceptual modular reactor designs submitted by the 
U.S. Department of Energy (DOE). Of these reviews, two were for LMRs (a 
sodium advanced fast reactor and a power reactor innovative small 
module) and the other was for an HTGR (a modular high-temperature gas-
cooled 2 reactor). Although formal applications for these designs were 
never submitted, the preliminary reviews conducted by the NRC provided 
insights into the key safety and licensing issues for non-light-water 
reactors.
    More recently, in 2004, at the request of the company PBMR 
Propriety (Pty) Limited, the NRC began a limited scope preliminary 
review of the pebble bed modular reactor (PBMR), an HTGR design. PBMR 
(Pty) Limited began submitting a series of white papers to address 
technical and policy issues, The NRC performed limited reviews of 
several of the papers but stopped because of the need to focus on work 
with higher and more immediate priority.
    The NRC has received letters from potential SMR licensing 
applicants outlining proposed application submittal dates. If these 
plans materialize, the NRC could receive an application for the 
licensing of an SMR as early as fiscal year (FY) 2011. In or around FY 
2012, the NRC expects to receive applications for multiple design 
certifications, early site permits, combined licenses, and 
manufacturing licenses related to SMRs. Additionally, the Next 
Generation Nuclear Plant (NGNP) program is expected to provide a design 
certification application to the NRC in FY 2013, which will be preceded 
by pre-application discussions. The NRC has been working closely with 
DOE to ensure that we will be ready to review this application.
    In anticipation of these activities, we established the Advanced 
Reactor Program, which is dedicated to preparing for and conducting 
licensing reviews of the SMRs. Our existing regulations and guidance 
are focused on light-water reactors and do not necessarily translate to 
other technologies. Therefore, we are identifying and executing needed 
research, developing analytical tools, identifying and resolving policy 
issues that could affect one or all three of the technologies, and 
preparing review guidance for both the staff and industry. We are also 
developing the reviewer skills and implementing knowledge management 
activities to support future licensing activities. This is consistent 
with the approach being used for the NGNP.
    Optimally, the necessary regulatory framework for licensing SMR 
technologies will be developed in parallel with, and not subsequent to, 
the development of the SMR technologies themselves. To that end, we 
have been interacting with the national and international community to 
stay abreast of developments and refinements in the SMR technologies. 
We are coordinating research and licensing activities with 
organizations such as the International Atomic Energy Agency, the 
Nuclear Energy Agency within the Organization for Economic Cooperation 
and Development, and the Generation IV International Forum. The NRC has 
both multilateral and bilateral agreements with many countries, and, as 
appropriate, we are discussing SMR development and licensing with these 
countries.
    As we have undertaken the review of our regulations and guidance 
for SMRs, we have identified some common issues, as well as technology-
specific issues. While several technologies exist within the broad 
spectrum of SMRs, the staff intends to address those common licensing 
issues generically.
    Regarding technology-specific issues, for the iPWRs, we are in a 
relatively good position to undertake these licensing reviews. Our 
initial assessments suggest that we will need only limited research and 
revisions to existing regulations and guidance to support licensing 
activities.
    For HTGRs, consistent with the NGNP, the NRC has been working with 
DOE to develop and coordinate research activities needed to support 
licensing reviews of these designs. We also are identifying policy 
issues and gaps in our review guidance and are beginning activities to 
resolve them. The NRC is sponsoring research that focuses on key issues 
for HTGRs, such as modeling reactor system performance and materials 
exposed to very high temperatures. These research activities coupled 
with those from DOE are expected to support the resolution of licensing 
issues for HTGRs. While substantial work remains to be completed, the 
activities underway should support the Agency's licensing review of an 
HTGR design.
    For LMRs, the NRC is just starting to review the regulations and 
guidance pertinent to these designs. While earlier LMR designs have 
been reviewed in the United States, we anticipate that many changes 
will be needed to the existing light-water reactor guidance, and 
perhaps to the regulations, to support efficient licensing of the new 
LMR designs. We also expect that significant research will be needed to 
support these changes. Given the magnitude of the work required and the 
NRC staffs limited experience with LMRs, preparing the staff to review 
a LMR licensing application may take several years.
    In general, the NRC staffs readiness to review the various reactor 
technologies will also largely depend on the level of innovation in the 
proposed design. As increasingly innovative technologies are 
introduced, it becomes even more important that the development of 
requirements and regulatory review guidance proceed in tandem with 
technology development to the extent possible. Furthermore, as 
applications are submitted to the NRC, the agency's ability to conduct 
efficient and timely reviews will largely depend on the applicant's 
ability to submit complete, technically adequate applications of high 
quality.
    In summary, the NRC is working proactively to fulfill its mission 
and be prepared to review design certification and combined license 
applications for the different SMR technologies. We appreciate the 
support we have received from the Congress for our activities in this 
area. We are actively engaged with our many stakeholders and the 
international community with respect to the different SMR technologies. 
The NRC has much work to do before commencing licensing reviews for 
SMR, but we continue to make progress and look forward to updating the 
Congress as we proceed.

    The Chairman. Thank you very much. Let me start with a few 
questions.
    Dr. Miller, let me ask you. The S. 2812 requires 
cooperative agreements with cost sharing by the government. Can 
you comment on the level of non-Federal cost sharing that we 
outline in the bill? I think we have one level for design work 
and another level for the actual getting the application done. 
Do you have any thoughts on that?
    Mr. Miller. Thank you very much, Senator. As I've looked 
into that I believe the numbers that are in the bill are in 
fact consistent with our policies and our practices within the 
Department. It's consistent, for example, with the NP 2010 
program. So I guess I don't see any issues associated with 
whether or not those numbers would be consistent with the 
program.
    Now having said that, as I said in my comments, we haven't 
had a review of the legislation yet within the Department.
    The Chairman. This is also for you, Dr. Miller. The bill S. 
2052 contemplates a nuclear energy research initiative 
authorizing 50 million per year for 5 years. Is that a 
reasonable level of funding for the Congress to contemplate on 
the subject if we were able to get that authorized and 
appropriated?
    Mr. Miller. Yes. So let me first again say that there 
hasn't been a review of the legislation. So I can't comment 
specifically on that.
    But I can, in my experience at national labs and 
universities about initiating these Federal research and 
development programs and it seems, in my personal opinion, to 
be consistent with a program like this. That level that may in 
fact increase over years, but it seems consistent with a 
program of this type, from my experience.
    But again, I want to repeat the Department hasn't really 
reviewed the legislation yet.
    The Chairman. S. 2812 authorizes the selection under merit 
review of 2 candidate small reactors to begin a demonstration 
program for licensing. One is to be under 300 megawatts. The 
other is to be under 50 megawatts.
    Is this the appropriate size/categories we ought to be 
looking at here? Is this the appropriate number of candidate 
small reactors that we ought to contemplate the government 
assisting with?
    Mr. Miller. So, let me first comment on the No. 2. Clearly 
that's a judgment call. Again, we haven't reviewed that, but 
the experience within NP 2010 is that there were 2 designs that 
ended up being supported out of NP 2010.
    One is the AP1000, the other one was the ESBWR. So 
consequently it doesn't seem outside the realm of what one 
might want to do. With the 300 megawatts, as I mentioned, there 
is some reason why that number would be an appropriate number 
related to liability insurance.
    There is some argument for making it larger. That's another 
reason why we would need an opportunity to review the 
legislation before we were able to come down on the number.
    The Chairman. Ok. The Nuclear Energy Research Initiative 
Improvement Act 2052, authorizes research and development. 
Should we also include anything about demonstrations in that 
legislation?
    Mr. Miller. That again is an important policy issue. In 
many of our programs when we were doing research and 
development it's clear what the government role is. It's clear 
what's appropriate.
    As we move closer and closer to deployment it becomes more 
of a question of what's the government role. That's the kind of 
thing we really need to look at on this particular bill to 
identify financially what the role is. On the other hand, 
without expenditure of funds we can still be a facilitator.
    We can facilitate industry getting together with NRC. We 
can facilitate workshops. So we can do things within the 
Department that encourage this technology without necessarily 
having to have funds to do it.
    The Chairman. Let me ask one other question. The timeframe 
that we have in S. 2052 strikes me as a layperson, as a long 
timeframe, particularly when we're talking about light water 
reactors. There's an awful lot of work that's been done. We've 
had small light water reactors for many decades now.
    Do we really need this much time between now and 2021 to 
get settled on a design and license in this area? Dr. Sanders, 
did you have a view on that or Dr. Miller, either one, any of 
you, any of the rest of you?
    Mr. Sanders. From our perspective it's really how much 
experience is available. Light water reactors have a long 
history of experience. Like we pointed out there is an 
infrastructure in place that can help motivate that and move it 
forward quickly.
    There's some very unique designs in that category though 
that are real stretched from today's technology that's going to 
take a little bit of research and development. With the liquid 
metal reactors, I'd like to remind everybody we operated those 
kinds of reactors for 40 years in this country. That was called 
EBR-1 and EBR-2. A lot of the challenge is going to be 
assimilate all that information and put it together in a case 
and then bring it forward.
    In many cases what you're going to see with these designs 
are enabling technologies that have caught up with the nuclear 
technology. By enabling the technologies I think new power 
generation concepts, advanced manufacturing concepts, marrying 
the factory design to the reactor design so that you can turn 
these out in a couple years instead of 7 years and those kinds 
of things. So it's a much broader R and D approach instead of 
just looking at the particular type of design. It's a much more 
integrated approach.
    Mr. Miller. May I?
    The Chairman. Yes, go ahead.
    Mr. Miller. If I may add to that. As my fellow panelists 
have mentioned, there are several categories of reactors. Some 
are much further out. It really is appropriate to have a 
research and development program for them.
    Some are more near term and we are always going to have a 
first of a kind issue when it comes to timing. I would expect 
after the first few of the more near term LWRs are actually 
deployed, they actually go through this process, the time is 
going to drop dramatically from the point of view of licensing 
as well as construction. In fact we have indications of 
reactors being built overseas that that's exactly the case that 
time does go down after you learn, after the first of a kind.
    I expect that to happen in this case as well.
    Mr. Johnson. Mr. Chairman, if I might?
    The Chairman. Yes, go right ahead, Mr. Johnson.
    Mr. Johnson. From a regulatory perspective it is true what 
the other panel members have made the point very clearly that 
clearly with the light--the small modular reactors that are 
light water reactor technology, we are closest to being able to 
revise whatever regulatory requirement revisions need to be 
made. Do whatever additional work is done to prepare our 
analysis tools to be able to support those. So those could be 
more ready in a more reasonable timeframe. As you go to the 
other technologies it would take longer.
    But again, I think it's important that we do that work 
before the application shows up so that the regulator is ready 
to license those reactors.
    The Chairman. Senator Murkowski.
    Senator Murkowski. Thank you, Mr. Chairman. Mr. Johnson, I 
would like to start with you. As we look at the advantages of 
these smaller reactors, I think it's clear that one of the 
positives is the ability to locate in some more remote areas. 
Places that otherwise we wouldn't necessarily think about.
    How does this impact the NRC's licensing process as you 
determine whether or not the site is appropriate? Then also, 
how the spent fuel issues and how they will be managed?
    Mr. Johnson. Thank you. Those are exactly the kinds of 
questions that we are beginning to take on as we look at 
licensing small modular reactors. We've done work to identify 
each of the policy issues including citing issues, emergency 
preparedness, for example, security. What are the security 
requirements?
    We've done outreach with external stakeholders, members of 
the public and the industry to catalog those policy issues. 
Then we'll work through those policy issues. So, I don't have 
an answer today with respect to what the impacts would be. But 
we certainly recognize that those policy issues do exist and 
will resolve those in time to support licensing.
    Senator Murkowski. Let me ask you on that point because you 
have indicated that you're setting up these review guidances 
and training reviewers. Do you have the sufficient staff with 
the technical expertise that is required to be dealing with 
these new designs? Are you ready to go or is it something that 
you are preparing for?
    Mr. Johnson. Thank you. I would say it really depends, 
excuse me, on the technology that we're talking about. If it's 
the small modular reactor, that is the light water reactor 
technology, we have a lot of experience with light water 
reactor technology. We have expertise. We have analysis codes 
that are fairly easily translatable.
    So we are ready. We could be ready to proceed fairly 
quickly with respect to those.
    Senator Murkowski. What about the new design?
    Mr. Johnson. With respect to the new designs such as high 
temperature gas, we are working in coordination with the 
Department of Energy. In response to the Energy Policy Act of 
2005 we have identified the gaps. I would say, in terms of our 
regulations and the requirements and in terms of the research 
that is needed, we've got a ways to go, but we're going to--we 
can make that, travel that distance, in time to support the 
deadline that was established in the licensing strategy.
    With respect to the liquid metal reactors we're just 
beginning to look at what it takes in terms of the research and 
the changes in our requirements. Today where I sit I think 
those changes could be significant. It could take us a number 
of years to develop those requirements to conduct that research 
and to have the expertise on staff to be able to support the 
reviews.
    Senator Murkowski. Let me throw this out to any of you, in 
terms of what you feel the biggest hurdle is that we're facing 
as we're trying to advance these small modular reactors and 
allow them to be constructed here in the United States? Is it 
regulatory? What is the biggest hurdle that we face?
    Mr. Sanders, you look like you're ready to go.
    Mr. Sanders. I'd say it's commitment.
    Senator Murkowski. Commitment from?
    Mr. Sanders. Commitment on behalf of the government as well 
as our industries, as well as our laboratories, as well as our 
universities to get the job done. I don't believe that any of 
these are a long term research and development program anymore. 
I believe that we have done a lot of research in a lot of 
different nuclear concepts for a number of years since 1953.
    The real challenge is going to be how do we take advanced 
technologies that have been demonstrated, continue the 
demonstration and the maturation of those technologies and pass 
them off to U.S. industry and get beyond that valley of death 
that exists and we are aware of that can make our industries 
very competitive in this area and our regulators much more 
comfortable in addressing these.
    Senator Murkowski. I appreciate that. Would anyone else 
like to respond?
    Mr. Miller.
    Mr. Miller. As I've looked at this and I assume Senator, 
your question has to do with near term deployment of these 
technologies and what is the hurdle associated with getting 
going and getting it started. It just seems to me, as I look at 
the licensing activities and the activities here in the 
Department of Energy, where we are attempting to finish our 
first loan guarantee, which we hope to announce really soon to 
get going with a GEN III-Plus large reactor, that our resources 
and attention to be on that right now and not on the smaller 
modular reactors as much as it should be.
    Mr. Pietrangelo. I think with respect to electricity 
generation the No. 1 issue is are they going to be cost 
effective in terms of being able to sell electricity in 
whatever market they're in. That's the key issue for the large 
modular reactors or large reactors as well. So I think doing 
the R and D to get to a detailed design to be able to cost out 
these projects, getting all the regulatory issues resolved so 
we know how to deal with how many operators, the security 
requirements, etcetera so that you can with reliability 
determine what the cost of generation will be.
    I think that's the number 1 hurdle.
    Senator Murkowski. Mr. Johnson.
    Mr. Johnson. The regulator is going to say that the 
obstacles, repair and the regulatory infrastructure in 
conjunction with developing the technology such that when the 
application shows up we're ready to proceed with that 
application review in a timely way. I think the success that 
we're having in terms of reviewing the large light water 
reactors is that we have, in fact, developed the review guides 
up front. We have the tools. We've had the complementary 
research.
    I think we should borrow from that in terms of the recipe 
that we use in addressing small modular reactors going forward.
    Senator Murkowski. I think it all comes down to a 
commitment to making it happen. Thank you.
    The Chairman. Senator Udall.
    Senator Udall. Thank you, Mr. Chairman. Again, let me 
acknowledge the hard work of you and Senator Murkowski. I 
appreciate the opportunity to have my bill considered today.
    I do have a longer statement for the record I'd like to 
include in the record.
    The Chairman. It'll be included.
    [The prepared statement of Senator Mark Udall follows:]

   Prepared Statement of Hon. Mark Udall, U.S. Senator From Colorado

    Thank you, Mr. Chairman. I am glad that we are having this hearing 
to receive testimony from different communities about the two pieces of 
legislation before the committee. It has been a pleasure to work with 
you and your staff, Mr. Chairman, and the Ranking Member and her staff 
on this promising area of nuclear energy research.
    Given the economic, national security, and environmental threats 
that our current energy system creates, we need a comprehensive and 
cleaner energy policy. In this regard, nuclear energy clearly has 
emerged as an important player in our search for a stable and domestic 
energy source that has less greenhouse gas emissions.
    But nuclear energy, like all of our energy sources, does face 
several challenges: high capital cost and the long licensing and 
construction times. My bill is intended to help address some of these 
challenges.
    This is why I have asked the Department of Energy to explore small 
modular reactors, which have the potential to overcome many of these 
challenges outlined in my bill.
    Smaller reactors have the potential to be more affordable to 
smaller utilities, and the ability to add modules one at a time could 
prove advantageous.
    There is also that possibility that small modular reactors could be 
fabricated at factories, cutting down on construction time.
    There are reasons why small reactors might have a streamlined 
licensing process, and I look forward to hearing from the Nuclear 
Regulatory Commission as to their thoughts. If, for example, the 
reactors were air-cooled, instead of employing large amounts of water, 
the licensing process could potentially speed up. Water use is a 
serious issue in many parts of the country, especially out West, and 
this capability could improve its applicability.
    All in all, there is great potential for small modular reactors to 
advance nuclear power's role in the power sector and help grow a more 
carbon-free economy. I look forward to hearing testimony from our 
expert witnesses, the recommendations they have for the bills and the 
discussion that follows.
    Thank you, Mr. Chairman.

    Senator Udall. Thank you for that. Dr. Miller, let me turn 
to you. Good to see you.
    When it comes to the small modular reactor program that 
we're discussing here in a broad sense, also specifically in 
regards to these 2 bills. What are the essential components in 
your mind of a successful small reactor program?
    Mr. Miller. Thank you, Senator. It's good to see you, sir.
    We think of this program as having 3 components. The very 
important, near term, LWR technologies that we've been talking 
about here and I agree with what my colleagues have said about 
the need to get on with deploying those and understanding, you 
know, what the costs will be and what the licensing issues are. 
I think that's one whole block of issues related to the LWR. So 
that's part of a program.
    Another part of the program would be the next wave that 
might come, which are the gas cooled reactors that are embodied 
in the NGNP program and other potentially gas cooled reactors 
that could be deployed for other applications in addition to 
electricity production. I think those are further back in the 
line of development. But I think a healthy program should 
include support for that component.
    Then last we've been quite encouraged with the energy and 
vigor with which the university and small companies have come 
forth with some pretty innovative approaches to production of 
nuclear energy that attempt to address more the reduction of 
waste, the high burn up of fuel-and therefore much better 
uranium utilization and issues related to proliferation risk. 
So there's some very innovative, thoughtful, further out 
approaches that have come forward that we think also should be 
part of a vigorous small modular reactor program.
    Senator Udall. Let me follow up before I turn to Mr. 
Pietrangelo. When you talk about a better utilization of fuel, 
does that also have a positive effect on the concerns we have 
about proliferation?
    Mr. Miller. Certainly it does that. But also the idea is to 
try to get the maximum energy one can out of every fuel element 
in order to minimize the impact on eventual, final geologic 
disposal pad. So it's meant to address both of those.
    Senator Udall. Both of those, ok.
    Mr. Pietrangelo, if I could, following up on Dr. Miller's 
comments on the non-electric generation applications or 
processes. Could you comment on the small reactor companies 
what they may offer in these areas of non-electric applications 
and what currently looks like the best business case in this 
area?
    Mr. Pietrangelo. Yes, I'm not familiar with the business 
cases for the specific designs that are being looked at. I 
think Dr. Sanders went over a lot of the potential applications 
for the higher temperature gas cooled reactors and desalination 
and other industrial applications for the chemical industry and 
a number of other industries.
    But at this point I don't think we know enough to know 
which of those is the best suited for which application. I 
think that's one of the goals of the R and D effort, obviously, 
is to get the detailed designs down and be able to look at 
those individual projects and determine what the best 
applications will be. So at this point there's a lot of 
potential, but we think we need to drill down to doing the 
blocking and tackling and figuring out exactly, you know, what 
can do what and how much it will cost and where it could be 
deployed.
    Senator Udall. Dr. Sanders, on that note, let me turn to 
you and ask you about the safety advantages of small reactors 
verses existing reactors and the GEN-III Plus reactors.
    Mr. Sanders. When people ask me about safety advantages I 
remind everybody that the safety standards in place have to be 
met. So by definition every licensed reactor whether it's large 
or small is going to meet the same standards. But complexity is 
the issue.
    One area where small modular reactors have a distinctive 
benefit over very large systems is reduced complexity. The 
liquid metal reactors are pool type reactors. They're low 
pressure. There's no high pressures involved on the primary 
side. So there's none of the issues associated with pressure 
boundaries.
    All of these applications then are intended to be placed 
underground. They basically are about the size of this room, I 
believe. Most of the concepts I've seen and we've covered these 
in ANS presentations and conferences for the last 5 years is 
many unique, valuable ideas out there across our infrastructure 
from universities, laboratories and industry.
    The complexity is the big issue, in my opinion. Fuel 
complexity is a big issue. Those are the issues that depending 
on the pros and cons and the advantages of a particular fuel 
type can be as simple as something like metal fuel or as 
complex as something that we don't even know about yet.
    So, but the bottom line is they'll all meet the same safety 
standards related to security, safety and safeguards by 
definition.
    Senator Udall. Just out of curiosity you talked about 
putting a reactor underground. Would the ceiling in this room 
be ground level or would it be deeper?
    Mr. Sanders. Possibly for about a 100 megawatt system, yes.
    Senator Udall. Thank you. Thanks, Mr. Chairman.
    The Chairman. Senator Burr.
    Senator Burr. Dr. Miller, I was encouraged to hear and I 
read in your written testimony that you expect the Department 
of Energy to award the first loan guarantee, you used the word 
soon in your written testimony in a response to Senator 
Murkowski, you used the word quickly. Could I ask you to define 
either one of those for me?
    Mr. Miller. Thank you very much, Senator. I think the most 
direct way to answer the question is to say that the Secretary 
has said several times that we expect to announce the first 
loan guarantee before the end of calendar year 2009. Now having 
said that, every day makes that less and less likely since the 
time remaining is shorter and shorter.
    However, I believe that's still a credible statement.
    Senator Burr. I thank you for that. You also mentioned that 
DOE would be implementing a modeling and simulating hub as a 
way to help reduce cost of constructing new nuclear plants. 
Will you include people from the construction process in that 
simulation?
    Mr. Miller. Yes. Very good. So the 2010 appropriations has 
22 million dollars for the Department of Energy's nuclear 
energy program to begin a modeling and simulation hub.
    We've drafted a funding opportunity announcement to define 
that hub. We've had our first workshop among the community. The 
workshop was extremely well attended with people from industry, 
universities, and national laboratories as well as our 
international partners. Many international partners are quite 
interested in our activities.
    The overall concept of the hub is to be able to do what we 
refer to as a multi-physics tool that will allow you to analyze 
the complete reactor innards. We have a history of picking 
parts of it and analyzing those very well, but not doing as 
well of integrating them and look at the interplay of all of 
the various complex things that are happening within a reactor, 
especially when it potentially goes off normal and how do you 
make sure you prepare for the activity of it going or the 
possibility of it going out of normal.
    Senator Burr. Dr. Miller, what are your cost reduction 
targets?
    Mr. Miller. So in the FOA right now all we're doing is 
involving industry. We're defining the final FOA. We're going 
to get responses from them. We expect our people who respond to 
the FOA to talk about things like what you're talking about.
    So the issue is we expect a response to that from the 
people who write proposals for this modeling and simulation up. 
We hope they respond to that.
    Senator Burr. Ok. Ok. Mr. Johnson, I would take for granted 
at the NRC there's an area that deals with safety. There's an 
area that deals with security. There's an area that deals with 
processing applications.
    Would that be a correct assumption on my part?
    Mr. Johnson. Yes.
    Senator Burr. Since we haven't permitted any reactors for a 
number of decades what's that piece that processes applications 
been doing all that time?
    Mr. Johnson. The--I was hesitant to give you an answer with 
a simple yes. I probably should have expanded. With respect to 
operating reactors for example, there are continual activities 
associated with overseeing operating reactors.
    They include inspection, enforcement, processing licensing 
applications because operating reactors change their licenses. 
So we process those. Doing technical reviews associated with 
that. There's some research that is done associated with that.
    An analogous sort of thing happens in the area of new 
reactors. We've established an Office of New Reactors separate 
from the operating reactor office because we don't want to 
distract that focus, that safety focus. In my office I have 
folks who are in charge of the process, making sure the process 
works. Separate folks who understand that the safety review----
    Senator Burr. The creation of that entity is how old?
    Mr. Johnson. The creation of that entity is approximately 3 
years old.
    Senator Burr. You know, did we envision before 3 years ago 
that we were going to have to begin to look at new reactors?
    Mr. Johnson. We did, indeed.
    Senator Burr. This is not a revelation that all of a sudden 
popped up. I'm curious because and this is not--I'm not taking 
a shot at the NRC. But, you know, any business with the 
responsibility that you've got would always have some degree of 
forward thinking preparing for what's going to come that's 
around the corner.
    Yet, it seems like every time we get ready to boost the 
nuclear industry we're held back by the need for NRC to try to 
put together the structure of regulation. You know, I'd sort of 
turn to you, Mr. Sanders. You talked about the critical mass 
that we have to meet for this to go forward. You talked about 
private sector commitment, government, academia, etcetera.
    Is it realistic to believe if all that were in place if Mr. 
Johnson and the NRC don't have--they haven't clearly 
communicated what the regulatory and permitting pathway is 
forward will it go forward?
    Mr. Sanders. It'll go forward. But to be fair to NRC, NRC's 
resources are constrained by the existing infrastructure. Keep 
in mind that and correct me if I'm wrong. A lot of your budget 
comes from existing utilities and focusing on them as a 
customer base.
    What NRC needs, in my opinion, is a development budget of 
their own that allows them to prepare for these other designs 
that may be coming down the pike and a national imperative to 
help make U.S. industry more competitive by supporting them in 
the regulatory process and moving things forward.
    Senator Burr. I'll take that, Mr. Chairman, as an answer to 
the last question I was going to ask which is how could we 
change the legislation to better support the objectives of 
building small reactors. I think I could put large reactors in 
there as well. I take that as a constructive suggestion to the 
Committee about how we address it.
    I thank the Chair.
    The Chairman. Thank you. Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman. Welcome to our 
panelists. I'm--Dr. Sanders, you were talking about the size of 
this room being a size for a modular nuclear facility. Am I 
correct in understanding that?
    Mr. Sanders. That's correct. A lot of the cartoons that you 
saw over there basically are looking at about a pit similar to 
a 2 story building and maybe even half of this room as total 
underground in placement.
    Senator Shaheen. So I'm trying to get a view of this room 
on a rail car. I assume when we're talking about the 
construction we're dividing it up into pieces in order to get 
it on the rail car.
    Mr. Sanders. Part of my--excuse me, part of the modular 
concept is how you ship it. There are designs that are sealed 
at the point of origin. They are somewhat smaller than the 40 
megawatt.
    But if you're talking about 300 megawatt I'd suspect you're 
talking about something that's a little bit larger, quite a bit 
larger. But the basic point is they are all small enough to go 
underground. From a security perspective that really reduces a 
lot of your requirements for what we call guns, gates and 
guards.
    Senator Shaheen. One of the concerns that has been 
expressed about the nuclear industry has been a concern about 
shipping. One of the debates around how do we deal with the 
waste that's been around taking it from plant sites and 
shipping it to someplace. I'm not going to say Yucca Mountain 
because I don't want anybody to get upset about that, but to 
ship it to a central location.
    How much of that is a concern when we're talking about a 
modular facility? Dr. Miller talked about being able to 
assemble the modulars at a location, ship them to where they're 
going to be used when the fuel has been used up, shipping them 
back to deal with the fuel. So how would that compare to 
concerns currently about waste that's generated at larger 
nuclear plants.
    Mr. Sanders. That depends on the particular design. Some of 
these designs don't have to be refueled for up to 10 or 20 
years. That means a shipment every 10 or 20 years.
    Some of them will have to be refueled on a more regular 
basis. So it really depends on the design. When people ask me 
about shipments, I like to remind them that we've made 7,000 
Type B shipments to the waste isolation pilot plant in New 
Mexico. 7,000 drums, 700 shipments, 10 years of operation, so 
it isn't something new.
    As far as placing small reactors in different locations 
around the country I like to remind folks that in San Diego 
harbor you probably have 5 or 6 sitting there in Norfolk, 
Virginia, in Bremerton, Washington and in New Loudon, 
Connecticut. Small modular reactors that are transportable 
being transported as we speak. They're called aircraft carriers 
and submarines. They meet the same criteria that these small 
pressurized water reactor designs meet.
    So I----
    Senator Shaheen. We have--I'm from New Hampshire were we 
have the Portsmouth Naval Shipyard.
    Mr. Sanders. Yes.
    Senator Shaheen. So, we appreciate that. In thinking about 
where other countries are in developing these modular reactors 
and I don't know who would like to answer this. But how does 
the United States compare on current technologies that are 
being or and what's being developed? Where are we with the rest 
of the world?
    Mr. Miller. I'll take an attempt at that Senator. My 
perception of what is happening is that all the major 
utilities, excuse me, the major vendors, such as Areva, for 
example, have a component of their activities in this arena and 
see this as a business opportunity. This also includes 
countries; for example, China has a small reactor design. India 
has a small reactor design.
    So I would say that there's a lot of interest to enter this 
new market. My observation is the United States is in a much 
better position to be a potential vendor in this arena than it 
is to break into the GEN III Plus world, which is much further 
along as far as deployment.
    Senator Shaheen. Thank you.
    Mr. Johnson. Senator, if I might?
    Senator Shaheen. Yes.
    Mr. Johnson. From the United States NRC perspective, we 
also are interacting with international regulators who are 
beginning to see similar interest in their countries. So we've 
established bilateral relationships and are learning, as they 
learn, requirements and guides and those kinds of things.
    Senator Shaheen. Thank you.
    The Chairman. Senator Landrieu.
    Senator Landrieu. Thank you, Mr. Chairman. I have a longer 
statement I'd like to submit to the record.
    The Chairman. It'll be included.
    [The prepared statement of Senator Landrieu follows:]

    Prepared Statement of Hon. Mary L. Landrieu, U.S. Senator From 
                               Louisiana

    Thank you, Mr. Chairman, and also, thank you to our distinguished 
panelists.
    I appreciate the Chairman holding this hearing today on S. 2052 and 
S. 2812, two bills that promote the use of small modular nuclear 
reactors.
    In the past I have supported numerous provisions to support the 
nuclear industry and I will continue to push forward towards a nuclear 
renaissance in America. I support these two bills before the committee, 
which is why I am agreeing to co-sponsor them today.
    Nuclear has the potential to provide clean, cheap energy for our 
country and I welcome the opportunity to discuss how we can move 
forward to bring more nuclear power plants online.
    Small modular reactors may have some advantages over larger nuclear 
plants in the United States.
    First, the high capital costs associated with large nuclear 
facilities can be significantly reduced. Whereas large nuclear reactors 
typically cost in the neighborhood of $14 billion, experts believe that 
small reactors could be constructed at costs ranging from $200 to $500 
million.
    Second, some estimate that small nuclear facilities could be built 
in just two years; significantly shorter than the current 7-10 years it 
takes to build a large facility.
    Third, smaller reactors (defined as 300 megawatts or less) can be 
used in smaller electricity markets, where it does not make sense to 
build a 1000 megawatt nuclear facility. This provides more opportunity 
to produce clean, carbon free energy.
    Fourth, small modular reactors are also more flexible in how they 
may be operated. If multiple reactors are used at the same location, 
refueling becomes easier as one reactor can be brought off-line to 
refuel while the other reactors continue to generate electricity.
    Fifth, these reactors are frequently small enough to be shipped 
using rail or truck.
    These primary advantages: affordability, speed of construction, and 
flexibility may indicate that for these initial years of what I hope 
will be a true ``nuclear renaissance'', we may want to think smaller 
instead of larger--and build more small nuclear reactors.
    Small modular reactors are facilities of the future that should be 
a part of the nuclear renaissance. The technology is real and with a 
dedicated commitment from the government and industry, I see a bright 
future for not only the country, but in particular Louisiana.
    In Louisiana, we could marry a small modular reactor with a coal-
to-liquid facility, or a coal-to-syngas facility. In this way, we could 
provide affordable synthetic gas to our chemical manufacturers and have 
a stable (and lower-carbon) source of diesel for our trucks and 
aircraft. In the Shreveport area of Louisiana, we have a lignite mine, 
the Barksdale Air Force Base, and several chemical manufacturers in the 
same region. I believe that this area could host a small modular 
nuclear facility with generated electricity for the Air Force Base, 
while using its process heat to run a coal-to-liquid facility providing 
our troops with a stable source of low-carbon diesel.
    Obviously, I have a parochial interest in such a project--but it 
also serves as an example of how a smaller nuclear reactor could 
advance clean energy on multiple fronts.
    In sum, as our country searches for the solutions become a cleaner 
more independent producer of energy, nuclear energy should have a large 
seat at the energy table. We keep talking about renewable energy and I 
support renewable energy development, but solar panels, windmills, 
hydropower and biomass--by themselves--are not going to make this 
country energy independent. America cannot be energy secure unless we 
fully develop the conventional energy resources we can produce here at 
home with a greater reliance on nuclear.
    I look forward to hearing the testimony of the witnesses on this 
important subject.

    Senator Landrieu. I'd like to thank you, Mr. Chairman and 
Senator Udall for your leadership. This is very, very 
encouraging, the testimony that I've heard. Not only because it 
may, we may develop a path to the creation of more electricity 
generation, but other applications that I'm hearing might be 
possible as well.
    But almost equally important is the jobs opportunity here 
for small business expansion and jobs for Americans because 
that really needs to be our focus. To me this seems like such a 
possible step forward. So I have 2specific questions.
    One, in other areas of energy production/exploration, water 
seems to be an issue whether you're talking about offshore, the 
cleanliness of water in our oceans and offshore drilling or the 
shale production and the lack thereof and the concern. Who 
wants to answer the question about what are the water 
requirements for these small nuclear modular units? Are there 
any places in the country that are either better suited or less 
suited?
    Who would like to answer that?
    Dr. Sanders.
    Mr. Sanders. I'll take a crack at it.
    Senator Landrieu. Ok.
    Mr. Sanders. Again that depends on the design. There are 
state-of-the-art secondary sides of these plants that don't 
make steam, the gas reactor. Also it needs a heat sink. But 
there isn't much water use in the reactor system, for example, 
nor in the liquid metal.
    A lot of the locations where you would put these actually 
have accessible water that's currently not used. It's either 
salt water or saline aquifers. Southeastern New Mexico has lots 
of water underground for example. But it's salty water.
    So it's not useful for crops or irrigation or other 
activities. But it's very useful for the heat sink for just 
about any kind of reactor design. In the process of using that 
heat sink, you can actually desalinate that water and, for 
example a 100 megawatt system based on the calculations from 
one of our members, could generate enough water to irrigate 
about 50,000 acres of useless water otherwise.
    So again, it's the integrated approach to both the market 
opportunities, the design and not all designs work in this 
particular capacity and the potential market. Water sales out 
West, they're a big market. So there's another opportunity that 
solves both the problems. Makes use of water that otherwise has 
no use.
    Senator Landrieu. Ok. It goes without saying that places 
that have rivers, streams.
    Mr. Sanders. Oceans.
    Senator Landrieu. Oceans, if you needed it, it would be 
there.
    Mr. Sanders. Right.
    Mr. Pietrangelo. Senator, some of the interest in the 
industry is in the potential for these smaller modular reactors 
to replace aging fossil fueled plants where the infrastructure 
is already there with respect to water transmission, etcetera. 
So that's some of the potential, at least in the electricity 
generation piece where the infrastructure is already there and 
would serve a national need as well.
    Senator Landrieu. Absolutely. We have a great deal of that 
in a part of the country that I come from.
    My second question is this, Mr. Johnson, and if follows up 
on what both Senator Murkowski and Senator Burr sort of alluded 
to. Every time we get excited about moving forward it seems as 
though we get slowed down. What I'd like to do is turn all 
these green on go.
    So what do you need in terms of a parallel enterprise so 
you can do all of your current work that we're asking you to do 
and then what other resources do we need to provide to you so 
that we can have a parallel effort and move a little more 
quickly here?
    Mr. Johnson. Thank you, Senator. I want to first say that 
the licensing strategy or the licensing approach, the process 
that we're using today to license the large light water 
reactors and the licensing process that we'll use to license 
the small modular reactors is set, is actually part 52 and it's 
a process that is working. So we're set with respect to the 
licensing process that we would use.
    The difficulty is with respect to translating requirements 
that we have that are very specific to light water reactors to 
be ready to review different technologies. We understand how to 
do that. We understand, for example that we need to look at the 
gaps in our regulations and then see where there are----
    Senator Landrieu. But do you need people? Do you need 
smarter people? Do you need more people? Do you need university 
support? What do you need?
    Mr. Johnson. So where we are in that process is to do that 
gap, look at those gaps, identify how big those gaps are and 
then use that to go back and build our resource needs, our 
scheduler needs. That's where we are in the process. The 
difficulty is that it's tough to do that with any degree of 
precision not working, not being brought along as the 
technology is being brought along.
    So that's what--that's the challenge. The challenge is to 
understand to be involved with the Department of Energy and 
with the industry as they are developing these different 
technologies so that we are lock step developing our 
requirements and our guides and so that we're ready to go. I 
think it's achievable.
    My pleading would be that we do it in parallel though and 
not wait until it's all done. Then go to the regulating.
    Senator Landrieu. But do you have the resources to do it in 
parallel, both personnel, research budgets, equipment, space, 
etcetera?
    Mr. Johnson. We haven't--we have resources programmed for 
the next generation nuclear plant as a result of the Energy 
Policy Act and that licensing strategy for NGNP. So we have 
those resources that we've been working through the process. We 
are just getting to be able to develop the detailed resources 
going forward for the other small modular reactors.
    We'll work those through the process. We have not yet.
    Senator Landrieu. Ok. Mr. Chairman, I just don't think 
there should be a resource issue for us. I mean, from where I 
sit and we all sit in the same place, I mean we are literally 
spending billions, billions of dollars in all sorts of 
different ways.
    I would hope that we could find the resources to spend 
here. It seems to me to have so much promise for what this 
country needs right now, starting with jobs and economic 
vitality, but also reaching the great goal of energy security 
for this Nation. So we can disentangle ourselves from decades, 
centuries, decades at least, of, you know, of wars being fought 
over these resources.
    So I'll leave it at that. But I'm not getting very clear 
answers on resources. As an appropriator, I'm going to press 
very hard on this through the Appropriations Committee.
    Mr. Chairman, thank you. I'd like to be a co-sponsor of the 
legislation.
    The Chairman. We'll be glad to have you added as a co-
sponsor on both pieces of legislation. Thank you very much.
    Senator Risch, did you have questions?
    Senator Risch. Chairman, I do not at this time.
    I just want to state that we at the Idaho National 
Engineering Laboratory are anxious to participate in this. As 
you know Idaho has the first city that was lit by nuclear 
energy in the world. We built the first nuclear plant right at 
the INL in Idaho.
    We're committed. We're anxious. We have a trained 
population there who is used to dealing with these kinds of 
issues.
    Like Senator Landrieu, I believe that this is the wave of 
the future. If you truly want to engage in the production of 
energy and do it in a manner that does not release carbon into 
the atmosphere and produce the large amounts of energy that a 
society needs to live the quality of life that we all want to 
live. It's going to take nuclear to do it. I think we all need 
to reinvigorate and recommit ourselves to the renaissance that 
has started, that started quietly and needs to move forward 
much more aggressively.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much. Let me just ask a few 
other questions. Dr. Miller, I'll start with you here.
    One of the things that we're proposing in S. 2812 bill is 
essentially for the Secretary to settle, to put together a 
merit based review of the various potential designs in these 
size reactors and to settle on a standard design. Now in the 
case of larger nuclear power plants one of the, sort of part of 
the common conventional wisdom around here is that the French 
did a much better job than we did of settling on standard 
design and going ahead and building a lot of them. We 
essentially left it up to everybody to develop their own design 
and it slowed us down. It made it more difficult and raised 
safety issues as well.
    What's the right answer to how you continue to encourage 
innovation and still get a design settled upon so that 
construction and deployment and use of these reactors can occur 
in a timely way? What's your answer to that? We're saying the 
Secretary shall develop a standard design for each of 2 small 
modular reactors. One would be not more than 50 megawatts.
    Is that the right number? Should there be 2 very small ones 
and 2 others less than 300? What's the right answer to that?
    Mr. Miller. Thank you very much, Senator Bingaman. Again, I 
have to start by saying that the Department needs to analyze 
the legislation which has not occurred yet. So let me say that 
the colleagues at the Nuclear Regulatory Commission have 
suggested that it would be helpful if in a small modular 
reactor program the Department would help them prioritize 
through some merit base peer review system which of these 
designs are mature enough and have enough applications and 
potential buyers, if you will, to be at the head of the queue 
as the Nuclear Regulatory Commission begins its activities.
    We've had several conversations of which this suggestion 
has been made. It's certainly a reasonable suggestion. But I 
have to say that we have not put together a program yet.
    Of course, I'm unable to talk about the 2011 budget 
process. So I can't just go into a lot of detail about that. 
But I'd like to have enough time, in fact, get back to you for 
the record eventually when we're able to about these kinds of 
things.
    [The information referred to follows:]

    The Department of Energy's FY 2011 Budget Request, submitted on 
February 1, 2010, includes a request to solicit and consider, through a 
competitive process, up to two small modular reactor (SMR) designs for 
financial cost-share assistance. These funds will help demonstrate the 
potential of the nascent SMR technology that provides more flexible 
siting for generating plants and will encourage new competition in the 
marketplace. Department cost-share funding will only support the 
Nuclear Regulatory Commission (NRC) design certification process for 
the selected designs, which will advance their commercial deployment if 
the design certification is granted by the NRC.
    Since light water reactor (LWR) SMR designs do not require 
extensive research and development or prototype testing to demonstrate 
safety, these designs likely will be the first to be submitted to the 
NRC for design certification. In the near term, the Department's cost-
share SMR program will focus on these LWR SMR designs. The SMR design 
certification program proposed in FY 2011 will be a competitive process 
that will be informed by workshops and will consider a range of 
commercial licensing and deployment factors, including a reasonable 
demonstration of a domestic commercial customer for the design. We do 
not consider it necessary to specify specific sizes (e.g., less than 50 
or 300 MWe) of the SMR designs that will be evaluated. We expect the 
marketplace will help determine the right size(s) of small modular 
reactors that can be readily licensed and deployed.

    The Chairman. Anyone else have a comment on that? Anyone 
who has looked at it?
    Mr. Pietrangelo. NP 2010 selected 2 designs and that's 
coming to fruition now.
    The Chairman. Right.
    Mr. Pietrangelo. Even despite NP 2010 there were 3designs 
certified in the late 1990s and another 3 going through 
certification now. So, even when all the designs weren't 
considered as part of the NP 2010 process, a lot of companies 
are still going forward with the design certification.
    The Chairman. So you think the fact that we are directing 
the Secretary to settle on 2 designs here would not preclude 
others from continuing to go ahead and develop.
    Mr. Pietrangelo. Not--right. Not based on what's happened 
in NP 2010.
    The Chairman. Ok. Alright. Senator Murkowski.
    Senator Murkowski. Just a couple more questions, Mr. 
Chairman.
    Dr. Miller, you mentioned a couple times that the next 
generation nuclear plant project and the announcements that 
came in September about $40 million for completion of 
conceptual design activities. Can you give me an update on that 
in terms of how many responses the Department got from this 
announcement? When you anticipate making some kind of an award 
for the project? If you consider this sufficient and if not, 
whether you would look to other alternatives to achieving the 
goals that we're setting out here with this Next Gen project?
    Mr. Miller. Thank you very much for the question, Senator. 
As you point out, the funding opportunity announcement went 
out. The date for submission of responses has past. We have 
received responses. It's in the hands of the source selection 
official in a competitive environment. So we're not allowed to 
publicly discuss what is happening in that.
    We hope to have a decision made within weeks, within the 
January or early February time frame, after which we can talk 
about this.
    Senator Murkowski. Dr. Sanders, the term you used was 
reduce complexity when you're talking about some of the 
advantages with the smaller reactors. One of the great debates, 
of course, with dealing with nuclear power is figuring out what 
we do with the spent fuel. Can you describe how the amount of 
the spent fuel that we're talking about from multiple small 
reactors, that would be interconnected, how this compares with 
the spent fuel that we see from one large 1,000 megawatt 
reactor?
    Mr. Sanders. Again, that depends on type.
    If it's a pressurized water reactor with essentially the 
same type of burn up for x amount of megawatt days you're going 
to have the same amount of fission product because it takes the 
same amount of fissions in order to make that.
    If it's a gas reactor design there will probably be a 
little bit different burn up rate occur.
    If it's a liquid metal design it could be designed with a 
conversion ratio of one, which is basically for every atom 
that's consumed an atom is generated for future consumption.
    So that's how you get to these ten, twenty year in core 
cycles. What I believe is needed is really the holistic 
approach to not 1 or 2 specific reactor designs. But how do I 
manage all of this in total? How do I use specific reactor 
parts or reactor types to manage my byproducts of other reactor 
types?
    We know how to do that.
    Senator Murkowski. We do or we don't?
    Mr. Sanders. We do know how to do that. We have done that 
and in the laboratories in the early days. The first 
electricity generated in Idaho was actually generated by a 
small breeder reactor based on some of these concepts.
    We went away from that for a couple of reasons. The 
pressurized water reactor, light water reactor technology was 
what the Navy picked for various reasons that make a lot of 
sense. A parallel commercial enterprise came out of that 
decision that basically sold 400 reactors around the world. 
That's where we're at from an opportunity perspective today.
    If we think outside of the box a little bit and think in 
terms of a holistic fuel cycle and how can I have the right 
approach that meets all the performance requirements that we 
want to accomplish whether it's proliferation prevention 
through export controls and exporting the right technologies to 
managing the byproducts of whatever reactor system that comes 
back. That's doable. It's called a systems approach. It's an 
integrated approach. It may take more than 1 or 2 types of 
reactors.
    That's really where we need to start is what are the 
performance requirements that would allow us to accomplish the 
objectives you just set. How can we manage or receive waste? 
Most of that waste is valuable. Ninety-eight percent of it is 
useful, but it depends on the particular reactor type that you 
choose.
    Senator Murkowski. Thank you, Mr. Chairman.
    The Chairman. Senator Udall, did you have additional 
questions?
    Senator Udall. Thank you, Mr. Chairman, I do. I want to 
turn to Mr. Johnson. We've had a lot of conversation about the 
licensing process. I'm curious if you thought the process might 
be quicker for some small reactors if, particularly, the 
reactor was air cooled?
    Mr. Johnson. Thank you. We haven't--regarding the process 
we do essentially, again, the same process. As we get details 
regarding what that design looks like, again assuming that we 
get a complete application that is technically sufficient. 
We'll look and see how long it will take us to do that review.
    Absent those details it's hard to determine how long that 
review will take. So I can't comment further.
    Senator Udall. As you develop greater understanding, I'd 
certainly appreciate the NRC sharing with us your thinking and 
the direction in which you're heading.
    Dr. Miller, let me come back to you again. You talk about 
SMRs being built here and then being shipped to other 
countries. Could you expand on how this would help with non-
proliferation concerns? Then perhaps if others would like to 
comment when you are finished?
    Mr. Miller. Thank you, Senator. Some of the more advanced 
concepts visualize the possibility of a sealed core that would 
be purchased by a country deployed, and operated there. The 
designs purport to be able to continue to provide electricity 
for decades without refueling. Then at the end of that period 
of time, there would be the whole sealed core, which could be 
underground, as Dr. Sanders said, and which could be taken back 
as spent fuel inside a sealed core, potentially refueled and 
taken back to the country.
    So this kind of an arrangement would have the benefit of 
having a situation in which the IAEA safeguards requirements 
would be less stringent owing to the lack of accessibility to 
the material. It, of course, still would be safeguarded by the 
IAEA. It still would have all those requirements. But there's 
at least reason to believe that it would be an easier safeguard 
issue than the present reactors are.
    Senator Udall. Would others care to comment?
    Mr. Sanders.
    Mr. Sanders. There's also enabling technologies that we 
haven't taken advantage of in command and control and 
intelligence systems and the ability to monitor reactor 
operations around the world that have moved along in parallel 
with the information age boom, but haven't been integrated into 
the operations globally of nuclear power plants.
    There's also the huge advantage of, you know, avoiding the 
weak links to sealed cores, but also minimizing the amount of 
times you have to come back and get that and open it up and 
replace it and that kind of thing.
    So again, this is, this holistic approach that integrates 
all these performance requirements together and comes up with 
the optimal network of reactor systems and fuel cycle 
approaches.
    Senator Udall. Dr. Miller, I believe there have been 
conversations in the IAEA community about overseeing this 
entire fuel cycle in the future. Is that correct?
    Mr. Miller. There have been conversations about both what 
we refer to as the front end as well as what we refer to as the 
back end. In the front end the issue is finding ways to 
guarantee fresh fuel supplies by having some type of fuel bank, 
Senator. This would complement the commercial business of 
providing spent fuel which is there. It's vigorous. It's 
international business.
    But there are some concerns that these may not be 
completely secure in the sense that a country might feel 
vulnerable that another country might stop their access to 
fresh fuel. So IAEA, as well as many other entities have been 
discussing how you would deploy this type of thing, especially 
in a world in which the number of countries, as Dr. Sanders 
mentioned, that are interested in nuclear is a growing, it 
seems to be a growing number. It's very important that we look 
at this.
    In the back end it's not nearly as mature. But there have 
been discussions within the international community. We 
certainly, in the Department, have been part of those 
discussions to look at the back end and how one might find a 
way to take back to either a third country that's agreed to do 
this in a safe and secure way or even the origin country.
    So that if you're a nascent nuclear power country, you can 
say, this is really, really great. I don't have to have an 
enrichment capability. I don't have to go find a final disposal 
place.
    I can now have nuclear energy without these aspects of 
nuclear energy. So it's more of a carrot-and-stick approach. 
It's more saying this is a good deal. I'm going to sign up to 
this deal.
    So there's lots of discussions of how one might enable 
that. As you can imagine, it's not a simple thing to do with 
international agreements. But there is a lot of discussion of 
this.
    Senator Udall. Thank you for that elaboration. Thanks again 
to the panel for taking the time to be here today.
    The Chairman. Senator Barrasso.
    Senator Barrasso. Thank you very much, Mr. Chairman. 
Nuclear power is a key component of making America's energy 
clean, affordable and reliable. We must increase America's 
nuclear energy capacity. When it comes to energy I believe we 
need it all.
    That's why I support a comprehensive, all of the above 
strategy for American energy. Uranium is a critical feed stock 
for nuclear power plants. We currently import about 90 percent 
of our uranium. We need to change that.
    The good news is that we can change that because America 
has vast uranium deposits. We need to encourage domestic 
uranium production. I believe it will foster job growth, 
promote economic security as well as energy security.
    The Department has invested significant time and effort in 
developing a transparent and coherent strategy for managing its 
uranium stockpiles. The excess uranium management plan 
represents broad consensus among stakeholders. It ensures the 
Department of Energy receives fair market value for the sales 
of its uranium. It also provides market certainty for domestic 
producers and consumers.
    Now unfortunately the Department has decided to turn its 
back on the management plan. That's threatening jobs in Wyoming 
and a number of other states. So despite clear concerns in 
Congress, the Department is moving forward with their plan.
    The Department of Energy is going to transfer nearly 1,200 
metric tons of uranium to the U.S. Enrichment Corporation over 
the next year. Additional transfers will follow in the years 
after that. Now the purpose is to fund additional temporary 
jobs, temporary jobs at the Portsmouth plant in Ohio. Now I 
support creating jobs in Ohio, but not at the expense of jobs 
in Wyoming.
    In October I sent a letter to Secretary Chu signed with 6 
other Senators. We raised concerns that it would negatively 
impact the domestic uranium industry in jobs in our states. The 
Governor of Wyoming also sent a letter. I'd like to read a line 
from it. He said, ``The loss of mining and mining related jobs 
in Wyoming and elsewhere will be a direct outcome of the 
Department's present course.''
    The Casper Star Tribune, our statewide newspaper wrote an 
editorial about it. The title, ``Uranium sales would hurt 
Wyoming industry.'' It says, ``The uranium industry's planned 
expansions and future operations in Wyoming should provide long 
term high paying jobs to Wyoming miners for years to come but 
those projects could be postponed or lost forever unless the 
Department of Energy reconsiders this ill timed sale of excess 
uranium before it's too late.''
    So Dr. Miller, the Excess Uranium Management Plan provided 
a ramp up to 10 percent of the U.S. requirements by 2013. That 
ramp up was intended to safeguard uranium producers and 
consumers from the Department of Energy uranium transactions. 
The Department has decided to abandon the gradual ramp-ups 
instead it almost reached the 10 percent in 2010. In 2011 it 
will go to 12 percent.
    Now this market cannot absorb that quantity without a 
plunge in the price. Your office led the efforts to develop the 
management plan. Why was that ramp up plan abandoned?
    Mr. Miller. Thank you very much, Senator. What we 
considered the core of that management plan is this 10-percent 
limit on what the Department will release to the market. The 
decision was made, that 10 percent will not be exceeded over 
the period of time in which a market analysis, which was 
commissioned by the Department, said that there would not be an 
adverse impact on uranium prices.
    We will do another market analysis prior to a decision in 
2011 or beyond. So the only decision that's been made is 
through FY 2010. Again, our analysis that we do prior to making 
such a decision has said that there's not a major adverse 
impact on uranium prices. We continue to abide by the 10&rcent 
spirit of that management plan.
    Senator Barrasso. As I'm looking at page 26 of Energy 
Resources International the DOE's market analysis says that the 
numbers are going to go up and it will be 12 percent in the 
year 2011. So I agree Federal law requires that any DOE sale or 
transfer not adversely impact domestic uranium mining. But the 
price of uranium dropped since the Department of Energy made 
its announcement.
    The Department of Energy's actions are already having an 
adverse impact on domestic uranium mining. The question is does 
the Department recognize the negative impacts its actions are 
going to have on jobs of the states where the Senators signed 
the letter?
    Mr. Miller. Let me, again, thank you, Senator. We have met 
with the appropriate people or we think the appropriate people. 
People from the mining community have come to see us. We've 
discussed it with them. I believe the plan that we came up with 
is responsive, is responsible, and again, prior to 2011 we're 
going to do another market analysis prior to making any 
determination for that year.
    So the determination is only through 2010.
    Senator Barrasso. The fact sheet that I have from the 
Department on the clean up at the Portsmouth facility and I 
have a news release that came out from the Department of 
Energy. You know, new jobs coming to Piketon talking about the 
Portsmouth site in Piketon, Ohio. It says, they'll be $850 
million invested over 2 years.
    Does the Department plan to permanently continue this level 
of funding or are these jobs temporary?
    Mr. Miller. Thank you about that. Thank you for that 
question, Senator. When it comes to that aspect of the program 
I'm going to have to get back to you for the record because 
that part is in the EM part of the Department of Energy as 
opposed to the NE part. So I can't answer that specific 
question.
    Senator Barrasso. Because I would suggest it doesn't make 
sense to create temporary jobs in Ohio at the expense of long 
term mining jobs in Wyoming. So I would appreciate you getting 
back to me. I would encourage you to rethink this entire 
proposal. Thank you.
    Mr. Miller. Thank you, Senator.
    Senator Barrasso. Thank you, Mr. Chairman.
    The Chairman. Thank you. Senator Sessions? Oh, Senator 
Sessions, go right ahead.
    Senator Sessions. Thank you. While I am a supporter of 
nuclear power, I believe it has a role to play and unless the 
economics don't work, I absolutely believe it's a critical part 
of our future for clean energy in the world. I just can't 
imagine we're not pursuing it more vigorously than we are. Some 
of the matters cause me concern.
    I know a number of the President's supporters oppose 
nuclear power. He said during this last campaign he had some 
modest comments of favoring nuclear power. Mr. Miller, you 
state that the Administration views nuclear power as an 
important element in its strategic strategy to increase energy 
security and combat climate change.
    You and Secretary Chu are ``working hard to advance nuclear 
power in the United States.'' Yet the only thing we have done, 
I think, to advance nuclear power in the past 30 years is to 
establish a 2-year blue ribbon commission to look at the 
options for nuclear power, ways to Yucca and nuclear recycling, 
which really slowed down, I think, the path we were on. 
Commissions have a number of values. One of them is to slow 
down something if you don't want it to go fast in its 2 year 
commission.
    So in June, Mr. Jaczko, the Chairman of the NRC, made a 
statement at the Heritage Foundation, ``that the NRC may issue 
one license before the end of his term in 2013.'' Just one. So 
Mr. Miller, what are we waiting for? How can we get more 
progress established here?
    Mr. Miller. Thank you, Senator. So let me first thank you 
for your support for nuclear energy. I share your view of how 
important it is to the country as we look forward to reducing 
our carbon emissions.
    I can't comment on the licensing parts of your question. 
I'll defer those to my colleague from the Nuclear Regulatory 
Commission. But from our point of view I would say that in the 
short period in which I've been at the Department, I have been 
quite encouraged with the energy that's gone into finally 
getting a nuclear loan guarantee released by the Federal 
Government. I think that's going to happen pretty darn soon.
    Senator Sessions. There was discussion about before the end 
of the year. Is that? It's getting close.
    Mr. Miller. Yes, sir. You know that's, I think that's only 
about 16 days, if I count.
    Senator Sessions. It looks like we're missing that. Are we 
missing that date?
    Mr. Miller. No, I'm standing by hoping we're going to have 
a loan guarantee by the end of this calendar year. I'm standing 
by that hope and prayer that that's going to happen.
    So I think that's the answer to your question as far as 
near term deployment.
    Senator Sessions. That would be a step. That would be 
something positive.
    Mr. Miller. That would be a huge step. It would be a very 
important, huge step. I think it would be the beginning of 
starting a wave of these Gen III Plus reactors moving forward.
    The second thing I'm very encouraged about is the support 
that the administration is giving to the notion of the need for 
having this additional vehicle of small and modular reactors in 
attempting to do what's appropriate for the Federal Government 
to get those deployed. To get the designs perfected so that we 
can make a difference nationally and internationally in this 
market. So I'm encouraged by that as well.
    I'm encouraged by the enthusiasm and energy of the 
scientists at our national laboratories, including Idaho 
National Laboratory, which has taken a new and fresh look at 
innovation and at ways in which we can continue to have a 
strong research and development program for deployment in both 
the near and long term. So I'm encouraged by what I see, from 
where I sit and what's happened.
    Senator Sessions. One thing you say, I know NRC is an 
independent agency and must maintain its safety, independence 
regulatory function. However, if we're going to move forward 
with expanding nuclear power, the question is do we have enough 
people and are we configured in a way that we can safely do it. 
So you have some influence, administration does over Mr. 
Johnson's budget. If he doesn't have enough people it could 
slow down.
    So how are you, Mr. Johnson, shaping up? If you had to 
invest a good bit of effort and time in looking at these 
smaller modular plants, could that slow down your base 
responsibility of maybe, not acting fast enough on some of the 
proven reactors that we have?
    Mr. Johnson. Thank you. The budget that we have in place 
and the priority scheme that we are using does place higher 
priority on the large light water reactors that we're currently 
working on. We have sufficient resources and staffing to work 
those applications that are before us.
    Again, we're making good progress against those schedules. 
Ultimately what we license we'll be able to operate to provide 
adequate protection with health and safety. But again, we're 
making good progress on the schedules. Those are higher 
priority.
    We also have as a priority the Next Generation Nuclear 
plant that we are working on a joint licensing strategy with 
the Department of Energy. We are making progress and have 
resources to move along with respect to that.
    The lower priority than are the remainder of the small 
modular reactors. We are looking as we get more information 
about what those--what will come forward and what those 
technologies will be, what we need to develop, to close the 
gaps in our regulatory requirements. We'll refine our resource 
estimates and then we'll come forward with those. We're not 
there today.
    The Chairman. Senator Risch, did you have a question?
    Senator Risch. Briefly.
    The Chairman. Go ahead.
    Senator Risch. You know one of the biggest criticisms we 
get is the licensing process and how difficult it is and 
particularly how lengthy it is. It seems to me it's time for a 
next generation of licensing. I mean, certainly when we started 
with nuclear no one really knew where we were going or how--
what the extent of the danger was.
    Of course, we've--the industry is now no longer an 
adolescent. It's an adult industry. It seems to me that we need 
a next generation of licensing just as we do the plants.
    Could you comment on it starting?
    Mr. Miller, could we start with you and maybe all of you 
could comment briefly on that suggestion?
    Mr. Miller. Yes. Thank you, Senator. I think you have a 
good observation. I think there is--it is appropriate for our 
various communities to get together for a conference, for a 
workshop to think about what are the radical, maybe not 
radical, what are the major changes that could be made, what 
other creative changes that could be made in the approach that 
we're taking the licensing, especially if we get a chance to 
really implement it and see it a little bit longer than it is 
now.
    It would be a little difficult to do it before we've even 
issued our first combined construction and operating license. 
But when we've gone through that and we can look back and 
experience it, I think it's quite appropriate for us to look 
and say, ok. So here's what happened. Now what can we do 
different, better.
    I have to agree with you.
    Senator Risch. Dr. Sanders.
    Mr. Sanders. I think the critical need is to push the 
process. The first of the, you know, I always tell people the 
most important shipment to whip was the first one. Then after 
the first one it became very much an everyday operation.
    We've got to get that first reactor done basically. 
Regardless of what process is used or whatever, it's a matter 
of timely completion of that first one whether it's a light 
water reactor, a gas reactor or whatever. I think NRC needs--
I'm not real clear on how their budgetary process is, but a lot 
of what they do depends on applicants and is paid for by 
applicants.
    So a lot of the issues are related to the flexibility they 
have to address these generic issues in a timely fashion, the 
generic issues that are outside of the boundaries of their 
current customer base. I'll leave it to you guys to comment on 
that if that's not what you understand.
    Mr. Pietrangelo. I'd like to defend the current process. 
Part 52 was established in 1992, well in advance of any of 
these applications. But this is the first time we're going 
through the combined license application with new designs in 
parallel, not as envisioned in 1992 where you'd have an early 
site permit, a certified design on the shelf that could be 
referenced than a combined license application.
    So I think the NRC is working very hard, as is the 
industry, through standardization to get through that first 
wave in a timely way. But we see improvements in a second wave. 
We're not pushing the NRC to move any faster on this first 
wave.
    So I think some of the criticism about how long it takes is 
because we're both in a learning curve going through this 
process for the first time with respect to combined license 
applications. We do expect efficiencies in a second wave, but 
I'd rather do it right rather than fast with these first 
reactors that are going to come online in more than 30 years.
    Senator Risch. We subscribe to that. We've been saying it 
should be done right rather than fast on this and many other 
subjects recently. Thank you very much.
    Mr. Johnson.
    Mr. Johnson. Yes. Thank you. I would just add that we have 
already made as Mr. Pietrangelo indicated, significant 
improvements to the process from the previous 2 step process to 
the current one step process. I'm always mindful of the fact 
that at the end of that license, when we issue that license, we 
actually have granted the authority to construct and to operate 
conditional upon verification that the plant was constructed in 
accordance with the design and the license and the regulatory 
requirements for 40 years.
    So we need to do it--we need to make sure that we do it 
right. It has a safety review associated with it. It has an 
environmental review associated with it.
    Both of those reviews provide for external stakeholder, 
public involvement. Those, we think, are a critical part to 
that process. The National Environmental Policy Act provides 
very discreet roles for the public that set the process length.
    So, again, I think because this is as important as it is 
that we involve the public and that we get to the right safety 
decision, the process is appropriate. Can we make it better? We 
continually look to make it better. We've identified some 
improvements and we'll implement those on the second wave 
certainly.
    But I think the process that we have in place in 
appropriate.
    Senator Risch. Mr. Chairman, thank you. Thank you, all of 
you, for that refinement. I appreciate that. I appreciate the 
defense of the process.
    Having said that, I would encourage everyone to continue to 
look for opportunities where you can do efficiencies. There 
isn't anyone in America that doesn't want you to do this 
safely. It needs to be done safely. You can't make a mistake.
    But because of the experience that you've had, I encourage 
you to continue to look for opportunities to streamline the 
process. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Senator Murkowski, do you have any other 
questions?
    [No response.]
    The Chairman. Let me thank you all. This was very useful 
testimony. We will try to take your advice to heart and move 
ahead with some legislation.
    Thank you very much.
    [Whereupon, at 11:54 a.m. the hearing was adjourned.]

                               APPENDIXES

                              ----------                              


                               Appendix I

                   Responses to Additional Questions

                              ----------                              

 Responses of Anthony R. Pietrangelo to Questions From Senator Bingaman
    Question 1. Your testimony on the bottom of page 2 notes that 
small-scale reactors will ``require the expansion of existing 
facilities and construction of new state-of-the-art factories.'' Do you 
think building such facilities will add extensively to the baseline 
cost of these small reactors?
    Answer. No, the construction of state-of-the-art factories will 
ensure that these small modular reactors are competitive with other 
forms of clean generation. In addition, it will help modernize U.S. 
manufacturing and fabrication so that it is more competitive with other 
countries through increased efficiency and productivity, thus 
increasing the potential for exports and American jobs.
    These new modular reactors will be manufactured and fabricated away 
from the generation site, easing and improving quality control. Such a 
process will enable greater construction efficiency and productivity to 
be achieved through the incorporation of lessons learned. The same 
personnel will perform the same tasks for multiple units going to 
different sites, as opposed to separate personnel performing the tasks 
at each site. This should reduce construction schedules and improve 
competitiveness.
    Question 2. Do you think the nuclear industry has the vendor base 
to support the construction of large-scale reactors and these newer 
small-scale reactors?
    Answer. There is sufficient global nuclear manufacturing capacity 
to support the first wave of four to eight U.S. nuclear power plants 
that will become operational around 2017. The global plans for the 
expansion of nuclear generation over the next 20 years will require 
increased global manufacturing capability. The initial indications are 
that other countries are beginning to invest in new manufacturing 
facilities to support this anticipated demand.
    Over the past two years, the U.S. nuclear industry has been 
conducting an outreach program to help educate U.S. businesses about 
the potential new opportunities in the nuclear industry both here and 
overseas. This effort has included holding a series of regional 
workshops to educate companies about market opportunities, to explain 
the quality requirements and specifications for nuclear components and 
to provide guidance on establishing high-level quality programs for the 
supply of nuclear components. In response to growing demand and greater 
awareness of market opportunities, we have already seen an increase in 
the number of domestic nuclear suppliers. ASME Section III Nuclear 
Certificates (commonly called ``N-stamps'') held in the U.S. have 
increased 22 percent since the beginning of 2007-from 221 in January 
2007 to 269 in May 2009. Three additional workshops are planned for 
this year.
    Congressional manufacturing and worker training incentives, tax 
credits, and grants would help to ensure U.S. industry competitiveness 
and will enable U.S. companies to expand their manufacturing 
capabilities to meet the expected increased demand for high-quality 
components for the global nuclear market.
    Question 3. You note in your hearing testimony on page 3 that ``The 
cost and time required to design, develop and license a small reactor 
is not necessarily reduced linearly with size.'' Are you saying the up-
front cost for licensing will be about the same as a large reactor?
    Answer. Yes, we anticipate that the up-front licensing costs for 
the first-of-class units will be similar to the costs for obtaining the 
first combined licenses for the large Generation III+ reactors.
    For small modular reactors, there are a number of regulatory policy 
issues, specific regulations and guidance that will need to be 
developed or amended to enable the deployment and safe operation of 
these plants. Many of these issues and regulations are generic to all 
small modular reactor technologies. These amendments and revisions will 
assure that the regulatory process for small modular reactors is 
efficient and well understood by both the industry and the NRC staff. 
Such actions should reduce the number of misunderstandings and 
misinterpretations normally associated with the first implementation.
    Once the first-of-class units have been licensed, we expect that 
the high level of standardization coupled with the Nuclear Regulatory 
Commission's design-centered review approach for combined license 
applications will significantly reduce licensing costs and schedules.
    The schedules for licensing subsequent small modular reactor 
generating stations will depend on whether there is an approved early 
site permit and whether NRC environmental reviews take credit for 
environmental reviews and conclusions that have already been completed.
Responses of Anthony R. Pietrangelo to Questions From Senator Murkowski
    Question 1. Assuming that a small nuclear reactor design of around 
300 electrical megawatts has been licensed by the NRC, could you 
estimate how long it would take to construct and get the reactor on 
line? How about a smaller reactor of around 50 electrical megawatts? 
How does that compare to estimates for large reactors?
    Answer. There are numerous small modular reactor designs under 
development. Each design has a different modular generating capacity 
and can combine a varying number of modules based on customer needs. 
The development of these designs is advancing beyond concepts to a 
level needed to support NRC design certification applications in the 
next 30 to 36 months.
    A 300-electrical megawatt modular plant design would generally 
require multi-module configurations for many of the designs being 
developed, with some designs supporting industrial cogeneration 
applications. Provisional construction estimates for the power block to 
fuel load for the first-of-class module is approximately 36 months, 
with another six to 12 months for start-up testing, depending on the 
uniqueness of the modular design features. Subsequent modules could be 
completed in a shorter time frame because the civil and structural work 
could be completed in parallel with or as part of the construction of 
the first module. The estimate assumes that state and local permits 
have been obtained and site preparation activities are complete before 
the combined license is issued. In addition, an operator training 
program would have to be established shortly after the start of power 
block construction to ensure that the operators are trained under an 
accredited program. The schedule and scope of site preparation 
activities will vary based on site-specific circumstances.
    Modular construction in a factory setting also is expected to 
improve the construction process and quality, adding increased 
certainty to the entire construction schedule. The construction 
schedule is expected to be reduced as lessons are learned and 
incorporated into construction practices. Experience indicates that the 
construction schedule for the Nth plant could be reduced by six to 12 
months.
    For a 50-electrical megawatt modular reactor plant, a larger 
proportion of the construction activity would be completed in an off-
site factory setting. As a result, the amount of on-site construction 
would be smaller, resulting in a shorter construction schedule. The 
schedule for start-up and power ascension testing is expected similar 
to that of a 300-megawatt plant.
    The estimated schedule for a large (in excess of 1,000 electrical 
megawatts) nuclear power plant varies dependent on design, site-
specific circumstances and contractual conditions. The construction 
time for the power block, first safety-related concrete pour to fuel 
load is generally between 48 and 54 months. The start-up and testing 
phase is an additional four to six months. Based on recent construction 
experience in Japan and Korea, it is expected that the schedule could 
be reduced to less than 42 months for subsequent plants as construction 
experiences are incorporated into the process, assuming a high level of 
standardization between projects is maintained.
    Question 2. You note that small-scale designs may be more 
compatible with smaller utilities than a large 1,000+ megawatt plant. 
Have you heard from utilities who are interested in smaller nuclear 
plants?
    Answer. Yes, interest covers the spectrum of utilities: large and 
small; regulated and unregulated; investor-owned, public power and 
cooperatives. In addition, there is interest from the industrial sector 
in the high-temperature modular reactors, once the reactor designs are 
developed for use in industrial process heat applications.
    Whether this interest grows into actual projects depends on project 
economics, which are affected by design, construction, operational 
considerations and regulatory requirements. Until there is clearer 
definition of the specific regulatory requirements, it will be 
difficult to develop designs to a level that will enable cost estimates 
to be developed with a degree of certainty needed to support a project 
authorization.
    Question 3. S. 2812 provides for DOE to develop and obtain from the 
NRC design certification for two small reactors. In looking at lessons 
learned from the Nuclear Power 2010 program, are two designs enough or 
does the program need to be expanded?
    Answer. We believe two designs are sufficient to establish a 
baseline set of projects and clarify the regulatory expectations and 
requirements for small modular reactors. This should stimulate other 
companies to move forward with the development of additional designs. 
The Nuclear Power 2010 project demonstrated that the momentum developed 
thorough government incentives for two designs will stimulate other 
vendors to move forward with designs to gain market share in the new 
nuclear generating construction cycle. There are five large nuclear 
generating designs referenced in existing combined license applications 
even though the Nuclear Power 2010 project covered only two of those 
designs.
    Question 4. In S. 1462, the American Clean Energy Leadership Act, 
this Committee included language to help develop our energy work force, 
including nuclear workers. Is additional language needed to assist the 
development of workers for small modular reactors?
    Answer. We support the current proposals outlined in S. 1462 and 
encourage the Committee to consider a worker training tax credit for 
the expenses of training workers for nuclear power plants and 
facilities producing components or fuel for such plants.
    The tax credit would be graduated and based on a percentage of 
wages-e.g., 40 percent of the qualified first-year wages of qualified 
workers, 30 percent of the qualified second-year wages, 20 percent of 
the qualified third-year wages of qualified workers. The credit would 
apply to participants in a U.S. Department of Labor Registered 
Apprenticeship program (or a participant in a State Apprenticeship 
Program recognized by the U.S. Department of Labor) and participants in 
an accredited program of the Institute of Nuclear Power Operations' 
National Academy for Nuclear Training.
    The tax credit mechanism will allow workers who will be engaged in 
the construction, manufacturing and operation of nuclear reactors, 
including small modular reactors, to receive the highly specialized 
training necessary to meet the industry's qualification standards. Some 
of this nuclear training may require specialized equipment or 
apprenticeship structures that may be more efficiently accessed through 
on-the-job training than through the community college system. Having 
access to this mechanism, in addition to the support outlined in 
Section 433 for community college programs, will provide a broader 
scope of resources available for work force development.
                                 ______
                                 
   Responses of Michael R. Johnson to Questions From Senator Bingaman

    Question 1. Your testimony at the bottom of page 4 indicates that 
in general small reactors that are based on light water designs that 
are ``in a relatively good position to undertake licensing reviews''. 
Can you clarify that statement relative to the other designs out there?
    Answer. The U.S. Nuclear Regulatory Commission (NRC), including the 
work of its predecessor agency, the Atomic Energy Commission (AEC), has 
been conducting licensing reviews for light water reactors (LWRs) for 
over 50 years and has substantial experience and an established 
regulatory structure for performing reviews of these types of nuclear 
reactors. In fact, the NRC based its regulations and review guidance on 
LWR technology. The new small modular LWR designs being proposed are a 
variation of the existing large scale LWRs. They will use the same fuel 
and same coolant, and will implement some of the same or similar design 
features as the existing large scale LWRs. For these reasons, the NRC 
does not expect the new small modular LWR designs to require 
substantial changes to the current regulatory framework. The NRC staff 
believes that it is therefore relatively well positioned to undertake 
licensing reviews for the new small modular LWR designs in the near 
term.
    The NRC has conducted a limited number of licensing reviews in the 
past for both high temperature gas reactors (HTGRs) and liquid metal 
reactors (LMRs). However, those designs are significantly different 
from the ones being proposed today. Unlike LWRs, these technologies 
employ different coolants, new fuel types, and new design features. 
Because of these significant differences, the NRC must conduct 
extensive research to support development of the regulatory framework 
to conduct licensing reviews.
    Question 2. About how many inquiries for licensing ``New Reactors'' 
has your office received or expects to receive?
    Answer. In characterizing new reactor licensing, it is important to 
draw a distinction between applications submitted by reactor vendors 
for certification of a reactor design versus combined license 
applications submitted by utilities. For small modular reactors, the 
NRC has been approached by reactor vendors proposing as many as nine 
different designs spanning three separate technologies (LWRs, HTGRs, 
and LMRs). Based on letters the NRC has received from small modular 
reactor vendors, we could receive a design certification application as 
early as fiscal year (FY) 2011, with others following in FY 2012. The 
exact number of anticipated design certification applications is not 
known due to uncertainty in the vendors' business plans. Additionally, 
the Next Generation Nuclear Plant (NGNP) program is expected to provide 
a design certification application to the NRC inFY 2013.
    The NRC has not been approached by any utility to indicate specific 
plans to submit a combined license application that would rely upon 
small modular designs. Therefore, at this stage, it is too early to 
predict how many combined license applications for small modular 
reactors may be submitted to the NRC.
    Question 3. The NRC is obviously under a tremendous work load, 
maintaining the safety and security of the 104 existing reactors and 
reviewing upwards of 18 combined operating licenses. Can your office 
support the work load it expects to receive with the volume of small 
reactors that might be coming in - some of which are not traditional 
light water reactors?
    Answer. In anticipation of the workload in performing the licensing 
reviews of new reactors, the NRC established the Office of New 
Reactors--separate from the Office of Nuclear Reactor Regulation--to 
focus on these licensing reviews, thereby limiting the impact on the 
oversight of the safety and security of the 104 existing reactors. 
Similarly, in anticipation of the workload for small modular reactors, 
we have established the Advanced Reactor Program within the Office of 
New Reactors to focus on reviews for these smaller designs.
    The NRC is currently developing resource estimates required to 
support review of the design certification applications that the 
reactor vendors have indicated will be submitted for small modular 
reactors. The NRC staff will continue to work through the budgeting 
process with the Commission regarding appropriate resource allocations.

  Responses of Michael R. Johnson to Questions From Senator Murkowski

    Question 1. As you look to establish regulations and guidance for 
high-temperature gas-cooled and liquid metal reactors, do you 
anticipate that the regulations will be based on existing light-water 
reactor regulations with changes to accommodate differences in 
technology, or will they be newly developed regulations?
    Answer. Changes will need to be made to the specific analysis 
methods used, and the criteria that are to be satisfied in 
demonstrating compliance with those regulations. Significant research 
will be needed to develop and evaluate these new or revised analysis 
methods and criteria. It is possible that changes to the existing 
regulations will be warranted but that will be evaluated on a case-by-
case basis.
    Question 2. You expressed a desire that the regulatory framework 
for small modular reactors be developed at the same time as the 
technology itself. What level of cooperation have you received from 
industry to help understand some of the innovative technology that is 
being proposed?
    Answer. The NRC is coordinating with the Department of Energy on 
the NGNP to identify and resolve challenges associated with HTGRs. In 
addition, the NRC has held pre-application meetings with several of the 
potential vendors to discuss some of the innovative design approaches 
being proposed. For example, NRC recently held a public workshop to 
discuss licensing issues for small and medium sized nuclear reactors 
that included industry, the Department of Energy and other 
stakeholders. As the industry's plans continue to materialize 
throughout FY 2010 and FY 2011, the NRC will increase its pre-
application meetings such that we maintain our effectiveness in keeping 
abreast of new and innovative design approaches.
    Question 3. Since some small reactors have much less nuclear 
material than conventional large-scale nuclear power plant and hence 
pose less safety concern, would the NRC modify its requirements for 
emergency planning zones around a reactor site to be consistent with 
the size of the reactor?
    Answer. NRC's regulations currently allow for the review and 
approval of different sized emergency planning zones (EPZs) on a case-
by-case basis for reactors below 250 megawatts thermal or for gas-
cooled reactors. Therefore, the NRC does not currently anticipate the 
need to modify its regulations in this regard. The applicants for these 
small reactors would need to develop a risk basis and detailed 
justification for a proposed change in EPZ size that would be 
significantly different from current LWRs. Then, the NRC will review 
that justification and reach a finding on its adequacy in supporting a 
revision to the EPZ for a specific design.
                                 ______
                                 
                                  American Nuclear Society,
                               La Grange Park, IL, January 8, 2010.
Hon. Jeff Bingaman,
Chairman, Committee on Energy & Natural Resources, U.S. Senate, 304 
        Dirksen Senate Building, Washington, DC.
Hon. Lisa Murkowski,
Ranking Member, Committee on Energy & Natural Resources, U.S. Senate, 
        304 Dirksen Senate Building, Washington, DC.
    Dear Chairman Bingaman and Ranking Member Murkowski: Thank you and 
your committee again for the opportunity to present the views of the 
American Nuclear Society (ANS) and express our support for your 
legislative initiatives regarding the development and certification of 
small modular reactors.
    Thank you also for soliciting our input on the questions submitted 
for the record regarding our testimony. To the extent possible, I have 
surveyed several ANS members to develop our response to these 
questions. In addition, as President of the ANS, I have initiated three 
Special Committees that are tasked to further explore issues related to 
the U.S. Nuclear Enterprise. Specifically, we are evaluating the 
national security advantages and opportunities for rebuilding a healthy 
export capability from the U.S., generic regulatory issues associated 
with small modular reactors (SMRs) in comparison with today's large 
reactors, and opportunities to optimize the nuclear fuel cycle in the 
U.S. by a holistic approach to waste and materials management using an 
optimum spectrum of small reactor types capable of converting today's 
``waste'' into fuel for tomorrow's SMRs.
    The members of these committees have been drawn from all of our 
constituent sectors: universities, labs, government, utilities, and the 
supply industry. We expect to be able to report our results at our 
annual meeting in June 2010.
    In addition, we are supporting a more detailed analysis of the high 
quality jobs that would be created if U.S. unions and industries were 
again major suppliers to the global marketplace. We are working with 
the American Council on Global Nuclear Competitiveness, the AFL-CIO, 
and the Department of Commerce's Civil Nuclear Trade Initiative in this 
area.
    Please contact me at any time for additional information on these 
and other activities. I and the other members of the ANS applaud the 
leadership that you and your committee have shown in support of nuclear 
science and technology.
            Sincerely,
                                         Thomas L. Sanders,
                                                         President.

              Responses to Questions From Senator Bingaman

    Question 1. Your testimony on page 4 mentions ``a fourth category 
of reactors.'' Can you explain them and shed light on how close these 
reactors are to proof of concept and perhaps licensing?
    Answer. The first three categories of small modular reactors (SMRs) 
we discussed are based predominantly on concepts that have at least 
been demonstrated in some detail over the last fifty years. The fourth 
category of reactors we alluded to are actually quite similar to the 
gas and liquid metal cooled concepts, but will have superior 
performance attributes that will require more fundamental research 
before licensing can be achieved. For example, proof of concept has 
been well demonstrated for sodium cooled fast reactors by almost four 
decades of operation, but extending core lifetimes to two-three decades 
between refueling will require further research on fuel materials prior 
to achieving certification for the longer operational cycles. Similar 
reliability issues also need to be resolved for some of the high 
temperature gas reactor (HTGR) concepts based on ``pebble'' fuel 
designs, the lead-bismuth cooled fast reactor concept, and the molten-
salt fueled reactor. Each of these has been proven conceptually in the 
laboratory, and each could have very significant future impacts in 
terms of return on investment and cost reduction.
    Other reactors included in category four have not been demonstrated 
in the lab, but do have a wealth of underlying analysis dating back 
several decades in some cases. These include the ``walk-away'' nuclear 
batteries that have been proposed in the literature. Serious long-term 
efforts are underway to develop detailed conceptual designs and to 
conduct proof-of-principle demonstrations for these. The goal in each 
case will require significant technology leaps to extend in core fuel 
duration to several decades and perform operations with very little 
hands-on operational and maintenance requirements. Licensing will 
likely require at least a decade of prototype demonstration to build 
the data base necessary for design certification.
    Question 2. Your testimony on page 3 notes that small light water 
reactors are the best understood based upon our current experience with 
today's fleet. What differences are there between small light water 
reactors and the ones we have developed over the years?
    Answer. In general, we do not expect the basic nuclear, thermal, 
fluid flow, heat transfer, and power generation attributes of the small 
light water reactors (LWRs) to differ significantly from the large 
reactors in use today. The two main performance enhancements envisioned 
are 1) extending the refueling interval to at least five years, and 2) 
reducing plant ``footprints'' by optimizing and reducing the size of 
components. In some cases, some components may be eliminated. With a 
significant size reduction, any SMR can then be placed underground 
without additional cost. Today's operating small and medium sized LWRs 
in the commercial fleet are virtually identical to their larger 
counterparts. The new designs being proposed basically would place all 
the components within what is called the primary pressure boundary to 
reduce overall plant dimensions considerably. When combined with a 
design for longer fuel lifetime, these new concepts will be somewhat 
similar to another category of small light water reactors--the Navy's 
nuclear propulsion systems.
    LWRs for naval applications have a number of important differences 
from the concepts being considered now for small modular commercial 
reactors. In general, naval nuclear propulsion systems are optimized to 
meet the military requirements for the ships in which they are 
installed. While it would be possible in principle to use a submarine 
reactor for a commercial application, it would not be the most cost-
effective solution. Specific differences include the following:

    a. The cores for naval reactors are designed to withstand combat 
conditions. They are mechanically rugged as a result. Cores are either 
replaced periodically, or not at all, so the fuel bundle shuffling that 
is used in commercial reactors is not practical for naval reactors. In 
essence, the fuel form for naval reactors is highly developed such that 
the ship will never need to be refueled. This does not mean that a 
naval core could operate for 33 years at full power. Rather, the ``life 
of the ship'' core will support normal operations for a submarine life 
of 30 years. Total time at sea, of course, is less than 33 years and 
the typical power level when operating is much less than full power for 
tactical reasons. The exact lifetime in Effective Full Power Hours is 
classified as is the core technology itself. The drive to develop a 
life of the ship core for a submarine is partly economic; refueling a 
submarine reactor is very expensive.
    b. Naval nuclear propulsion plants are designed, to the extent 
practical, to be able to isolate failed components and still retain 
substantial operating capability. This is a military requirement. As a 
result, steam generators and reactor coolant pumps are located in 
primary loops that are isolable from the reactor. Typically, redundant 
reactor coolant pumps are installed as well so a single failed pump 
will not compromise the ability to make full power. Similar 
considerations apply throughout the rest of the plant where practical. 
Small light water reactor designs such as those envisioned by U.S. 
entrepreneurs, can have the steam generators and other components 
located within the primary pressure boundary. While there may be some 
requirements for accessibility for inspection or repair during a 
refueling outage, this is not a reactor safety or licensing issue so 
much as it is a long-term economic issue.

    Despite these differences, small modular commercial plants would 
benefit from most Naval LWR technologies. In addition, new submarine 
and aircraft carrier plants are being designed to also be operated with 
smaller crews, to require less maintenance, and to facilitate any 
maintenance that is required. These trends are directly applicable to 
small modular commercial designs as well.
    Question 3. Your testimony on page 4 notes that the ``manufacturing 
infrastructure'' is already in place with small naval reactors used in 
our shipyards. Can you please explain that in more detail?
    Answer. I am looking for more complete information on this, but the 
construction of naval nuclear propulsion plants involves components 
from hundreds of vendors across the U.S. Many of these vendors produce 
equipment and supplies that must meet very rigorous standards for any 
nuclear systems. Therefore, the infrastructure exists to produce 
essentially all of the components and supplies that would be necessary 
for a small modular commercial reactor as well. In addition, the two 
nuclear-capable shipyards, Electric Boat in Connecticut and Newport 
News in Virginia, have developed the ability to build large complex 
modules under nearly factory conditions and assemble them into ships. 
This technology, already widely used to build boiling water reactors 
(BWRs) in Japan, would be even more important for initiating the yearly 
construction of a few small modular commercial reactors.

             Responses to Questions From Senator Murkowski

    Question 1. Some of the proposed small reactors are anticipated to 
operate for 30 years without the need for refueling. Would the spent 
fuel from those reactors need to be treated any differently than 
conventional reactors that refuel every eighteen months? How does this 
compare to the spent fuel in naval propulsion systems?
    Answer. The details of naval fuel are classified so our comments 
must be general. Small liquid metal reactors (LMRs) have metallic fuel, 
which would best be recycled using pyro-chemical processes. Virtually 
all the actinides and uranium would then be recycled into new cores, 
and only fission products would be sent to a geologic repository for 
disposal. Removing the actinides and uranium from the waste volume 
going to the repository would reduce the disposal burden on the 
repository by at least a factor of five. This in turn would increase 
potential repository capacity on the order of five times and would 
reduce the effective lifetime of the radiation hazard from hundreds of 
thousands of years to more like 300 years. Used fuel from LWRs or gas 
reactors that may have a longer fuel lifetime would also benefit from 
recycling with the actinides being used to fuel small fast reactors. 
There is, however, a limit to how long an LWR core can be effective 
because of the fuel depletion and increasing neutron absorption in the 
fission products that are produced during operation.
    Question 2. You mention that more than 60 countries are seeking or 
expressed interest in developing new nuclear generating capacity. What 
lessons can we learn from international efforts on small-scale nuclear 
reactors?
    Answer. Most of the emerging market opportunity across the world is 
for smaller reactors. According to the International Atomic Energy 
Agency (IAEA), a small reactor is 0 to 300 megawatt electric, while a 
medium-sized reactor generates 300 to 700 megawatt electric. 
Fundamentally, most countries cannot really absorb large thousand-
megawatt electric nuclear systems. Of 442 nuclear power plants around 
the world last year, 139 were small-and medium-sized reactors. Table 1 
lists the current fleet of small-and medium-sized reactors. These 
reactors generated 61.6-gigawatt electric, or 16.7% of the world 
electricity production. Of 31 recently constructed nuclear power 
plants, eleven were smaller systems.



    Most of these countries would prefer similar sizes in the future 
for one of two reasons: 1) affordability, and 2) smaller sizes allow 
them to add capacity as needed and to perform shutdown maintenance and 
refueling without having to import large and costly amounts of 
replacement electricity.
    Large-scale development of advanced, versatile small modular 
reactors for the emerging world market is the key to enabling nuclear 
energy to grow as needed and to exploit nuclear energy's million-fold 
advantage in energy intensity compared to all other energy sources. 
More than 50 concepts and designs of innovative SMRs are being 
evaluated for their use by an IAEA team that includes Argentina, 
Brazil, Canada, China, Croatia, France, India, Indonesia, Italy, Japan, 
the Republic of Korea, Lithuania, Morocco, Russian Federation, South 
Africa, Turkey, U.S.A., and Vietnam.
    Several countries are developing SMRs to penetrate these markets. 
Russia, Japan, and South Africa are promoting small LWR, liquid metal, 
and HTGR concepts, respectively. Russia has a unique market advantage 
because they are offering a ``cradle-to-grave'' fuel cycle agreement 
with their customers. Any country purchasing a Russian system will not 
have to worry about developing a disposal system. All used fuel will be 
returned to Russia.
    America must also be a competitive supplier to this evolving global 
marketplace to assure that U.S. values related to safety and 
proliferation prevention are also promoted around the world. Working 
with other nuclear societies, ANS has supported and encouraged a global 
nuclear fuel cycle model for the 21st-century based on ``cradle-to-
grave'' materials and technology agreements. Fuel suppliers would 
operate reactors and fuel cycle facilities. Fuel users would operate 
reactors, lease and return fuel, and not have to worry about disposal 
of radioactive materials. The IAEA would provide safeguards and fuel 
assurances, backed up with a reserve of nuclear fuel for states that do 
not pursue enrichment and reprocessing
    This cradle-to-grave concept addresses virtually all potential 
proliferation concerns with the expanded use of nuclear power. 
Developing such a comprehensive fuel cycle service capability would 
provide market advantages superior to the current approach, virtually 
defining how nuclear trade in the 21st century will evolve, and enable 
the nuclear powers to help the developing world acquire the energy 
resources necessary for achieving a prosperous future, with 
controllable environmental impacts. From a U.S. national security 
perspective, it would strongly discourage user nations from developing 
enrichment and reprocessing capabilities that are arguably the most 
acute proliferation threat we face today.
    We believe that the time is right for a new paradigm for global 
nuclear trade, and the development of small modular reactors that are 
appropriate for the emerging global market is one key to regaining U.S. 
export capabilities.
    Question 3. We in Congress often discuss and debate ideas for 
creating American jobs. Your testimony discusses how small reactors 
provide an opportunity to re-build and expand the nuclear manufacturing 
industry in America and create jobs.
    a. Has the industry examined the number of jobs that might be 
created from a small reactor nuclear factory?
    Answer. The ANS is working with the Department of Commerce, the 
American Council on Global Nuclear Competitiveness (ACGNC) and the AFL-
CIO to develop an estimate of the number of jobs that would be created 
if U.S. industry and labor became major suppliers to the global market 
for small modular reactors. A report will be available by June 2010. 
Our expectation is that a typical factory (or group of factories) could 
easily produce 100-200 of these systems per year. We expect that the 
total time required between the initial order and emplacement will be 
about two years.
    b. How many people are employed for the manufacturing of the naval 
nuclear reactors?
    Answer. I am trying to get better information on this. The Naval 
Reactors Program employs thousands of people. The Fiscal Year 2009 
Budget Request shows over 200 personnel associated with headquarters 
activities and field offices. There are about 3400 engineers and 
scientists at the Navy's Bettis Laboratory and about 2500 engineers and 
scientists at Knolls Atomic Power Laboratory (KAPL). These personnel 
are not building reactors, of course, but do design and manage all 
aspects of operation, maintenance, and disposal of naval nuclear 
plants. In addition, there are 10,500 workers at Electric Boat and more 
than 15,000 workers at Newport News. Most of these shipyard workers are 
involved in integrating all components of the vessels. Finally, there 
are hundreds of component suppliers providing products that range from 
steam generators to welding electrodes. According to the Heritage 
Foundation, the aircraft carrier industrial base consists of more than 
2,000 companies in 47 states. Likewise, the submarine industrial base 
consists of more than 4,000 companies in 47 states (Web Memo no. 1693, 
dated November 5, 2007 by the Heritage Foundation). See also ADM Donald 
testimony to House Armed Services Committee June 13, 2005, concerning 
the vendor base for nuclear construction.
    c. How many naval nuclear reactors are built each year?
    Answer. Naval nuclear ship construction is budget limited, and the 
vendors and shipbuilders involved in these plants could easily build 
more than they are today. Increased production would likely improve 
their efficiency and reduce unit costs. At present, approximately one 
new submarine is being built each year, with two per year planned in 
the out-years. The next aircraft carrier is now under construction but 
it will not be delivered for some years to come. Thus, approximately 
one-two naval reactors are constructed each year.

                              Appendix II

              Additional Material Submitted for the Record

                              ----------                              

                                       NuScale Power, Inc.,
                                  Corvallis, OR, December 14, 2009.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources, U.S. Senate, 
        Washington, DC.
Hon. Lisa Murkowski,
Ranking Member, Committee on Energy and Natural Resources, U.S. Senate 
        Washington, DC.
    Dear Mr. Chairman and Ranking Minority Member Murkowski: On behalf 
of our employees and customers, as well as the university community 
here in Corvallis, Oregon, I want to thank you and your colleague from 
Colorado, Senator Mark Udall, for your leadership in encouraging the 
development of modular, scalable nuclear reactor technology in the 
United States. Your recent sponsorship of the Nuclear Power 2021 Act, 
and the hearing you will hold on December 15 regarding S.2052 and 
S.2812, are important milestones for a technology that offers 
emissions-free, safe and economical energy. If this letter can be 
presented into the formal hearing record, it would be appreciated.
    Assistant Secretary of Energy Dr. Pete Miller and the Chief Nuclear 
Officer from the Nuclear Energy Institute will ably inform you of what 
we believe are the important national energy policy implications and 
benefits of promoting this innovative approach to a well proven 
domestic technology. As members of the American Nuclear Society, we 
appreciate that organization's contributions to the hearing as well.
    As the CEO of one company that is at the forefront of modular, 
scalable nuclear power technology, I want to share some additional 
observations that I believe offer windows into the future of nuclear 
power in the U.S. Each has a direct bearing on the legislation you have 
sponsored.

   Public Acceptance--In the summer of 2008 Oregon Business 
        Magazine ranked NuScale Power as #4 in its ``Top 10 Companies 
        to Watch.'' NuScale was flanked by high tech startups 
        indicating to me a broader acceptance of nuclear power as an 
        important component of future business development in our state 
        and the region. The public recognizes the unmatched record of 
        safety and performance in our industry and are ready to embrace 
        a future in which nuclear power is a major part.
   Our Workforce--NuScale Power, incorporated in 2007, went 
        from nothing to more than 40 highly-educated employees who are 
        masters and PhD graduates from across the country indicating a 
        very strong acceptance of `modular, scalable' technology as the 
        next evolution in the nuclear power industry. NuScale is 
        already creating `green jobs' in America. We couldn't be more 
        proud of the caliber and commitment of our staff, whose average 
        age I might add, is in the middle 30's. The acceptance of our 
        technology within the professional community has been 
        overwhelming.
   American Manufacturing--The potential for job creation by 
        NuScale's technology reaches well beyond the State of Oregon. 
        NuScale's complete nuclear system can be entirely manufactured 
        in the United States which provides a local manufacturing base 
        and the potential for international exports. Thus the NuScale 
        workforce extends to our partners and subcontractors throughout 
        the country, including: companies such as Kiewit Construction 
        (Omaha, NE), Curtiss Wright (Pennsylvania), Electric Boat 
        (Groton, CT), Precision Custom Components (York, PA) and GE-
        Energy Services (California).

    While our first commitment is to the US domestic market for which 
the NRC and DOE have a primary obligation, we also see enormous 
potential for U.S. vendors to sell innovative U.S. technologies to 
overseas markets at some point in the very near future. This is 
important to our national balance of payments, and it is important to 
NuScale and its strategic partners. Your legislation helps to promote 
the potential to create green jobs in the U.S. and expand America's 
presence in international markets.
    Again, we thank you for your leadership in the area of modular, 
scalable, nuclear power reactors and look forward to working with you 
as this legislation proceeds.
            Sincerely,
                                            Paul Lorenzini,
                                           Chief Executive Officer.
                                 ______
                                 
      Statement of Jack Spencer, Web Memo, The Heritage Foundation

    The Senate is considering two bills that are meant to help small 
and modular nuclear reactor development. Unfortunately, the Nuclear 
Energy Research Initiative Improvement Act (S. 2052) and the Nuclear 
Power 2021 Act (S. 2812) would have the opposite impact.
    Together (or individually), these bills would smother the private-
sector initiative and free-enterprise spirit that has driven small and 
modular reactor development in recent years. Instead of embracing this 
new and innovative approach to nuclear energy development, these bills 
would subject the small and modular reactor business to the same 
government-depressed trajectory that plagues traditional reactors.
The Nuclear Energy Research Initiative Improvement Act (S. 2052)
    S. 2052 would authorize $250 million over five years to support the 
emergence of small and modular nuclear reactors. While the spirit of 
the act is laudable, its approach is mostly counterproductive. The 
essence of the act is to mandate that the Department of Energy (DOE) 
develop a five-year plan to ``lower effectively the costs of nuclear 
reactors.''
    There are several problems with the act:

   More government support is not needed.--Private investors 
        have been driving the small and modular reactor business in 
        recent years. They recognized that small and modular rectors 
        could potentially fulfill a market demand that large rectors 
        could not, and they did it without government support.
   The government is neither capable nor qualified to reduce 
        the prices of nuclear reactors.--Private industry has the 
        interests, expertise, and background to develop cost-effective 
        manufacturing and construction techniques. History demonstrates 
        that government intervention would only slow the phenomenal 
        progress made on the small reactor front.
   Government intervention has not produced a single new large 
        reactor, and there is no reason to think it would work for 
        small ones.--The federal government's attempts to subsidize the 
        commercialization of large reactors have failed to create a 
        viable nuclear industry. The small reactor business has taken a 
        different approach. Instead of leaning on government to direct 
        the progress of industry, they have by and large built 
        privately funded commercial enterprises out of federal research 
        and development projects. Instead of controlling this 
        innovation through DOE meddling, the federal government should 
        embrace it as a model for other energy sectors.
   The bill plays into the hands of the anti-nuclear agenda.--
        The bill directs the DOE to conduct ``public workshops'' to 
        generate ``public comment'' to inform its five-year plan. This 
        opens the door to over-politicization and legal sandbagging--
        two of the anti-nuclear lobby's favorite progress-killing 
        tactics.
   Creating an arbitrary timeline makes no sense.--Government 
        program timelines to produce commercial projects do not work. 
        Once the government creates a development program, the market 
        begins to revolve around it. Then as the timeline slips--as 
        they always do--so does the eventual introduction of the 
        products. Timelines should be market-and investor-driven, not 
        dictated by Congress or the DOE.
The Nuclear Power 2021 Act (S. 2812)
    S. 2812 creates a DOE program to develop and demonstrate two small 
and modular nuclear reactor designs. In essence, it authorizes the DOE 
to dictate who will make up America's small, modular reactor business 
for the foreseeable future.
    This is the wrong approach because:

   It is anti-competitive.--Multiple companies have invested 
        private dollars and resources to build the commercial small and 
        modular nuclear reactor business. By choosing winners and 
        losers, the DOE would take away the incentive to compete and 
        replace it with the incentive to lobby Washington. The result 
        would be that Washington, not the market, would decide which 
        technologies move forward.
   It stifles innovation.--This anti-competitiveness results in 
        less innovation in the marketplace. The irony is that private-
        sector innovation is what has given rise to the small and 
        modular reactor market to begin with. As the established 
        nuclear industry became bogged down in federal bureaucracy, 
        nuclear energy entrepreneurs were investing in new and 
        innovative ways to bring nuclear technology into the 
        marketplace. S. 2812 would apply the same anti-innovation 
        bureaucracy to the small and modular reactor business.
   It deters private-sector investment.--Multiple companies are 
        currently investing in small, modular reactors. By picking 
        which two get government support, S. 2812 essentially punishes 
        those companies that were not chosen. This signals to private 
        investors to either not get into the nuclear business or to 
        spend significant resources on lobbying instead of product 
        development.
Not All Bad
    However, the bill does contain some good provisions. In addition to 
raising the profile of small reactors, both bills attempt to address 
(though unsuccessfully) one legitimate government function: licensing.
    The long-term success of nuclear power, regardless of reactor type, 
will depend on an efficient regulatory regime. This is especially true 
for small and alternative reactor types. The lack of regulatory 
structure for these reactors represents a major barrier to market 
entry. Though neither piece of legislation fixes this problem, both 
recognize it.
A Better Approach
    Congress could allow small and alternative reactor technologies to 
move forward by doing the following:

    Reject Additional Loan Guarantees.--Loan guarantee proponents argue 
that high upfront costs of new large reactors make them unaffordable 
without loan guarantees. Presumably, then, a smaller, less expensive 
modular option would be very attractive to private investors even 
without government intervention.
    But loan guarantees undermine this advantage by subsidizing the 
capital costs and risk associated with large reactors. A small reactor 
industry without loan guarantees would also provide competition and 
downward price pressure on large light water reactors.
    Avoid Subsidies.--They do not work. Despite continued attempts to 
subsidize the nuclear industry into success, the evidence demonstrates 
that such efforts invariably fail.
    The nuclear industry's success stories are rooted in the free 
market. Two examples include the efficiency and low costs of today's 
existing plants and the emergence of a private uranium enrichment 
industry. On the other hand, government intervention is the cause of 
the industry's failures, as illustrated by the government's inability 
to meet its nuclear waste disposal obligations.
    Build Expertise at the Nuclear Regulatory Commission (NRC).--The 
NRC is built to regulate large light water reactors. It simply does not 
have the regulatory expertise to efficiently regulate other 
technologies, and building that expertise takes time.
    Helping the NRC to develop that expertise now would help bring new 
technologies into the marketplace more smoothly.
    Establish a New Licensing Pathway.--The current licensing pathway 
relies on reactor customers to drive the regulatory process. The 
problem is that the legal, regulatory, and policy apparatus is built to 
support large light water reactors, effectively discriminating against 
other technologies.
    Establishing an alternative licensing pathway could help build the 
necessary regulatory support on which commercialization ultimately 
depends.
More Harm Than Good
    It seems that some Members of the Senate are making a real effort 
to help move small, modular reactors forward with S. 2052 and S. 2812. 
Unfortunately, their efforts would do more harm than good.
    In the process of attempting to help small, modular reactors, in 
practice, these measures would smother the very market forces that have 
driven the success of small, modular reactors to begin with.
                                 ______
                                 
  Statement of Carl Bergmann, (Co-Director) Ken McLeod (Co-Director), 
     Whit Gibbons (Head, Outreach Program), Savannah River Ecology 
                               Laboratory

    Madam Chairman Cantwell, Ranking Member Risch, and members of the 
Energy Subcommittee of the Senate Committee on Energy and Natural 
Resources: we wish to provide a perspective on and offer our support 
for H.R. 2729 and the Department of Energy's National Environmental 
Research Parks (NERPs).
    We appreciate the opportunity to provide testimony in support of 
H.R.2729, which has far-reaching implications nationally for 
advancements in energy technologies accompanied with credible 
environmental oversight and public education and awareness. The passage 
of this bill will support the country's national energy policy and the 
stated mission of the U.S. Department of Energy, and as stated in Sec. 
3 of the bill, will not limit the activities of the Federal Government 
on NERP land.
    The contributions to field research relating to energy technologies 
that can be accomplished at these DOE sites, which are unsurpassed as 
outdoor laboratories, are boundless. The opportunities to achieve 
public trust through transparent presentation of ecological research 
findings and advancements in environmental stewardship through 
education and outreach programs are limitless.
    Environmental research themes leading to science-based decision 
making regarding energy technologies that will be further enhanced by 
official recognition of the National Environmental Research Parks 
include the following:

          Environmental characterization of the impacted ecosystems, as 
        contrasted to the unimpacted, natural habitats, which is a 
        necessary first step in determining environmental and health 
        risks and in devising appropriate remediation and restoration 
        strategies; research on ecological risks and effects, which 
        will help to ensure that good decisions are made by reducing 
        uncertainties associated with complex environmental processes; 
        and, studies on remediation and restoration of natural habitats 
        that can be conducted on sites where large land areas are 
        impacted by relatively low levels of metals, organics, and 
        radionuclides.

    The NERPs in the DOE complex can also serve as reference landscapes 
for the patchwork of commercial and private land areas that exist 
outside of their borders as well as providing a landscape with 
biological communities that can serve as a reference for climate 
change, without the impact of typical economic development. Long-term 
ecological studies require uninterrupted field research and will be 
enhanced when large land areas are available. Such studies can be 
conducted in the NERPs if they are officially designated as defined 
entities where long-term research can be carried out. Dedicating these 
areas that are minimally affected by impacts from agricultural, urban, 
or unmonitored industrial activities, as National Environmental 
Research Parks, will be in the best interest of all Americans. The 
establishment of the SRS and other DOE sites as National Environmental 
Research Parks will assure a legacy that DOE can be proud of.
    In providing testimony in support of the National Environmental 
Research Park concept, we urge that you remember that NERPs were 
initially created on the premise of studying the interaction of 
industrial development and nature. Such studies are beneficial to the 
national interest. As such National Environmental Research Parks are 
fundamentally different from National Parks, National Wildlife Refuges, 
and National Forests. It should be further noted that a NERP is not a 
regulatory mechanism and is not restrictive of energy technology 
development on or around a site. Instead, it provides a framework to 
generate the knowledge to guide implementation of sound ecological 
stewardship practices consistent with DOE's directives and strategic 
plan.
    The research conducted at the seven National Environmental Research 
Parks targets the interaction of energy production and environmental 
stewardship. To take advantage of the opportunities for collaboration 
through development of a nationwide network of scientists, a NERP 
Workshop was held at the Savannah River Site on November 19-20, 2009. A 
summary of this workshop demonstrates the capabilities that will be 
afforded each of the NERP sites in regard to environmental research and 
public education as they pertain to and will contribute to DOE's stated 
missions on the sites. We therefore have attached the workshop summary 
as an addendum to our testimony.
    We urge you to continue the process of formalizing the DOE lands as 
National Environmental Research Parks, and wish to conclude with the 
following statement from a 1987 NERP planning document.

          The basic operating premises of the National Environmental 
        Research Park concept are that the Department of Energy has 
        stewardship for lands representing a large array of the 
        Nation's ecological regions; a corresponding array of 
        environmental activities (including impacts) are taking place 
        on these lands; that a highly competent cadre of researchers 
        are associated with these sites; and by proper organization of 
        research to achieve agency mandated environmental goals, we can 
        simultaneously aid in resolving environmental problems on-site, 
        locally, regionally, nationally, and globally. In short, the 
        National Environmental Research Park concept is basic to an 
        ecosystem based land-use management program.

                     SUMMARY OF NERP WORKSHOP 2009

    Across the United States there are seven National Environmental 
Research Parks (NERPs) on Department of Energy lands. Unlike the U.S. 
Department of the Interior's National Parks that preserve land, the 
NERP designation does not restrict future land use and NERP sites 
require the juxtaposition of developed and undeveloped areas. The need 
for ``natural'' and ``human impacted'' areas on DOE sites was a key 
component of the 1972 NERP charter. In fact, research on the NERPs is 
used to evaluate and mitigate the environmental consequences of energy 
use and development and to demonstrate potential environmental and 
land-use options.
    The designation of the first NERP site in 1972 coincided with the 
``Calvert Cliffs Court Decision'' in 1971 (U.S. Court of Appeals for 
the District of Columbia Circuit; Docket No. 24839) in which the 
justices addressed the Atomic Energy Commission's (the predecessor 
agency of DOE) response to federal law (NEPA), leading to the 
unequivocal interpretation that research on general basic ecology 
should be conducted at each site and that such research should extend 
to population biology and ecology.
    No consistent funding mechanism has been in place to support 
environmental research on the NERP sites for the last two decades. 
However, the passage of H.R. 2729 has sparked resurgent interest in the 
research value of NERPs. The bill would recognize the DOE NERP sites 
(Fermilab, Idaho, Los Alamos, Nevada, Oak Ridge, and Savannah River 
[with the inclusion of Hanford yet to be determined]). The bill would 
also provide funding for the next five years to conduct research 
related to the environmental aspects associated with DOE missions on 
each site. Although the amount to be provided to each site would be 
modest, the productivity and value of the research, monitoring, and 
communications to the public far outweigh the costs.
    One important outcome of such legislation would be the opportunity 
to create a nationwide network of NERP sites with collaborative 
research programs and mutual consideration of environmental issues 
faced by the sites. Such a network could provide an unprecedented 
opportunity for research aimed at addressing regional, local, and 
global issues pertinent to current and future energy missions.
    With the prospect of creating such a network, the Savannah River 
Ecology Laboratory hosted a NERP workshop (November 19-20, 2009) to 
bring together participants from each NERP site for a two-day 
discussion of creating a NERP network. A majority of the workshop was 
devoted to discussing research being conducted at each NERP site along 
three major themes: climate change, stewardship on DOE sites, and the 
coexistence of energy production and stewardship.
    In the climate change discussion it was immediately apparent that 
the NERP sites are ideal locations for studying the impacts of climate 
change for several reasons.
    First, they occur in a wide variety of bioregions (the NERPs are in 
South Carolina, Tennessee, Nevada, New Mexico, Illinois, Idaho, and 
Washington) and encompass an area that is representative of over half 
of the American landscape. Cumulatively the NERPs are five times larger 
than the National Science Foundation's Long-Term Ecological Research 
sites (NSFLTER), making replication and large scale experiments 
possible to ensure that the results are meaningful to larger areas. 
Each NERP will be affected by climate change differently, but can 
result in excellent opportunities for comparative research programs 
with common goals. For example, Los Alamos has conducted long-term 
research on the relationships between carbon uptake and water loss from 
the individual plant to the ecosystem level. The findings address 
climate variability and forest or desert management issues that are 
applicable to any of the sites, which can develop comparable, 
collaborative research projects.
    Second, a wealth of irreplaceable long-term data already exists at 
each site. Investigations concerning the potential impacts of climate 
change on biota require data collected over decades to address long-
term changes above and beyond typical year-to-year variation. Because 
prior research at NERP sites has not revolved around standard short-
term funding opportunities there exists unparalleled long-term data on 
plant and animal communities that can serve as the basis for future 
studies. For example amphibian populations at an isolated wetland on 
the SRS have been monitored continuously for 31 years.
    Third, the substantial available land area within some NERP sites 
has allowed for some of the largest replicated experimental 
manipulations examining the impact of climate change (e.g. rainfall 
modification experiments conducted at both Oak Ridge and Savannah 
River).
    At the end of the discussion it was agreed that with a funded NERP 
network the following could be undertaken:

    1) compilation and on-line access to extant data sets from among 
the NERP sites,
    2) standardization of data collection techniques for subsets of 
climatic and meteorologic variables where possible, and
    3) coordination of future experimental manipulations to examine the 
variety of impacts climate change is expected to have across the 
regions of the US.

    The discussion of stewardship on DOE lands focused on

    1) the use of long-term ecological research data models on plants, 
animals, and natural communities to develop sound conservation and land 
management policies,
    2) assisting DOE with environmental compliance issues, and
    3) the importance of set aside areas to establish reference sites 
for environmental research that examines impacts of energy 
technologies.

    As above, the major recurring topic was the existence of 
unprecedented long-term data sets at each NERP site, as well as the 
ability to study disturbed and undisturbed habitats. As additional 
ecological research is conducted to examine the effects of human 
disturbance and habitat fragmentation, participants agreed that NERP 
sites provide an invaluable resource unlike any other. The NERP sites 
cover a combined area greater than 2 million acres, and they have 
representative developed and undeveloped tracts of land. The 
undeveloped areas provide necessary reference sites to examine the 
ecology of biota in an undisturbed environment for comparison with the 
effects of disturbance in developed or otherwise altered habitats.
    Also, similar to climate change research, there have been large-
scale long-term experimental manipulations undertaken to investigate 
the impact of various land management practices including different 
fire regimes and forestry techniques. Such manipulations are only 
possible when there is the combination of large areas of land, 
permission to alter the environment, and sufficient time to monitor the 
long-term effects. NERPs are ideal for such research. Participants at 
the NERP Workshop agreed that it was important to collaborate on a few 
important environmental issues that are generally relevant across the 
DOE complex, while also addressing the unique environmental challenges 
intrinsic to each of the NERP sites. For example, surface water-
riparian and fire management are both important to DOE sites but have 
different environmental issues that must be addressed, depending upon 
the region of the country.
    The final research discussion examined the theme of coexistence of 
energy production and stewardship. Specifically, three topics were 
addressed, which were

    1) the use of existing data to facilitate DOE's choice of sites for 
future mission-related activities,
    2) the use of sound science to assist with environmental cleanup 
and ecological risk assessment, and
    3) the need for new research addressing potential future DOE 
missions and alternative energy production methods.

    Workshop participants recognized the need to continue basic 
research focused on the fate and effects of DOE-relevant contaminants 
in support of ongoing decommissioning and environmental cleanup 
activities. The NERP program could facilitate cleanup by providing 
regulators and local stakeholders with realistic, achievable cleanup 
goals based on credible scientific evidence. The independence of NERP 
research will also be important in driving stakeholder consensus 
regarding new site missions, especially those related to nuclear 
energy.
    An overarching theme of the Workshop was that one mission of the 
National Environmental Research Parks is the education of students and 
the general public about site activities. Thus, each site recognized 
the importance of maintaining a strong and active Environmental 
Education and Outreach program that could inform the public of the 
diverse ecological activities conducted at the park and to educate 
students at various levels in environmental science. The two goals are

    1) to train people in ecological and environmental sciences by 
taking advantage of the outstanding opportunities to provide unique 
learning opportunities to all ages, including the completion of 
advanced degrees based on site activities, and
    2) to educate the public by promoting a stronger connection between 
these Federal facilities and the surrounding communities. All sites 
were in agreement that a credible outreach program was important to 
enhance public confidence that the Department of Energy is fulfilling 
its environmental stewardship responsibilities.

    Energy production will always be a crucial component of DOE's 
mission. The NERP sites can provide a unique opportunity to assess the 
interactions between the emerging energy policy issues (wind, solar, 
nuclear, transmission corridors, oil, gas, and rare earth mineral 
extraction, etc.) and the environment. As such it is imperative that 
along with research developing alternative energies there be research 
aimed to examine, evaluate, and mitigate the environmental consequences 
of energy production. Creation of a nationwide NERP network that is 
funded on an annual basis would bring together scientists united by 
common goals but with unique capabilities and scientific expertise. 
Together they could not only assist DOE with future missions but also 
reduce public skepticism regarding DOE activities by providing 
independent peer-reviewed scientific research.
                                 ______
                                 
                                 GE Hitachi Nuclear Energy,
                                   Wilmington, NC, January 4, 2010.
Hon. Jeff Bingaman,
703 Hart Senate Office Building, Washington, DC.
    Dear Chairman Bingaman, On behalf of GEH, I applaud your efforts 
associated with the Senate Energy and Natural Resource Committee 
hearing on Small Modular Reactors held on December 15, 2009. The 
Nuclear Power 2021 Act (S. 2812) as well as the Nuclear Energy Research 
Initiative Improvement Act (S. 2052) is legislation that can advance 
U.S. technologies and processes.
    As you may know, the issue that the private sector faces with small 
modular reactors is the fact that many costs do not scale with power 
output. While a smaller reactor will use less steel and concrete, 
therefore having less capital cost, there are many other costs that do 
not scale with reactor power. Some of the costs which do not scale 
include: licensing certification, licensing fees when operating, plant 
security requirements, control room staffing, and Emergency Planning 
Zones (EPZ). These costs, all necessary to meet government regulations, 
significantly impact the savings gained in capital costs of small 
modular reactors.
    In particular, there is significant value in a Nuclear Regulatory 
Commission (NRC) license. With a NRC license ``in hand'' the private 
sector can better control the total cost of a small modular reactor. In 
addition, overseas sales of U.S. small modular reactors could be 
expected and a NRC license ``in hand'' would help to increase the 
probability of those sales. In order to improve the potential for 
success of small modular reactors under S. 2812 and S. 2052, the 
following changes are recommended:
Nuclear Power 2021 Act (S. 28121
    Remove the cost shares for both the design and licensing work 
within the bill. Rather, replace these provisions with just one 
provision that provides licensing and national laboratory support in 
obtaining a NRC license for the reactor technology. This would apply to 
the first technology movers and would continue until the vendor holds a 
NRC license. The cost of licensing a new technology is a high hurdR. 
The process could be much improved and expedited by having the 
government cover the cost GE Hitachi Nuclear Energy Letter to Chairman 
Bingarnan Page two of the NRC licensing process and by providing 
national laboratory technical support in answering NRC Requests for 
Additional Information (RAI). This framework would provide the national 
laboratories with a very focused, near-term, goal-oriented technical 
and R&D support role.
Nuclear Energy Research Initiative Improvement Act (S. 2052)
    Similar to S. 2812, S. 2052 stipulates cost sharing between the 
government and private industry. Consistent with our suggested changes 
to S. 2812, we recommend that Section 2, paragraph (4) of S. 2052 be 
deleted.
    If the above changes are made to S. 2812 and S. 2052, then the 
focus of the legislation is apparent--perform energy research that 
supports licensing small reactor technologies.
    These changes will provide taxpayers with near term deliverables 
for both the NRC and DOE. This will harness the best minds in the U.S. 
to produce new nuclear technologies that can be used domestically and 
will be attractive overseas because of the rigor associated with 
obtaining the NRC license.
    My staff and I can provide you more details if desired.
            Sincerely,
                                       Christopher Monetta,
                                             Senior vice President.
                                 ______
                                 
              Statement for NEI, Nuclear Energy Institute
   public/private partnership for small reactors will promote clean 
                          energy, job creation

    WASHINGTON, D.C., Dec. 15, 2009--Legislative proposals pending in 
Congress to accelerate development of small, scalable reactors with 
electric generating capacities of no more than 300 megawatts are 
supported by industry and should be enacted expeditiously, an industry 
leader told the Senate Energy and Natural Resources Committee today.
    The establishment of a private/government partnership to work 
together on the research and development of small reactor technology 
would greatly enhance a diversified energy strategy aimed at boosting 
energy sources that can meet rising electricity demand while reducing 
emissions of greenhouse gases, said Anthony Pietrangelo, the Nuclear 
Energy Institute's senior vice president and chief nuclear officer.
    ``Large nuclear energy facilities will provide the bulk of 
additional electricity in the near future, but small, modular reactors 
will act as a complement to these large-scale projects and expand the 
applications for carbon-free nuclear energy,'' Pietrangelo said.
    Small reactors also have multi-use capabilities combining 
electricity generation with industrial process heat applications such 
as those used in the petrochemical industry and coal-to-liquids 
applications.
    Pietrangelo cited analyses from the U.S. Energy Information 
Administration assessing the Waxman-Markey climate legislation and the 
National Academies of Science, which concluded that the United States 
must nearly double the existing 100 gigawatts of nuclear energy 
capacity by 2030 to meet greenhouse gas emissions reduction goals.
    Small reactors of fewer than 300 megawatts-comparable from a 
capacity standpoint with many renewable energy projects-will be more 
compatible than large nuclear power plants with the needs of smaller 
U.S. utilities from an electricity production, transmission and 
financial perspective, Pietrangelo said. Small reactors also have 
attractive manufacturing efficiencies.
    ``These designs can be used to replace inefficient fossil-fired 
power stations of similar size that may no longer be economical to 
operate in a carbon-constrained world. The infrastructure, cooling 
water and transmission facilities already exist at such facilities, and 
smaller reactors can be built in a controlled factory setting and 
installed module by module, reducing the financing challenge and 
matching new electricity production to demand growth,'' Pietrangelo 
said.
    He pointed to the success of the Department of Energy's cost-
shared, public-private Nuclear Power 2010 program in reducing business 
risk and enabling near-term construction of larger advanced-design 
reactor technologies. A similar effort must be expended for small 
reactors, he said.
    ``The development and use of a new nuclear reactor technology can 
take two decades, with design costs exceeding $1 billion. The cost and 
time required to design, develop and license a small reactor is not 
necessarily reduced linearly with size. In addition, it takes time and 
resources for the Nuclear Regulatory Commission to develop the 
institutional capacity to license new reactor designs,'' Pietrangelo 
said.
    He urged the sponsors of proposed Senate legislation to jump-start 
small reactor development to work together to combine the provisions of 
three proposals into a single bill. He also said legislation should 
include the following provisions:

   define the scope, priorities and funding for research and 
        development;
   define the scope of private sector/government cost-share 
        provisions for design development and prototype simulation or 
        testing;
   provide funding to assist the Nuclear Regulatory Commission 
        and the industry in resolving generic regulatory issues 
        specific to small-scale reactors; and
   define private/government cost-share projects for the 
        development, NRC review, and implementation of first-of-class 
        combined license applications for each new type of small-scale 
        reactor.

    ``The potential benefits of small, modular nuclear energy plants 
are substantial and should be pursued and supported,'' Pietrangelo 
said. ``These designs expand the strategic role of nuclear energy in 
meeting national environmental, energy security and economic 
development goals.''
                                 ______
                                 
                             Nuclear Regulatory Commission,
                                 Washington, DC, December 10, 2009.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources, U.S. Senate, 
        Washington, DC.
    Dear Mr. Chairman: As requested in your letter dated December 1, 
2009, I am submitting, on behalf of the U.S. Nuclear Regulatory 
Commission (NRC), the following comments regarding S. 2052, the 
``Nuclear Energy Research Initiative Improvement Act of 2009,'' and S. 
2812, the ``Nuclear Power 2021 Act.''
    Because of our role as a regulator, the NRC offers no comments on 
whether, as a policy matter, small modular reactors or other new 
nuclear reactor technologies should or should not be pursued. The NRC's 
role would be limited to ensuring that any reactors utilizing new 
technologies will be constructed and operated in a manner that will 
provide adequate protection of public health and safety and the common 
defense and security. Accordingly, the NRC's comments relate to the 
NRC's regulatory role.
S. 2052
    S. 2052 would require the U.S. Department of Energy (DOE) to 
``conduct research to lower the cost of nuclear reactor systems.'' This 
language would not, though, expressly direct the DOE to conduct 
research on safety in conjunction with its research related to cost 
reduction for nuclear reactor systems. Such safety research could be 
valuable in supporting the NRC's role in determining whether particular 
cost-saving measures are consistent with public health and safety--a 
determination the NRC would need to make before making any licensing 
decisions. Accordingly, the NRC suggests adding the words ``consistent 
with protection of public health and safety'' after the words ``lower 
the cost of nuclear reactor systems'' in the provision of Section 2 of 
S. 2052 that would add a new paragraph (2) to section 952(a) of the 
Energy Policy Act of 2005.
    To the extent that the research into nuclear reactor systems leads 
to submission to the NRC of applications based upon new technologies or 
designs, the NRC may need to conduct infrastructure development and 
confirmatory research before receiving applications in order to ensure 
an efficient and effective review process once applications do arrive. 
To facilitate efficient licensing reviews, Congress would therefore 
need to provide the NRC with adequate appropriations to cover this pre-
application work.
S. 2812
    S. 2812 requires the DOE to obtain two small modular reactor design 
certifications from the NRC by January 1, 2018, and to obtain two NRC 
combined licenses--one for each certified design--by January 1, 2021. 
As the NRC staff has indicated in prepared written testimony for the 
Committee's December 15, 2009 hearing, the NRC has already begun 
conducting preparatory work on various matters related to small modular 
reactors. However, the amount of additional work that the NRC must do 
to prepare itself for efficient reviews of the small modular reactor 
design certification and combined license applications described in S. 
2812 will vary based upon the technologies ultimately chosen. For 
example, the NRC expects that it is much closer to being able to 
efficiently evaluate applications for small modular reactors that would 
utilize light water reactor technology--the same technology employed in 
the existing fleet of large commercial nuclear plants--than 
applications reliant on technologies with which the NRC has much less 
experience.
    Thus, while the NRC is not contending that the deadlines in S. 2812 
are unattainable, and while the NRC would make a concerted effort to 
make licensing decisions within any statutory timeframe, the NRC 
emphasizes that the time and resources it will need to develop the 
appropriate infrastructure and conduct any necessary confirmatory 
research could vary substantially depending upon which small modular 
reactor technologies are ultimately pursued. S. 2812 does set target 
dates for ultimate receipt of NRC licenses, but it sets no deadline for 
determining which technologies will be chosen as the basis for the 
designs that the DOE and its private-sector partners would seek to have 
licensed. Therefore, it is not clear how much advance warning the NRC 
would have about which technologies the license applications will 
reference.
    In addition, pursuant to its Atomic Energy Act responsibilities, 
the NRC will not grant a license if the applicant does not demonstrate 
to the NRC that public health and safety and common defense and 
security will be adequately protected. Therefore, for the deadlines in 
S. 2812 to be met, the NRC would need to receive appropriations 
adequate to support any necessary infrastructure development and 
confirmatory research as well as the application reviews themselves, 
and applicants would need to submit high quality applications in a 
timely manner.
    In light of the considerations described above, the NRC suggests 
adding language to the deadline provisions of S. 2812 to ensure there 
is no undue pressure on the DOE or the NRC to compromise on safety or 
security because of impending statutory deadlines. Section 645 of the 
Energy Policy Act of 2005 provides an example of possible alternative 
language. That act established the Next Generation Nuclear Plant 
Project, and Section 645(c) sets forth a specific date by which the DOE 
is to complete construction and begin operations of a prototype nuclear 
plant and associated facilities. But Section 645(c) also gives the DOE 
the option--in the event it cannot comply with the statutory deadline--
of ``submit[ting] to Congress a report establishing an alternative date 
for completion.'' The NRC believes that similar safety-valve language 
would be appropriate for S. 2812 to account for any complications 
related to safety or security that might arise as new small modular 
reactor technologies are developed and assessed.
    If you have questions about these views, please do not hesitate to 
contact me.
            Sincerely,
                                         Gregory B. Jaczko.
                                                          Chairman.
                                 ______
                                 
                                            Hyperion Power,
                                     Denver, CO, December 17, 2009.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources, U.S. Senate, 
        Washington, DC.
RE: S. 2812

    Dear Senator Bingaman: I am the CEO and a co-founder of Hyperion 
Power Generation Inc.--a small business technology transfer company 
spun out from Los Alamos National Laboratory. Hyperion was the first 
Small Modular nuclear power Reactor (SMR) company to meet with the 
Nuclear Regulatory Commission about its intention to commercialize an 
SMR design. Hyperion Power continues to be the market leader in the 
U.S. for SMRs.
    I have spent the last 20 years commercializing technologies from 
the DOE complex and greatly respect the work done by DOE personnel. 
With dedicated key associates, I directly founded four Los Alamos 
National Laboratory (LANL) startups and assisted in dozens of others--
while at LANL (on two different ``tours''), as a consultant to 
Technology Ventures Corporation, and while working as a venture 
capitalist. I am uniquely qualified to provide testimony on the impact 
of S.2812 in particular and felt that we could have provided an 
essential perspective.
    To Hyperion Power, and our friends at two other commercial U.S. SMR 
firms, S.2812 looks like a program that will favor the DOE 
establishment over private industry. It seems clear the bill as written 
will stifle innovation and could kill an industry just begun by DOE 
technology transfer success.
Allow me to explain
    S.2812 will create a government sponsored standard and will be 
limited to two SMR designs. Whoever doesn't win this government 
competition will essentially be blocked from raising equity capital lot 
their firms. Investors will nut want to ``back the horse'' that does 
not win this first race, when the race is defined by the U.S. 
Government as The Standard Design for Small Modular Reactors. While I 
admit Hyperion Power and NuScale are the two most likely small business 
winners of this competition (since we are the closest to market), we 
and our stockholders would much prefer not to risk our corporate lives 
by supporting S.2812 as written.

Issue #1: DOE Decides What Will Be the Standard & Will Compete with 
        Industry
    A. The DOE should not be placed in the difficult position of 
competing with private industry, but that's what this bill will do. End 
of story and ``game over'' for private industry if this bill goes forth 
as written as it places the DOE in the untenable position of deciding 
which SMR design will be commercially successful. As you know, there 
are many factors that determine which commercial products will be 
successful. Is the DOE prepared to be a commercial judge?
    B. Also, the bill (S.2812) says, ``(4) Technical Considerations-In 
evaluating proposals, the Secretary shall take into account the 
efficiency, cost, safety, and proliferation resistance of competing 
reactor designs.'' Our concern is the Hyperion Power Module is not 
optimized for efficiencyit is optimized for safety and security. DOE 
personnel might look at our design and judge it as non-competitive 
compared to other designs and select some less safe design because they 
are concerned about efficiency.
    The NRC determines the safety and security of a reactor design. The 
market should decide which reactor designs will be successful, not the 
U.S. government. Quite frankly, and perhaps oversimplified, this is the 
American way--the government deciding what products to sell is most 
assuredly not.

            Solution #1
          The best solution to this issue in the current bill is to not 
        allow any DOE reactor design in the competition unless it had 
        been commercialized by the time this bill was announced (1 
        November 2009). Other solutions are to provide for up to ten 
        designs. not two, or to not provide direct funds to any 
        company, (our preference) and to instead alter the bill to 
        really help the SMR industry by funding an NRC office of small 
        reactors (see below).

Issue #2a: Previous Civilian Nuclear Programs Have Had Little Impact
    Previous civilian nuclear competitions have been cited as a good 
argument for the structure of S.2812. However, following the 2005 
Energy Policy Act, new 3rd and 4th generation nuclear programs 
involving existing large firms have had mixed results. The SMR firms, 
and especially Hyperion Power. have never requested government R&D 
funding (in fact we pay LANL to do work for us under a CRADA), nor has 
our industry asked the government to establish any commercial standards 
in our industry. All we have asked is for the NRC to be attentive to 
the needs of the marketplace.

Issue #2b: The SMR Industry is a REAL Opportunity for Small Business--
        Please don't kill it
    You really must throw out what you know about the civilian nuclear 
reactor market as the SMR industry, with its roots in small business, 
is already breaking the Big Company stranglehold on civilian nuclear 
power innovation. For one thing, the SMR industry does not require the 
billions of dollars required by traditional (1,000MW) design firms.
    Hyperion Power has taken the rough-formed design we licensed from 
LANL and completely altered it for the market. We'll get to market for 
less than $80 million--It should be self evident that an influx of tens 
of millions of government dollars will grossly upset this industry. To 
quote a phrase, if ``you break it, you buy it'' in the same way that 
the traditional large nuclear industry can't seem to survive without 
government subsidy. The nascent SMR industry does NOT need nor want 
direct government subsidy. It simply wants a chance to grow 
unfettered--without the threat of government-subsidized competitors.
            Solution #2
          If any government funds are to be directly granted to 
        commercial partners, we ask that you consider these monies to 
        be limited to existing small commercial reactor developers and 
        not make those funds available to larger commercial films, such 
        as B&W, nor foreign controlled firms such as Westinghouse, 
        Toshiba, or GE-Hitachi.

Issue #3: It's Not Capital, It's the NRC
    We have no issue, save one, raising capital for our firm: the issue 
is the apparent politics and ``randomness'' from the U.S. government 
regarding civilian nuclear power. S.2812 will only make this worse.
    The development of Small or Modular nuclear power Reactors (SMRs) 
can provide an economic boost in manufacturing. Hyperion Power alone 
can create 15,000 jobs of a wide variety and generate $32 billion into 
the economy over 15 years. To compete in this industry and provide this 
benefit for the U.S. economy, we must be able to compete globally.
    Hyperion Power has signed letters of intent from customers to 
purchase over 100 Hyperion Power Modules. Many of these customers, 
impressed as they are with our technology, have indicated they will 
purchase the first design to make it to market. It would be a shame to 
see yet another American industrial and employment opportunity lost to 
global competitors with more nimble bureaucracies.
    To do that the U.S. must move faster. Our non-U.S. competitors will 
deploy units in 2013. Officials at the U.S. Nuclear Regulatory 
Commission have told Hyperion Power not to hope for licensing of SMRs 
``for several years.''

    Other official statements are just as troubling.

          (1) NRC Chairman Jaczko
           . . . would like to see the NRC make some final decisions 
        during my time as Chairman;'' and that he ``would hope that by 
        2012 we've made substantial progress on reviewing at least one 
        of the applications in front of us.''
                  Interview with NationalJournal.com entitled ``NRC at 
                Center of Regulatory Roadblock,'' 11 September 2009

          (2) Marvin Fertel, CEO, Nuclear Energy Institute

           . . . licensing SMRs would ``take away from the efforts of 
        the NRC,'' American Nuclear Society, D.C. chapter meeting, 
        October 2009

    Clearly the establishment is against our little industry. Providing 
big commercial firms a token amount of money, along with the government 
deciding which commercial products are viable, will not solve this 
issue, and could in fact kill the SMR industry. Setting ridiculously 
long goals for licensing SMRs is equally crippling.
    No help is better than this kind of help.
            Solution #3
          Provide $50 million in direct finding to the NRC to fund an 
        SMR office and direct the NRC to begin evaluation of one or 
        more commercial SMR designs by 2011. The NRC's existing policy 
        is that a design must show it is commercially viable before 
        they will start design certification: let that existing 
        standard be the benchmark for which reactor is certified and 
        keep the DOE out of the commercial market.

Issue #4: Hearing on 15 December 2009
    We remain concerned about fundamental fairness, balance, and 
effective enquiry that will stifle the albeit ``good intentions'' of 
S.2812 and perhaps other bills by providing an unfair advantage to DOE 
projects. Hyperion Power and others are pouring millions of private 
capital into the SMR industry (and Hyperion into the DOE lab at Los 
Alamos). This concern was fanned by our inability to be heard at this 
week's Energy Committee's hearings on December 15. By his very presence 
Tom Sanders from Sandia National Laboratory was allowed to promote his 
SMR design at that hearing, but the two private companies that ignited 
the SMR industry were not able to voice their opinions and provide 
valuable information gleaned from the frontlines of the marketplace.
    As you may know, Hyperion Power is a small business success story--
a unique spin-out company from Los Alamos National Laboratory and a 
success story for the whole DOE complex. Why keep this story from the 
Committee?
            Solution #4
          As private industry was not allowed to speak at the December 
        15 hearings, we would like the US Senate Committee on Energy & 
        Natural Resources to hold an additional hearing which would 
        focus on the startups struggling in this new industry segment 
        and invite executives from NuScale, Hyperion Power, and Adams 
        Atomic Engines.
    We would greatly appreciate the opportunity to meet with you in 
person in order to discuss our concerns directly.
    The SMR industry did not even exist three years ago. I would hope 
you'd agree that it makes sense to hear from those of us who are 
responsible for creating interest in the industry when considering 
S.2812 or other bills related to SMRs.
    I appreciate your attention to these important issues and look 
forward to a continuing dialogue regarding the best path forward for 
realizing the benefits of SMR technology for our economy, our security, 
and our global responsibility to help protect our environment.
            Sincerely,
                                       John R (Grizz) Deal,
                                                               CEO.

                                    

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