[Senate Hearing 114-474]
[From the U.S. Government Publishing Office]
S. Hrg. 114-474
THE STATUS OF ADVANCED NUCLEAR TECHNOLOGIES
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
__________
MAY 17, 2016
__________
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
LISA MURKOWSKI, Alaska, Chairman
JOHN BARRASSO, Wyoming MARIA CANTWELL, Washington
JAMES E. RISCH, Idaho RON WYDEN, Oregon
MIKE LEE, Utah BERNARD SANDERS, Vermont
JEFF FLAKE, Arizona DEBBIE STABENOW, Michigan
STEVE DAINES, Montana AL FRANKEN, Minnesota
BILL CASSIDY, Louisiana JOE MANCHIN III, West Virginia
CORY GARDNER, Colorado MARTIN HEINRICH, New Mexico
ROB PORTMAN, Ohio MAZIE K. HIRONO, Hawaii
JOHN HOEVEN, North Dakota ANGUS S. KING, JR., Maine
LAMAR ALEXANDER, Tennessee ELIZABETH WARREN, Massachusetts
SHELLEY MOORE CAPITO, West Virginia
Colin Hayes, Staff Director
Patrick J. McCormick III, Chief Counsel
Benjamin Reinke, Ph.D., Congressional Fellow
Angela Becker-Dippmann, Democratic Staff Director
Sam E. Fowler, Democratic Chief Counsel
Rory Stanley, Democratic Legislative Aide
C O N T E N T S
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OPENING STATEMENTS
Page
Murkowski, Hon. Lisa, Chairman and a U.S. Senator from Alaska.... 1
Cantwell, Hon. Maria, Ranking Member and a U.S. Senator from
Washington..................................................... 3
Daines, Hon. Steve, a U.S. Senator from Montana.................. 4
Risch, Hon. James E., a U.S. Senator from Idaho.................. 5
Crapo, Hon. Mike, a U.S. Senator from Idaho...................... 5
WITNESSES
DeWitte, Dr. Jacob, CEO and Co-Founder, Oklo Inc................. 6
Gilleland, Dr. John, Chief Technical Officer, TerraPower......... 14
Hopkins, John, Chairman and Chief Executive Officer, NuScale
Power.......................................................... 18
Kuczynski, Stephen, Chairman, President and Chief Executive
Officer, Southern Nuclear Operating Company, Inc............... 26
Peters, Dr. Mark, Director, Idaho National Laboratory............ 42
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
Cantwell, Hon. Maria:
Opening Statement............................................ 3
Crapo, Hon. Mike:
Opening Statement............................................ 5
Daines, Hon. Steve:
Opening Statement............................................ 4
DeWitte, Dr. Jacob:
Opening Statement............................................ 6
Written Testimony............................................ 9
Questions for the Record..................................... 81
General Atomics:
Statement for the Record..................................... 116
Gilleland, Dr. John:
Opening Statement............................................ 14
Written Testimony............................................ 16
Responses to Questions for the Record........................ 88
Hopkins, John:
Opening Statement............................................ 18
Written Testimony............................................ 20
Responses to Questions for the Record........................ 91
Kuczynski, Stephen:
Opening Statement............................................ 26
Written Testimony............................................ 28
Responses to Questions for the Record........................ 97
Murkowski, Hon. Lisa:
Opening Statement............................................ 1
Peters, Dr. Mark:
Opening Statement............................................ 42
Written Testimony............................................ 44
Responses to Questions for the Record........................ 108
Poneman, Hon. Daniel:
Statement for the Record..................................... 113
Risch, Hon. James E.:
Opening Statement............................................ 5
THE STATUS OF ADVANCED NUCLEAR TECHNOLOGIES
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Tuesday, May 17, 2016
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The Committee met, pursuant to notice, at 10:05 a.m. in
Room SD-366, Dirksen Senate Office Building, Hon. Lisa
Murkowski, Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. LISA MURKOWSKI, U.S. SENATOR FROM
ALASKA
The Chairman. Good morning. The Committee will come to
order.
Senator Cantwell will be joining us, but I understand she
is stuck behind a motorcade.
We come to order this morning to begin the hearing on the
status of innovative advanced nuclear technologies. We are
holding this hearing because nuclear energy must be a national
priority. It provides about 20 percent of our nation's
electricity and 63 percent of our emissions-free electricity.
It is safe, and it is extremely reliable.
When cold winters hit the Northeast and the flow of natural
gas is restricted, nuclear plants can continue to provide
electricity to residents, literally saving lives. When the wind
is not blowing and the sun is not shining, nuclear is still
providing essential base load capacity. For any number of good
reasons, nuclear has to remain part of the energy mix.
In addition to supporting the current nuclear fleet, I have
long supported the research, development and deployment of next
generation nuclear technologies, including small modular
reactors, micro-reactors, Generation IV reactors and future
fusion reactors. That support appears to be growing here in
Congress which is a good thing for our country.
We are entering a new era for nuclear power. The
opportunity for innovation in nuclear technologies has not been
this great since the 1960's. Despite the many difficult
challenges associated with full deployment, technical--
financial, bureaucratic and license-related--there is
unprecedented interest from both the public and private
sectors. We can help by removing barriers and optimizing our
public-private partnerships.
Despite the clear benefits of nuclear energy, the industry
is at a crossroads. The current operating fleet faces a number
of challenges due to political decisions, or state market
designs and regulations that skew the value of nuclear to the
grid. Moreover, the President's greenhouse gas regulations do
not value the contribution of nuclear-generated electricity on
a level footing with the other sources of emissions free
electricity.
In order to facilitate the emergence of advanced nuclear
technologies, we adopted the Nuclear Energy Innovation
Capabilities Act, which was sponsored by Senator Crapo, as an
amendment to our broad, bipartisan energy bill. Senator Crapo
is with us this morning. Thank you, Senator, for your
contributions on this important issue. That amendment was
adopted by a vote of 87 to 4, highlighting the value placed on
nuclear innovation on both sides of the aisle. The House has
passed a nearly identical bill which we hope, when signed into
law, will be a valuable step in getting advanced nuclear
technologies to the market.
As these technologies are developed they will face further
challenges. To give one example, they will have to navigate a
complicated and expensive NRC licensing process as they come
closer to deployment.
I am pleased to have joined, as a co-sponsor, Senator
Inhofe's bipartisan bill, the Nuclear Energy Innovation
Modernization Act. In many ways that bill compliments the
provisions within our energy bill. It helps reform the NRC in
smart ways without compromising safety, and I am hopeful that
it will be reported quickly out of the Committee on Environment
and Public Works.
Beyond new legislation we must also continue our fiscally
responsible support for nuclear research and development. In
that vein, I was pleased that we were also able to increase the
authorizations for both the Office of Science and ARPA-E within
our energy bill.
I believe that removing bureaucratic barriers to public-
private partnerships, reforming the licensing structure, and
continuing responsible funding for nuclear science RD&D will
help drive these innovative technologies to revolutionize the
industry and provide robust economic growth.
Our nation deployed the first commercial nuclear power
plants, and our regulatory structure is still considered the
gold standard. Our universities and national labs are world
leaders in education and research. I see advanced reactors as
the next chapter of America's leadership in this field.
This is critical because we must remain the go to country
for nuclear know how, especially as many foreign nations
increase investment and try to challenge our dominance in this
industry. Our nation must continue to be the major player on
the world stage for nuclear energy, and we must be able to
deploy our innovative advanced reactors here at home.
I am pleased to welcome our very esteemed panel of
witnesses. We have representatives from a great cross section
of advanced reactor technologies at different stages of
commercialization, a national laboratory that has been a
nuclear leader for decades, and a utility that has consistently
supported current and advanced nuclear technologies. I welcome
all of you here today.
With that I will turn to Ranking Member Cantwell, welcome.
STATEMENT OF HON. MARIA CANTWELL, U.S. SENATOR FROM WASHINGTON
Senator Cantwell. Thank you, Madam Chair, and thank you for
calling this important hearing on advanced nuclear technology.
I would also like to thank the panel for being here today
and for their work in this important field. The group of
witnesses will provide us with a comprehensive viewpoint needed
to explore the current state of advanced nuclear technology in
this country.
Nuclear energy has provided nearly 20 percent of electrical
generation in the United States over the past two decades and
currently produces 60 percent of American's carbon free-
electricity, but the 99 reactors licensed to operate today in
the U.S. will not last forever. If nuclear power is to remain
part of our energy future, we need to develop and demonstrate
the next generation of nuclear power.
For me, we also need to deal with the challenges of nuclear
waste. I should say, we all need to deal with this. It is
something that presses every day for us in the State of
Washington.
The lack of a comprehensive set of solutions has hampered
both commercial nuclear development as well as our defense
waste cleanup efforts in this country. Secretary Moniz has
worked hard to break the log jam, and I think this Committee
will ultimately play a key role in crafting a path forward on
this very technically challenging issue.
Meantime, we should also acknowledge that while nuclear
power has a record of operating safely and cost effectively,
there is also potential for catastrophe like we have seen at
Fukushima, Three Mile Island and Chernobyl.
If nuclear power is to have a future, the problems that we
have consistently been plagued by in the past must be met with
innovation and effectiveness. New designs must be safer,
cheaper and efficient, and proliferation resistant. In
addition, we must have licensing and regulatory systems that
ensure nuclear power is not only safe but accepted by the
public so transparency and open communication by the industry
and government is also important.
The Department of Energy and private industry have been
working to address these problems. There are several designs
being considered here in the U.S. and globally that have
promising features to address some of these long standing
issues. I look forward to hearing from the witnesses today on
those specific technologies.
Advanced nuclear may, someday, make a real contribution to
advanced manufacturing in Washington State and the Northwest
Region. I am pleased to have here TerraPower, NuScale and the
Idaho National Laboratory. The Pacific Northwest National
Laboratory is also making important contributions in advanced
nuclear development.
The Northwest has proven to be an exciting place for the
development of advanced nuclear technologies, and NuScale
Energy, Energy Northwest, Utah Associated Municipal Power
Systems are all partnering to construct and operate the
country's first small modular reactor.
In addition, TerraPower and the Chinese National Nuclear
Corporation signed a memorandum of understanding to develop
TerraPower's traveling wave reactor. So it is clear that making
a dent in the global carbon emissions will require cooperation
between U.S. and China which may prove to be one of the biggest
nuclear-energy markets as well as a testing ground for advanced
nuclear.
TerraPower's engagement with China is an important example
being set for advanced reactor technologies. In order to be a
part of the new wave of nuclear energy, the U.S. must be a
strong exporter of advanced proliferation resistant nuclear
materials and technology.
So the advancement of nuclear technology is an important
pathway for the global community to move away from carbon
emitting technologies. It is vital that the U.S. continue to
lead in this area of clean energy, and nuclear solutions may
prove to be a key component of our overall efforts.
Again I thank the Chair for holding this important hearing,
and I look forward to hearing from the witnesses.
The Chairman. Thank you, Senator Cantwell, and thank you to
our witnesses. We attempted to schedule this earlier in the
year and unfortunately you got bumped. Thank you for your
flexibility and your willingness to come back before the
Committee.
At this time, I will introduce a few of the witnesses, and
we have a couple members here who would like to do more
detailed introductions of some of our witnesses this morning.
Our panel this morning will be lead off by Dr. Jacob
DeWitte, who is the Co-Founder and the CEO of Oklo, welcome
this morning.
Dr. John Gilleland, who is the Chief Technical Officer at
TerraPower, which Senator Cantwell has just mentioned.
Mr. Hopkins will be introduced by Senator Daines this
morning, as we understand that he is a fellow Montanan, but I
also know that he is a pretty strong fisherman that comes up to
Alaska occasionally. So, welcome to the Committee.
Senator Daines?
STATEMENT OF HON. STEVE DAINES, U.S. SENATOR FROM MONTANA
Senator Daines. Well it is my honor to have John Hopkins
here from Superior, Montana. He is the Chairman, CEO of
NuScale, and it is great to have him with us here today.
I am very much looking forward to his testimony and very
excited about the innovation coming out of this group of
panelists, specifically from John Hopkins' group, on these
modular nuclear reactors as part of the solution going forward
here with our all-of-the-above energy portfolio.
Welcome, John.
Mr. Hopkins. Thank you, sir.
The Chairman. Thank you, Mr. Hopkins, for being here.
After his testimony we will welcome Steve Kuczynski to the
Committee. He is the President, CEO and Chairman of Southern
Nuclear Operating Company, welcome. It is good to have you
here.
And Dr. Peters will be introduced by Senator Risch.
STATEMENT OF HON. JAMES E. RISCH, U.S. SENATOR FROM IDAHO
Senator Risch. Thank you very much, Madam Chairman.
Dr. Peters, welcome.
I would like to introduce Dr. Peters, who is relatively new
at the Idaho National Laboratory.
Dr. Peters comes to us from Argonne, where he was an
Associate Lab Director, and prior to that he had been employed
as a scientist at Los Alamos. He has a deep background in
nuclear energy.
It is fitting that he comes to Idaho which is the flagship
and lead nuclear energy laboratory in America, which we are
very proud of. And that is for good reason. Most people do not
realize that the first light bulb lit by civilian energy from
nuclear power happened in Idaho at the Idaho National
Laboratory. We are very proud of that, and we maintain that
position.
So, Dr. Peters, we are glad to have you. I am sure we will
see you frequently here at this Committee.
With the Chairman's permission I would like to introduce my
colleague and friend, Senator Crapo.
Senator Crapo, although not on this Committee, grew up in
the shadow of Idaho National Laboratory in Eastern Idaho. He
remains engaged and interested. He and I partner on virtually
everything that we do over there. In fact, right now we are
partnering on a couple of pieces of legislation which we just
dropped. With the Chair's permission, I would like Senator
Crapo, maybe, to just give us a couple of sentences on those
two pieces of legislation which we are introducing.
Mike?
The Chairman. We are happy to invite you before the
Committee, Senator Crapo, and I am happy to have had an
opportunity to join you all out at the Idaho National Lab.
Senator Risch. That is true. That is right.
The Chairman. Very, very informative, and a very necessary,
a very necessary, tour for so many of us.
Senator Crapo, if you would like to say just a couple of
words?
Senator Crapo. I know this is not the usual procedure, so I
will be very quick----
The Chairman. I do not think you are being picked up by the
record.
Senator Cantwell. We are happy if you sit on our side of
the dais.
Senator Risch. Yes. [Laughter.]
The Chairman. There you go.
Senator Risch. I can assure you he is not very comfortable
over there. [Laughter.]
Senator Cassidy. Can we get a photo of that? [Laughter.]
Senator Crapo. No, not with the sign. [Laughter.]
STATEMENT OF HON. MIKE CRAPO, U.S. SENATOR FROM IDAHO
Senator Crapo. Well thank you very much. I know this is
unusual. So thank you, Senator Risch and Madam Chairman, for
allowing me to just say a few sentences.
Actually, Madam Chairman, you identified the legislation
that Senator Risch just referenced in your introductory
comments. So I won't elaborate further on that.
We've got NEIMA and NEICA, the two major bills that will
reform both the process and create the new emphasis for going
into our new advanced nuclear reactors and helping to make them
much more aggressively facilitated.
I am excited about all of this, and I look forward to
working with all of you. Thank you for letting me, kind of,
join the Committee for a moment.
The Chairman. We appreciate it. Thank you for your
leadership on this, Senator Crapo.
With that, let's begin with our panel of witnesses.
Dr. DeWitte, if you would like to lead off, please?
STATEMENT OF DR. JACOB DEWITTE, CEO AND CO-FOUNDER, OKLO INC.
Dr. DeWitte. Thank you.
Chairman Murkowski, Ranking Member Cantwell and
distinguished members of this Committee, I want to thank you
for holding this hearing and for giving me the opportunity to
testify. I'm honored to be here today, and I'm excited that you
are holding this hearing because I've been passionate about
nuclear technology since my childhood.
I was born and raised in Albuquerque, New Mexico, where my
Saturdays as a young boy were often filled with my father
taking me to get donuts followed by a visit to the National
Nuclear Science Museum. And during those trips I recall being
captivated by the science and technology and physics of nuclear
power, and I knew from a young age that I wanted to work on
nuclear reactors.
So I am Jacob DeWitte, the CEO and Co-Founder of Oklo. Oklo
is a Silicon Valley-based company developing a very small,
advanced reactor that produces two megawatts of power. That's
very small relative to without the nominal size of a thousand
megawatts. We like to call it sometimes a micro-reactor or a
nuclear battery and it is designed to bring distributed, clean,
affordable and reliable power in small packages to the market.
These reactors fit into containerized systems that can
power a wide variety of markets both domestically and
internationally which do not have access to affordable and
reliable power and in some cases, do not have access to power
at all. Our reactor operates purely on natural forces with very
few moving parts in the entire system, and it is designed to
operate for 12 years before refueling.
It will produce reliable, affordable, safe, emission-free
power wherever it is needed and the reactor is sized
appropriately to open up new opportunities for clean and safe
nuclear power in remote and rural communities as well as
industrial and military sites in areas that are too small for
larger reactors.
The Oklo reactor has the potential to reduce these
customers' energy bills by up to 90 percent. Furthermore, our
reactor is up to 300 times more fuel efficient than current
reactors and can actually consume the used fuel from today's
reactors as well as depleted uranium stockpiles around the
nation. In fact, our reactors and others like them, could power
the world for 500 years with the global inventory of used fuel
and depleted uranium, all while reducing the radioactive
lifetime of those materials.
Our reactors can also assist with plutonium disposition by
consuming excess cold war materials and turning them into
clean, peaceful energy.
We started Oklo because we believe advanced reactors will
be a significant part of the energy mix of the future, and we
wanted to make that future a reality as quickly as we could.
So advanced reactors can provide clean, affordable,
reliable and extremely safe, carbon free power that can be
deployed on a global scale. They offer the promise to realize
the energy future envisioned by the intellectual giants upon
whose shoulders we all stand. Fermi, Weinberg, Wigner, Seaborg,
and others all saw the potential that next generation reactors
have.
Some of the key attributes of advanced reactors include a
competitive economics due to reduced capital cost and shortened
construction times, multiple energy output streams ranging from
electricity to process heat, improved fuel efficiency and the
ability to consume used nuclear fuel, flexible operations such
as load following and grid stabilization to couple with
renewables, and passive inherently safe designs producing walk
away, safe technologies as well as flexible siting independent
of access to cooling water. Additionally, advanced reactors
enable a broad diversity of reactor sizes. Micro-reactors like
ours can bring affordable and reliable nuclear power to areas
that cannot support larger plants. Alaska and Hawaii are good
examples.
But there are a number of places in the continental U.S. as
well as other U.S. territories that are excellent candidates
for these reactors. The size and characteristics of our
reactors also enable us to reach markets that are underserved
by existing energy technologies.
Looking farther afield, advanced reactor technologies can
fuel mankind's ambitions of navigating the stars. We need
energy to explore the heavens and nuclear energy will power
future trips to our neighboring planets and beyond. This is not
science fiction. This is work that is actually happening today.
Dozens of startups and large companies are now working to
commercialize advanced reactor technologies in the United
States. Nuclear innovation is alive and well and advances in
computational simulation and modeling, along with an injection
of talented, young, creative, hungry engineers into the nuclear
industry have fueled much of this growth. Federal efforts to
attract students into nuclear engineering programs over the
last decade are paying dividends and there is more to come.
This activity has also attracted over $1 billion in private
investment. And these investments are supporting advanced
reactor companies because of their massive market potential as
well as the environmental benefits of next generation reactors.
And while the capital invested so far is significant, there is
still much more that can and will be invested in advanced
reactor projects, especially if some of the remaining hurdles
are cleared.
Advanced reactor developers face a variety of hurdles and
challenges to deploying their technologies. One such challenge
is the regulatory process which is significant and necessary
challenge, but it's a challenge that advanced reactor
developers must navigate.
Unfortunately, the regulatory process, as it exists today,
is not a good fit for these new technologies and the venture
finance models that fund them. On the other hand, I must
emphasize that the widely held belief that advanced reactors
cannot be licensed today is also mistaken. We have found clear
licensing pathways for our technology, but at the same time
there is room for significant improvement and modernization.
We laud the recent work done by the Department of Energy
and by this Committee and by the Senate as a whole both
supporting the recent legislation that passed into the Energy
bill as well as the pending legislation for regulatory reform.
These are crucial steps to help us seize the tremendous
opportunities in front of us, to advance nuclear power and also
the massive opportunities that we have to be the leader at the
global stage.
Thank you.
[The prepared statement of Dr. DeWitte follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Dr. DeWitte.
Dr. Gilleland, welcome.
STATEMENT OF DR. JOHN GILLELAND, CHIEF TECHNICAL OFFICER,
TERRAPOWER
Dr. Gilleland. Thank you.
My name is John Gilleland. I'm the Chief Technical Officer,
as was mentioned. I'm, sort of, CEO Emeritus, I suppose.
It is a nuclear design company based in Bellevue,
Washington. I'd like to thank you, Chairman Murkowski and the
members of the Committee, for the invitation to testify here
today and to extend my particular thanks to our home state
Senator, Maria Cantwell, who has been a strong supporter of our
operations. Thank you.
TerraPower's goal is to bring our technologies to markets
globally as sources of clean, non-emitting, affordable, base
load energy and electricity. TerraPower is the developer of the
traveling wave reactor, a full size, sodium cooled, fast
reactor.
We are also working with Southern Company, Oak Ridge
National Lab and the Electric Power Research Institute in the
early R & D phase of a very high-potential additional
generation for a reactor. We won a DOE-advanced reactor concept
award for this activity in January.
Today I would like to talk about the traveling wave reactor
because we've come a long way and we'd like to convey the
lessons we've learned over the last ten years. We've been at
this for ten years.
In 2006 Bill Gates, our Chairman, convened a group of
colleagues from the world of science and technology to address
two issues, energy poverty and climate change.
Many inhabitants of developing countries have little access
to affordable base load electricity. Living standards cannot
rise without electricity. Hospitals cannot function without
access to reliable power. A child cannot do homework without
light to read.
It's been known for a long time that access to electrical
energy is essential to human development, but the global
consensus of scientists is that climate change requires us to
radically reduce carbon emissions. Since developed countries
and now developing countries are meeting the population's
demands for base load power by burning large amounts of fossil
fuels, the resulting emissions are locking us into a
deteriorating spiral of climate change and damage to our
environment.
Ten years ago Bill Gates and his colleagues looked at the
entire menu of low carbon energy solutions. They concluded that
nuclear power is an essential element of any credible, low
carbon emissions solution. For the right uses and the right
venues, wind and solar will play valuable roles but nuclear is
the only known technology that can provide the needed huge
amounts of energy with minimum impact on our land use and thus,
on the natural world.
Nuclear power has already demonstrated its ability to
generate large scale, dependable electricity without emissions
at affordable prices, and the new nuclear plants now being
constructed are setting new standards for accident prevention.
We, at TerraPower, are now ten years and hundreds of
millions of dollars into our advanced reactor development. As
we've guided those efforts there have been many lessons
learned. When I talk to students I usually talk about eight to
ten of these lessons. For this Committee, I think there are two
main lessons.
First, TerraPower is already using Federal facilities such
as the Idaho National Laboratory. Like other companies
TerraPower pays to access the government's highly qualified,
skilled researchers and advanced equipment. Ours is already an
example of public/private partnership.
The bulk of the funds I just mentioned, all from private
visionary investors, have gone to universities, businesses and
the national laboratories. This is in the spirit of the recent
Paris meetings, and we are an early prototype for the
breakthrough Energy Coalition's Mission Innovation goals.
Neither the national labs, nor private enterprise could
have accomplished what they have done without each other. The
recent White House summit on nuclear energy endorsed this
approach. The Gateway for Accelerated Innovation in Nuclear, or
GAIN, aims to integrate the capabilities of the private sector,
universities and laboratories.
So the first big lesson taught to us over the last ten
years is that programs like GAIN do work. That's what we've
been doing for ten years.
The second big lesson is the government needs to supplement
and help the private sector with appropriate and solid
oversight functions. We've had good experiences over the last
ten years.
One of the effective coordination--one is the effective
coordination of TerraPower's international activities with the
Department of Energy's National Security, Nuclear Security
Administration and the Department of State. Another is the
helpful set of consultations we've had with the Nuclear
Regulatory Commission (NRC).
But the lesson learned, as we look into the future and we
lay out our particular plans, is that it is increasingly clear
that Congress must ensure the NRC has sufficient know how and
funding to license this country's next generation of nuclear
plants.
In closing, I would say our efforts on the TWR and MCFR,
which is a Molten Salt Reactor we're doing with Southern
Company and others, are but two designs. So we encourage
exploration of other innovations such as was talked about by
the gentleman to my right.
It is only by working together that we will achieve the
breakthroughs we need to make advanced reactors in a better
world, a reality. The United States possesses unique strengths,
technical and cultural, that can make astonishing
accomplishments, if and only if we have the wisdom to unleash
them.
Thank you.
[The prepared statement of Dr. Gilleland follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Dr. Gilleland.
Mr. Hopkins, welcome.
STATEMENT OF JOHN HOPKINS, CHAIRMAN AND CHIEF EXECUTIVE
OFFICER, NUSCALE POWER
Mr. Hopkins. Thank you, Senator.
NuScale Power is currently the leading developer of
American small modular reactor technology. This technology has
been in development for more than 15 years. Our company is
based in Corvallis, Oregon and majority owned by the Fluor
Corporation.
We are advancing a unique and innovative SMR design which
offers the safest light water reactor nuclear technology that
is near term deployable. Our design is uniquely safe. We have
solved one of the most vexing problems of the nuclear industry
with what we call the triple crown of nuclear safety.
In a case of a loss of all sources of electricity at the
plant, the NuScale Power module shuts itself down and cools for
an unlimited period of time. With no operator action required,
no need for additional water and no electricity.
The NuScale Power module uses simple properties of physics,
convection, conduction and gravity to drive the flow of coolant
in the reactor. The thermal hydraulic properties and
capabilities of technology have been demonstrated through an
extensive test program inspected by the U.S. Nuclear Regulatory
Commission and which are protected by patents issued or pending
since 2011.
The NuScale Power module is an ideal option for carbon-free
electricity generation. The NuScale design is dramatically
smaller than today's pressurized water reactors and eliminates
need for safety-related, electrically-driven pumps, motors and
valves necessary to protect the nuclear core. It can be
factory-manufactured and transported to a site via rail, truck
or barge.
We are preparing for our first deployment project, known as
the Utah Associated Municipal Power Systems Carbon Free Power
Project, which will be sited in Idaho and possibly a location
on the Department of Energy's Idaho National Laboratory site.
We expect to deliver our first project of 12 modules in a
600 megawatt plant to UAMPS for an overnight price of less than
$3 billion with commercial operation commencing in 2024.
Energy Northwest which operates the Columbia Generating
Station in Washington State, has joined this project and holds
a first right of offer to operate the UAMPS project.
In December 2013 the Department of Energy selected NuScale
as the sole awardee for funding in round two of the DOE Small
Modular Reactor Licensing Technical Support Program focusing on
providing a cost share grant in support of licensing expenses.
NuScale may receive up to $217 million of matching funds over
five years. We are the only near-term deployable SMR developer
receiving DOE funding support, and we are proceeding at full
speed toward long-term commercialization.
With support from this funding NuScale has expanded its
workforce to include more than 600 engineers and has made
substantial progress on the engineer and analysis and tested
needed to complete the design certification application for
submittal to the NRC by the end of 2016. Successful completion
of the DOE-funded SMR cost share program depends on sustained
congressional support through continued appropriations. We
appreciate your past support, and we ask that you continue to
prioritize small modular reactor programs in a tight budgetary
environment.
A risk to the delivery of our technology as currently
planned is the uncertainty of the time and process for the NRC
design certification and combined operating license efforts. In
order to meet our customer needs to deliver carbon free
electricity to their grids, we must be positioned for
commercial operations in 2024.
NuScale has been engaged with the NRC in pre-application
review efforts since April 2008. We are on schedule to submit
our design certification application by the end of this year,
and the NRC plan currently reflects a 40-month review process.
We are currently working with senior staff at NRC to complete
the final issuance of the new scale design specific review
standard expected by the end of June 2016 which provides the
acceptance criteria for their review of our DCA.
We appreciate the quality interactions we continue to have
with the Office of New Reactors and their dedication to a
thorough and timely review. It is important that sufficient NRC
resources are assigned to review in a NuScale application to
ensure completion within the 40-month schedule so that we can
be in position to meet the growing marketplace demands for our
carbon free energy source.
I'd like to thank the Committee for holding this important
hearing. And I look forward to any questions you may have.
Thank you.
[The prepared statement of Mr. Hopkins follows:]
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The Chairman. Thank you, Mr. Hopkins.
Mr. Kuczynski, welcome.
STATEMENT OF STEPHEN KUCZYNSKI, CHAIRMAN, PRESIDENT AND CHIEF
EXECUTIVE OFFICER, SOUTHERN NUCLEAR OPERATING COMPANY, INC.
Mr. Kuczynski. Welcome.
Good morning, Chairman Murkowski, Ranking Member Cantwell
and members of the Committee. My name is Steven Kuczynski. I'm
the Chairman, President, CEO of Southern Nuclear Operating
Company. We operate a fleet of six nuclear power reactors at
three sites and are constructing two state of the art AP1000.
That's Advance Pass of 1000 reactors at Plant Vogel near
Augusta, Georgia.
It's an honor to appear before this Committee to share my
views on advanced nuclear technologies, an area that is pivotal
to our nation's future and worthy of this Committee's interest.
I currently serve as Chairman of the Nuclear Energy
Institute Advanced Reactor Working Group, or ARWG, an industry
initiative created with the understanding that today's
decisions about nuclear energy, research and development will
enable a nuclear fleet of the future. Today the U.S. fleet of
100 commercial reactors which provides 20 percent of the
nation's electricity is comprised exclusively of light water
reactors. They are called light water reactors because they use
ordinary water for cooling purposes and to moderate the nuclear
chain reaction.
In some other countries, such as Canada, deuterium oxide is
the main coolant to moderator. Deuterium oxide is heavier than
water which is why these reactors are commonly known as heavy
water reactors.
Taken together light water and heavy water reactors have
proven to be the safest, most efficient, cost effective means
of electricity generation.
Within the ARWG we see tremendous promise for even better,
more innovative nuclear reactors, and we are actively working
toward achieving demonstration of multiple advanced reactors by
2025. We believe commercial deployment is feasible by 2035.
Advanced reactors are often called non-light water reactors
because they do not use water as a coolant or a moderator but
neither do they use heavy water. Instead, advanced reactors
under consideration in the United States are being designed
around the use of liquid metals, salts, gases or other advanced
techniques.
At Southern Company we are actively engaged in researching
and assisting in deployment of advanced reactor technologies
including the prismatic block high temperature gas cooler
reactor which is expected to be significantly more efficient
than current operating reactors and the molten chloride fast
reactor which we are exploring under the DOE Advanced Reactor
Concepts Program alongside TerraPower, Oak Ridge National
Laboratory, the Electric Power Research Institute and
Vanderbilt University. We are very proud to be working with
these distinguished organizations.
So one might ask, why support advanced reactor research and
development?
We know that significant new electric generating capacity
will be required in the decades ahead to meet the nation's
growing energy needs. Nuclear power is an attractive option for
meeting this demand with reliable, affordable, clean sources of
base load electricity with zero emissions. And advanced
reactors will be even more efficient, produce less by product
material, have enhanced safety features, require even a smaller
geographic footprint, come at a lower cost to customers and be
capable of using a broad range of fuel types.
In addition, advanced reactors are expected to be scalable,
meaning they can be constructed in varying sizes, and able to
adjust output to meet variable demands or supplement
intermittent renewables. They will also provide a valuable
source of process heat for a wide range of industrial
customers, and we see tremendous promise for military
installations to use these technologies to generate electricity
and provide energy to meet other needs.
In addition to the work we're doing with Gen IV reactors,
Southern Nuclear is engaged with the industry's effort to bring
small modular reactors to market.
In closing I'd like to highlight five key points for the
Committee.
First, collaboration between the Federal Government and the
private sector will be critical to promoting nuclear energy
innovation in the United States. As was true in the early days
of nuclear technology development, the national labs will need
to play a central role. Importantly, the national labs have the
resources and facilities, as well as the flexibility within the
existing regulatory structure to accomplish significantly more
advanced R and D work than a private U.S. company or university
could do alone.
Second, the Federal Government needs to move forward with
innovative licensing frameworks and regulatory structure
tailored for advanced reactors. The current regulatory system
with its exemption based licensing approach built around light
water reactors will be ineffective for licensing non-light
water technologies, makes it difficult to attract private
investment. Southern Company is taking a lead role in industry
led licensing modernization initiatives.
Third, innovation benefits from competition which is why
the Federal Government should support advanced reactor programs
without picking the ultimate winners and losers at this point.
Fourth, the U.S. must remain the global leader in nuclear
energy technology, as we have been in the past. Many nations
are currently working on advanced reactor designs. Our nation
should not cede leadership in nuclear power innovation to
others.
Finally, the ARWG's goal of commercial deployment by 2035
is, in my view, achievable. With the current fleet of reactors,
it took just a decade to progress from a concept to commercial
operation. This required innovation, collaboration, leadership
from forward thinkers like Admiral Rickover and the strong
support of Congress and the Executive Branch.
Our nation has the knowledge and expertise to make this
kind of technological progress in nuclear energy happen again.
As before, innovation and collaboration will provide the keys
to success.
Again, thank you for allowing me to appear before your
Committee, and I look forward to your questions.
[The prepared statement of Mr. Kuczynski follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Mr. Kuczynski.
Dr. Peters, welcome to the Committee.
STATEMENT OF DR. MARK PETERS, DIRECTOR, IDAHO NATIONAL
LABORATORY
Dr. Peters. Thank you. Thank you, Chairwoman Murkowski.
Thank you, Chairwoman Murkowski and Ranking Member Cantwell
and members of the Committee for this opportunity to speak to
you today. I am Mark Peters, Director of the Department of
Energy's Idaho National Laboratory (INL), the lead national
laboratory for nuclear energy.
I'm pleased to participate in this most distinguished panel
before the Committee, and I'll request that my written
testimony be made part of the record.
The Chairman. It will be included.
Dr. Peters. Before I begin my testimony, I'd like to thank
Senator Risch for his support of INL and for co-sponsoring the
Nuclear Energy Innovations Capability Act, authored by Idaho
Senator Crapo, Senator Booker and Senator Whitehouse. This
legislation, as part of the Senate Energy bill, is the
companion to the House measure of the same name. The House and
Senate legislation are important enablers to much of what I
will discuss today.
The U.S. is widely recognized as a world leader in the
development of advanced nuclear reactors; however, leadership
is earned, not granted and other nations are investing to
develop the facilities, capabilities and people necessary to
excel. The U.S. has the opportunity to regain domestic
manufacturing and supply chain capabilities lost when we did
not build new reactors during the last 30 years.
Small modular reactors and advanced nuclear reactors can be
entirely sourced in the U.S. creating new advanced
manufacturing facilities vital for economic growth.
The value proposition for U.S. nuclear energy has never
been stronger. There are strong global and domestic interest in
nuclear energy due to the recognition that safe, secure,
reliable and affordable energy is the engine for economic
growth, prosperity and quality of life.
The U.S. cannot meet increasing electricity demand and
stringent clean air goals with renewable energy alone. In this
effort nuclear and renewables become complementary. Safe and
reliable nuclear energy provides 19 percent of total
electricity and 63 percent of the U.S. electricity sector's
carbon-free generation today.
We are on the cusp of a fundamental transportation in
nuclear energy. The existing light water reactor fleet will
serve as a bridge to SMRs and advanced reactor technologies. We
have developed tremendous expertise in operating light water
reactors at the highest level of safety and efficiency and that
expertise is relevant to advanced reactor design and
operations.
Our conversations with advanced reactor developers
indicated challenges in two main areas: resolving technical and
licensing challenges at an early stage and addressing remaining
technical licensing and economic questions at the demonstration
and deployment phase.
In November the Administration announced formation of the
Gateway for Accelerated Innovation in Nuclear, the GAIN
Initiative. GAIN will provide the people and facilities to
develop and test key components and mitigate uncertainty while
allowing developers to fine tune their designs.
Resolving technological risks can give investors the
confidence to move forward with increased financing for an
advanced reactor design. As a core part of GAIN, INL and our
national laboratory and university partners are the portal for
designers and developers interested in a wide range of DOE
nuclear energy related capabilities and expertise.
For the later stage commercialization, companies may access
INL and other government sites for demonstration and deployment
capabilities which can reduce costs and improve performance of
their design as it moves to full commercialization.
An example of this is the recent announcements related to
potential siting of a NuScale SMR in the INL site which will
provide a near-term opportunity to provide a demonstration
platform for innovative nuclear technologies.
New types of industry partnerships are also driving
strategic investments. For instance, INL is working
cooperatively with TerraPower to build new capabilities to
provide R and D support for the traveling wave reactor concept
Dr. Gilleland discussed earlier.
The experimental fuels facility at INL's materials and
fuels complex has gone a transformation in recent years to
expand capabilities for the traveling wave reactor.
Madam Chair, we are creating a new paradigm in nuclear
innovation and nuclear energy. This paradigm involves new ways
of working with the diverse nuclear community that includes
utilities, startups, large nuclear suppliers, government
entities, non-profits and everyone on this Committee. We are
your national laboratories, and we're open for business.
Recent White House and DOE initiatives as well as
congressional legislation and funding are setting the stage for
research, development and deployment of new and advanced
nuclear energy systems. The end result will mean cleaner, more
plentiful energy with the potential for lifting billions out of
energy poverty.
Thank you for inviting me to testify, and I look forward to
your questions.
[The prepared statement of Dr. Peters follows:]
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you all, I appreciate the testimony
this morning and your leadership in these areas.
Thinking about the exciting developments and the prospects,
and Dr. DeWitte, your focus on micro-reactors is really quite
exciting for a place like Alaska where we are not connected to
anybody else's grid. You have to have some level of
scalability. You have to be able to take it down to small
communities or perhaps with our military installations. I look
at this and see there is room for extraordinary potential.
As with any good idea though, you have situations relating
to the financing and you have a regulatory process; so I want
to start with my questions this morning on the regulatory
aspects.
Mr. Hopkins, you probably have as much experience as
anybody with NuScale in terms of the process that you have gone
through. You have been underway for about 15 years working with
the NRC since 2008. As you have outlined it, my take away is
you think that you are able to work within the NRC licensing
process as it is.
Mr. Kuczynski, you have suggested that there are some real
challenges within the process as it exists today taking these
new technologies and basically trying to make them fit within a
structure that has been designed for basically a different
model or a different approach.
I would like to have a more full discussion on this issue
of whether or not we need to see this licensing framework
restructured, to be more adaptable to recognize that we have a
whole range of different technologies that we are considering
right now. Recognizing that time is money, what do we do with
the regulatory process as it exists now?
I kick that out for general discussion.
Mr. Hopkins, Mr. Kuczynski, go ahead.
Mr. Hopkins. Senator, we have been working with the NRC,
since 2008. However, there are differences between our small
modular reactor and a large plant. There are exceptions.
As an example, we don't have any hydrogen production
because we're oxygen starved in our reactors; therefore, we
don't need a hydrogen re-combiner.
So there are things that we are working with the NRC, which
takes a lot of time and effort, to get them understanding what
those differences are. We typically do what's called topical
reports. So any of these variances that we see we write a
technical paper for review by the NRC. And so far, I think
we've submitted eight or nine of these topical reports. I
believe we have 15 to submit.
But we view our opportunity here, as was mentioned earlier,
to help pave the way for the next Gen IV advanced reactor
because as the NRC stays focused and understands the nuances
and change. Although we are a light-water reactor, which
they've known the technology for 50 years, there are nuances
that are different in small modular reactors.
Our hope is, as we go through this process which we
budgeted right now in the neighborhood of $50 to $60 million,
to go through design certification application, we'll also be
able to enhance the advanced reactors going through, as you
mentioned, the gold star or the gold plate of the NRC.
The Chairman. So you are paving the way for others, but I
am sure that there are a lot of others sitting back and
watching the NuScale process going forward saying maybe we do
not want to be number two, maybe we want to wait until the
process is a little more complete, having to produce these
assessments or these analyses every step of the way.
Mr. Kuczynski, you have mentioned that Southern is looking
into a more innovative licensing process. What are you
recommending?
Mr. Kuczynski. Yes, let me clarify and thank you for that
question. I'll tag onto what John has to say.
In my opening remarks I talk about light-water technology,
and the SMR that NuScale is building is a light-water
technology, just a different type. So the existing regime is
probably more suitable than it will be for advanced reactors.
And so, my comments are around what we are all calling now,
modernizing the regulatory, kind of, regime. And through a lot
of work with a lot of groups, we've all, kind of, landed on, I
think, kind of, four cornerstones of what we think needs to be
done in the regulatory arena.
One, it does need to be modernized to accommodate fuels
that are completely different, designs that are completely
different, outside of our knowledge base.
So there are really four things we're talking about. First
being a more performance-based, meaning just set the
expectation of what these products need to deliver and let the
innovators figure out how to do it versus a really prescriptive
approach. Second is bringing a more risk informed basis into
the whole regulatory regime. The third one is really around a
staged process and there's a number of reports out there that
talk about trying to retire the technical risk in a more staged
process instead of all the upfront investment without certainty
of whether those kind of design concepts will be approved. And
then the fourth one is really modernize a framework to be
technology inclusive so that it doesn't focus just on light
water technology.
What is very good though is as we progress in the SMR
licensing activities, it really builds on our Generation 2, our
advanced passive reactors, and that there are some generic
issues that, we believe, will be resolved through the SMR
licensing process that has a direct relationship to advanced
reactors. Things like the emergency planning zones,
containment, security, control room staffing, those are very
good generic issues that, as John said, can pave the way for
resolving some of these before advanced reactors need to be put
together.
The Chairman. Alright, thank you.
Dr. Gilleland, I am well over my time, but if we have an
opportunity to continue this, I would like to gain more
information.
Senator Cantwell, please go ahead.
Senator Cantwell. Thank you. Thank you, Madam Chair.
Dr. DeWitte, on behalf of Senator Alexander and myself,
since you mentioned visiting museums as a young child, we
invite you to visit the Manhattan Project, the B reactor in the
State of Washington. I am sure Senator Alexander will extend
his own invite to you.
The reason I am bringing that up is because, I think, you
crystallized in your testimony the opportunity, how big of an
opportunity, this was in the past. And, as you said, the giants
that we stood on like Fermi.
My question is really to you if you want to weigh in, but
also to Dr. Gilleland and Dr. Peters. This China market which I
am a big fan of the U.S. trying a clean energy strategy just
because they're 40 percent of the energy use. So anything we do
together helps accelerate the deployment. They are now 73
percent dominated by coal. Could you talk about the market
opportunity for the new reactors?
Dr. Peters, could you also talk about this new materials
development, the research and development on new materials that
would help us on our current, the development of new materials
and how that helps us in reaching this market opportunity?
Dr. Gilleland. Well, certainly working with China is a good
thing for the United States because it is the huge market. It's
the dominant market in the world. They're going to build tons
of reactors and maybe someday hundreds.
Our motive, of course, was to work with China because it
would make the most difference on the emissions front and they
are set up to proceed with actually trying out these new
reactors. So we have a joint venture which we're about to sign
the CNNC to proceed with a prototype.
Our motive here also has been to keep the United States in
the game, as it were, because I think we have this unique
combination of capabilities between the national labs and our
way of doing things rapidly and entrepreneurially and
innovatively. And so, that combination is, I think, very, very
powerful.
Now the agreement would involve us being equal partners.
Whatever gets built in China can be built in the United States.
In the 2030's when we must replace the coal plants, I would
hope to see a wave of construction and activity back in the
United States.
So it is a way for us to participate in the dominant
market, make the biggest difference and equip ourselves to do
the right thing in the United States.
Senator Cantwell. The expertise of the labs helps us
leverage this technology. So I want to bring in Dr. Peters
here, that it is the labs that helps keep the supply chain in
the United States, our skill level, our innovation, our
technology. The supply chain would?
Dr. Gilleland. Yes, there's nothing that keeps you more
focused than trying to build something. Your dogma goes out the
window because you're trying to solve real problems with a new
type of reactor.
And we have engaged about 50 institutions in the United
States in a very focused way. And most of that hundreds of
millions of dollars has gone to those institutions. It is the
building of the supply chain, a very advanced supply chain.
And I think in the future almost all of our advanced
reactor activities will be international in nature. That's just
the way the world is working right now. You look around the
world where the energy is needed and where the emissions must
be low and that's the message to us.
So we have to get in there and try to lead. That's what
this is all about.
Senator Cantwell. Dr. Peters?
Dr. Peters. Yes, thanks, Senator.
So first and foremost let me completely support what you
said that actually the national labs and universities in the
U.S. are a differentiation and they remain a differentiation
for us, as a country. Granted, manufacturing has wavered but
the world still looks to us for that expertise. And so, that is
an advantage that we still have.
A couple of examples, and this isn't just at INL, I would
also mention Oak Ridge, Los Alamos and PNNL as being/having
expertise. But two examples. In the fast reactor space, much
like what TerraPower is developing, you have either a metal or
an oxide fuel depending upon how you want to manage your safety
case. But we still have world leading expertise in both of
those fuel types. That's some of what is being brought to bear
in the case of the collaborations with TerraPower as they're
developing a metal fuel for a sodium fast reactor.
But also for high temperature gas reactors, Steve mentioned
those TRISO fuels, so silicon carbide particle fuels. Oak Ridge
has a world leading position there, and we support that as
well.
So when you look at the advanced fuels for these reactors,
the expertise sits at the U.S. national labs.
Senator Cantwell. Thank you.
Thank you, Madam Chair.
The Chairman. Senator Cassidy?
Senator Cassidy. Thank you, Madam Chair.
Mr. Hopkins, the SMRs, I was looking at your thing. You are
still going to have it surrounded by 7.4 million gallons of
water. I did not have time to do the math, but it still seems
like although it is small and modular, it is only small
relative to the current. But it is really still a substantial
footprint, I presume?
Mr. Hopkins. Actually sir, to your point, it's 7.2 million
gallons. That's the ultimate heat sink that the module sits in.
The actual footprint for a 600 megawatt plant is nominally
about 32 acres. So you could expand that out to, let's say, 100
acres or 150 acres, but the footprint itself is only 32 acres.
So our sweet spot, we believe, in the United States quite
frankly, is for coal replacement. So if you think of the
majority of coal here in this U.S, it's been 300 to 600
megawatts. We're hoping, in fact our first project is actually
for coal replacement, is to be able to put in with the existing
infrastructure a 600 plant, 12-module facility.
Senator Cassidy. Now let me ask, I live near Entergy River
Bend Nuclear Power Plant in Louisiana. I went and toured it,
and they literally have a paramilitary force on hand for
security with video surveillance of the fences. Every now and
then they catch a raccoon trying to sneak in, that sort of
thing. Will that be required for the SMRs?
Mr. Hopkins. We're currently in discussion with the NRC. If
you look at the actual footprint of the plant itself, the
reactor building is a rectangle box. And so we believe if you
look at the minimal number of entrances and exits, we could
reduce that security plan, but that's still something we're in
discussion with the NRC. So our general belief is the answer is
yes, we can reduce that security force. To what number? We
don't know at this time.
Senator Cassidy. But would it still require 24/7 security?
Mr. Hopkins. Yes, sir.
Senator Cassidy. With AK----
Mr. Hopkins. Well, there's new technologies that are out
that we're looking at right now that are non-lethal
technologies that some of the labs are currently working on. So
we're exploring different options. But we----
Senator Cassidy. Mr. DeWitte, would you require that same
sort of security footprint? Because I can imagine you are
someplace desolate, if there is a desolate place in Alaska. I
am sure there is not. [Laughter.]
Where you have this, sort of, small operation, but
nonetheless it is radioactive material. Could somebody
helicopter in, grab it and take off with it and make a dirty
bomb?
Dr. DeWitte. That's a great question.
First, that leads me to just think the work that NuScale is
doing to help answer some of these questions and leading the
way on these things because the discussions they're having will
inform how we approach this. Because fundamentally, when you
think about what we're doing and our size, it's very similar to
research and test reactors that are at college campuses across
the country. They're very safe, very secure. Their security
intervention usually involves relying on campus or local police
to get there in a certain time period because the amount of
material is so small.
Fundamentally that's, kind of, the same approach that we
believe we can take and still meet all the objectives, not to
mention the fact that the material is very heavy and hard to
get at and hard to deal with in order to actually divert to do
something with it.
Senator Cassidy. Okay.
Mr. Kuczynski, you had mentioned, you used the word
``affordable.'' But what I understand about what Southern
Company is doing with nuclear, it is quite unaffordable.
I asked an energy company why they were not doing what you
all were, and they said listen, we can make ten natural gas
plants for the cost of what they are doing, and they are
cheaper to operate. Now I have learned to say what I have been
told, not what I know. So I say that not to challenge, but just
to say what someone else has said. Your thoughts about that?
That natural gas, the economics of nuclear, at least the scale
that you are doing right now does not work with natural gas?
Mr. Kuczynski. Yeah, I would respectfully disagree about
the economics and our working. Essentially our project, when we
certified it about six years ago, we anticipated a 12 percent
rate increase to our customer base. Currently today we expect
that to be less than seven percent, maybe around six and a half
percent.
So this is a $14 billion project that's actually going to
come in on a lower rate impact where customers, when we're
completed, then when we start it, we think that's a phenomenal
achievement. And----
Senator Cassidy. I do not know how all this works in your
business model, so again, I am asking not to challenge, but to
learn. If somebody had built the equivalent number of natural
gas powered plants at today's fuel prices, would it have cost
$14 billion to generate the same? I think you have 2,000
megawatts.
Mr. Kuczynski. Yes, of course it would be less. But you
make a big assumption about today's fuel prices. If you take a
levelized approach, equalize it over 40 to 60 years, there
isn't anybody that would give you a contract on 40 years on gas
prices.
So we diversify our fuel mix in an effort to do clean,
safe, reliable and affordable energy for the long-term and you
need a diversification of fuel supply. We cannot be all gas.
In fact, our fleet has now transformed itself from less
than 20 percent gas to over 55 percent gas by just fuel
switching. So our ability to switch fuels based on the
economics is a tremendous advantage for Southern Company, and
that's why electricity rates are among the lowest in the
country and reliability is the highest. And that's why we're
able to attract economic development in our part of the
country.
So we're huge proponents of nuclear. It's stable, strong,
reliable. And this plant is going to be around for 60, likely
80, years, with very, very stable cost bases.
Senator Cassidy. If I might ask though, the $14 billion
that you are, for the 2,000 megawatts, how much would it have
cost to do that with natural gas-fired plants?
Mr. Kuczynski. Yeah, I'm not an expert at that at this
point in time. I can get back to you afterwards.
Senator Cassidy. Please.
Mr. Kuczynski. But essentially you have to look at it not
on today's fuel prices. And we've done the economic analysis
with nine different scenarios and nuclear. Continuing our
project is, by far, the most economic result to date for our
project.
Senator Cassidy. Thank you.
I yield back.
The Chairman. Thank you.
Senator Heinrich?
Senator Heinrich. Madam Chairman, I want to thank you for
this hearing. I think it is important that we look at advanced
fission technologies. I also want to suggest that it might be
useful, at some point, to have a second hearing on the status
of nuclear fusion research as well where there are some pretty
exciting developments, particularly around new materials
developments and super conducting magnets at places like MIT.
I want to start with Dr. DeWitte. First off, where did you
get your donuts? I think that is an important question.
Dr. DeWitte. Johnson Donuts. [Laughter.]
Senator Heinrich. Excellent, very good answer.
More to the point today, can you talk a little bit more
about the design that you are pursuing, where you are in that
process? And then what are the implications for things like
fuel and spent fuel or waste, I should say, because you
mentioned you are using spent fuel as your fuel source? So what
does your waste stream look like and what are the challenges of
dealing with spent fuel which is, obviously, highly
radioactive?
Dr. DeWitte. Sure. Thank you for the question, Senator.
So a couple things. We launched in 2013, and we've been
working on this for a few years prior. And the reason we
started on this very small concept is because we surveyed the
field and saw that the economic opportunities of going small
and starting off grid were very favorable, economically, for
doing nuclear at these sizes, as well as the fact that it was a
manageable approach to a new technology from a start ups
perspective. Starting something small like that gave us a
vector on how to tackle these issues.
So we've completed our confirmatory testing on what we're
aiming to do with the system and completed verification and
validation testing on full scale heat transport. We're moving
into building an exact scale non-nuclear prototype later this
year that will complete our transient testing on other things,
much, similar, very similar, to the work that NuScale did
several years ago building up the prototype testing plant.
One nice thing about us though is we're so small we can do
everything at the exact scale. So that helps.
We anticipate submitting a license to the NRC sometime
around 2018/2019, a license application, I should say. And what
we would like to do is have our first reactor deployed in the
very early 2020s. And we'd love to go as fast as we can to do
that. But that's, kind of, the nominal targets we've set.
In terms of dealing with the fuel, we anticipate the very
first reactors will be fueled with normal enriched uranium, low
enriched uranium. Because of the difficulties in dealing with
spent fuel, we don't really want to add that risk into the very
first one. When I say risk, I mean technological risk, into the
first reactor.
Senator Heinrich. What kind of enrichment level?
Dr. DeWitte. It's on the order of about 15 percent.
Senator Heinrich. Okay.
Dr. DeWitte. And mind you, these are very small reactors,
so it's a small amount of fuel.
But we do, we are interested in opportunities to help with
the plutonium disposition issue going on with, specifically
related to the MOX plant in South Carolina.
Senator Heinrich. Right.
Dr. DeWitte. That would not be as much of a technological
reach and it would prove out a lot that we'd like to do with
spent fuel.
And there are some interesting technologies that we
anticipate using to accelerate getting spent fuel into reactors
for destruction and transmutation because what we do is we can
fission all of the actinides over time. And what you're left
with are fission products that normally have a half-life of
about 30 years. So they're more or less gone in about 300 as
opposed to the tens to hundreds of thousands with actinides.
Senator Heinrich. Okay, thank you very much.
I want to get back to this issue that Senator Cassidy
raised about general economics. Dr. Gilleland, I think you
mentioned affordable nuclear power, and certainly Mr.
Kuczynski, you walked through this a little bit. But I am
having a hard time reconciling a number of information points.
I did a little bit of Google research this morning about
this that is in the news, and one of those stories that came up
was around two large reactors in Illinois that have light water
reactors that have lost about $800 million over the past six
years.
I am trying to figure out what kind of unsubsidized,
levelized costs per kilowatt hour is everybody targeting to
ensure that these advanced technologies are actually
competitive in the marketplace?
For any of you really.
Dr. Gilleland. Well certainly, as Bill Gates said all the
way through from the beginning, if you can't afford it, it's
all theory.
But the fact of the matter is in the case of the traveling
wave reactor. Since you eventually do away with enrichment and
you never need reprocessing, since the reactor would reduce the
amount of waste produced by about a factor of five, since the
basic fuel would be depleted uranium which is already mined,
there's enough at Paducah to power the United States' fleet for
hundreds of years. You add all those things up and you end up
with a lower price of electricity. I'm not a great economist,
but if you don't have to do something it's less expensive.
Senator Heinrich. Sure, but----
Dr. Gilleland. And so the----
Senator Heinrich. There is going to be----
Dr. Gilleland. Levelized carbon.
Senator Heinrich. A target in terms of a cost per kilowatt
hour that makes sense. I mean, we are seeing PPAs now at
ridiculously low prices compared to what we saw a few years
ago.
So I assume all of you have a goal for where you need to
get to, to make sure that ten years from now as some of these
technologies continue to come down the cost curve, that you are
ahead of that.
Dr. Gilleland. Yes.
And our levelized costs, I don't have those right in my
head right at the moment. They're in the range of seven to
eight cents per kilowatt hour, that kind of range, roughly
speaking.
And we often compare to alternatives and since our system
is so much simpler and since the waste produced is so much less
and since the fuel is right now considered waste, that goes a
long way.
Some people confuse depleted uranium with spent fuel. Spent
fuel is what's been used and it's now radioactive and is
sitting around the country waiting for disposition. Depleted
uranium is that vast quantity of uranium sitting behind
enrichment plants. It's never seen a reactor. It's never been
in one. Ninety something percent of all uranium mined is not
useful as fuel.
And our objective was to take a look at Paducah and these
other fuels of uranium and say, if you can burn that you're up
a factor of ten in your fuel supply, it's already mined.
There's no CO2 in mining it. If you can burn it very
efficiently with burn ups of 30 percent, several--an order of
magnitude higher than present fission plants, then basically
you're extending the fuel supply by about a factor of 40 to 50.
And that's done without need for a proliferation prone
processes such as reprocessing.
The Chairman. Thank you.
Senator Risch.
Senator Risch. Well thank you very much, Madam Chair.
Dr. Gilleland, your understanding of economics is a lot
like a lot of us Americans but you need to spend a little more
time with the government. [Laughter.]
Senator Risch. When the Government was shut down here they
told us by not doing it, it was going to cost us more than
doing it. So it gets very complicated when you get into
government economics as opposed to just plain old common sense
economics.
Dr. Peters, the advanced test reactor which is certainly
one of our important facilities at the INL has been used for
testing fuels for the Naval Nuclear Propulsion Program, and it
has been very important in that regard. There has been some
talk about how the ATR could be used to support the gateway for
accelerated innovation for nuclear initiative. Could you talk
about that for just a minute for us, please?
Dr. Peters. Sure, thank you, Senator, thank you for the
question. Good to see you.
So as you already said the advanced test reactor has been
operating since the 60s, and its core mission to this day is to
support the nuclear navy and that continues. And also note that
we have a line of sight to this machine being operating as far
as 2050, if not beyond, to continue to support that mission.
But there's already an existing part of the ATRs mission
that's a part of the National Science User Facility that DOE
funds that actually funds university researchers and industry
researchers and other lab researchers to use some of the
irradiation time at ATR to do work on our current nuclear
energy system and also advanced nuclear reactor systems.
So really, yes, it will be a part of the test bed. It's a
good example, actually. ATR and the High Flux Isotope Reactor
at Oak Ridge are two good examples of test reactors that will
be an important part of the GAIN test beds.
So and we're continuing to look to ways to, sort of, expand
the capability of ATR to be able to be more responsive to
industry needs.
Senator Risch. Thank you, I appreciate that.
I recently met with the people who founded the Transatomic
Power where they are dealing with these new molten salt
reactors which, I guess, is kind of new to me and probably not
to you people who work in this on a daily basis. But what can
you tell us about that briefly, about this technology?
Dr. Peters. It's an exciting technology.
Actually, the founders were at school with Jake, at the
same time with Jake at MIT. So it's another example of some of
these exciting startups that are emerging from the university
community.
It's a molten salt technology. It operates at high
temperatures. It's a very exciting technology. It's early in
its development, but it's a perfect example of an early stage
company that needs access through things like GAIN to
capabilities at the laboratories to be able to do testing and
evolve their design.
But, I mean, yes. There's--48 companies. Jake's being one,
Transatomic being another that are out there with advanced
concepts both fission and fusion, actually. And so the whole
idea is to try to make sure that the labs are open to helping
all of those companies at whatever stage of maturation they're
in.
But there's reasons to be very excited about Transatomic.
Southern's, for example, working with Oak Ridge about molten
salt technology as well.
But when you look at the laboratories, the reactor
technology sort of grew up through the laboratories in
different ways. And actually the resident expertise in the
laboratory system in molten salt tends to sit at Oak Ridge
National Laboratory. They have a prominent capability there.
Senator Risch. Thank you.
Last, every time I visit the INL there is always a
discussion about new talent coming into the pipeline. There
does not seem to be as much interest as there should be in
young students wanting to take on nuclear physics.
Can you talk for a minute about the partnerships that the
INL has formed with our universities in Idaho to try to nurture
this and resolve this issue and move it along?
Dr. Peters. Yes, sure.
So we have partnerships with, close partnerships, with
Idaho State University, University of Idaho and Boise State,
but in the nuclear energy area, particularly with Idaho State
University, and the University of Idaho. And so we're working
actively with them to bring students to the laboratory so that
the students are not only getting training/education at the
institution but also understanding doing research at the
laboratory and a lot of back and forth between the university
and the lab.
Also working with them to help devise their curricula in a
more effective way to train the next generation. And that's a
great partnership, but also, as part of the partnership that
manages the laboratory, as you're aware, we have a national
partnership. So we have other universities that are a part of
that, part of the partnership that includes MIT, NC State, Ohio
State, and University of New Mexico and Oregon State as well.
And so there's a national picture as well.
But I should say that, I mean, witness the guy at the end
of the table down here. There's a change. The young people that
are coming out today out of undergrad and grad school are
looking to save the world and they're realizing that nuclear
has got to be a part of it. I didn't feel like that was there,
say 15 years ago, so I'm just really excited about it.
Senator Risch. That is good to hear.
Thank you so much.
Thank you, Madam Chairman.
The Chairman. Senator Manchin?
Senator Manchin. Thank you, Madam Chair, and thank all of
you.
I will start with you, Mr. Kuczynski, since you are in the
utility business.
Do you agree with the EIA's forecast as far as an energy
mix is going to be needed through 2040? And I guess, depending
on whether the Clean Power Plan goes into effect or no, it does
not. But they have, I think I can go a few figures. They had
coal at 30, 32, 33 percent. You had natural gas at 30, 31, 32.
Renewables at 18 and nuclear at 16. And even with the Clean
Power Plan nuclear still stays at 16. That does not make sense
to me. But do you agree with the forecast? Do you all see that?
Mr. Kuczynski. We look at a number of forecasts whether
they're out at APRI or EIA. We do know that we're headed to, I
think, a carbon constrained future. That seems to be embedded
in every, kind of----
Senator Manchin. Do you all have concerns as Southern about
the reliability of this system?
Mr. Kuczynski. We do not have concerns about the
reliability of the system. We have an extremely robust system.
Part of being in a regulative, regulated vertical we are able
to invest significantly in our systems. So despite, you know,
severe weather in our area we have tremendous functionality in
our transmission distribution.
We do believe nuclear is going to play a role, and we think
some studies show nuclear playing a much stronger role. And
that is why we're participating in this area of advanced
reactors because not only do we have a deployable, large scale
base load that we have solved the engineering, regulatory and
almost all the construction risk already with the AP1000.
Senator Manchin. Let me ask----
Mr. Kuczynski. It is ready to go. Advanced reactors could
even expand us further. That's why----
Senator Manchin. Will advanced reactors, will you be able
to ramp up and ramp down as power demands?
Mr. Kuczynski. Many of the advanced reactor designs----
Senator Manchin. Because right now I do not think they do
that, do they?
Mr. Kuczynski. Are designed to do that. In fact, they could
couple very nicely with the renewable energy sources.
Senator Manchin. That is what has been so attractive with
the natural gas because gas is easy to ramp up and ramp down
and the others are not quite.
Mr. Kuczynski. Right. Each energy resource has its own
features.
Senator Manchin. Okay. Does anybody else want to comment on
that?
Dr. DeWitte. I'll just add----
Senator Manchin. Go ahead.
Dr. DeWitte. Advanced reactors changed the paradigm for
load following and responding to the grid needs. I mean, our
system operates fairly easily between 10 and 100 percent power
and fairly quickly.
So it's an important feature, and it's going to change the
economics, long-term, of what advanced nuclear reactors can
bring to the table.
Senator Manchin. You all are very much involved as far as
in the development of the new technologies as far as how
nuclear will be used or could be used within the system,
correct? I mean, all of you, I think, are in some form of that.
I am sure you have looked at other sectors and mine, in
West Virginia, as you know, we do not have any nuclear power
plants in West Virginia but we have a tremendous amount of
coal-fired plants. We think that we do it as clean as possible
and would like to even do it even more but we have no
investment or no buy in at all from the Federal Government that
is helping us to advance the technologies.
Have you been looking at some of that or do you see some
advancement in that arena? Again, I know you all have done----
Mr. Kuczynski. We, as a company, are investing in clean
coal technology.
Senator Manchin. Coal.
Mr. Kuczynski. With our Kemper facilities. You know, we are
deeply embedded in trying to assure that that fuel source can
meet our future energy sources.
Senator Manchin. Yes, and we are watching you all, but your
cost overruns are pretty substantial.
Mr. Kuczynski. Yes, it's true. You know, first of a kind
big projects.
Senator Manchin. Right. That could be a cutting project for
us to be able to use a dependable fuel, a reliable fuel such as
coal for many years.
Mr. Kuczynski. So as we get over those hurdles the
technology will----
Senator Manchin. Southern, I believe, has coal in the mix
for quite some time, right?
Mr. Kuczynski. Oh yeah, we, that was our predominant energy
source for many years. It no longer is. Gas is our predominant
energy source.
Senator Manchin. Okay.
It is my understanding that China will add 23 nuclear
reactors by 2020 increasing its capacity from 2 percent to 15
percent.
I am interested to know more about your company of
TerraPower, Mr. Gilleland, and its agreement with China's
National Nuclear Corporation to build traveling wave reactors,
or TWRs? Can you tell me what's so attractive about this
contract or how it is going?
Dr. Gilleland. It's going well. We've been at it for ten
years. We're a few hundred million dollars into the effort. We
have used about 50 institutions in the United States, including
national laboratories, in this development.
The State Department negotiated an agreement with us so we
could freely exchange information with China, and that's going
to be possible for other nations as well on the traveling wave
reactor.
The reason they did that for us is because eventually
enrichment will not be needed and reprocessing will never be
needed. That's where you take spent fuel and rework it again.
People who analyze weapons proliferation risk say those are the
two things that represent the greatest risk.
So our goal was to come up with a reactor which could be
universally and ethically exportable, as one professor put it.
We are about to sign an agreement with CNNC to have a joint
venture----
Senator Manchin. Do you all plan on manufacturing in
America or manufacturing overseas?
Dr. Gilleland. It will be both places.
Generally, the first of a kinds are predominantly built
here. Certainly the research and the leadership and the
management of the joint venture will be the United States.
We plan to have the beginning of construction in 2018 or
thereabouts with the first prototype plant going into
operation----
Senator Manchin. Yes.
Dr. Gilleland. In 2025 or 2026. The first commercial units
will come a few years after that.
The important role that the national labs are playing here
is in the materials, development and testing. So are the
universities.
Senator Manchin. My time is running out, sir. I am so sorry
to cut you short on that.
Dr. Gilleland. Okay, sorry. Go ahead.
Senator Manchin. But if I could just ask one question?
Do you all believe that coal along with nuclear power is
going to be needed for quite some time to guarantee the base
load that is needed for this country? Do you all have any
opinion on that at all? Anybody, just really quickly, if I may
ask?
Mr. Kuczynski. In our long-term study, coal still is a
factor in our long-term generation mix.
Senator Manchin. As far as base load, you've got coal.
Mr. Kuczynski. Correct.
Senator Manchin. Coal and nuke, right, for base load?
Mr. Peters, do you agree?
Dr. Peters. Well yes, I think, but I'd also put in the plug
for clean coal and continued----
Senator Manchin. Oh no, no, no, we're----
Dr. Peters. Yeah, no, but innovation, including going to
carbon capture and sequestration.
Senator Manchin. So basically for the reliability of the
system----
Dr. Peters. Right.
Senator Manchin. Coal is going to be needed the same as
nuclear is going to be needed, correct?
Dr. Peters. As a bridge to a future that, I think, looks
quite different.
Senator Manchin. Okay.
Dr. Peters. It's probably a very long bridge.
Senator Manchin. You are talking about beyond 2040, 2050.
Dr. Peters. Yes, 2040, 2050.
Senator Manchin. Maybe you all could talk to the
Administration and make them understand that. We would really
appreciate it if you could.
Thank you.
The Chairman. Thank you, Senator Manchin.
Senator Alexander?
Senator Alexander. Thanks, Madam Chairman, and thanks to
the witnesses for coming.
Mr. Kuczynski, we have a couple of questions from Senators
about cost. It costs TVA about $8 million to build 860
megawatts, and they built it in a year, I think. So it is
costing you $14 billion to build 2,000 megawatts, right? That
is a lot more expensive. The gas plant probably lasts 20 or 30
years. Is that about right? And the nuclear plant could last up
to 80 years.
Mr. Kuczynski. Up to 80, correct.
Senator Alexander. And then you have the long-term cost of
fuel which we do not know about, except we do know it has been
a lot higher not long ago.
So my point is that even though at first $14 billion for
2,000 megawatts of nuclear does not compare very well with $2
billion for 2,000 megawatts of gas, if you take the length of
time the plants might last and the importance of diversity in a
big utility like yours, it does make sense to go with nuclear
power.
Mr. Kuczynski. We fully agree with, kind of, that summary.
And 14 is full carrying cost, not overnight costs so----
Senator Alexander. Let me ask you something else. Senator
Heinrich mentioned the Illinois plants that were losing money.
Exelon probably owns those plants. They are a merchant utility,
right? And you are an investor-owned utility, is that correct?
Mr. Kuczynski. Well they're investor-owned also, they're
just in an unregulated market----
Senator Alexander. They are in an unregulated market, and
you are in a regulated market.
Mr. Kuczynski. Correct.
Senator Alexander. Exelon has testified that because of the
size of the subsidy for wind power that basically, at some
times, the wind producers in its region can give away its power
to Exelon and still make a profit forcing Exelon to buy the
wind power and not the nuclear power, making the nuclear power
less viable.
Is the big wind subsidy that has been on the books for 23
or 24 years a deterrent to the expansion of carbon free nuclear
power?
Mr. Kuczynski. Yeah, I think the industry, you know,
supports Exelon's position in those markets where it's not a
true competitive market, and I think those of us that support
nuclear believe we can compete in a levelized market that has
an equal playing field.
I think in Illinois there is an over capacity. There's a
lack of low gross and of subsidies and the massive growth in
wind has just changed the dynamics of that market, and it's had
unintended consequences with regards to those reactors.
Senator Alexander. Let's talk for a moment about the amount
of money.
Here we have a number of people who are engaged in clean
energy research. We are talking about carbon free electricity
that is reliable and at a reasonable cost. We have seen what
has happened in other big countries, Germany and Japan, when
they did not use nuclear power, and we saw the consequences on
their manufacturing capacity.
But coming back here, we spend, according to the
Congressional Budget Office, about $9 billion last year and
this year on subsidies for wind, $9 billion. We spend about $5
billion on energy research, as a government.
Mr. Gates and others, including me, think we should double
the amount of money we spend on energy research from $5 billion
to $10 billion as rapidly as we can. That would permit people
like you, or that would encourage people like you, to create
new forms of clean, carbon free electricity. We might even find
a way to have an economical method of capturing carbon from a
coal plant or a gas plant which would be the Holy Grail, it
seems to me, of carbon free electricity.
But even if you do not do that, my question to any of you
is, wouldn't it be a better idea to phaseout this wind subsidy
after 40 years, it is a mature technology according to the last
Energy Secretary, and spend that $5 billion a year on energy
research? We could instantly double the amount of money the
United States spends on energy research if we did that.
Wouldn't that be a better use of our money?
Dr. DeWitte. I'll jump in and say----
Dr. Peters. Senator, they're going to ask the national lab
guy to answer that question. [Laughter.]
So I guess I'm going to beg off on the part about where the
money comes from.
Senator Alexander. Well don't do that. I want an answer to
the question.
Dr. Peters. Alright.
Senator Alexander. Are you going to continue to waste $5
billion a year on subsidies for that technology, or if somebody
else wants to answer that, or are we going to spend it on
encouraging people like you to create advanced reactors and
small reactors or other forms of clean----
Dr. Peters. Senator, I think that if we increase the clean
energy research funding, I have no doubt that we will unleash
innovation and we will transform the energy sector.
Senator Alexander. Yes.
Dr. Peters. So increasing clean energy funding absolutely
has to happen, but again I think it's outside of my purview to
comment on where the money comes from.
Dr. Gilleland. Being a very unpolitical guy, the answer is
yes.
Senator Alexander. Thank you.
Thank you, Madam Chairman. [Laughter.]
The Chairman. Dr. DeWitte, did you want to jump in there?
Dr. DeWitte. I was just going to say what John said, yes.
The Chairman. Okay, you got your answer.
Senator Franken?
Senator Franken. I would yield my time right now to Angus.
The Chairman. Thank you.
Senator King?
Senator King. First, Senator Alexander, my understanding is
that the wind PTC that was extended in the last deal at the end
of the year phases out over five years. I think what you are
seeking is actually happening. That is my understanding. I may
be incorrect about that.
Senator Alexander. Well that may be true. But in the next
two years it is $5 billion a year, and that is exactly the
amount of money we would like to have to double our energy
research.
Senator King. I guess it is a question of what does phasing
mean? It is phased out over a period of time. That was what was
decided at the end of the year.
Anyway, I was very interested in Mr. Kuczynski, is it? You
said you wanted to play on a level playing field. Are you
advocating today that we repeal the Price Anderson Act and the
nuclear industry should have to pay the full cost of insurance?
That is what you said, I think, you want a level playing field.
Mr. Kuczynski. Yes, I was more recognizing, kind of, the
current subsidies that are in play and----
Senator King. And Price Anderson is not a subsidy? Of
course it is a subsidy.
Mr. Kuczynski. We don't necessarily consider it a subsidy.
It's not been utilized----
Senator King. It walks like a duck, it is a duck, it is a
subsidy. If you had to buy that insurance it would cost you a
fortune, is that not correct? Yes or no?
Mr. Kuczynski. The industry pulls----
Senator King. No. Yes or no? If you had to buy insurance on
the commercial market for your plants would it not cost you a
lot of money?
Mr. Kuczynski. I have not researched on exactly what that
price would be.
Senator King. Okay, so if you are not too worried about it
then will you tell the Committee you think we should have
repealed Price Anderson?
Mr. Kuczynski. I think Price Anderson has been a valuable
part of our energy strategy for 50 years.
Senator King. I will say it is, but it is a subsidy.
Now in your $14 billion for your plant, were there any
other subsidies?
Mr. Kuczynski. We have utilized----
Senator King. Do you receive subsidies from the Federal
Government?
Mr. Kuczynski. Yes, we have utilized, the way we believe
subsidies ought to be utilized and for emerging technologies to
get them restarted. So subsidies are----
Senator King. How much of the $14 billion was Federal
subsidy?
Mr. Kuczynski. Well, we have not taken any direct
subsidies. The only thing we have used to this point is loan
guarantees which is technically not a subsidy, it's a financing
mechanism that the Federal Government will be reimbursed for
all financing costs.
Senator King. Okay.
Mr. Kuczynski. So we have not used any other subsidies,
directly, for our projects.
Senator King. I am inclined to agree with you on that.
There were no direct subsidies of that $14 million. That is
your testimony?
Mr. Kuczynski. Correct.
Senator King. Okay.
Dr. Cassidy is gone, but as I do the calculation, pretty
straight forward, $7 million a megawatt for your plant. Two
thousand into $14 billion.
Wind, which I know something about, $2 million a megawatt.
Gas, between $600,000 and $700,000 a megawatt. So a huge
differential.
I am not anti-nuclear. I like Maseratis. I just cannot
afford them.
I do not understand any economic theory other than
assumptions about natural gas prices that your power is going
to be economic in the immediate future. Now if you do an 80-
year calculation and you assume very high gas prices and no
problems with disposal and waste disposal and all those kinds
of things, I suppose you can make it work. But frankly, I just,
again, I am not anti-nuclear, I just do not know how we can
afford it.
Can anybody answer that question? The numbers do not work.
Seven million dollars a megawatt? That is verses half a million
or three quarters of a million, I mean, per megawatt for gas
and $2 million for wind?
Dr. DeWitte. I think there's a couple things that are
important to highlight there.
Senator King. I know the cost of gas is a factor, and that
has to be. I clearly understand that.
Dr. DeWitte. Right, that and the fact you have capacity
factors that do matter. Nuclear having excellent performance
capabilities, delivering about 90 percent of their--capacity
which is a big difference from what you see with typical
renewables.
Senator King. Sure.
Dr. DeWitte. But it's also not nuclear verses renewables. I
think that's an all too often, I think, pitted argument.
Senator King. No, no. That is why I put gas into the mix. I
am just taking a range.
Dr. DeWitte. Right. And I'll say the other thing I would
add to that is that advanced reactors do have the opportunity
to fundamentally shift the economic paradigm of nuclear power.
The advanced reactors usually don't operate at high pressures,
use far less steel, far less concrete and they have a huge
economic potential in terms of achieving costs that are more
competitive.
Senator King. I agree with that. I think one of the great
mistakes we made in this country in the nuclear industry was
having each plant being an individual plant with its own unique
design rather than a standardized design. Is this something we
are moving toward is some kind of standardized design?
You are nodding. Is that? Could you?
Dr. Peters. The industry, the industry and NRC have already
moved to that, Senator. And that would be part of the continued
reform of the licensing process. When we go to advanced
reactors the idea would be to not have it every design, you
know, you have a design certification process up front, then
you're simply licensing a site, constructing the same reactor.
Senator King. Right, and you can modularize.
Dr. Peters. Yeah, yeah.
Senator King. And standardize parts and those kinds of
things.
You are now nodding. Is that correct? Is that where we're
headed?
Mr. Hopkins. Yes, sir, that's the intent of the small
modular reactor is people ask often why we limit our size to 50
megawatt electric because still a lot of our testing on seismic
and etcetera, the height of the containment and the reactor
itself, we wanted to ensure that it lent itself to a
standardization of design so we could build these in a factory,
both containment and the reactor. So what you have in the field
is really a civils project, concrete to steel.
Senator King. Exactly.
Do we have any price? Do we have any per megawatt numbers
on this new approach?
Mr. Hopkins. Well, Senator Cassidy mentioned earlier about
we do have a customer. They have to prove their economics
before they go before their membership.
If you were looking today at Henry Hub prices of gas at
less than $2 per million BTU, a levelized cost of engineering
and combined cycle plant is nominally in the range of about $55
per megawatt hour.
Senator King. Yes.
Mr. Hopkins. We're right now, with small modular reactors
at today's prices, based on the economics, about $72 per
megawatt hour.
The question becomes if you look and it was mentioned
earlier, in the West there's not a lot of gas. You have to
bring the gas in. You have to go through the permitting
process.
But the question becomes with LNG exports and other things
and moderate production right now where it was over capacity.
There was a lot of people moving in are now leaving the gas.
What will the gas be in five to seven years?
Senator King. Sure.
Listen, and once you do nuclear you have fixed your energy
costs and your fuel costs. I understand that. That is true of
hydro, wind, other. The difference is nuclear is base load. I
understand that distinction.
The question is can we get that initial capital cost down
to a place where it makes sense? I think that is the challenge
and that is what we are talking about here.
Mr. Hopkins. Well, what we're looking at right now is we
have to be commercial viable for these to exist; otherwise
there is no market.
And if you look at the small modular reactor, each of these
units, of 12 of them, are independent. So you could put two or
three and get them operational to stop--to start offsetting the
cost of putting the additional plants in. So from a finance
ability when you could put 600 megawatts for less than $3
billion U.S. Those are financeable.
Senator King. Yes.
Mr. Hopkins. And those are, you can put those on a balance
sheet. And we currently have banks coming to us now, you know,
saying here's how we think we can finance your project. So
that's a big step.
Senator King. It is a big step. Again, I hope that we can
work, get to the place where we have economic capital costs and
that then the technology can provide enormous fossil fuel free,
carbon free energy.
Thank you.
Mr. Hopkins. Absolutely.
The Chairman. We are going to move to Senator Franken here.
Thank you.
Senator Franken. Thank you.
Wait, what did you want to say, Dr. Peters?
Dr. Peters. I was just going to re----
Thank you, Senator.
I was just going to re-emphasize that when you look at the
research and innovation agenda for Generation IV reactors, a
big part of what we're focused on is, in fact, addressing the
cost, getting down the cost curve.
Senator Franken. Okay.
Dr. Peters. At the early stage as well.
So it is pushing the envelope on safety, burning the fuel
more efficiently, but also going after design features that
will help reduce capital cost because that is clearly a huge
obstacle, I would say, to getting to commercialization.
Senator Franken. Okay, that is enough. [Laughter.]
Senator Franken. It has been five years since Fukushima, so
it is important that we keep safety in the forefront when we
are discussing nuclear power. I want to ask about these small
modular reactors and advanced nuclear technologies and how they
could potentially enhance safety if they are designed to
operate without the need for external power to cool the
reactors after all was loss of backup power from generators at
the Fukushima plant that caused the cooling systems to fail.
Mr. Hopkins, can you give us an overview of the major
safety concerns with traditional nuclear power and how SMRs
improve safety such as by removing the need for backup power?
Mr. Hopkins. Yes, sir.
Actually two weeks ago I was in Japan and had this
conversation. If you recall what happened at Fukushima, it
wasn't the earthquake, it was the tsunami that resulted in
knocking out the electrical which therefore knocked out the
cooling pumps and the plant couldn't cool itself down.
The small modular reactor passive safety systems. And this
actually came about 15 years ago under a DOE program called
Multiple Application of Small Modular Reactors. And the intent
in the objective was to design a reactor with safety in mind.
It wasn't about economics.
So even prior to Fukushima a lot of passive safety systems
that were going on research at Oregon State University and Dr.
Jose Reyes had to deal a lot with what the problems that
occurred in Fukushima.
So our plan in passive safety, we refer to as the triple
crown. If you were to have a station black out situation, the
way that the reactor is designed it will cool itself down. You
don't need operator intervention. You don't need additional
electricity nor do you need additional water for this
particular reactor to cool down.
And thinking this core is 120th the size of the large
reactor. And so part of what we have at our Technical Advisory
Boards that are made up of Senior Chief Nuclear Officers from
23 utilities and technical staff is to--and these are actual
operators to look at those sequences. How would this reactor
cool itself down? How can you circumvent a Fukushima event? And
we believe the science is there and that's what we're currently
working with the NRC with.
Senator Franken. Okay.
Mr. Gilleland?
Dr. Gilleland. Yes? It's the same.
Senator Franken. What are the safety benefits of advanced
nuclear designs like TerraPower's technology?
Dr. Gilleland. It's a very similar answer.
The reactor is designed in such a way that the heat is
efficiently conducted from the fuel out through the coolant,
and it's because we use metal fuel and metal coolant.
Long story short, if you had a Fukushima there's no
problem. You can have no internal or external power and the
heat will be conducted to the outside world after the reactor,
because of the way the physics works, shuts itself down.
There's no need for a computer or a human to decide anything.
In addition, the mother of all accidents is that you also,
not only lose that power for cooling, but you fail to put the
control rods back in which is not what happened. This is worse
than Fukushima. In that case the reactor also reduces
automatically, its power to a very low level and can remain in
that state indefinitely.
So that was the starting point for much of what our design
effort was about. That first aspect of being able to use that
type of reactor to shut itself down when there is loss of
cooling was demonstrated at Idaho many, many years ago, the
walk away reactor. So this gentleman's elderly people saw it
done.
Senator Franken. Okay, good.
Let me ask a question about the need for base load, because
that has been brought up here. To what extent does advanced
storage technology one, make the smaller reactors actually,
maybe, a good idea since you do not need to necessarily be the
base load? To what extent does better storage speak to that?
And to what extent does better storage and real advances in
storage decrease the need for the kind of base load that we
have needed throughout our history?
Dr. Gilleland. Well in my opinion, storage does not
decrease the need for base load. It's a huge amount of energy,
and load following which has been mentioned before would be
very useful in these plants. You wouldn't have to have storage.
But at a certain point running a reactor steady state at full
power for 90 percent of the time, that's a very economic way to
operate a nuclear plant or power facilities.
But people usually use the term energy storage in the
context of renewables which are inherently intermittent like
wind and solar. There it would be helpful in the dispatching of
that energy when you need it versus when the sun is shining or
the wind is blowing.
Senator Franken. That is what I am talking about.
Dr. Gilleland. I beg your pardon?
Senator Franken. That is what I am talking about.
Dr. Gilleland. Oh, but you're still stuck with the fact
that the solar constant is a constant and that even if you were
to provide free energy storage you still have to think about
the fact that you're going to have to rate the system to
produce, in a short period of time, the energy you want to
deploy over a longer period of time.
What that adds up to is a lot more acres, a lot more square
miles going into solar panels or into sites for wind.
Senator Franken. Okay.
Dr. Gilleland. So there's a fundamental logic that says
storage will help renewables but it's not going to get around
the inherent problems associated with intermittency and the
amount of energy density that's available from the sun or the
wind.
Senator Franken. Okay.
Does anybody else have an----
Dr. DeWitte. I would just add that storage also can couple
well with the nuclear power plants as well because you can
charge those up at night and then discharge them in the day to
either match up with renewables or match the curve. So there
are opportunities for storage innovation improvements to
partner well with nuclear technology.
Dr. Peters. But the investment in storage is absolutely
vital. You know, it doesn't replace.
Everything that they said was--I totally agree with, but
innovation in storage is really an important thing to continue
to support from the government.
Senator Franken. I see a lot of nodding.
Dr. Peters. Yes, really, really important to support.
Senator Franken. Like for me too. I am nodding that my time
is up. [Laughter.]
The Chairman. I agree on both counts. [Laughter.]
The Chairman. Storage and your time is up.
Let me turn to Senator Alexander, if you would like to pose
a second question in the second round?
Senator Alexander. Well thanks. This is very interesting
and I thank you all.
On Senator Franken's point and Dr. DeWitte, I think that is
very important. The disadvantage of nuclear power is that you
cannot turn them on and off, but the use of them and the demand
goes way up in the afternoon. So if we had a really good
storage system, probably the greatest beneficiary of a really
good storage system would be nuclear power because it produces
so much electricity.
The second thing, on Dr. Gilleland's point, we use about a
quarter of all electricity in the world in this country. So
we're not going to run the country on windmills. I have said
many times that is like going to war in sailboats when the
nuclear navy is available. I mean, it is useful. It is helpful.
Third, on the subsidies, the Senator from Maine asked about
the Pricewaterhouse. Well, the nuclear industry self-insures
$3.75 billion which has never been used for accidents. So the
first money comes from the nuclear industry. I think that would
be important to point that out, Mr. Kuczynski, next time he
gets asked about that.
On top of that, then the government might come in. But we
come in from many emergency and disasters well before that.
That would be our responsibility and it has never been used.
As far as the phase out of the wind subsidy, I mean, let's
think about this. It has been going on for 24 years. The last
energy secretary was a Nobel prize winner, and in testimony
before this Committee he said it is a mature technology.
Now small reactors are not a mature technology. For the
last five years we have been trying to pay for the government's
part in helping that get off the ground. Advanced reactors are
not a mature technology. That is where we might actually deal
with climate change. We might actually deal with it there.
Here we are wasting $4 or $5 billion a year, and the point
that it is phased out, that is a trick. That is a trick. It has
been phased out more than a dozen times. That is called an
extension. Now they have just extended it for a longer period
of time and called it a phaseout, but it costs $4 or $5 billion
a year. It is not $40 or $50 million, it is $4 or $5 billion.
That is the amount of money that would double what we could
spend on energy research.
So I think it is time for us to become rational about our
energy policy, and rational to me means create an environment
of government support through short-term support for new
technologies. For example, there is a production tax credit for
nuclear which, I guess, Mr. Kuczynski, you will take advantage
of. But it is capped at 6,000 megawatts. The wind is uncapped.
That is another big difference next time that question comes
up.
So I favor, Madam Chairman, short-term support for new
technologies and then they are on their own. The reason solar
is about to be competitive is it does not have that kind of
support. They have had some support, but nothing like these
generous production taxes credits. As a result the cost of
solar has been coming down, down, down, and it is about to get
competitive as a supplement to the huge base load power that we
need.
We need for the same thing to happen, not just with wind
power, it needs to be on its own. I mean right now we have got
a big company trying to build big towers to destroy the
landscape in Tennessee where the wind blows 18 percent of the
time. That is absolutely absurd.
TVA has said we don't need any more new electric base load
power for 20 years, and we have taxpayers spending money they
could be spending on clean energy research to build wind
turbines in a place where they would just spoil the environment
and where the power is not needed. That is really bad policy.
I would like to see, as far as NuScale's support, the
support for advanced reactors. The whole idea there is that
support will end and you will be competitive or you won't
exist, right? I mean, you have said that to us in testimony if
I am not mistaken.
Mr. Hopkins. Correct.
Senator Alexander. So, I think that is the approach, Madam
Chairman, we should take with any of these new technologies
where they are promising we should invest heavily in research,
perhaps even support jump-starting a new technology like
advanced reactors or maybe some, I mean, like small reactors,
maybe some advanced reactor. But get out of the way, and then
see what can survive.
Solar is about to survive. We hope NuScale will survive. We
hope some of these new advanced reactors will have that as
well. Let wind power survive too, then maybe some of these
Illinois nuclear plants won't close because of negative
pricing.
You have been very generous to let me extemporize here at
the end, and I thank you for it.
The Chairman. Well, Senator Alexander, I know you have been
occupied on the floor moving through education bills and our
first appropriations bills, but we miss you in the Committee.
Your contribution is not only important, but just a good
reminder to us of the role that government should be playing as
we help to facilitate this.
I think one of the things that I have enjoyed as I have
learned more about these advanced reactor technologies is just
the whole smorgasbord that is out there. We are not talking
about one approach, one technology. There is a diversity now
that I think we recognize. How we figure out how we encourage
that rather than doing what we do around here, which is
deciding who the winners and who the losers are going to be,
and hoping that we bet on the right one.
So your comments about this, I think, are very important on
the level of support that we should be providing at the Federal
level.
I want to ask one more quick question, and then we will
wrap up. I appreciate everyone giving us so much time this
morning.
This is directed to you, Dr. DeWitte, because I am very
curious about the true potential for what you are describing
with micro-reactors and the potential in remote areas. Whether
it is a place like Alaska or you think about some of our
islands and our territories.
I have been going back and forth a lot with the folks in
Guam about what we are going to do. We have military buildup
there, but basically you are an island that is still powered by
diesel. CNMI is still powered by diesel. Look at Puerto Rico,
and the financial mess that they are in. So much of that comes
to them because they have not been able to figure out how they
deal with their energy.
I look at some of these areas as just a perfect opportunity
or environment to have these smaller scaled technologies. But
how you deploy them out--and let's use Alaska. Let's take an
area like Bethel. You've got about 4,000 people out there. You
are not attached by road. It is expensive in the first place.
How do you deploy? How do you deal with, you mentioned in
response to, I believe it was Senator Cassidy, some of the
issues about how you deal with the proliferation? You are
sitting out there in Bethel, and I think you indicated that
this is heavy, difficult stuff to move. Realistically how could
something like this work in remote, high cost areas with small
populations?
Dr. DeWitte. Thank you for the question, Senator.
That's exactly the market that we are targeting is to bring
power to save money in places like Bethel where we would build
probably between two and four reactors. And they work in a neat
way because they're designed in a containerized fashion such
that we would ship basically two shipping containers nominally
out per reactor that would go. So in the case of four reactors,
we'd have eight containers that would go up. In four of those
containers are the reactors themselves, the reactor module. We
would then bury that in a hole that we'd dig, not very deep,
about 20 feet deep. And then on top we would put the other
container which contains the power----
The Chairman. We want to talk to you later about permafrost
and how we deal with that, but yes. [Laughter.]
Dr. DeWitte. Fair.
So in those situations we can actually mound up and it
works above. Good point though. But and that actually adds a
nice benefit for a couple reasons, permafrost itself, but
that's a separate conversation.
But anyway, you put the reactors there and then the process
works that you can then tie up to either a microgrid solution
or whatever the local grid system is there. And advances in
power electronics actually enable us to do even more things in
terms of grid matching and harmonizing with demand curves in
small communities that are islanded from other grids
effectively. And we would produce power for 12 years before
refueling. And these systems use low enriched fuel, so they're
not weaponizable material. They're also fairly small. I mean,
you talk about fitting a shipping container. That also means
there's not much fuel in there. But they're also not small
enough that you can just throw it on the back of your pickup
truck and drive away. They weigh 30 plus tons. And you don't
have equipment left there that would be able to move them, as
well as the emplacement that goes on top of them.
To the point that then the reactors themselves really
aren't attractive, you know, targets to say to go after and try
to get materials. Plus, from the intervention side and
security, like Senator Cassidy mentioned and asked, you know,
we have a staff. We'll plan on having security staff and
personnel inside but it's also something we can respond to just
like we have those plans in place for research and test
reactors in other places. It's something that we can manage and
definitely secure and make sure that it is not presenting a
problem.
And the important thing though is that this provides a
level of energy security and reliability that these communities
have never really seen before, right? They no longer have to
rely on diesel.
We've talked to some folks in certain communities that talk
about bringing diesel in on dog sled. Those costs get super
expensive very quickly. We eliminate those problems.
On top of that it's not just electricity we can provide,
it's also process heat, right? So we can heat community centers
or even local, if we tied into the infrastructure that is in
place, district heating. And we could tie into that and supply
for that.
And the important thing is that this saves a lot of money
over diesel fuel, and it opens up, basically, larger portions
of energy to be used by those populations to help overcome a
lot of the challenges that they're stuck with which is, you
know, constrained by limited access to power.
And in terms of operations, you know, we have these things
operated, the small crew, because they're cooled purely by
natural forces. We wanted to design something that's very
robust such that it doesn't require much intervention or
maintenance or monitoring. So you kind of operate this thing
sort of like you think of an oil rig where you have crews going
in and off, and that's basically how we provide that
infrastructure and then produce power in these areas. And it
gives us the opportunity to be able to put these nearly
anywhere. So that's really the objective that we're trying to
go after.
The Chairman. We have talked a fair amount about public-
private partnerships and working with the national labs,
working with universities. How much has been done with the
Department of Defense?
They obviously have not necessarily a renewable mandate,
but a goal toward reduced emissions on military installations.
At one point in time the community of Galena, along the Yukon
River, was actually looking at small nuclear as a potential for
not only that community, but what, at that time, remained of a
military installation.
How much discussion is going on with DOD for military
installations, particularly in more remote areas whether it is
Guam or whether it is Eielson Air Force Base?
Dr. DeWitte. We've engaged with different groups in the
Department of Defense who've been interested in this. I think
the big issue is they understand, generally, the need profile,
but I think where we are and where we need to get to is to show
that this is a mature technology that works. And I don't think
the DOD is necessarily the right place to, well, let me
rephrase that. The way they've looked at it is not necessarily
the right place to start.
I think that can change as they see this going, and I think
there's opportunities and partnerships between DOD and private
industry like with what we're doing in possibly DOE in showing
that this can work. But DOD has been hesitant to, I would say,
take the lead on doing these reactor technologies because I
think they still perceive them to be more on the developmental
stage and not quite as ready for deployment. And we're hoping
to change that perception very soon.
The Chairman. Mr. Hopkins, do you have any comments on that
aspect of it or just the applicability of the small reactors?
Mr. Hopkins. My understanding, Senator, is that in fact the
DOD are looking now at small modular reactors. I think one
thing that helped us all is the Administration's Executive
Order on Alternative Energy last year came out and included
SMRs as part of alternative energy which could open the brand
with four Federal facilities.
If you look at your state in an area of Fairbanks, we have
quite a few military installations, Fort Richardson, Fort
Greeley, a large air force base. If you could work out a PPA
with the local utility to provide the military installation
reliable energy of which they need, not only for the military
installations but also the surrounding community where the
support staff is and where these people live. I envision that I
could see applications for micro or small modular reactors in
those types of instances.
The Chairman. I appreciate that.
Very interesting discussion this morning. I appreciate the
contributions of all of you and your leadership in this area
which, again, I believe very, very strongly, needs to be a
robust part of our energy portfolio.
So thank you for your contributions.
And with that, we stand adjourned.
[Whereupon, at 11:59 a.m. the hearing was adjourned.]
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